With more than 100,000 new household photovoltaic (PV) systems being installed across Australia throughout 2010, electricity distribution utilities have been kept busy connecting these systems and implementing the relevant network connection agreements with customers.

As the number of PV systems connected to the grid steadily increases, distribution utilities are beginning to feel the affects – both positive and negative – these systems can have on the performance of local electricity networks. In some situations, distributed PV generation can assist in meeting load peaks that occur during daylight hours, and local generation also reduces transmission and distribution losses within the network – ultimately reducing costs and greenhouse gas emissions.

However, high concentrations of household PV systems can also cause localised voltage control issues (particularly where daytime loads are light and PV generation is significant) and this can make it difficult for utility businesses to ensure that the supply remains within statutory voltage limits at all times.

Electricity distribution networks were and in many cases are still being designed for load flow patterns assuming the one-way flow of electricity from the distribution transformer to the customers. The installation of numerous roof mounted PV systems is changing this load flow at certain times of the day and this puts the distribution utility in the highly unenviable position of being legally responsible for ensuring quality and reliability of supply to its customers even though it has little control over the number, location and size of the distributed generation devices being connected to it.

As electricity generated by solar modules inevitably becomes cheaper than retail electricity prices (it already is in some heavily subsidised jurisdictions) customers will expect to be able to generate their own electricity when it suits them (i.e. when the sun is shining) and purchase electricity from the grid on demand at other times. This is not a load flow pattern that electricity distribution networks have been designed to accommodate and will require the next generation of network design engineers to develop and implement new strategies and standards to ensure supply quality and reliability standards continue to be met in this new operating environment.

Utilities both here in Australia and overseas are responding to the challenges posed by high levels of distributed PV generation in a variety of ways, including reviewing technical standards for grid connect inverters, reviewing the content of grid connection agreements, reviewing utility and government policy settings around the support provided to customers to install systems, reconsidering load management strategies, and reviewing and evaluating technological solutions that have the potential to play a role in reducing the impacts of distributed PV generation.

One of these potential technological solutions is a new generation of grid-connect inverters capable of much more than isolation of the PV system in the event of a system outage – as has typically been their main control function in the past.

New ‘smart-grid enabled’ inverters will feature real time two-way communication capability – not only providing access to live network and PV system performance data but also enabling the remote control of the systems including turning them on or off and controlling their active and reactive power output. The next generation of grid connect inverters have the capability of providing reactive power up to the Volt-Ampere (VA) rating of the inverter 24 hours per day. Reactive power, measured in VA reactives (VARs), can be used to improve the network power factor and reduce the amount of electrical current required to meet peak loads. This reduces losses and defers the need to upgrade infrastructure to meet peak loads.

Real time access to distributed reactive power generation with the distribution network is a relatively new concept, which is potentially of significant value to network owners. The trial and evaluation of smart-grid enabled inverters within distribution networks will be an important step in understanding and maximising the potential benefits of this technology.

Mandating that customers make the monitoring and control of household PV systems available to local electricity distribution utilities, however attractive as that may seem to some utilities, would be an unpopular and unlikely scenario. A more realistic possibility is that utilities could in the future provide a financial incentive to customers, in one form or another, in return for a degree of control over their PV systems. The type of control of interest to utilities, including reactive power generation, is not necessarily at odds with the objectives of the customer (typically to generate as much active power as possible to offset electricity purchases) so there is considerable potential for win-win solutions to be developed in this area. It has even been suggested that utilities may find it attractive to supply smart grid-enabled inverters to customers free of charge in return for limited control over the PV systems.

A further reality for electricity distributions businesses is that they currently have very little influence over the location or siting of PV systems. The broad brush nature of state and commonwealth government incentives for household and, in some cases, commercial PV systems means that these do not take into account the potential positive or negative impacts on the grid at the specific installation location.

Utility businesses that understand the options and opportunities related to the installation of PV systems may be in a position to work with the various levels of government to develop location-specific incentives for private sector investment in PV systems where clear benefits to the utility can be identified, and also the reverse – reduced or no incentives to install PV systems where their installation is likely to create serious potential quality or reliability issues.

Utilities may also consider directly investing in PV systems where the benefits are clear and quantifiable. In this situation, one of the key considerations is the availability of suitable land or rooftops within targeted distribution areas. Options considered by utilities include utilising existing assets such as substation buildings and even the electricity poles themselves to host solar modules. Some utilities have also trialled directly approaching customers in particular areas of the network and inviting them to host utility-owned PV systems on their rooves. This model is being tested in some of the Solar City programs currently running in selected cities around Australia.

There is no doubt that distributed PV systems are becoming a key feature of electricity distribution networks in Australia, as they are all around the world. The tipping point – where electricity generated from customers’ (unsubsidised) PV systems becomes cheaper than electricity purchased from the grid – will be reached within the next ten years and with it will come the widespread installation of PV systems on most residential and commercial buildings within our towns and cities.

Engaging with and understanding the features and capabilities of the emerging inverter technologies will assist electricity distribution utilities to respond positively to the technical challenges posed by high concentrations of distributed PV systems, and contribute actively to policy development in an area that will surely have a significant affect on their operating environment over the next decade.