The rapid change in the way electricity is delivered to customers is about to be highlighted by a new project that will see a new housing estate built without being connected to the grid. The idea has the support of the government of South Australia, a state which already sources 40 per cent of its electricity from wind and solar.
The idea has been freely talked about in the past year by network operators, particularly those with large regional operations such as Queensland, Western Australian and South Australia.
In WA, the energy minister raised the possibility that the mining town of Ravensthorpe may go off-grid, as much due to safety and reliability factors as it is with economics.
In Queensland, regional network operator Ergon says it may make sense to take individuals and communities off-grid, and it is already installing battery storage to ease the pressure on its remote network, and to allow for more localised renewable energy generation, rather than transporting electrons from far-flung coal-fired generators.
In South Australia, the network operator also agrees it will make sense for regional communities to look after their own electricity needs, through local renewable generation and storage, and either cut the wire to the main grid, or reduce its size.
The economics for new housing developments is even more compelling, given the huge costs of connecting them to the grid.
Now, the first major commercial housing developments to go ahead without a grid connection may be announced soon. Developers are looking at the idea of becoming a utility.
South Australian solar energy and battery storage company Zen Energy Systems last week flagged it was in talks with housing developers to build energy self-reliant housing estates that don’t need to be connected to the main electricity grid.
“We are having many housing developers coming to us for new housing estates saying – ‘look can you take me through all the options’ … right through to taking the whole development off the grid,” CEO Richard Turner told a seminar hosted by the Planning Institute and Engineers Australia, according to the local website InDaily.
“We’re talking to probably half a dozen major developers around the country who have housing developments of two, three, four thousand homes, talking about some sort of hybrid network alternative.” The hybrid alternatives include rooftop solar, battery storage, and micro gas generators.
“From the developer’s point of view they’re saying ‘can I be the utility?’,” Turner said. “Yes you can – you can be the utility, the retailer. It opens up a whole new world of how we can live.”
This points back to the recent prediction by Ron Stobbe, the head of SA Power Networks, that grid operators like his may find a role in the future facilitating such developments, but there would be little or no room for conventional centralised generation, or electricity retailers as they are currently structured.
It is not just new developments though. Turner also said he was studying the feasibility of removing SA towns from the electricity network using a combination of rooftop solar, wind and other options such as cogeneration.
“If we transferred those towns to micro-grids that relied on local generation and local storage of renewable energy, and took them off the main transmission grid eventually, with community-owned models … then we would have a much more efficient system,” he said.
“That would then make our city networks much more efficient and translate to a lower cost of power for everyone. It’s almost turning the clock back 100 years and giving these towns back their old power stations.”
The concept appears to have the approval of the state government, which has overseen developments that mean more than 40 per cent of the state’s electricity needs comes from wind and solar.
State Energy Minister Tom Koutsantonis told InDaily that localised generation was a good option for the future of regional towns and for individuals to save costs.
“With one in four household customers in SA now using solar PV systems, and as energy storage devices such as batteries reduce in cost, there is enormous potential for customers to offset their electricity usage and, in future, be serviced by more localised generation and energy storage,” he said.
“As the cost of battery technology declines, it is likely to be more cost-effective to have localised generation in some more remote locations, rather than have a monopoly maintain and upgrade antiquated transmission systems, in which the cost is ultimately passed on to consumers.”
Energy Ministers have released a consultation paper to consider appropriate regulatory frameworks. Submissions to that paper close at the end of the month.
Originally published on RenewEconomy.