Problem of Solar Plenty in Australia As Regulator Considers Two Way Pricing

Problem of Solar Plenty in Australia As Regulator Considers Two Way Pricing

Australia, where rooftop solar PV has been a huge success, with rooftop solar nudging past the 13 GW mark earlier this year, faces a touch new choice on keeping the momentum up.

The Australian Energy Market Commission (AEMC), in a draft  paper, has proposed offering two-way pricing to address the issue of network congestion on the national grid. That means giving distribution networks power to price power they take from rooftop owners flexibly. The regulator has taken care to highlight that this would by no means be a given, as the pricing changes would be made after due consultation. And will run both ways, ie, rewarding potential owners for sending power when it is needed, and possibly lower prices when power demand is not really high. The AEMC will take feedback on the proposals till May 13th

Riding on the back of a strong 2020 performance when 2.60 GW was added on rooftop solar, Australia has been grappling with issues of managing all the new intermittent power on its grid. Battery storage was seen as one option, combined with variable pricing, but the grid operators have also been early adopters of large batteries, as one way to control volatility. Large utility scale projects in the country have increasingly looked to a Hybrid, or large battery model, to get more out of renewable energy.

To that extent, the regulator hopes that the new system, if implemented, would further drive battery usage, as consumers look to control their output to the grid by consuming more of their own generated power.

It is important to stress here that the argument here is nothing like the argument between net metering and gross metering in India. The tiny 10 Kw limit for net metering that has been proposed for India is already discourages smaller firms to reconsider their solar plans. Plus, in the Australian case, the variable pricing is not a default option, it is meant to be used in periods when there is effectively surplus power.

That might explain just why tiny Australia (in terms of population) has a solar rooftop segment that is more than twice as large as India.  Renewable growth has already placed many coal based power plants at risk of closure by 2025, ahead of schedule, in soma cases.

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Prasanna Singh

Prasanna has been a media professional for over 20 years. He is the Group Editor of Saur Energy International