Last week the CSIRO’s Low Emissions Technology Roadmap report was released officially by the Government.
Perhaps unsurprisingly, the announcement of the release was focused on the role of gas rather than some of the more interesting findings of the report which actually highlighted the inevitable and huge role that renewables would play.
In almost every scenario the role of renewables resulted in benefits – even though it has been argued that the report was “a stitch up” and very obviously designed to downplay the benefits.
It used inflated costs for solar and wind (above what the market price is already) and an extremely conservative view on escalating gas prices amongst other things. Wind and solar were described as “variable renewable energy” (VRE).
Renewable energy is cheaper. Full stop.
Despite this, there are three astoundingly profound statements that emerged and simply couldn’t be buried.
The first was that “…a reliable electricity system delivering 95% abatement in 2050 compared with 2005 levels and VRE share of ~90% is possible at moderate cost ….” and “…a VRE share of up to 40-50% is possible without requiring any enabling technologies for supply-demand matching…” and even more incredibly that it “is 18% less (cost) than in Pathway 3, in which VRE share is limited to 45%”
What these highlight in simple terms is that using 90% renewable energy is cheaper than using 45% renewables. It also highlights (over and over again) that there are no reliability issues that can’t be readily overcome with either 45% or 90% renewables.
Despite what the mainstream press or some of our leaders have said, the CSIRO and co-authors (the Electricity Networks Association) have concluded that far higher renewable penetration levels are a non-issue.
2.6GWH of storage is plausible.
The second interesting finding is that to fully unleash 90% renewable penetration, 2.6GWH of battery storage is required for every 1GW of or renewable capacity (presumably once the 45% penetration threshold is passed).
Is 2.6GWH per 1GW of (say) solar even achievable?
In rough terms, Australia installs around 0.5GW of rooftop solar per year. In rough terms 2.6GWH of storage is around 330,000 battery installations at today’s average size. So, that means we would need to install around 168,000 batteries per annum to allow 90% penetration.
This means that within a few years, every solar system would need to be installed with storage if today’s rates of installation continue, an ambitious target.
However, I mapped out some growth rates (see graph) that are more conservative than historical solar growth rates and you know what? It’s entirely plausible.
Critically, I can very easily see us hitting our first 2.6GWh within just three or four years. Even more powerfully, one cannot overlook the fact that there are already almost 2 million homes with solar (or 5GW) already installed and mostly already paid for, so there is an existing market to help kick start it.
Beyond these factors, its feasible that we may see support for batteries and certainly, we will see larger batteries at lower prices, very quickly.
Fascinatingly, mapping it out to just 2025 shows the potential for almost 6GWH of batteries across more than 760,000 homes – 25% lower than other pundits have forecast for Australia.
So, it’ entirely plausible.
This report is huge and complicated but for me at least, these two issues alone are powerful and incredibly understated.