Community batteries will harness surplus solar power and make coal an even bigger liability than it already is.
Digging up vegetation compressed more than 100 million years ago and burning it to make steam to drive turbines surely can’t be among the top one thousand smartest ideas of the 21st century.
A source of thermal energy that will outlast any coal reserves and is very cheap to tap is the earth’s nearest star – the sun. The only problem is that, unlike electricity from burning coal, solar power isn’t available at night time.
Unless it is stored.
Batteries are the answer.
Australia has the highest uptake of rooftop solar in the world, with more than 21 per cent of homes having solar panels on its roof. But only one in 13 Australian solar households also have battery storage.
At last week’s ALP national conference, Labor leader Anthony Albanese announced a policy of rolling out community batteries in suburbs and towns around Australia to store rooftop solar electricity generated during the day for use in the evenings.
Consider the basic economics: it’s much more efficient to build a single community battery for, say, 100 households, than every household having to buy and pay for the installation and maintenance of its own battery.
The McKell Institute has produced a report, Power to the People https://mckellinstitute.org.au/research/reports/power-to-the-people-proposals-to-increase-the-rollout-of-community-batteries/ analysing the economics of community batteries.
A community battery can aggregate the rooftop solar power generated in a local community and make it available to that community in the evenings when it is most needed, reducing electricity bills.
A further economic benefit is that community batteries can enable solar households to sell any excess electricity into the grid in the evenings when prices are high.
Community batteries can also avoid the cost of local upgrades of electricity distribution systems to strengthen the grid, further reducing electricity prices.
Under proposals being considered by the Australian Energy Market Commission, solar households could face charges to export surplus power to the grid during the day https://www.afr.com/companies/energy/solar-households-face-tougher-rules-20210224-p575c7
By storing that excess solar power, community batteries can help solve the problem of too much solar electricity being sent into the grid during the day.
Already community batteries are being rolled out right around Australia – but on a limited basis. Labor’s policy would accelerate the rollout.
Grid-scale batteries are being installed at the sites of existing coal-fired power stations and beyond https://www.afr.com/companies/energy/hunter-set-for-world-s-biggest-battery-20210204-p56zji Those big batteries adjacent to coal-fired power stations will utilise the huge transmission systems that send electricity to major population and industrial centres.
The Rewiring Australia policy announced by Anthony Albanese in his budget reply speech last year will help connect large-scale solar and wind power generators to these established transmission systems.
Then there’s wet batteries: pumped hydro that will complement grid-scale and community batteries in solving the storage problem. At pumped hydro sites, renewable energy is used during the day to pump water back up for release in the evenings when electricity is expensive.
As the storage problem for solar power is solved, the older coal-fired power stations will come under increasing competitive pressure. Many are already losing money to renewables during the day and will become more unreliable as they age.
Chair of the Energy Security Board, Dr Kerry Schott, has advised that coal-fired power stations are on track to close four or five years before the end of their rated lives as plentiful renewable energy coming online makes them unprofitable https://www.afr.com/companies/energy/coal-power-stations-going-broke-schott-20210216-p572xn
Under its gas-led recovery plan, the federal government has threatened to use its own corporation – Snowy Hydro Limited – to build a 1000 megawatt gas-fired generator at Kurri Kurri in the Hunter Valley if the private sector does not reach a final investment decision by the end of this month https://www.afr.com/policy/economy/angus-taylor-s-home-made-power-crisis-20210321-p57cq0.
Gas is poorly suited to generating baseload power. During the day, like coal, it will be beaten by renewables with their zero fuel costs.
But gas can play an integral part in the electricity-supply task by firing up during evening peak and intermediate periods.
Instead of clinging nostalgically to coal-fired generators and commissioning feasibility studies into new coal-fired power stations https://www.afr.com/companies/energy/collinsville-an-unlikely-front-line-in-climate-wars-20200209-p53z4y conservative politicians need to recognise that the private sector simply will not build any more of them.
Conservatives might claim community batteries will never catch on. But that’s what was said about television sets and computers.
Conservatives who cling to ageing coal-fired power stations will make us a prime target for carbon tariffs https://www.afr.com/policy/energy-and-climate/run-down-by-the-green-tariff-train-20210214-p572f6 and other international trade restrictions.
By exploiting its abundance of solar and wind energy and supporting it with battery storage, Australia can become a global clean-energy superpower while delivering low-cost, reliable power to the people.
Craig Emerson is chair of the McKell Institute, a distinguished fellow at the ANU, director of the APEC Study Centre at RMIT and adjunct professor at Victoria University’s College of Business.