The Australian Energy Market Commission (AEMC) last week announced that Australians could soon be charged for exporting solar to the grid to help cope with electricity “traffic jams”.
So, what are these jams and is charging solar owners the only option to fix the problem?
What are electricity traffic jams?
Australia’s electricity grid has traditionally operated on a one-way power delivery system, where big energy generators like coal-fired power and hydroelectric plants deliver electricity via poles and wires to homes and businesses.
But with the uptake of rooftop solar photovoltaics (PV), electricity is now not only being taken from the grid to the home, but is also being injected back into the grid.
This is fine up to a point, but if too much power is put into the grid it can push the voltage too high, according to electrical and information engineer Gregor Verbic from the University of Sydney.
This is already starting to happen in some places where there has been a lot of solar PV uptake.
“When you feed more power into the grid than is used, this can raise voltages in the network,” Associate Professor Verbic said.
“Many networks in the country have reached a point where during the middle of the day the voltage gets too high, and inverters start tripping to prevent damage.”
The problem here isn’t just for houses that have solar panels and inverters, but also for transformers on the grid, according to grid integration researcher Marnie Shaw from the ANU’s Energy Change Institute.
Transformers take high-voltage electricity that is transported long distance in high-voltage power lines, and step it down to the 240 volts that we use in our households.
“[High voltage] is an issue for transformers on the grid,” Dr Shaw said.
“They’re only rated for a certain power flow.”
In extreme cases, feeding too much electricity into the grid can cause the flow of power to reverse, which creates instability, Dr Shaw said.
So what happens to the solar-generated electricity if it’s not being exported to the grid or used to power appliances or charge batteries?
It simply isn’t generated. This is because a solar panel doesn’t push electricity towards a battery or other device; the battery sucks the electricity from the solar panel.
Because there’s nothing using the flow of electrons generated by the solar panel, the solar panel generates no electricity.
What are the possible solutions to peak solar?
In some instances, solar PV owners are already suffering the consequences of the grid being ill-equipped to deal with high solar input.
Some electricity exports from houses to the grid have been completely stopped or throttled, according to Dr Shaw.
“People are connecting solar, but they can’t export at all, or the solar exports are being curtailed at certain times of the day,” she said.
“That’s unfair for people who have already purchased solar and some solar owners are already paying for this unclear practice [through being unable to export].”
But there are a number of other longer-term options available to deal with too much solar feeding into the grid.
The first is to change our energy usage to marry up with peak periods of solar energy generation.
That means where possible, using things like pool filters, washing machines, dryers and other energy-intensive appliances during the middle of the day.
As Australia’s uptake of electric cars increases, they can also be used to soak up excess power during this time.
The advantage of this approach is that this time of the day is also when energy tends to be cheapest, and so it doubles as a cost-saving measure for households.
The disadvantage is that it’s not always an option for people who may not be at home during those periods.
It’s also not a catch-all solution because solar energy isn’t consistent – the amount of sunlight can vary significantly from one day to the next depending on cloud cover.
Poles and wires or batteries?
Another option is to upgrade our electricity grid infrastructure, Dr Verbic said.
“If you replace the existing wires with thicker ones, the over-voltage is no longer an issue,” he said.
“But reverse power can still be a problem. This can be dealt with by replacing protection systems in the transformers.”
This is a more expensive approach that offers a blanket fix for something that is only really a problem during the middle of the day.
Batteries are a third option that can help evenly distribute power across the day by absorbing it at peak generation periods and releasing it when our power demand is highest.
Again, batteries require financial investment, but they can earn individual households, community investors or councils income by selling to the grid when prices are high.
An electricity distribution model called the local use of system tariff (LUOS) can be used in conjunction with batteries to reduce power costs for people without batteries or solar.
Under this system, electricity users pay less for power generated locally, according to Dr Shaw.
“You pay less for energy used closer to the source,” she said.
“It would be cheaper for households that don’t have solar to buy energy from houses that do. And it would be cheaper for local houses to buy energy from a local battery.”
There are plenty of solutions, according to Dr Shaw, and it’s about adapting to a changing situation.
“It’s about trying to capitalise on this fantastic resource – it’s actually the world’s best problem to have.”
‘Smart’ rooftop solar that can regulate export amounts
A further option is to regulate how much energy is exported into the grid at different times of day from each rooftop solar unit, using a mechanism called a “dynamic operating envelope”.
It works like this: every day, the electricity distributor says how much solar can be exported to the grid for each five-minute block of time for the next 24 hours.
This is based on the risk of the network being put under stress, due to a combination of a high supply of rooftop solar power and low demand.
For example, if it’s forecast to be a sunny autumn day but not hot enough for people to turn on their air-conditioners, the risk of congestion may be high.
The distributor then sets the solar export limit to a low figure – at least for the hottest hours of the following 24 hours.
Household solar inverters automatically download and implement this limit.
South Australia, which has a high uptake of rooftop solar, is already implementing such a system as the “Smarter Homes” initiative.
This requires all newly installed rooftop solar systems to have inverters that can be instructed to stop exporting energy to the grid.
From later this year, they will be required to have the ability to regulate the amount of energy they export – a dynamic operating envelope mechanism.
What has it cost to set up this smart system? Relatively little compared to the money spent every year on maintaining and upgrading distribution networks, said Gabrielle Kuiper, a distributed energy resources expert and guest contributor with the Institute for Energy, Economics and Financial Analysis.
South Australian Power Networks (SAPN), the sole electricity distributor in South Australia, will spend $3.9 billion on the state’s grid for 2020-2025.
In that same period, Dr Kuiper said, SAPN will spend an estimated $32 million to roll out flexible export limits as a standard connection service in the state.
That is, building a system to flexibly manage rooftop solar exports is costing less than 1 per cent of ongoing expenditure on the grid.
“It’s certainly not costly to change the system,” Dr Kuiper said.
“The problem of solar rooftop congestion is being blown out of all proportion.
“Flexible export limits would basically manage the grid in a much smarter way and people would export a lot more.”
But they are not the whole solution, warned Bryn Williams, the Future Network Strategy Manager at SAPN.
As more rooftop solar is added to the grid, the dynamic export limits for each unit will gradually be set lower and lower, he said.
“The benefit of having dynamic operating envelopes is we can run the grid closer to capacity, but at some point that capacity will be used up,” he said.
Eventually, the network has to upgrade the capacity of the infrastructure itself by installing higher gauge wires or higher-voltage substations.
How will the proposed tariff fix the problem?
Under the AEMC’s proposal, networks would impose pricing mechanisms to encourage households to not export rooftop solar at moments of low demand and high supply, when the grid is congested.
It would do this by charging them in the range of two cents per kilowatt-hour in moments of high demand.
The AEMC’s modelling shows a typical solar household may lose $70 of a $970 annual benefit from having rooftop solar through the reforms.
The tariff may eventually solve the problem of congestion by encouraging people to invest in batteries or use more power during the hours of the day when their rooftop solar is generating at its highest rate, says Professor Renata Egan, director of UNSW’s Australian Centre for Advanced Photovoltaics.
But Professor Egan said it would take a long time for the tariffs to have any impact, as most people don’t know what export tariff they’re on anyway.
“The average end consumer has next to no interest in tariff optimisation,” she said.
“And they have low levels of trust for energy distributors.
“It would be a very slow process of implementing widespread optimisation.”
She said having a system that flexibly managed rooftop solar exports, like South Australia’s, presented a far better option.
Dr Kuiper warned that the “worst possible outcome” of the AEMC’s rule change would be for households to disconnect from the grid, creating an “energy death spiral” in which more and more people disconnect and leave the cost of maintaining the network to a dwindling number of remaining households.
“We want to optimise the benefits of people’s private investment in rooftop solar,” she said.
“We want people who have solar to export to people who don’t have solar.”
But Mr Williams said the public outcry over the AEMC’s proposal was overblown and that tariffs were “extremely complementary” with the “dynamic exports” project SAPN is in the process of rolling out.
He said the rule changes would ultimately allow the networks to upgrade their infrastructure in order to better serve the needs of rooftop solar owners.
“We’re very supportive of the AEMC’s rule changes,” he said.
“They’re extremely complementary with having flexible export limits.”
How do other countries approach this problem?
For her Churchill Fellowship in 2017, Dr Kuiper travelled to North America and Europe to study how countries there managed the transition away from having grids built around large centralised power stations.
She concluded that, despite lagging on climate in other ways, Australia was leading the world in innovation around rooftop solar.
“Yes, we can learn things from overseas, but Australia is really at the forefront,” she said.
This is partly because rooftop solar is so popular here.
Australia has more solar panels and more watts of rooftop solar per person than any other country in the world.
The generating capacity of all the rooftop solar in Australia added together is larger than any single power plant in the country – and growing larger every day.
Australia’s vast land mass also means it has much to gain from innovating with rooftop solar and other distributed energy resources, rather than sticking with centralised power production, she said.
“People talk about distributed energy resources and they’re often characterised as distributive energy problems, but they’re actually opportunities,” Dr Kuiper said.
“Today’s energy transition is equivalent to when the steam turbine was invented.
“It’s just different technology and adjustment is needed.”
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