Australian power company AGL is to install the largest ‘virtual power plant’ in the world in Adelaide, South Australia using batteries from San Francisco-headquartered energy storage firm Sunverge Energy.
AGL will install 1,000 centrally controlled batteries in South Australian homes and businesses with a combined 5MW/7MWh storage capacity. The AU$20 million (US$15.4 million) project aims to help solve the state’s grid challenges and reduce the risk of power price shocks in the state. Last month saw a raging national debate over whether renewables had caused extreme electricity price hikes in the state with some claiming that renewables are being deployed too fast for the grid to cope. However new energy minister Josh Frydenburg said that there were a number of complex factors in the price hikes with renewables only a small part of the problem.
AGL has selected Sunverge batteries and control systems for phase one of the project. Sunverge received an ARENA-backed investment boost and its batteries are also being trialled in Queensland by Ergon Energy.
The Australian Renewable Energy Agency (ARENA) has conditionally committed up to AU$5 million funding for AGL's South Australia project.
ARENA chief executive Ivor Frischknecht said: “When small-scale batteries work together they become more than the sum of their parts. AGL plans to operate the batteries as a kind of virtual power plant, installing them alongside solar PV and linking all 1,000 systems with centralised monitoring and management software.
“The result is like adding a 5MW power station that can quickly deliver enough energy to power 1,000 South Australian homes where and when it’s needed most. This approach can ease local network constraints, displace gas power and complement the Victorian interconnector, especially during times of peak demand.”
Frischknecht added that the batteries make solar and storage more competitive and that the project could act as a catalyst for regulatory changes to allow for more virtual power plants in the country.
Virtual power plant
The virtual power plant uses cloud-based software to operate separate energy storage systems in unison to meet peak energy demand across an entire community or service area, helping consumers utilize their own rooftop-generated solar or stored solar power during peak demand periods and reduce their power bills.
Multiple storage systems acting together help to strengthen the grid and provide long-term bill reductions for consumers.
The project will be rolled out in three phases over 18 months. In the first phase up to April 2017, the first 150 customers in metropolitan Adelaide will be eligible to purchase a discounted Sunverge SIS 5kW / 7.7kWh energy storage system for AU$3,500, which includes hardware, software and installation. Solar customers are expected to achieve a seven–year payback period.
Later phases will see an offering to narrower zones within metropolitan Adelaide where peak demand management and other network support services can be demonstrated.