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Flicking the switch: (Hybrid) energy comes to Flinders Island


How do you get a power system to a remote community quickly and safely?

It’s not a trick question but the answer might surprise: you build it elsewhere.

For its newest Hybrid Energy Hub on Flinders Island, Hydro Tasmania tried something new. Parts were assembled in factories on the Tasmanian mainland and shipped over the Bass Strait in containers, ready for installation and commissioning within a matter of months.

The new Hybrid Energy Hub at Flinders Island. IMAGE: Hydro Tasmania

 

These “plug and play” components have been tasked a seemingly simple aim, to provide a reliable power supply to Flinders Island’s population of less than 1000 people.

But there’s more than just lessening the number of blackouts at play here. Hydro Tasmania’s newest microgrid project aims to displace diesel generation on the island by 60 percent through solar and wind power and battery storage. On some days when the wind blows strong or the sun is out in force, it’s hoped the island will run entirely on renewables.

It also builds on the work done in other remote locations at King Island, Rottnest Island and Coober Pedy by “modularising” the process of building such power systems in remote locations.

“It’s something that’s not been done before,” Hydro Tasmania’s chairman Grant Every-Burns said.

“It’s a Tasmanian innovation and it’s bringing clean energy to an isolated community. With that innovation comes less diesel usage, lower diesel fuel costs, lower emissions and the opportunity for Flinders Island to further boost its clean and sustainable reputation.”

ARENA contributed $5.5 million to the project as part of its CARRE program for encouraging renewables in regional Australia.

Chief executive Ivor Frischknecht said the agency was delighted to be involved in the latest iteration of Hydro Tasmania’s microgrid work.

Speaking at the launch of the hub on Flinders Island on December 11, he said there was “huge potential” for the technology to be used in other remote communities in Australia and overseas.

“Queensland alone has almost 50 remote communities that are quite similar in size and scale to Flinders Island,” he said.

“[There is opportunity in] The rest of the world, particularly the developing world, and power systems in not so remote areas that aren’t working well. So being able to bring in a reliable system that has a lot of renewables in it, that you can simply plug in together and get going quickly and easily, there’s huge potential there.”

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Hydro Tasmania’s manager of Hybrid Energy Operations, Ray Massie, agreed there were global applications for their work and data from the Organisation for Economic Co-operation and Development shows there is a need. It’s estimated that the more than 1 billion people still have limited or no access to reliable electricity, many of them in remote locations.

The Flinders Island Hybrid Energy Hub features a single 900 kW wind turbine and 200 kW solar array. The enabling systems include a 750 kW/300 kWh battery, 850 kVA flywheel, and 1.5 MW dynamic resistor.

The hub is on the site of an old diesel-powered plant and has been in operation since November. On the day of launch, it was headed towards 83 hours straight of 100 per cent renewable generation.

LISTEN TO OUR PODCAST, THE INNOVATORS, EPISODE 6 FROM FLINDERS ISLAND.

 

 

Spending on poles and wires pushes up your electricity bill. It doesn’t have to be that way

One of the most expensive parts of running a power network is building and maintaining the infrastructure, the so-called poles and wires, needed to transmit and deliver electricity.

As a consumer, when you look at your monthly power bill, between 40 and 55 per cent of the total amount is made up of costs associated with the transmission and distribution network, according to the Australian Energy Market Commission.

And as the infrastructure in our cities and major markets ages that price is likely to increase.

Researchers at the University of Technology Sydney, led by Dr Chris Dunstan have argued that the current regulatory framework means that building new grid infrastructure is often more profitable for network businesses than introducing demand management solutions that encourage people to use less energy, even when doing so would reduce costs to consumers.

The ARENA-funded research from Dr Dunstan’s team has been instrumental in bringing about a change to market rules that will come into effect in 2019 and should encourage the use of demand management when it is the most suitable option.

READ MORE: DR CHRIS DUNSTAN EXPLAINS HIS RESEARCH

But a new project being funded by the Australian Renewable Energy Agency (ARENA) aims to demonstrate, ahead of those changes, a real-life implementation of that approach by fast-tracking the integration of rooftop solar and battery storage with the broader electricity market.

And a handful of Melbourne residents will be the guinea pigs leading the charge.

ARENA is providing $450,000 for United Energy to trial behind-the-meter residential solar and storage in Melbourne this summer.

The $1.23 million trial will demonstrate if harnessing the capability of residential solar and storage systems can defer the need for costly upgrades to the distribution network, leading to a better deal for consumers.

ARENA chief executive Ivor Frischknecht said that solar and storage technology could reduce the need to build new grid infrastructure.

“This trial will show how solar and storage could play a key role in future energy infrastructure, easing pressure on the distribution network and reducing network costs for consumers,” Mr Frischknecht said.

United Energy will install 4kW of solar and battery storage systems in 42 households across seven of the most constrained substations across United Energy’s network in Melbourne’s south eastern suburbs and the Mornington Peninsula.

These are substations where the ability to meet demand is most difficult to manage.

The systems will provide 4kW solar/13.2 kWh storage per site, creating 160kW solar and 554 kWh storage in total.

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HOW IT WORKS

At times of peak demand, when the substation is struggling to deliver the amount of electricity required, homes participating in the trial will automatically switch from receiving electricity from the grid to receiving it from their battery.

That should remove load from the substation and allow a greater balance between supply and demand, making for a more stable network.

While the ability of solar-linked battery storage to play this role should be relatively clearcut, network operators need to learn how such a system would work, get used to working with it and develop confidence that it can play a larger role in the future.

This trial will provide an opportunity to demonstrate that ability to meet network reliability requirements and help network operators to increase efficiency and reduce costs.

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United Energy’s Network Planning and Strategy Manager Rodney Bray said solar and battery storage technology would change the way utilities plan their grid infrastructure.

“As battery prices fall in the future, solar coupled with storage has the potential to become an economically feasible alternative to traditional, costly network augmentation,” he said.

The funding has been awarded under ARENA’s Advancing Renewables program which supports a
broad range of development, demonstration and pre-commercial deployment projects that can deliver affordable and reliable renewable energy for Australian families and businesses.

The UTS review found that incentives were needed in order to encourage network operators to look for demand side savings.The partnership between ARENA and United Energy is a practical example of a sustainable solution to maintain network reliability while reducing the need to invest in expensive new infrastructure.

READ MORE: UNITED ENERGY ARE PART OF ARENA’S DEMAND RESPONSE PROGRAM

 

 

NOJA Power Intelligent Switchgear

Exciting times ahead for an Australian company that has definitely got legs

As a nation we have fallen hard for rooftop solar; Australia leads the world in uptake of the technology.

And that huge penetration has thrown up both challenges and opportunities. It means that Australian companies are well placed to take advantage of this moment with smart products and new technology born from creative R&D.

One such company making a splash with innovative thinking is Queensland-based Redback Technologies – a fast-growing start-up that has set as its goal helping to ensure that Australian households and businesses are one day entirely powered by renewables.

At ARENA WIRE we love celebrating the success of Australian companies who are leading the innovation push that is helping accelerate the shift to a renewable energy future.

Redback creates products that seamlessly integrate hardware and software to help consumers optimise the generation, management and storage of their own power.

“Our smart software uses machine learning to predict solar generation and customer usage, using inputs like weather data, and then makes intelligent decisions on how to use energy to achieve the best outcome for customers,” Redback founder and Managing Director Philip Livingston says.

“Its capabilities ensure effective management of energy at the customer’s site, resulting in lower bills and a reduction in fossil fuel reliance.”

The Redback system (installed on right) allows householders to take charge of their energy use. IMAGE: Redback.

 

HOW IT WORKS

The company’s flagship product, the Smart Hybrid System, consists of a 4.6kW inverter and battery enclosure which integrates with up to 9.6kWh’s of energy storage.

The system is enabled to provide an uninterrupted power supply and backup power all in one.

It uses machine learning to gather intelligence over time, learning from user habits as well as drawing data from external factors like weather to control energy use.

The Redback system also allows consumers to take charge of their energy usage.

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Solar panels generate their energy in the middle of the day but, for most people, peak consumption is before work in the morning and after work in the evening.

The system enables households to direct the energy generated in the middle of the day to their devices using a cloud-enabled intelligent system for analytics and remote control.

Redback’s system optimises self-consumption of solar-generated electricity so households can use their energy when they want – improving the pay-back from solar panels.

It works to drive down energy costs for households that install the technology.

Redback allows householders to optimise their solar and battery systems. IMAGE: Redback.

AND THAT’S NOT ALL

Redback’s software also enables thousands of systems to be aggregated to form a virtual power plant to provide grid services, demand response and to support the increased integration of renewables into the grid.

The devices will form a part of EnergyAustralia’s demand response project as part of ARENA and AEMO’s three-year $35.7 million demand response trial, which will be in place for the coming summer.

Redback has enjoyed a meteoric rise and the company is preparing to expand further, announcing plans to take on an additional 30 staff over the next six months as it beefs up its research and development capability.

That expansion has been made possible by an equity investment of $US 7 million from The Clean Energy Innovation Fund and Right Click Capital, which was announced last month.

The Innovation Fund draws on the combined skills and experience of the Clean Energy Finance Corporation (CEFC) and ARENA.

The fund – which uses finance from the CEFC to invest in innovative clean energy companies and projects – recently committed US$5 million (approximately A$6.42 million) to Redback.

OUR NEW PODCAST, THE INNOVATORS, IS COMING SOON. HERE’S A SNEAK PEEK

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Right Click Capital, an investment firm specialising in identifying, investing in and supporting high-growth Internet and technology businesses across Australia, New Zealand and South East Asia, has invested about $2.55 million.  

The firm will also contribute its specialist experience to support Redback’s expansion in Australia and the wider Asia-Pacific region.

Mr Livingston says the equity investment will allow the company to expand its research and development capabilities as well as accelerate development of its smart software suite.

“Redback is committed to innovation. Our vision is to ensure Australian households and businesses are entirely powered by renewables,” Mr Livingston said.

“This investment enables us to expand our expertise in data science, software development and engineering and electrical engineering so we can continue to develop our next-generation energy intelligence platform and devices.”

ARENA Chief Executive Ivor Frischknecht said the investment announced last month was a positive move for the innovation fund.

“We’re proud to get behind Australian innovation that helps Australian households and businesses make better use of their rooftop solar and battery storage, improve efficiency and save on energy costs,” he said.

Those comments were echoed by CEFC Chief Executive Ian Learmonth.

“We can lead the way in developing innovative technologies like Redback’s so households and businesses get the most benefit from these investments,” he  said.

The investment follows EnergyAustralia’s recent announcement that it will offer Redback’s inverter system to its 1.7 million customers in Victoria, New South Wales, Queensland, the ACT and South Australia.

$160 million 60 MW Kennedy Park wind, solar and battery hybrid reaches financial close in Queensland

The Australian Renewable Energy Agency (ARENA) today announced $18 million in funding for the $160 million Kennedy Park wind, solar and battery project, based in North Queensland.

The 60 megawatt (MW) project will consist of 43.2 MW of wind, 15 MW of solar PV, a 2 MW lithium ion battery and a synchronous condenser.

On behalf of the Australian Government, ARENA will provide $18 million recoupable grant for the project, a joint venture of Australian renewable energy developer Windlab and Eurus Energy.

In an ASX announcement today, Windlab announced the project had reached financial close. The project will also receive up to $93.5 million in debt finance from the Clean Energy Finance Corporation.

ARENA’s funding was originally committed in July 2016, but the project has subsequently been expanded in scope to overcome connection challenges.

Kennedy Park will now include nearly double the wind power originally intended through 12 3.6MW turbines.

On completion, the combined wind and solar farm will generate 210,000 megawatt hours of electricity per year – enough to power more than 35,000 average Australian homes.

The project will also improve stability and reliability of the grid for communities in North Queensland, through enabling technologies to control voltage and frequency.

The project is expected to be fully operational by the end of 2018.

This project will also lay the foundations for a planned much larger second phase, called ‘Big Kennedy’, a $2 billion 1200MW solar and wind farm, due to commence in 2019.

The project will demonstrate fully integrated wind, solar and batteries storage and will generate electricity closer to the point of use, relieving demand on long transmission lines from the southern parts of Queensland.

ARENA Chief Executive Officer Ivor Frischknecht said Kennedy Energy Park will be the first time a combined large scale solar, wind and battery farm will be connected to the grid.

“Kennedy enjoys one of the best and largest wind resources in Australia, alongside one of the best solar sites.
“By integrating wind, solar and batteries, this will be able to provide reliable and dispatchable electricity to North Queensland,” Mr Frischknecht said.

“This project will now also help improve the stability and reliability of the network in North Queensland,” he said.
“ARENA is excited to be funding such an ambitious project in what will be a significant step towards Queensland generating half its electricity from renewable energy.”

“We believe Kennedy Energy Park will demonstrate how effectively wind, solar and storage can be combined to provide low cost, reliable and clean energy for Australia’s future,” said Roger Price, Windlabs Executive Chairman and CEO.

“The broader adoption of projects like Kennedy can address the recommendations of the Finkel review and ensure that Australia can more than meet its Paris Commitments while putting downward pressure on energy prices,” Mr Price said.

ARENA media contact:

0410 724 227 | media@arena.gov.au

Download this media release (PDF 143KB)

A glimpse of the future is about to get underway in far north Queensland

Renewable energy is not without limitations and prominent among them is variability. The sun does not always shine, nor the wind always blow.

But a trailblazing project in far north Queensland is on the verge of testing whether a new approach, combining wind, solar and Tesla-supplied battery storage, can provide dispatchable renewable energy into the grid from a single site, 24 hours a day.

Kennedy Energy Park, near the remote town of Hughenden, is now entering the construction phase of development after securing funding from ARENA and finance through the Clean Energy Finance Corporation.

The $160 million project, the first of its kind anywhere in the world, is a hybrid of wind, solar and battery storage. Expected to be fully operational by the end of 2018, it will produce around 210,000 MWh of power each year – enough electricity to power the townships of Hughenden and nearby Julia Creek, 300 km inland from Townsville (or around 35,000 average Australian homes).

Kennedy will be developed by wind energy company Windlab in conjunction with Eurus, Japan’s largest developer of wind and solar farms. Windlab was originally established by the CSIRO, Australia’s principal scientific research institute, to develop cutting-edge atmospheric modelling tools to find the best wind energy sites in Australia and internationally.

Kennedy Energy Park provides ideal conditions for both wind and solar generation. IMAGE: Windlab.

 

Windlab CEO Roger Price said the project was a model for how Australia might use its natural resources to its economic and environmental advantage in the future, and that the technology, which he dubbed “high-penetration renewable energy”, could be exported globally.

“At the location it’s very sunny during the day, which is no surprise, but then the wind starts to blow in the late afternoon and continues to blow through the night,” he said.

“By putting the two technologies together with some storage behind one connection point, we’re creating a hybrid generator.”

“That means there is much less variability, and much more predictability at being able to provide renewable energy that very closely matches average network demand.”

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ARENA will contribute an $18 million grant for the development of the $160 million project. Equity will be provided by Windlab and Eurus, with the Clean Energy Finance Corporation (CEFC) contributing $94 million of non-recourse debt on a long-tenure basis.

The facility will provide 60 MW in total, including 43.2 MW of wind power and 15 MW of solar, which will be backed up by 2 MW of lithium ion storage, supplied by Tesla. It will provide a template for how battery storage can complement and boost solar and wind energy in the future.

ARENA Chief Executive Officer Ivor Frischknecht said Kennedy Energy Park will be the first time a combined large scale solar, wind and battery farm will be connected to the grid.

“Kennedy enjoys one of the best and largest wind resources in Australia, alongside one of the best solar sites. The project will provide renewable energy to North Queensland, while  providing a test case for connecting hybrid wind, solar and storage to the NEM,” Mr Frischknecht said.

The location is also ideal because far north Queensland is one of the few parts of the National Electricity Market where demand is currently growing (across much of Australia demand is growing at peak times but is stable or falling overall).

The grid connection and battery storage will also allow the facility to provide valuable grid stabilising services, such as frequency control – where short injections of electricity are dispatched into the grid to balance supply and demand and ensure system stability. Such services are usually only provided by coal or gas-fired power stations.

An artists impression of the Kennedy site. IMAGE: Windlab.

 

BIG AND GETTING BIGGER?

Hopes are high that Kennedy will be a first step for a massive expansion of renewable energy in the region.

“This project in its own right is very exciting, but for us it’s even more exciting because we believe it’s a catalyst for what we call Big Kennedy, north of this location, which is a huge 80,000-hectare area capable of supporting 1200 megawatts of wind alone,” Price said.

In June the Queensland government, which has committed to a goal of 50 per cent renewable energy by 2030, pledged half a billion dollars to boost transmission in the area. Windlab hopes ‘Big Kennedy’ – which it will fully own – will be online in two to three years time, with the potential to power a far bigger area of North Queensland.

“You’re going to see a significant amount of solar built in Queensland, because it has such a great solar resource and solar’s become so cheap, but what you can’t do is meet that whole 50 percent target using solar alone, because it’s only sunny during the day,” Price said.

Kennedy is ideally situated for solar resources and access to the NEM, as this chart shows. IMAGE: Windlab.

“But there is a considerable wind resource in Queensland which is compatible with the solar. With Kennedy, we’re really showing how these technologies can work together, which will help guide the state in looking at how it can meet its 50 percent renewable target over the next 12 years.”

The project will also help Australia meet its commitments according to the Paris Agreement, while helping to lower energy prices, Windlab says.

“I don’t think there’s a location in Australia where the wind resource and the solar resource are as complementary as they are here, but there are other locations where it’s still very economically viable to combine those two resources together, both in far north Queensland and in places in Western Australia,” Price said.

A LESSON FOR THE WORLD

Windlab also works in eastern Africa and southern Africa, and the company believes the technology on show at Kennedy could be replicated and exported internationally to these and other locations.

It ill also be a shining example at home of how renewable energy can prove itself to have outgrown some of the limitations that accompanied its early stages.

“I think this project will demonstrate that you can deliver very low-cost and highly reliable renewable solutions,” Price said. “The industry’s got a bit more work to do prove that, but over the course of the next few years I firmly believe it will become self-evident.”

 

 

Time to ditch the generator? The town where renewables took over

It was more than a moment. More than a day, even.

For an uninterrupted 35 hours last week the remote mining town of Coober Pedy, where the sun’s relentless heat long ago drove many of its residents into cooler subterranean dugouts, was powered by 100 percent renewable energy.

Through a combination of wind, solar and battery storage, funded in large part by an $18 million investment by ARENA, Coober Pedy achieved 100 percent renewables for the first time since its hybrid energy generation project went live in July. 

Watching the clock tick over in the early hours of the morning from his Brisbane base was Energy Developments’ General Manager Keith Barker.

Coober Pedy Solar Farm. IMAGE: ARENA.

“It made me stay up to 12.45am to see if it happened,” he laughed. “A couple of other times we had a fairly long period and I’d thought ‘Are we going to do it today?’ but we didn’t.”

Coober Pedy has traditionally relied on off-grid power, supplied by EDL’s diesel-powered generators. With the hybrid renewable project, signed off by ARENA and EDL in 2014 and switched on in July 2017, 12,000 solar PV panels deliver 1 megawatt (MW) of energy, two wind turbines bring 4 MW of power and battery storage rounds out the picture with 500 KWH.

The system relies on the technology developed by Hydro Tasmania in its King Island Renewable Energy Integration Project and the soon-to-be-launched Flinders Island microgrid.

Hydro Tasmania’s Hybrid Energy Solutions manager Ray Massie said his team delivered “an advanced control system that lets EDL balance wind, solar, battery and diesel power, as required, in a stable and secure way.”

The long-term goal of the project is to provide clean, efficient renewable energy and reduce the town’s reliance on diesel generation by 70 percent.

“That’s why we and ARENA went into this in the first place. There are many places like Coober Pedy that will be off-grid for the forseeable future,” Barker said.

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While Coober Pedy residents won’t have noticed the renewable energy milestone – the town’s energy needs are subsidised by the state government to keep prices affordable – Barker says there is significance to hitting 100 percent.

“The importance about getting to 100 percent renewables is about demonstrating that you can switch your diesel or gas engines because there’s been a lot of discussion about the NEM (National Energy Market) and whether you can rely on renewables.

“To show that we can operate with 100 percent renewables demonstrates you don’t have to have an engine running.”

Just can’t wait to be King: Rottnest Island’s path to renewable energy

It’s a long way as the crow flies from windswept King Island in Tasmania’s Bass Strait to sun-kissed Rottnest, off the coast of Perth. But while these two small islands are separated by vast distances they have plenty in common.

King Island was a trailblazer for off-grid energy independence in Australia’s remote communities. And the lessons learned in that project have led directly to the one now taking shape thousands of kilometres to the west.

On isolated King Island, which has no connection to the national grid, an $18.25 million project (including $6.08 million from ARENA) has combined wind, solar and bio-diesel generation technology with battery storage and a ‘smart grid’ system to create a fully-functional renewable energy microgrid.

It creates enough electricity to meet 65 per cent of the island’s energy needs, dramatically reducing the amount of diesel fuel required and lowering carbon dioxide emissions by as much as 90 per cent.

The lessons learned from that and other projects (such as Flinders Island, where ARENA has also contributed funding) have made Hydro Tasmania world-leaders at carrying out this type of project. And that expertise has taken them to Rottnest.

A new solar array is part of the Rottnest project. IMAGE: Hydro Tasmania.

 

THE ROTTNEST STORY

It has been a long time coming. Until the late 1970s, diesel generation was virtually the only source of electricity on Rottnest Island.

Experimental wind turbines began a long process of limiting diesel use, but it wasn’t until 2004 that a 600 kilowatt (kW) wind-diesel hybrid system was installed, generating about a third of Rottnest’s energy and saving about 400,000 litres of diesel each year.

Since then, given the precious and delicate environmental values of Rottnest Island, residents and visitors have always been interested in securing a more sustainable way to meet their power needs.

Now it is on the way via the Rottnest Island Water and Renewable Energy Nexus Project (WREN). The $6.51 million project is being carried out by Hydro Tasmania with support from the ARENA and the Rottnest Island Authority.

ARENA will contribute $4.8 million to bring a greater share of renewable energy to the island, which has a population of just 114 but sees that swell to more than 15,000 tourists a day during peak season.

HOW IT WORKS

Catering to those hordes of tourists requires a serious amount of energy. The island’s 5 gigawatt-hours (GWh) power demand has been provided by five conventional diesel engines, two low-load diesel engines and a single 600 kW wind turbine.

A large portion of that energy is used to run the desalination plant that produces fresh water for the island’s visitors and residents. 

Now, using innovative renewable integration technology, Hydro Tasmania’s Hybrid Energy Solutions team is installing a power system that will make Rottnest Island 45 per cent renewable-powered (factoring in the existing wind turbine) with up to 90 per cent of power supplied by renewables at times when conditions are most favourable. 

Hydro Tasmania has installed a 600 kW solar array and integrated it with the existing power system to boost and diversify the renewable energy capacity in the system.

It has also installed a hybrid control system, along with enabling technology to better manage the variable renewable generation and reduce diesel fuel consumption.

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The hybrid control system coordinates the generation (wind, solar and low load diesel) with enabling technologies, including a dynamic resistor and demand management of the desalination plant. Wind turbines can create fast fluctuations in power that are an issue for a small grid. The resistor solves this problem.

By integrating renewable resources (solar and wind) with the island’s desalination plant and water storage facilities, surplus renewable energy can be used to create clean drinking water.

When weather conditions mean that excess renewable energy is being produced, the desalination plant will automatically switch over to renewable power, saving huge amounts of diesel fuel.

The biggest innovation for Hydro Tasmania has been designing and delivering a system to make all of these complex parts work together. The WREN project will deliver renewable electricity and clean water at a lower cost, with lower emissions.

The new app shows residents and tourists the way energy is being generated in real time. IMAGE: Hydro Tasmania.

THERE’S AN APP FOR THAT

An app called “Rottnest Island Water and renewable energy nexus” can be downloaded for both Apple and Android devices. It provides real-time power usage, project information and educational materials. Visitors can also use the app to learn more about sustainability on Rottnest Island and how they can make a sustainable difference.

The current project fits in as part of a renewable energy plan for the island. The system has been designed to be scaleable as future needs expand. 

Rottnest Island is on the verge of a clean energy future befitting of its unspoiled beauty and significance as a place that Australians love to visit and want to preserve. A key moment arrives in November, when the switch will be flicked on this new chapter in Australia’s renewable energy transition.

Hydro Tasmania’s Hybrid Energy Solution’s team is at work implementing hybrid renewable energy projects around Australia. You can contact them at hybridenergysolutions@hydro.com.au

Let’s talk about deX: a new way to buy and sell electricity

Australia is a market country. A market economy.

Want to buy and sell a stake in a company? There’s a (stock) market for that. Want to rent out your apartment? AirBnB provides a digital marketplace where consumers interact with each other as buyers and sellers.

Why should electricity be any different?

Until now the energy market has been predominantly for wholesalers and retailers. The job of individual consumers was simply to use electricity and pay whatever they were charged for it.

That’s all about to change.

Introducing deX, a digital exchange platform that creates an open marketplace where distributed energy can be bought and sold by businesses, households, communities and utilities.

ARENA has contributed $450,000 towards the $983,000 cost of the pilot project, which brings together energy retailers, network operators and a host of new players such as GreenSync, Tesla, Wattwatchers, and Geli.

IMAGE: GreenSync

“This is the first time that industry has come together in this way,” said GreenSync Chief Executive Phil Blythe. “This is an opportunity born from our current energy crisis.”

”deX provides a framework to increase customer value, improve system reliability and manage the transition to a renewable energy supply.”

It’s an idea that was originally born at A-Lab, ARENA’s own space in which energy leaders meet to thrash out innovative solutions to some of the challenges facing renewable energy and energy markets more generally.

“A-Lab helped to bring together industry leaders in ways that have never happened before to better facilitate breakthrough thinking on complex challenges facing the electricity sector.” ARENA Chief Executive Ivor Frischknecht said.

While the deX is initially only a pilot program it is hoped and expected that it will soon expand its footprint.

The top-down model that has traditionally governed how consumers source the energy they need is officially under challenge.

SO WHAT HAS CHANGED?

With the rise of home solar power, batteries, and other local sources of energy generation, Australia’s energy market becoming one in which millions of smaller generators can provide their own energy, store it, trade it with others or send it back into the grid.

Australia is a world-leader when it comes to rooftop solar, with around 1.7 million or 15 per cent of the nation’s roofs hosting miniature solar farms. Combining rooftop solar with batteries allows households and businesses to use that stored renewable energy whenever they want.

deX will make it possible for them to also sell the electricity back to network companies, allowing it to help meet peaks in demand or strengthen the grid.

With ARENA’s support, GreenSync is developing a digital marketplace that will change the way distributed energy is produced, traded and consumed.

The decentralised energy exchange (deX) will make it possible for the owners of rooftop solar and battery systems to earn money for helping to keep the lights on in their neighbourhood.

deX is a digital marketplace that allows consumers to buy and sell electricity. IMAGE: Adobe.

WHAT IS DISTRIBUTED ENERGY?

Australia’s energy market, and those around the globe, are becoming more complex by the day. CSIRO modelling shows that over 35% of all electricity will be generated and managed by customers in 2050.

Distributed energy resources are smaller power sources (such as individual consumers or businesses) that can be aggregated to provide power to meet demand within a larger system.

As the electricity grid becomes more complex, integrating renewable energy which is often intermittent, DER such as storage and advanced renewable technologies can help provide stability.

Because this energy is produced by a large number of smaller energy sources and methods it can be difficult for large industry players to harness the energy it offers.

THAT’S WHERE ENERGY EXCHANGES COME IN

Energy exchange platforms will play an important role in efficiently capturing the benefits offered by distributed energy resources.

Such platforms have the potential to provide the technical, information and economic incentives required to drive efficient investment in DER installation across electricity networks.

GreenSync’s prototype decentralised energy exchange (deX) develops and tests the principles and functions required for a future large-scale, open-access, reliable and secure DER exchange.

A pilot will take place across two network locations (United Energy on the Mornington Peninsula and ActewAGL in Canberra) and seeks to test the ability of deX to meet peak demand and power quality issues, and demonstrate how market-integrated batteries might address grid constraints.

HOW IT WORKS

deX makes DERs visible and dispatchable, allowing them to be contracted, aggregated and coordinated to provide electricity services.

It lists buyers and sellers, records agreements between them, manages event handling and verifies that both parties have met their agreed obligations.

Say you are a consumer, wanting to put solar panels on your roof and a battery in your garage. At the point of installation your household system will be connected to the grid and also to the deX.

The partnership announced on Thursday involves big and small industry players such as Tesla, Varta, Wattwatchers and Geli. Through these providers and the “internet of things” you’ll become part of the deX, a buyer or seller of energy depending on your needs and preference.

For many people this will operate similarly to a mobile phone plan. They will sign up with an energy retailer (such as AGL or Mojo Power) and pledge to make a certain percentage of their stored energy available if it is needed. In exchange they’ll get a financial bonus.

If demand spikes, for example due to hot weather, that electricity will be dispatched to help meet that demand, removing the need for expensive new infrastructure to be built and ensuring supply remains stable and the lights stay on.

WHO BENEFITS?

deX is designed to create a more efficient energy system for everybody involved.

Retailers – the companies who buy wholesale power and sell it to consumers (the guys who send you your monthly power bill) get an extra source of power, allowing them to hedge against sudden price spikes in wholesale energy prices. deX also allows them to offer new packages and products to their customers.

Network operators, such as United Energy and ActewAGL, benefit from a more secure system and access to a wider array of non-network power generating options. They also obtain power that comes with lower set up and maintenance costs. For them, the benefit lies in using distributed energy sources to provide power at times of high demand, allowing them to meet their service obligations in a cost effective manner.

Energy users (that’s both businesses and individual customers) can benefit in multiple ways. They can earn income from selling power or network support services. In addition, they can likely enjoy subsidies for installing rooftop solar and storage systems. In fact, we’re not really calling them energy users any more. In the world of deX, they are prosumers.

WAIT, WHAT’S THAT?

Prosumers are consumers who are also energy producers. They are people or businesses who are seeking greater control over their energy generation and usage but also want access to new revenue streams from participating in electricity markets.

SO, CAN I SELL ELECTRICITY TO MY NEIGHBOURS?

It’s a tantalising notion, being able to directly negotiate a price with other individual consumers and directly sell them the electricity you don’t need. While that capacity will be built into the deX system it  won’t be immediately available. There’s a chance this could be a feature of a beefed up future version somewhere down the line.

deX will create energy prosumers. IMAGE: Adobe.

HOW DID THIS ALL COME ABOUT?

deX is a direct result of ARENA’s innovative A-Lab approach, which gathers industry and technical leaders together several times a year and asks them to come up with creative solutions to constraints on the energy system and renewable energy generally.

deX is not just a success story for GreenSync, it’s also an achievement that ARENA feels some ownership due to it GreenSync’s involvement in an early pilot session for A-Lab, ARENA’s award-winning grid integration innovation lab.

At the first pilot session in mid-2016 ARENA convened a group of 30 industry participants to explore the theme of “consumer driven distributed energy markets in action”. The idea for deX was born.

GreenSync, along with United Energy, Mojo Power and several other participants developed an initial concept for a transactive grid platform. At a subsequent A-Lab incubate session ARENA’s team worked with representatives from GreenSync and other participants facilitate the development of the detailed design for deX, and the project received ARENA funding late last year.