Shell Energy – Community Hubs Project

Summary

Need

In contrast to residential and utility scale battery storage, distribution network scale storage market remains in early stages of development, with only small volumes deployed. Community batteries are a promising solution to enable the storage of distributed renewable energy for later use, reduce distribution network constraints, and help put downward pressure on electricity prices.

As such, the October 2022 Federal Budget provided $200 million for the community batteries for Household Solar Budget Measure to deploy 400 community batteries across Australia. The batteries deployed in this project will contribute towards this.

Action

Shell Energy will deploy 10 behind-the-meter community batteries at various customer sites across Sydney and regional New South Wales. The community batteries will be sized between 250 kW and 1500 kW, and have a total capacity of about 8,500 kW and 18,190 kWh. The batteries will be located within Shell Energy customers’ premises. They will be connected behind-the-meter to the local distribution network to provide multiple services such as peak shaving, frequency regulation, voltage support, solar soak, wholesale market participation, and renewable energy integration, to the customer, the network, and the market.

The Project has three main objectives:

1. To demonstrate the feasibility and benefits of community battery projects and share the learnings and outcomes with the industry;
2. To develop and implement a viable business model for mid-scale battery storage that is scalable in various sectors; and
3. To foster community and industry collaboration and capacity building to support the growth of the community battery storage asset class.

Outcome

The project aims to commercialise community batteries and close the current commercial gap by improving cost-effectiveness, increasing revenue opportunities, and encouraging customer investment to ensure sustainability without long-term government aid.

The objectives will be achieved through the following outcomes:

1. 1. Increase in the value delivered by renewable energy by improving the economics of community battery projects through the reduction in, or removal of, barriers to large-scale deployment;
   2. Increased skills, capacity and knowledge relevant to renewable energy technologies by building industry capability to deploy community batteries at scale;
   3. Increase in the value delivered by renewable energy by:
      1. Helping put downward pressure on household electricity costs;
      2. Contributing towards lowering emissions;
      3. Providing a net benefit to the electricity network, having regard to matters such as network constraints; and
      4. Enabling storage of distributed solar energy for later use or sharing and supporting further distributed solar installations