Energy storage in Australia – a view from the ground as the market takes off

For the last ten years diesel prices have been increasing approximately 5% per annum in Australia, with many remote areas paying more than AU$2.50 (US$1.95) a litre for delivered diesel fuel. Add to this the cost of maintaining the generators, as well as the non-economic impact of noise and pollution on local communities, and the business case quickly stacks up for renewable energy coupled with energy storage in off grid Australia.

Australia’s King Island, located in the Roaring Forties of Bass Strait, off the north-western tip of the main island of Tasmania, has been using renewable energy for many years. Recently Hydro Tasmania created King Island Advanced Hybrid power station by integrating an Ecoult UltraBattery storage system, capable of 3MW of power contribution and storing 1.6MWh of useable energy, into the local network. The battery is the largest ever installed in Australia and will increase the amount of time the network can operate on 100% renewable energy.

Last year the Australian Renewable Energy Agency (ARENA) - an independent agency established by the Australian Government in July 2012 - announced funding for a range of hybrid energy and storage projects.  This included off grid generation and storage in 32 remote indigenous communities in the Northern Territory, as well as funding for research and development (R&D) into the longevity and cost effectiveness of storage technologies.

In another example, funding was made available to the Lord Howe Island Hybrid Renewable Energy System, 600km off the New South Wales coast. This project will add 1MW of renewable generation to their existing diesel power generation system through a proposed combination of 450kW of solar PV, 550kW of wind and 400kW of battery storage, along with stabilisation and demand response technology. The hybrid system is estimated to reduce the Island’s requirement for expensive shipped-in diesel by up to 70 per cent.

ARENA hopes this project will be used as an example for other remote communities in Australia to consider sustainable ways of generating energy.  

Australian mining companies are also looking at hybrid solutions including storage to meet their future energy needs. In many mining projects, over the life of the mining site, solar-plus-storage is proving more cost effective, than conventional diesel powered generation.  Work is being done across the sector to convince project developers to invest more upfront in these projects, but reap the savings across the life of the mine. Already some sites are beginning to test storage solutions, using solar with battery storage to help power operational lighting, we can expect that as they gain confidence with the technology, energy storage will be used in many more applications.

ARENA has also provided funding for a feasibility study into a solar thermal power station in remote Western Australia, which would include a solar thermal tower and a molten-salt energy storage system, potentially supplying power to an entire mining operation and the remote community of Perenjori. Results from the study are expected in April 2015.

In the iconic outback mining town of Coober Pedy in South Australia, another ARENA funded project is designed to meet 70% of the town’s power needs with a renewable energy /diesel hybrid project also integrating short term (duration) energy storage technology.

Dutch-headquartered Photon Energy has moved to the Australian rooftop PV market, and also diversified into working on the Muswellbrook communications tower project. Pictured is a Photon rooftop installation in Sydney. Image: Photon Energy.
Another useful case study is the application of energy storage in the communications sector.

Last year, I attended the system launch of the Australian communications infrastructure company BAI’s broadcast tower in Muswellbrook, in regional New South Wales.  Following an initial trial the facility is due to move from on-grid to going completely off grid. In an innovative project the broadcast tower will be run entirely on solar power coupled with advanced battery storage technology, with a small emergency generator to provide backup power in the event of rare climatic events.

With stringent operating parameters, providing reliable and consistent power supply in this application is crucial.

It is also an example of remote electricity customers taking themselves off-grid as grid costs escalate and cost-effective on-grid support cannot be guaranteed in the future.

The project managed by European PV developer and O&M specialist Photon Energy, in association with the German Energy Agency, Deutsche Energie-Agentur GmbH (dena) will demonstrate that remote communications infrastructure in Australia can successfully be moved off-grid, using a cost-effective and reliable system while meeting stringent operational regulations.

And if the Muswelbrook project partners’ cost projections are anything to go by, this and similar projects demonstrate that energy storage can enable fuel savings of between 40% and 60% in many remote base station installations and have a fantastic international market ahead of them.

Energy storage technology is ‘breaking through’ as the technology cost falls.  These early energy storage projects in Australia are crucial because they provide industry with the confidence that well-designed energy storage solutions are technically stable, can be relied upon in all conditions and make financial sense. 

We are at the starting point of a very exciting time as the energy market is transformed.

It is the biggest business opportunity I have ever seen….