As we enter the new decade, the devastation of the Australian bushfire season has understandably dominated the news both at home and abroad.
This has clearly highlighted the vulnerabilities that Australians face during these times of disaster. One clear area prone to risk is our electricity grid and the impact that bushfires can have on the national electricity market.
This vulnerability was laid bare only four days into the 2020 New Year. It was the first Saturday of the year when traditionally many businesses are still closed, and total electricity demand is lower.
What was different this year was that the temperature on 4 January 2020 was particularly diabolical, with the mercury flying well into the forties.
In Western Sydney, Penrith cracked 48.9 degrees Celsius, making it the hottest ever day recorded in Greater Sydney and one of the hottest places in the world on Saturday afternoon.
In Canberra temperature records also tumbled, with the Nation’s capital reaching 43.6C, its new hottest temperature record for any month.
The map above tells the story, with a huge band of extremely high temperatures covering much of Australia.
Electricity Grid Havoc
With the State sweltering and air conditioners cranking, demand rose steadily throughout the day and demand for electricity was relatively higher than previous years as indicated in the graph below.
Further pressure mounted on the electricity grid, with bushfires and smoke disrupting transmission from Snowy Hydro, causing a loss of around 2000 megawatts of generation.
Escalating the situation further, NSW was effectively cut off from Victoria with sections of the network tripping and the interconnector shutting off.
A lack of supply to meet this high demand meant NSW was heading for potential blackouts and the NSW spot price in the National Electricity Market (NEM) skyrocketed toward the peak allowable price of $14,700 per megawatt hour by 5pm.
To put this in context, this peak price was over 165 times the previous year spot price average. Urgent appeals were made to reduce electricity use across the state.
Embarking on a New Renewable Journey
Against this backdrop, the City of Newcastle (CN) had just begun its new electricity contract.
On New Years Day, the City had officially switched over to 100% renewable electricity supply for all its operations, including all of our large sites such as libraries, galleries, administration centres and works depots, over 200 small sites and more than 14,000 street lights.
The City of Newcastle was the first local government in NSW to transition to 100% renewable electricity supply (along with City of Sydney beginning this year).
Newcastle achieved this through a combined approach of constructing its own solar generation assets, in the form of both rooftop and ground mounted Solar PV systems, installing battery storage at key sites and signing a Renewable Energy Power Purchase Agreement (PPA) with Sapphire Wind Farm.
This approach diversifies supply and builds a resilient energy strategy.
The new electricity contract placed CN’s large sites and street lighting onto spot market pricing, complemented by a PPA with Sapphire Wind Farm that closely matched supply and demand.
This provided a hedge for predominantly evening and Street Lighting load, given the City of Newcastle’s extensive solar generation assets already in place.
Analysis showed that on an average annual basis, renewable generation output from Sapphire matched CN’s electricity demand over 85% of the time and enough power capacity was purchased to also ensure that over the course of a year, City of Newcastle was operating on 100% renewable electricity supply.
The crowning jewel in City of Newcastle’s renewable energy infrastructure is the 5 Megawatt solar farm, located on an area of rehabilitated landfill at Summerhill Waste Management Centre.
This solar farm was commissioned in the latter half of 2019, in time to begin pumping out significant amounts of new renewable electricity generation into the local distribution network in Newcastle.
This formed a further piece of the City’s energy strategy, placing the asset on spot market pricing as part of its new contracting arrangements.
Video 1 – Summerhill 5MW Solar Farm – Source Youtube
First test comes early
Detailed analysis and modelling had predicted that the City of Newcastle would achieve significant financial savings by moving to this new contracting structure over the long term.
The new energy strategy would also take advantage of cost-reflective electricity pricing through smart energy management.
Only four days into the new contract, the chaotic pricing unfolding that Saturday was going to be an extraordinary test of this strategic direction.
Receiving an alert from the retailer about the peak pricing event, City of Newcastle actioned what demand reduction it could, with the CEO messaging site operators to minimise electricity use as much as possible.
This included adjusting or turning off air-conditioning units, switching off air compressors, turning off any building or workshop lights and evaluating what IT equipment could be shutdown.
At the same time available battery storage systems connected to rooftop PV were set to discharge.
While we didn’t curtail our public EV charging, onsite Solar PV and battery storage at these stations managed to cover these charging sessions, though it’s an area for future demand reduction consideration depending on the circumstances.
While the timing favoured CN, with reduced demand due to it being a weekend, solar generation in play and evening street lights not yet on, it also demonstrated the resilience built in by the City.
City of Newcastle was able to ride through this event as a net-exporter to the grid and importantly utilising localised, urban assets to provide decentralised and local generation capability to the city.
At the same time, the City demonstrated the benefits of its renewable hedge during these extremely volatile periods, by utilising a mix of both wind and solar generation (and some limited battery storage).
This extraordinary event was an early encouragement of the forward-thinking decision to move to 100% renewable electricity supply.
The proof will shown be over an extended period of time rather than these individual events, but this extraordinary event was encouragement for the leaderships and forward- thinking decision to move to 100% renewable electricity supply. No doubt we’ll have our good days and bad days, but so far so good.
CN will now progress the next phase of more detailed demand response planning and investigation of additional battery storage to fully insure against any spot price exposure and truly take advantage of cost-reflective electricity pricing.
- Electricity Demand across all sites is matched or covered by the Wind PPA (Hedged), Electricity cost = Fixed PPA price.
- Site Electricity Demand exceeds generation (Unmatched) so exposed to spot price = Market Price (Cost)
- During High Price Event, City of Newcastle is supporting grid as a Net-Generator = Revenue at Market Price
- Wind PPA generation exceeds Site Electricity Demand (Unmatched) = Excess exported at Market Price
Adam Clarke is program co-ordinator at the City of Newcastle.