Australian Utilities Cozy Up to Home Storage: ‘If We Don’t Respond, Someone Else Will’

Australian utilities are moving to combat the threat of revenue loss from residential energy storage by opting to supply batteries themselves. Three companies -- Red Energy, Ergon Energy and ActewAGL -- announced trials offering Panasonic battery systems.

“Our customers are already showing interest in this technology, and if we don’t respond to what our customers want, someone else will,” said ActewAGL CEO Michael Costello.

The Australian Capital Territory utility, which already has more than 15,000 residential installations in its catchment area, expects to start offering the systems this October.

“The trial will validate batteries as a product offering in the Canberra environment and evaluate the product functionality,” Costello said.

He confirmed ActewAGL had been working with Panasonic for two years “on how to make a trial of battery energy storage in Canberra a reality.”

Panasonic, which last year won the contract to supply Tesla’s Gigafactory in the U.S., is said to be keen on using utilities and retailers as a channel to the residential market, rather than selling direct to homeowners.

The battery maker expects to launch in Europe with a similar model, beginning with Germany. For the Australian market, the company is offering a 2-kilowatt, 8-kilowatt-hour lithium-ion battery suited to 5-kilowatt solar arrays.

As previously reported, there is growing interest in such systems across Australia, as a result of high electricity prices and problems with getting new grid connections. Some utilities have fought back by supporting measures to cut the spread of solar.

One of these is Ergon, which last year introduced large energy user demand charges that were viewed as a disincentive to install solar. For its residential customers, however, Ergon appears to have adopted an ‘if you can’t beat them, join them’ approach with Panasonic.  

At ActewAGL, the introduction of battery storage might be advantageous beyond simply keeping residential customers on the books.

“Battery storage will help minimize the capital investment required on our network to manage the few weather events that cause peak demand issues throughout the year,” said the company in a press release.  “This will help reduce network charges and benefit customers through lower energy prices.”

Costello is pretty clear that this is really about keeping residential customers happy, though. “There are many different benefits for our customers,” he said. First, they can generate their own renewable energy from the sun, without having to rely on coal-fired power. The other main benefit is customers will be able to access the full value from solar panels on their roof by storing excess generation for use at nighttime.”

A recent report by the Australian Clean Energy Council stated that 1.4 million households in Australia now have solar power, although installations dropped 8.5 percent in 2014.

Last year was considered a particularly tough one for renewable energy in Australia, as the government moved to cut the country’s targets for large-scale installations.

“The review of the RET stalled investment in large-scale renewable energy such as wind and solar power in 2014, with investment falling by 88 percent,” said Clean Energy Council chief executive Kane Thornton in a press statement.

Concern over the outcome of RET negotiations was put to rest this month after the opposition Labor Party agreed to a cut in the target, from 41 gigawatt-hours of annual renewable energy production to 33 gigawatt-hours by 2020.

The agreement has been credited with providing needed long-term stability to encourage further renewable energy investments, although the Australian Solar Council has come out against the cut.

“This is still a bad deal for Big Solar,” said the industry body. “The Solar Council calls on all political parties to commit to at least 50 percent renewables by 2030.”

Given that the RET is largely irrelevant to residential customers, these deliberations will likely have little impact on household solar installations apart from the impact they could have on grid electricity prices.

Australian utilities appear to be increasingly aware of this fact. What remains to be seen now is how much the lure of solar plus storage will entice homeowners to stay with their current energy supplier. 

Source: http://www.greentechmedia.com/articles/read/australian-utilities-cozy-up-to-energy-storage