Renewable Energy: 7 Lessons from South Australia

 

The state of South Australia is a global leader in the use of renewable energy. The use of renewable energy will play a crucial part in helping the world hit the targets set at the Paris Climate Agreement to tackle climate change. The progress made by South Australia could help the rest of the world find a faster route to a successful energy transition, according to a report from the Institute for Energy Economics and Financial Analysis (IEEFA).

World Economic Forum has picked seven takeaways from A Grid Dominated by Wind and Solar Is Possible, South Australia: A Window into the Future report.

 

1. Most - and sometimes all - annual demand can be met by wind and solar

The South Australia state government set a 2020 target of getting 26% of the state’s energy from renewables. It smashed that goal, with renewables delivering 60% of its energy needs. In October of that year, 100% of the state’s energy came from solar sources – just for one hour, but it was impressive.

Key to its success has been a commitment to a mix of renewable sources, the IEEFA says. “South Australia therefore provides valuable lessons for the rest of the world, showing what is possible with variable renewable energy (VRE) and distributed energy resources (DER) integration.”

2. Renewables adoption can be driven by government policy and market features

South Australia is known for its sunshine and reliably strong winds. But having a lot of sun doesn’t automatically mean a lot of solar power. For that, there needs to be the right legislative processes in place. The Australian federal government introduced its Renewable Energy Target (RET) in 2001, along with a Renewable Energy Certification scheme aimed at encouraging new installations. “Many early projects incentivized by RET were installed in South Australia as the market was attractive to investors and developers,” the IEEFA report says.

3. Ambitious plans can spark economic growth

The South Australian government has set its sights on producing 500% of its energy from renewables by 2050 and becoming a net exporter of greener power.

The neighbouring states of New South Wales and Victoria are among its intended targets, IEEFA says, with additional plans to export “green hydrogen, green steel and other low emissions products internationally”.

4. Renewables can help deliver sub-zero wholesale electricity prices

Wholesale electricity prices for South Australia were the lowest in the Australian National Electricity Market in the final quarter of 2020. So low that the price of electricity fell to minus-$9 per megawatt hour (MWh) between 10am and 3.30pm during the first quarter of 2021.

Image: AEMO

5. Renewables grids can deliver system reliability and security

“Overall South Australia has met its reliability standard for the past 15 years,” IEEFA says. The only exception was in 2008-09 when “extreme temperatures in Victoria and South Australia reduced the availability of the interconnector between the two states”.

Continuing to maintain supplies will mean having an infrastructure that can accommodate a larger number of generators and the distributed nature of energy resources, the report says. It cites 253 occasions when the Australian Energy Market Operator had to intervene in the market during 2019-20 (compared to 153 times in 2018-19) to direct “synchronous generators to maintain the system in a secure operating state”.

6. Batteries can support system reliability and energy security

South Australia has four grid-scale batteries on-stream and two more being built. This includes the world’s largest battery energy storage system, according to IEEFA – the Hornsdale Power Reserve (Tesla).

The report describes the Hornsdale battery as “a technical success, helping to keep the lights on when faults have occurred in the grid”. IEEFA also points out that the site has recouped its capital cost in just over two years of operation.

7. Distribution networks can adapt to support rooftop solar

An estimated 40.3% of households in South Australia have rooftop solar panels. To ensure their safe and effective incorporation into the grid, the ebb and flow of electricity across the distributed network must be carefully managed.

Last year, South Australia introduced a regulation to enable operators to remotely disconnect rooftop solar inverters. IEEFA however recommends the use of dynamic operating envelopes or DOEs. “DOEs allow distributed energy resources to import and export within the constraints of distribution networks on a five-minute basis, set 24 hours in advance,” IEEFA says.

 

South Australia was a region that relied 100% on fossil fuel as recently as 2006. But now it closed its largest coal-fired power station while supporting the workers back into employment through funding a solar-powered greenhouse that employs 220 people. It fast-tracked wind farms in rural areas and offered residents a $3,000 subsidy for a solar energy battery. It also built the world’s largest grid-scale battery storage system and supported green power plants with big contracts. With these measures, South Australia smashed its green energy goals and now has one of the world’s greenest energy systems.

What is Malaysia doing to cut CO₂ emissions? Could we not learn from this Australian experience?

 

Reference:

7 renewable energy lessons from South Australia, World Economic Forum, 14 Jun 2021