South Australia | A record breaking transition to Renewable Energy

20 October 2017

A year has passed since South Australia and her population of 1.8M people were plunged into numerous state-wide power blackouts. Since then, remarkable political jaw boning and even more unique investment decisions have doubled down on efforts to enhance the State’s wide portfolio of battery storage and renewable energy projects.

The State is being recognised as a global sector leader with case studies to emulate across 1,515 MW of solar generation and 3,178 MW of new wind generation projects committed or proposed as at July 2017. This momentum extends the already 48%+ of current total energy production derived from wind and solar initiatives.

Furthermore, the commerciality of these projects have positioned South Australians to have the cheapest power prices in the country in as little as six months. With an objective to have every newly constructed energy facility to produce and deliver power at price < AUD $80 /MW, the $8 billion State investment and 4,500 job creation could not come soon enough for households. The National Electricity Market indicates that South Australia was hit by a 76% increase in average wholesale electricity prices from $61.67 /MW in FY2016 to $108.66 /MW FY2017.

Small Scale Performance

The November 2017 Australian Energy Market Operator (AEMO) report highlights that 9.2% of the electricity generated in South Australia for the last financial year came from small-scale (sub 100kW) of solar PV on the rooftops of households and businesses. That level of rooftop solar penetration could be regarded as a record for any major global grid.

With annual rooftop PV solar installs up across the State by ~47%, this is a direct response to a ~30% likelihood production shortfall of up to 243 MW or approximately a four hour State-wide Unserved Energy deficit. With that factor of PV uptake, AEMO conservatively suggests that by 2025, rooftop solar could generate 2,500GWh a year or 22% of total State demand.

However, the rate payers of South Australia are still disgruntled and in a tight waiting game as the 1,515 MW of solar generation and 3,178 MW of new wind generation projects that are either committed or proposed in South Australia are yet to transmit.

Supply Breakdown: South Australian Local Electricity FY2017

Local Generation Generation in GWh Share of Total
Gas 5,596 50.5%
Wind 4,343 39.2%
Coal 0 0.0%
Rooftop PV 1,016 9.2%
Diesel and small non-scheduled generation* 122 1.1%
Combined Interconnector Flows Flow in GWh  
Imports to South Australia 2,889  
Exports from South Australia 164  

Source: AEMO, November 2017. * Small non-scheduled generation is approximate, and is based on a larger list of generators than in the 2016 SAER. It includes data from selected non-scheduled generators less than 30 megawatts (MW) capacity, including PV non-scheduled generation.

Battery Innovation

Tesla’s World Record

The September 2016 black system in South Australia highlighted the extreme challenges faced when optimizing a generation mix. While AGL’s announcement to build a 210 MW gas-fired generator at Barker Inlet Power Station and the State’s own gas powered generation were welcomed to ease pressure of Interconnection upgrades, it was US-based Tesla’s energy storage commitment to the Premiere that gave the State worldwide attention for its renewable energy transition.

In July 2017, Tesla had been accepted to deliver by a tight self-imposed and promised 100 day schedule, a 100 MW (129 MWh) lithium ion battery storage capacity to be paired with the existing 309 MW Hornsdale Wind Farm. The project is 85%+ complete and on track to be switched on in time for the December 1st deadline and the onset of the Australian peak summer demand.

Approximately 70 MW of the capacity will be allocated to the State Government to stabilise fault or outage scenarios while other infrastructure laggard is brought into service. The other 30 MW is to be used by Neoen (Hornsdale owners) to “time shift” renewable energy i.e. battery stored at low wholesale prices and exported when prices at high.

It is worthwhile to note that if the adjacent wind farm cannot produce energy during unfavourable weather conditions, the battery does not sit idle but will charge from the grid itself when opportune.

Whyalla Steel

As a response to skyrocketing commercial energy prices for the GFG Alliance owned Whyalla Steelworks operation, the Company acquired Zen Energy to build 1 GW of renewable and storage capacity to slash energy costs across the steel group operations by 40%.

The battery storage will use control technology from the US-based Greensmith and the installation paired with a pumped hydro storage facility in a disused iron ore mine.

The steelworks will look to extend upon the initial South Australian implementation with a further varied energy type mix, scale and storage to cover 100% renewable power to serve the Company across its other plant operations in Melbourne, Sydney and Newcastle.

Port Augusta – Hybrid

Irish company DP Energy has major hybrid energy plans for Port Augusta with a two-phase roll-out totalling 450 MW solar PV, 225 MW wind and 400 MW battery. Whilst the project has not been confirmed, Downer Group and Vestas have been indicated as the preferred contractors.

While the development application for the second stage will be filed soon, the combined power production has density comparison to a fossil fuel facility, although having a far more dynamic transmission, minimal emission and at a cheaper price.

Spencer Gulf – Pumped Hydro

Energy Australia with consortium Arup Group and Melbourne Energy Institute were awarded by Australian Renewable Energy Agency (ARENA) to partially fund a feasibility study for a new pumped hydro energy storage project utilizing seawater. A detailed engineering design, complete environmental impact assessment, grid connection and land access arrangements will be released to assist a final investment decision planned for announcement in the second half of 2018.

The proposed project would have the capacity to produce around 100 megawatts (MW) of electricity with six-to-eight hours of storage and reliability that does not rely on river or flowing water. With pumped hydro, water is pumped from a lower reservoir to a higher one when energy is cheap.

Wattle Point at Dalrymple Substation

This 30 MW battery storage facility is on track to be delivered by May 2018 and will be operated by AGL and contracted to perform grid services to ElectraNet. With support by ARENA’s large scale infrastructure finance function, a co-investment of AUD $12M will be made to the $30M total project cost.

Construction has been awarded to Adelaide company Consolidated Power Projects who will work with international power company ABB and battery provider Samsung to deliver the project.

The regulated network service will improve reliability for the southern Yorke Peninsula region (population of 25,000+) by supplying ~2 hours power in low reserve conditions by Heywood interconnector constraints but will also provide much longer supply when sufficient renewable generation is found from Wattle Point wind farm and local PV.

Generation Investment

These renewable project examples in South Australia by both private investment and public policy are encouraging the restoration of sustainability to the region’s energy supply mix.

These actions will assure the State of its influence as a participant in the National Energy Market, improve forecasting to mitigate islanding, improve a system restart process and ultimately satisfy capacity that also allows for hardware upgrades and secondary systems.


About: empicial pi is a boutique professional services group providing multi-disciplinary, cross-sector advice. In conjunction with market leaders, empirical pi takes pride to deliver independent and unanchored considerations that are always actionable to propel strategies for local, national and international arenas.

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