Renewable future for business and industry

A funny thing happened on the way to Australia’s energy future: the humble householder became a literal powerhouse of change. Alongside that domestic energy revolution, the Australian Renewable Energy Agency (ARENA) is working to bring the renewable energy benefits discovered by those householders to the rest of Australia’s community, including businesses and industry.

In the past few years, Australian domestic energy consumers have installed rooftop solar systems in such unexpectedly large volumes that it has taken both the renewables industry and electricity sector by surprise. According to the Australian Bureau of Statistics, one in five Australian households have installed rooftop solar panels or solar hot water systems in an effort to take control of their electricity use, reduce costs and do their bit for the environment.

Just last year, Australians invested $2.1 billion in distributed, small-scale solar, making it the fifth biggest market for that technology in the world and almost seven times the $330 million spent on large-scale solar in 2014. International energy analyst Bloomberg expects half of the $55 billion spent in Australia on new electricity generation over the next 15 years will be on rooftop solar PV.

Most of the business community has been slower off the mark to embrace renewables, which is perhaps understandable given the need to establish a business case before adding new technologies to industrial or commercial infrastructure. However, the ultimate cost saving to be made from making the move to renewables is making the proposition increasingly more compelling.

Renewable energy has been a feature of Australia’s energy mix for several decades, growing from around 10% of electricity generated in 2005 to around 13% in 2013. Hydroelectricity has traditionally made up the bulk of that contribution. But with wind energy and rooftop solar PV maturing and declining in cost, these newer technologies are now taking up a greater proportion.

The drive for household energy autonomy has upended the way we think about renewable energy, which in the past has focused mainly on the replacement of fossil fuel-based power generators. While large-scale renewable energy plants contribute to national energy supply, rooftop solar has highlighted the huge potential at the other end of the scale, not only for individuals but also for businesses, collectives and communities, to affordably generate their own electricity using renewable energy technologies.

In addition to mature solar PV technology, there are many other innovative renewable energy solutions emerging from the work of Australia’s world-class researchers and developers that, with some targeted assistance, could also reach commercialisation and be made available to Australian consumers.

Providing such support is the role of ARENA, an Australian government agency that was specifically established to lower the cost and increase the use of renewables in Australia. By taking a strategic and business-focused approach, ARENA has identified and is pursuing a number of priorities that will accelerate Australia towards its energy future.

One of those priorities is to help large-scale solar farms approach the same cost as wind farms, which are already commercial. Another related priority is to identify and overcome the challenges that arise from increased volumes of renewable energy being sent into the nation’s electricity grids. ARENA is also focused on helping communities and businesses in remote areas and on the fringe of grids to benefit from the same energy-autonomy being enjoyed by urban households with rooftop solar.

Since its inception almost three years ago, ARENA has committed more than $1 billion in 230 projects that span the innovation chain - from laboratory research and pilot plants to demonstration and pre-commercial installations. Many have specific application for businesses, such as Granite Power’s project to produce solar electricity and heat for a local swimming pool, CSIRO’s solar-generated air conditioning and electricity for a community shopping centre and Weipa Solar’s renewable-powered mine site and community in remote Australia. Around 76% of ARENA’s projects are located in Australia’s rural and remote locations.

Other projects have broader applications, such as BlueScope’s integration of solar cells into buildings, University of Melbourne’s work on the printing of solar cells, Muradel’s production of transport fuels from inedible plant matter and Carnegie Wave’s harvesting of energy from the ocean to produce electricity and desalinated water.

In each case, these projects aim to speed up the advancement of the renewable energy technology or its application so that it will become more affordable and able to compete in the commercial market. ARENA’s rigorous process for considering potential projects includes an assessment of the technology’s technical and commercial readiness, which ensures that only those with the best chance of reaching commercialisation are provided with assistance.

ARENA takes a technology-neutral approach, and as a result its investment portfolio includes solar PV and thermal, ocean, biomass, geothermal and hybrid technologies as well as solutions that enable the use of renewables.

In remote Australia, solar PV and solar-hybrid installations are also proving to be more affordable - and reliable - than trucked-in diesel, which is expensive, needs transport and storage infrastructure, and is dependent on roads remaining open during the wet-weather months.

The mining industry, in particular, has demonstrated a growing interest in renewable energy solutions for their remote operations. Even though the sector has stopped rapidly expanding as it moves into operational phase, depressed commodity prices and increased energy costs have made renewable energy solutions more competitive and attractive. ARENA is supporting several projects that involve mining operations or have application to mining sites. One innovative example is a redeployable solar-hybrid farm that can be packed up and moved in containers when a mining operation moves to a new location.

One of the factors that make renewable energy expensive is that projects of this kind have not been done before in Australia, or only on a few occasions. Lack of relevant skills and local experience in building and operating renewable energy installations means higher interest rates, higher supply chain costs and big construction contingency margins. ARENA helps overcome this early mover disadvantage by providing support to technology developers over time frames that are longer than those usually accepted in the commercial market. And by ensuring these early projects get off the ground, ARENA reduces perceived risk, builds partnerships, attracts investors and increases local knowledge and expertise.

ARENA plays a unique role in funding the projects and sharing the knowledge that will hasten the arrival of Australia’s energy future. The agency is constantly on the lookout to add new projects for its portfolio and is currently accepting applications for a number of programs. To find out more, visit arena.gov.au/initiatives-and-programmes/.

Latest project: Batteries trial to put storage on the front foot

A new Canberra-based storage trial will examine whether lithium-ion batteries could enhance electricity grids and increase the use of renewable energy.

Australian Renewable Energy Agency (ARENA) CEO Ivor Frischknecht said IT Power (ITP) would carry out the trial, supported by $450,000 of ARENA funding.

“ITP will analyse the performance of six major lithium-ion battery brands, comparing them to existing and advanced lead-acid battery technologies to investigate how they could operate in large and small electricity grids,” Frischknecht said.

“Storage is important for allowing more renewable energy to be used in Australia on-grid and off-grid by smoothing out energy supply.

“Power companies could, for example, consider renewable energy based on mini-grids with storage as an alternative to maintaining sections of the main grid that currently run at a loss.”

Frischknecht said the testing in a controlled environment would result in a greater understanding of various storage technologies and how they can best be adopted as they begin to compete with lead-acid batteries on cost and reliability.

“Lithium-ion batteries are increasingly used in electric vehicles and consumer electronics, giving them great potential for future cost reductions compared to other storage technologies,” Frischknecht said.

“ITP is building a test facility at the Canberra Institute of Technology to put each battery through its paces with repeated charge and discharge cycles simulating real-world applications and Australian environmental conditions.

“The findings will be shared broadly across the energy industry with investors, power companies and researchers in line with ARENA’s commitment to knowledge sharing.

ITP Managing Director Simon Troman said conventional battery storage had been used to optimise the design of remote power systems for many years.

“Recent reductions in the cost of lithium-ion batteries coupled with potentially significant performance advantages warrant serious testing of this new storage option,” Troman said.

The trial will proceed for three years and is scheduled for completion in June 2018.