Renewables’ backed up storage is the future of energy in Australia, at both utility- and small-scales, Kane Thornton, CEO of CEC writes.
By harnessing the powers of the natural resources Australia is blessed with and storing excess energy until it is needed, we can decarbonise our economy, deliver benefits to communities and meet government targets.
To make that happen, we need to embrace storage as a critical solution.
Consumer energy resources
Australia is a rooftop solar success story.
Last year, more than 11 per cent of our electricity came from rooftop solar systems – a figure that continues to grow rapidly . I’ve written before about how the next stage for Australia is to incentivise the uptake of home batteries to make the most of those solar panels.
But it isn’t just rooftop solar and batteries. Other technologies such as electric vehicle chargers, water heaters and heat pumps make up what is referred to as ‘consumer energy resources’ (CER).
As a collective, CER have a profound role to play in Australia’s renewable energy future.
The 2024 Integrated System Plan, published by the Australian Energy Market Operator (AEMO), predicts in its ‘step change’ scenario that we will require approximately four times more rooftop solar, a seven-fold increase in residential and commercial batteries, and a huge increase in orchestrated battery capacity by 2050 to limit global temperature rise to less than 2 degrees.
In other words, CER has a critical role to play in what AEMO predicts would be the lowest-cost pathway to meeting both Australia’s energy and emissions targets.
Many Australians, often aided by government incentives, have embraced the benefits of rooftop solar and there are now over 3.7 million households and small businesses with panels installed.
It is now up to governments to find efficient ways to incentivise the other elements of CER, particularly home batteries. Home batteries can harness, and dispatch energy generated during the day for use when the sun isn’t shining, making solar panels even more valuable.
Earlier this year, we published a national roadmap for CER: Powering homes, empowering people. The roadmap outlines just how important CER is and what industry and policymakers need to focus on to ensure consumers are brought along on the CER journey.
The modelling for that roadmap revealed four crucial things we risk losing if we do not meet the predicted levels of CER in the Draft ISP:
• Over $22 billion in savings for Australian taxpayers
• $35-71 off the average annual energy bill for all Australians
• Up to 3.8 million more homes and businesses with orchestrated batteries
• 18,200 jobs in selling, designing and installing CER
Those are significant numbers we cannot afford to ignore.
Empowering consumers to embrace CER
Our CER Roadmap, written with consumers squarely front of mind, identifies five key themes that will empower consumers along each step of the CER journey: education, targets, consumer protection, incentives, and unlocking and maximising the use of network capacity.
Under those themes are practical recommendations such as funding support at state and federal levels to incentivise uptake, government targets for the orchestration of CER on government-owned assets, a National Home Battery Saver scheme and empowerment funds to help educate consumers on CER benefits.
A key recommendation and one in which we all play a role is communicating the value of these assets and technologies to consumers so that they understand what they are getting and how it will help them, be that lower energy bills, increased energy independence, supporting emissions reduction or helping to support the network by shifting energy flows to where there is available network capacity.
Large-scale storage boom
On the larger-scale side of storage, Australia is set for a boom . Q1 2024 marked the fourth consecutive quarter in which large-scale energy storage projects secured financial investment commitments of over $1 billion.
The record-breaking performance of the sector in 2023 was clearly not a flash in the pan, suggesting Australia is considered one of the most attractive markets for battery energy storage systems.
There are also significant developments to come in energy storage away from commonly seen technologies such as lithium-ion batteries and pumped hydro facilities, both of which are established at scale and widely used.
We published a landmark report in June, The future of long-duration energy storage, which provides a comprehensive overview of how alternative long-duration storage technologies could help keep costs down and firm renewables as the transition progresses.
The report covers a whole range of exciting alternative technologies, only some of which are already being practically used but all of which could play a huge part in the years to come. Those include mechanical storage, such as compressed air; electrochemical storage including redox flow and hybrid flow batteries; and thermal storage, which includes concentrated solar power and miscibility gap alloy.
Our report explores how these alternative storage technologies can complement lithium ion and pumped hydro to replace fossil fuel generation, forming a portfolio of long-duration storage that will help meet the needs of a modern, renewable energy system.
The future of energy
We’ve heard a lot recently in Australia about other forms of energy, including nuclear. But those plans are thinly drawn, speculatively based on technology, capability and a political landscape that doesn’t exist in Australia.
What Australia has already is an abundance of natural resources and the technology to harness them to decarbonise our economy. Renewable energy is already providing almost 40 per cent of our electricity.
If we are to meet our climate targets, there is no time to waste getting bogged down in starting a new industry and spooking clean energy investors , risking them choosing to invest elsewhere.
Rather than indulge a nuclear plan that would be decades in the making and incredibly costly, we must stick to and incentivise what is demonstrably working. At both small- and utility-scale, renewables backed by storage is the future of Australia’s energy system.
This article featured in the August edition of ecogeneration.
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