Do we need to change energy production, renewable energy storage and use, and if so, why?
On June 29 this year Essential Energy confirmed 34 houses at Ewingsdale lost power caused by a fault in the power lines described as a ‘burnt neutral’. The outcome? For several residents, damage to electrical appliances cost them hundreds or thousands of dollars.
On July 7, a few days later, Essential Energy was instructed to shed 40 megawatts (MW) of electricity supply near Lismore in response to ‘issues threatening power system security,’ which affected around 24,500 customers in a wide arc across our region.
Shared community batteries
Research shows that events such as these are much less likely to occur through the installation of a series of large battery energy storage systems, often called community or neighbourhood batteries.
These shared systems are designed to benefit everyone; whether households and businesses with solar panels, or renters, businesses or households without solar panels.
The principle of a large battery energy storage system is that it ‘soaks up’ excess solar generation during the middle of the day. The battery then discharges that power into the grid when the sun isn’t shining during the evening. This reduces electricity costs for participants.
These large battery systems can balance generation and consumption, and stabilise the grid by reducing voltage issues. New battery designs have no limit on energy capacity, have no noise or emissions and modules can be added to meet demand as they do not degrade like current batteries; and can be classed as an ongoing asset for the shire.
A community battery
A community battery stores renewable energy and reduces reliance on fossil fuels for electricity generation. It is a more decentralised, democratised, sustainable and resilient energy system, which increases local community connection to low-cost renewable electricity.
Battery energy storage systems work in two ways. First, there’s the consumer variety which most people are familiar with, the ‘behind-the-meter’ (BTM) system. This ‘small-scale battery storage’, which includes residential-level battery storage units, is a good thing because it helps reduce stress on the public grid and stores power for the household when the sun isn’t shining.
These household batteries are designed to improve the stability of their owners’ energy supply and cut costs.
Then there is the ‘front-of-the-meter’ (FTM) system. An FTM system is larger and directly connected to the power – on the utility or power generation company side of the energy distribution equation, and usually belongs to a utility. They help the utility solve network congestion issues and/or provide an alternative to building new power lines; and of course, the battery stores energy for use at different times.
Energy from different sources
What happens when energy comes from different sources like solar, wind and fossil fuels? When the sun-soaked community battery is full, the system allows for ‘arbitrage’. Arbitrage is the practice of taking advantage of a difference in prices in two or more markets. This means that energy generated during the middle of the day (when prices are lowest as rooftop solar penetration is high) is discharged during the evening when demand soars and when prices are higher as the electricity generated at night is generally from coal or gas, that is, they are non-renewable fuels.
This stored local renewable power, produced by the community and used by the community during the day can be sold back after dark. This practice leverages price variability through a combination of matching deals to capitalise on the difference between the market prices at which the units are traded – lower prices during the day and higher prices during the evening. In other words, it can reduce electricity market price volatility.
A stand-alone energy asset
Community batteries are usually installed as a stand-alone energy asset in a local area (say a local government area) at a medium scale, typically storing hundreds of kilowatt hours and transmitting the stored energy for direct community benefit.
Big grid-scale community batteries are viable. Locally produced solar storage makes better use of the distribution networks of poles and wires, sending surplus capacity into the network. After all, big grid-scale community batteries have an economy of scale because they are hundreds of times bigger, connect to the grid in appropriate places, and give access to more competitive tariff arrangements as they operate as a large-market customer.
What is the economic downside?
There are large costs to set up a battery-grid connection. Utilities need to recover the costs of installing the battery and have a clear positive operating margin. In selling the discharged stored energy, utilities need an economy of scale to be profitable. There are many policy options on how to set prices of energy sold to the grid which need to be carefully considered to make that investment worthwhile.
If the government uses taxpayers’ money to prop up ageing coal-fired power stations, or even fund new power stations, then surely investing in, and enabling, renewable schemes that support energy security, let alone reducing emissions, makes good economic sense.
To be sure, at the local level, there are pros and cons for the FTM and BTM cases. Individuals operating BTM have made a significant financial outlay in order to harness solar energy and discharge their battery in the evening for their private use.Households and businesses avoid complicated arbitrage arrangements. They have the backup protection of their household battery and enjoy the private benefits but the potential public benefit is lost.
Without a doubt, there are techno-economic complexities in installing grid-scale community batteries, but they also raise new and exciting socio-political considerations. In a decentralised energy system, they can offer the benefits of increased community control over energy production, demand and planning, and reduce the inequalities within and across communities, especially those with acute disadvantage.
Social acceptance and sustainable community participation
To ensure a positive social impact of new energy technologies, it is imperative to maintain social acceptance and sustainable community participation. Communities who have successfully trod this path have shown a commitment to engage, learn, and understand how the process works so they can contribute constructively. T
he feeling of energy security is vital, now more than ever – for businesses and residents.
The Australian federal government has committed to providing shared storage for up to 100,000 households. They claim that the community batteries will lower electricity bills, and provide energy security and reliability.
In addition, they allow households who cannot install solar panels to enjoy the benefits of renewable energy, which in turn reduces pressure on the electricity grid (say in times of heatwaves, bushfires, or floods) and absorbs excess energy that might cause voltage spikes in the electricity grid, and, of course, they help lower emissions.
Change is underway
Change is seriously underway in energy production, storage, and use – particularly in large battery energy storage systems (BESS), which includes the exciting application of community batteries. Byron Shire could be one of the communities working to take advantage of this opportunity for cheaper, cleaner more reliable energy.
There is nothing so powerful as an idea whose time has come.
The science is in.
Dr Anne Stuart, Chair, Zero Emissions Byron and Adjunct Research Fellow at Griffith University, has lived in the shire for 36 years.
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