17/06/2020 - 16:54

Call for reform of $17m solar scheme

17/06/2020 - 16:54

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Moving to a flexible price for rooftop solar output will help alleviate pressure on the grid from increasing uptake of the panels, according to a new report, and could be used instead of subsidy schemes currently proposed.

Call for reform of $17m solar scheme
Jemma Green is chair of Power Ledger. Photo: Attila Csaszar

Moving to a flexible price for rooftop solar output will help alleviate pressure on the grid from increasing uptake of the panels, according to a new report, and could be used instead of subsidy schemes currently proposed.

Regulators are grappling with a big problem as rooftop solar panels become increasingly popular.

During daylight hours, electricity production from the panels reduces demand from centrally dispatched generators.

The impact is so substantial that it risks demand in the main Western Australian power grid sometimes falling below safe operating levels within four or five years.

When the sun begins to set, demand dramatically increases as the panels are no longer able to provide power, a challenge which also has technical impacts on traditional generators.

Power Ledger chair Jemma Green told Business News the state government should move from a solar feed in tariff at the existing level of 7 cents to a dynamic price set by market forces.

Dr Green authored a recent paper which analysed a peer to peer energy trading scheme trialled in Fremantle, supported by Power Ledger’s software.

“Renewables, not just in WA but generally, particularly solar, are causing problems in the grid,” Dr Green said.

“There’s too much solar in the day.

“The Australian Energy Market Operator said they may need to turn off rooftop solar in (extreme) instances.”

In some countries, the feed in tariff has been abolished, although a similar move in WA met political resistance.

The state government has assessed a variety of proposals to smooth the impact of solar on the network.

Options included subsidies for household batteries.

More recently, Western Power announced its 100 Megawatt Industry challenge, which will incentivise businesses to alter demand levels during the day, when the grid has excess power.

Work in the state’s Distributed Energy Roadmap paper estimated the cost of the feed in solar scheme continuing to operate in its existing form would be $17 million in the 2020 financial year.

The cost will increase as take up of the panels grows.

Dr Green said a dynamic feed in tariff would be a less costly option than a subsidy.

It would provide a price signal for users to invest in storage, she said, and encourage load shifting.

“If instead of feed in tariff subsidies, there was cheap peer to peer energy available, this could encourage load shifting and thereby support distribution network and reverse flow issues,” Dr Green said. 

“This would negate the need for further subsidies to encourage greater demand for electricity when the sun is shining.

“Solar peer to peer electricity priced cheaply and correctly can deal with reverse energy flows without any subsidy.”

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