The returns from owning a solar system are slowly diminishing, as feed-in tariffs are wound down to offset ever rising levels of exports into the grid. Don’t tell Australians, however, because they’re madly installing PV systems like never before. When the crunch comes, as is happening in South Australia and Western Australia, it will be the 70,000-odd battery-owners among the 2.5 million or so PV owners around the country who will be getting the best value from their systems.
Tomorrow’s energy landscape is in play and positions are being negotiated for who will satisfy AEMO’s hoped for requirement of between 6 and 19GW of “dispatchable resources”, most of it storage, mentioned in the Integrated System Plan 2020.
Australian energy-tech software business Evergen sees a portfolio of technologies filling the void and has attracted $3 million in backing from clean energy investor Providence Asset Group, part of it linked to taking on the role of global software partner for emerging hydrogen battery solutions Lavo and H2Store.
Hydrogen at home and at work
At the big end, H2Store is a commercial-scale hydrogen battery being developed at the University of NSW. Providence Asset Group’s plan over the next few years is to deploy 1.2GW of H2Store technology across its portfolio of solar farms. At household scale, Lavo is a consumer hydrogen battery that relies on a metal carbide solution that allows hydrogen to be stored at pressure about equivalent to a barbecue gas bottle, rather than far higher pressures appropriate for industrial applications. The developers claim one Lavo unit will be equivalent to about three Tesla Powerwalls in terms of storage.
Evergen CEO Ben Hutt says the company’s software smarts can cope with coordinating hydrogen storage assets to stabilise the grid or participate in energy markets the same way it does with batteries. “Hydrogen batteries store a lot more energy than a lithium ion battery, so they are really useful for situations where people want to be independent of the grid, entirely or partially,” Hutt says. “We’re attracted to hydrogen as a long-term energy solution because it’s much better for the environment and these assets last 20 to 30 years each rather than 10 years for lithium-ion batteries.”
Lavo units are in testing, with plans for them to be commercialised by the second half of 2021. Lifetimes of 20-30 years are theoretical. “It’s still the R&D and commercialisation phase,” Hutt says.
Evergen is providing optimisation software, consumer-facing apps and ultimately the ability to enrol these hydrogen batteries into virtual power plants. Providence and UNSW’s Hydrogen Energy Research Centre have a 10-year joint research and collaboration initiative.
Virtual becomes reality
Connected systems of privately-owned batteries, coordinated to operate as virtual power plants, are expected to be key participants in tomorrow’s grid to manage flighty generation from wind and solar. Evergen’s list of VPP projects includes AusGrid’s 100-battery pilot project to test value of a residential fleet to the network, some community battery projects and VPPs for major utilities where batteries are orchestrated to participate in the energy markets. “There is a range of different VPPs in play at the moment,” Hutt, pictured above, says.
The future looks set for rapid growth in Evergen’s realm.
“In Australia by the end of February next year we’ll have more than 50MW of batteries being orchestrated in various virtual power plants, so the era of mass adoption of batteries at residential-, commercial- and utility-scale is definitely now,” says Hutt, pointing to a busy period before summer and its anticipated network disruptions. “Summer is a time when people really want to have assets live and we’re experiencing that desire for clients to have batteries connected to VPPs before Christmas.”
Hutt says the company is working with owners of large-scale solar farms who are preparing them for on-site storage and Evergen expects to be orchestrating fleets totalling 5,000 household batteries by the end of the year, with several multi-megawatt projects coming online in early 2021.
May we use your battery?
When it comes to being granted access to a privately-owned household battery, it’s not all so straight forward. Many PV-owning consumers still don’t quite understand the real value locked up in a battery, he says, and there are “negative voices” in the world of solar installation who are “actively hosing down the economics of batteries” because they want to sell more solar.
Demand for residential storage is rising, however, as word gets around that it makes better sense to use your solar energy than export it. “Electricity is a complex product to buy,” he says, “and consumers have a high level of distrust for the energy system – worse than for the financial institutions.”
The secret is to simplify the proposition, he says, so that the value of participating in a VPP is explained by outlining an expected financial incentive and what subsidies might be available. Homeowners looking over a proposal to install a PV system should be aware that feed-in tariffs are falling and that “active curtailment” is on the way as a way for networks to cope.
“If we say South Australia is a leading evolution of the system, people there are now being actively encouraged to put a battery in their house,” he says. “There are lots of changes happening.”
The two-sided energy market of tomorrow will be very different, and the proposition of owning a battery needs to be understood against that imagined but inevitable criteria. “The lifetime value of a battery is very high,” Hutt says, “even if the short-term value might not necessarily always justify the outlay.”
Perceptions about storage are changing. The energy highs and lows of approaching summers will cement a different understanding of the value proposition.
“These things will become ubiquitous over time,” he says. “The system needs a lot more batteries to function properly in the future. Part of our vision is that consumers should get electricity for free. Batteries are the key to doing that.”