Sharing incentivised under proposed network change

Sharing incentivised under proposed network change
Central Park will have its own low-carbon natural gas power plant, producing thermal energy for its residents and workers

An energy market rule change has been proposed that could revolutionise the way power is generated and transmitted, giving consumers better access to clean power and offering savings to individual and businesses.

The Property Council, the City of Sydney and the Total Environment Centre have joined forces to challenge high electricity network charges, arguing the energy they produce takes the burden off the grid. The group has asked the Australian Energy Market Commission (AEMC) to introduce an incentive called a Local Generation Network Credit (LGNC) to encourage energy sharing on a precinct scale.

The Total Environment Centre said with a system of LGNCs, generators whose power is used locally would get a credit for taking the strain off the network during peak periods. This in turn would reduce network maintenance and infrastructure costs.

The Centre’s energy market advocate Mark Byrne told media generators might bypass the grid altogether without the incentive.

“This is a case of use it or lose it,” he said.

“In the past 10 years we’ve built a hugely expensive electricity network and users are going to be paying for that for the next 30 years, so we want to extract the maximum benefit from it that we can.”

The credits would be earned by large-scale energy generators, such as the Central Park residential and shopping precinct, one of Sydney’s greenest developments that generates power through a tri-generation plant. Its neighbour, the University of Technology Sydney (UTS), said it could use some of Central Park’s power to meet its own renewable energy targets.

“We actually found we can’t meet that commitment with opportunities just like energy efficiency and solar, so we’re looking at transitioning to low carbon precinct tri-generation,” UTS Institute for Sustainable Futures research principal Ed Langham told ABC News, acknowledging distribution and transmission currently accounts for about half of the total power bill – whether the power travels a long distance or across the street.

Mr Langham said the university has even investigated building its own power lines to get around the network charges, but the disadvantages outweigh any cost savings.

“We should be utilising the existing grid that we already have, that we have already invested so heavily in throughout the past five to 10 years,” he said.

High network charges are also one of the main reasons the City of Sydney had to shelve its half-billion-dollar tri-generation project in 2013. The project had aimed to build a series of mini gas-fired power plants from the CBD to the biggest urban renewal site in Australia – Green Square – with Lord Mayor Clover Moore blaming restrictive electricity network regulations among the reasons the plans were abandoned.

With the recent push for LGNCs, the Lord Mayor said she was pleased to see the rules being challenged.

“For years the city has been pushing for a system that makes it easier for residents and businesses to access clean power that is generated and used locally,” she said.

The rule change could benefit householders in two ways in the long run: savings on network maintenance and infrastructure could be passed on to consumers as reduced power bills, while people with rooftop solar systems who sell their power to local aggregators could also get a better price for their power.

The AEMC’s determination on the LGNC rule change proposal is expected to take about a year.