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ISSUE 3 · September 2018 · www.energymagazine.com.au

Solar, batteries, microgrids:

THE FUTURE WILL BE DISTRIBUTED

INTEGRATION: THE GREAT LEAP FORWARD

FOR RENEWABLES

NUCLEAR CAN SOLVE THE ENERGY TRILEMMA

Wind’s breezy future

WITHIN REACH


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ISSUE 3—SEPTEMBER 2018 WELCOME

ISSUE 3 · September 2018 · www.energymagazine.com.au

Solar, batteries, microgrids:

THE FUTURE WILL BE DISTRIBUTED

INTEGRATION: THE GREAT LEAP FORWARD

FOR RENEWABLES

NUCLEAR CAN SOLVE THE ENERGY TRILEMMA

Wind’s breezy future

WITHIN REACH

Cover image features wind turbines, highlighting our features on wind energy and the All-Energy Conference.

5,867 1 October 2017 - 31 March 2018

Published by

Monkey Media Enterprises ABN: 36 426 734 954 PO Box 1763 Preston South VIC 3072 P: (03) 9988 4950 F: (03) 8456 6720 monkeymedia.com.au info@monkeymedia.com.au energymagazine.com.au info@energymagazine.com.au ISSN: 2209-0541

Editor Laura Harvey Senior Associate Editor Jessica Dickers Associate Editors Lauren Cella Charlotte Pordage Journalists Elisa Iannunzio Lauren Butler Digital Marketing Manager Sam Penny Business Development Manager Rima Munafo Marketing Assistant Helena Brace

EDITOR’S WELCOME

I

n the past three months, we’ve been inundated with reports and inquiries into the current state of the energy industry. Everyone from the Australian Competition and Consumer Commission to the Australian Energy Market Operator, the Australian Energy Market Commission, the Energy Security Board and the COAG Energy Council have had their say on where we’ve gone wrong, and what we need to do to fix the industry. Faced with a multitude of evidence, opinion and political commentary, it’s been difficult to know who to believe – or more importantly, to decide how we can best come together and move forward. One thing I think we can all agree on is this: the time for reports is over. Just about everyone who could potentially weigh in has had their say. The facts have been laid before us, and we now have the basis to establish the best path forward. But more importantly, the time for political point scoring is over. If nothing else is taken away from the various reports that have been tabled in recent months, let it be this – we will not solve the energy trilemma without a bipartisan approach to energy policy. Ultimately, we all want the same thing. The conjecture is how we achieve it. Let’s put it bluntly: it’s time for our governments to grow up, come to the negotiating table and agree on a fair and just energy policy that will achieve the best outcomes for our people, our productivity and the planet. That is the challenge currently facing our federal and state government ministers. Will they rise to meet the challenge? Time will tell. But with a federal election year looming, it’s becoming increasingly clear that energy policy is going to remain front page news for a while to come.

In the meantime, we need to remember what lies at the heart of our industry – and that is the customer. We must remember, they’re not interested in these increasingly politicised reports. What they do care about is working towards a solution that results in power that is clean, affordable and reliable. This issue of Energy is full of stories from companies and individuals who are working to provide their customers and broader stakeholders with innovative energy solutions. The political landscape might feel gloomy, but there’s still so much we can do as an industry to tackle the challenges we’re currently facing head on. We’ve had our time to have our say. Now’s the time to come together, with a unified voice, and provide the solutions our customers, large and small, are so desperately seeking. Laura Harvey Editor

Production and Customer Service Erin Foster Senior Designer Alejandro Molano Designer Aileen Ng Publisher Chris Bland

We’re keen to hear your thoughts and feedback on this issue of Energy. Get in touch at info@energymagazine.com.au or feel free to give us a call on (03) 9988 4950.

September 2018 ISSUE 3

1


CONTENTS NEWS 6

ACCC puts electricity under the microscope

6

Northern Gas Pipeline construction complete

7

Storage solutions to stabilise the grid

8

New technology to increase solar exports

10 Construction begins on Grandville Harbour

Wind Farm

EACH ISSUE 1

FROM THE EDITOR

4

CONTRIBUTORS

80 FEATURES SCHEDULE 80 ADVERTISERS’ INDEX

10 Australia's first hydrogen innovation hub

announced

12

28

INDUSTRY INSIGHT

ALL-ENERGY

RENEWABLES

12 Making it work: Generating and retailing in the new energy paradigm

20  Record-breaking renewables:

28  Selecting the right foundation

24  Scalable, modular and efficient solar diesel hybrid power generation

30  Renewable energy scheme for

16 Moving with the currents of energy change

18 How did energy get so off course?

2

20

September 2018 ISSUE 3

year in review

for ground-mounted PV panels

Tonsley tenants

26  Australia's renewables leaders to gather in Melbourne

www.energymagazine.com.au


CONTENTS

32

40

46

DISRUPTION

MICROGRIDS

ASSET MANAGEMENT

32 The customer-led challenge of

40  The future will be distributed

46  The fundamental priorities for

planning for disruption

34 The ongoing benefits of

Victoria's smart meter rollout

38 Smartly securing your grid

GAS PIPELINES 44 Jemena and Senex fast-track domestic gas

from cyber attacks

52 MARKETS 52  Securing the future for renewables

56 Cyber security a vital link for

energy networks

pace with the rate of change

50  Securing executive support for mobile technology

70

ASSET INSPECTION AND DRONES

WIND

60 Drone autonomy for improved

DISTRIBUTED GENERATION

NUCLEAR ENERGY

forward for renewables

68 Orchestrating renewable

70 Wind energy: a breezy future within reach

power pole inspection

64 Integration: the great leap

www.energymagazine.com.au

48  Asset management: keeping

60

SECURITY

asset managers

74 Nuclear can solve the energy trilemma

77 Energy innovation hubs and

nuclear power

generation into the grid

September 2018 ISSUE 3

3


CONTRIBUTORS

Ed McManus

CEO, Powershop Australia and Meridian Energy

Ed McManus became the Chief Executive Officer of Powershop Australia in January 2016. In this role, Mr McManus is driving a unique service that gives customers transparency and control like they’ve never had before over a key part of their household budget – their energy bill. With a strong and growing customer base, Powershop powers more than 100,000 households and businesses from across Victoria and New South Wales. Mr McManus is excited by the challenge of trying to make a connection with customers in an industry where trust is currently low. But it’s also the idea of being a part of a business that strives to have a positive impact on the future of the planet that pushes him daily.

Mark Butler

Federal Shadow Minister for Climate Change and Energy

Mark Butler has been the Labor Member for Port Adelaide in Federal Parliament since 2007, and is the Shadow Minister for Climate Change and Energy. Mr Butler served as Minister for Ageing and Australia’s first Minister for Mental Health in the Gillard Government. He has also held the ministries of Housing, Homelessness, Social Inclusion, Climate Change, Water and the Environment. Mr Butler is the author of Advanced Australia - The Politics of Ageing, published in 2015; and Climate Wars, published in 2017.

Suzanne Falvi

Executive General Manager, Security and Reliability, Australian Energy Market Commission

Suzanne Falvi leads the team responsible for reviews and rule changes relating to system security and reliability in the Australian energy market. A principal focus of the team in the past year has been the extensive system security work program, and a detailed review of reliability frameworks in the national electricity market. She also leads the AEMC’s reliability panel secretariat. Before her appointment as Executive General Manager, Ms Falvi was an AEMC senior lawyer. She previously worked as senior energy policy adviser for the ACT Government , as in-house counsel for a solar technology R&D company, and for Minter Ellison specialising in competition, energy, administrative law and commercial litigation. She holds a Bachelor of Economics, a Bachelor of Law with Honours and a Master of Laws in International Law from the Australian National University.

Steven Neave

General Manager Electricity Networks, CitiPower/Powercor

Steven Neave began his 29-year career as an electro-mechanical draftsman and engineer, before moving into senior management roles responsible for design, and more recently control and operations. In December 2015, Mr Neave was appointed General Manager of Electricity Networks, overseeing asset management, strategic planning and augmentation, compliance and day-to-day operations activities for VPN. Mr Neave has a Bachelor of Electrical Engineering and a Masters in Entrepreneurship and Innovation.

4


CONTRIBUTORS

Michael Paparo

Policy Manager, Standards Australia

Joining Standards Australia in 2017 as a Policy Manager, Michael Paparo works on the role standards play in supporting industry, government and consumers across each sector of the Australian economy. Prior to joining Standards Australia, Mr Paparo worked in professional policy for over five years at the Property Council of Australia, Chamber of Commerce & Industry Queensland (CCIQ), and as an official at the Commonwealth Treasury in Canberra.

Lachlan Blackhall

Head, Battery Storage and Grid Integration Program, ANU

As an enthusiastic entrepreneur with experience in founding and growing start-up companies, Lachlan Blackhall has combined his love of business and skills in engineering and mathematics to become an inspiring teacher, mentor and innovator. While completing his PhD studies in engineering and applied mathematics at ANU, Dr Blackhall founded InnovationACT, a business planning and entrepreneurship outreach program; and after finishing his PhD, he co-founded Reposit Power, a technology company that designs systems for grid-deployed energy storage. In his current role at ANU, Dr Blackhall leads a team designing and implementing the building blocks for powering the future electricity system with battery and energy storage.

Andrew Bray

National Coordinator, Australian Wind Alliance

Andrew Bray is the National Coordinator of the Australian Wind Alliance, which represents farmers, wind-workers, small business and community members who value wind power as a clean, safe and effective source of energy. Mr Bray has a passion for wind power and the positive contribution it can make to the local economy and to helping Australia transition to a cleaner energy supply. Mr Bray is based in one of NSW’s prime wind districts, near the Capital Wind Farm on Lake George in the Southern Tablelands.

Pene Newitt

Insight and Analytics Team Leader, Western Power

Pene Newitt is a Team Leader in the Business Intelligence and Data Analytics Function at Western Power. As leader of the Insights and Analytics team, she is responsible for providing actionable information for the business on both current and topical questions. Ms Newitt's team is accountable for insights regarding emerging technologies in the customer and commercial space, including electric vehicles, community batteries and solar PV distribution. Furthermore, it delivers relevant analytics in such areas as value positioning, reliability of supply, revenue protection and health and safety. Ms Newitt has been part of the Western Power team for five years, working in both customer and business strategy. She has 15 years’ experience in customer analytics for services industries, including banking, superannuation, land development, telecommunications and energy.

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NEWS

ACCC PUTS ELECTRICITY

UNDER THE MICROSCOPE

T

he electricity market has been scrutinised by the Australian Competition and Consumer Commission (ACCC), which released its final report from the Retail Electricity Pricing Inquiry in July. The Inquiry, which commenced in March 2017, began by identifying the root causes of high electricity prices across the entire electricity supply chain, and has now made 56 recommendations detailing ways to fix the National Electricity Market. “The National Electricity Market is largely broken and needs to be reset. Previous approaches to policy, regulatory design and competition in this sector over at least the past decade have resulted in a serious electricity affordability problem for consumers and businesses,” ACCC Chair Rod Sims said. “There are many reasons Australia has the electricity affordability issues we are now facing. Wholesale and retail markets are too concentrated. Regulation and poorly designed policy have added significant costs to electricity bills. Retailers’ marketing of discounts are inconsistent and confusing to consumers, and have left many consumers on excessively high ‘standing’ offers.” The ACCC estimates its recommendations, if adopted, will save the average household between 20 and 25 per cent on their electricity bill, or around $290-$415 per annum. Further, Australia’s 2.2 million small to medium businesses could save an average of 24 per cent on their electricity bill, and commercial and industrial customers could see electricity costs decrease on average by 26 per cent. Energy Consumers Australia Director of Research, Lynne Gallagher, said the final report confirms what consumers are telling them: that the electricity market is not working as it should. “Energy affordability is the number one concern of consumers – they want comfortable homes, competitive businesses and bills that don’t make them so anxious that they put off opening them,” Ms Gallagher said.

According to Ms Gallagher, this review is the most thorough assessment of the electricity market in a very long time, and provides the evidence base for reform to improve energy affordability. “The report sheds new light on why prices are increasing, identifying significant issues around network costs, concentration and structure, and the way that retailers are presenting offers and engaging with consumers,” Ms Gallagher said. The Australian Energy Council’s Chief Executive Sarah McNamara said, “There is no secret to why energy prices are high. The ACCC acknowledges that previous approaches to the design of policy and regulation over a decade have pushed up prices for households and businesses. “The energy industry acknowledges that consumers find the retail market confusing and that is why we have been working with regulators at both the state and federal level to make energy offers easier to understand." “The energy industry has also been dealing with more than a decade of energy policy uncertainty that has had an adverse effect on much needed investment in the wholesale market. “The ACCC report indicates there are no simple solutions but that more steps can be taken to improve confidence in the energy market.”

NORTHERN GAS PIPELINE CONSTRUCTION COMPLETE

J

emena has announced that a major project milestone has been reached, with the 622km Northern Gas Pipeline (NGP) now complete. Antoon Boey, Executive General Manager of Corporate Development at Jemena, confirmed the landmark was reached with all 622km, and approximately 34,000 lengths of pipe, being welded, lowered in and now fully buried in the trench. “The sheer scale of this project is enormous – the largest current gas pipeline project in Australia. This milestone is due to the fantastic effort of those working in remote, hot and often dusty conditions,” Mr Boey said. “Overall the project is tracking on schedule. Apart from the pipeline, we’re thrilled that construction of the Mount Isa Compressor Station is also finished, and that completion of the Phillip Creek Compressor Station in the Northern Territory is imminent.” The pipeline and both compressor stations will now be rigorously checked before gas commissioning later this year.

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September 2018 ISSUE 3

“When Jemena was awarded the contract to develop and construct the NGP in 2015 we committed to constructing the pipeline on time, safely, providing training and employment opportunities for people from the communities surrounding the pipeline, and introducing competition into the east coast gas market,” Mr Boey said. “What we’re seeing today is these promises being fulfilled. We are so proud of how the NGP has provided training, development and other opportunities to people from the communities surrounding the pipeline. “Almost 800 jobs have been created as part of the pipeline’s planning and construction phase – around 700 of which have been awarded to people from local communities along the pipeline route. Plus we’ve seen $120 million spent with businesses in the Northern Territory and Queensland.” Mr Boey said the Northern Territory had a unique opportunity to grow its economy and contribute to the east coast gas shortage.

“Jemena is progressing its plans to extend and expand the Northern Gas Pipeline and will continue to work with the community to understand how they can contribute to this next phase of growth and activity. On commissioning, the NGP will be able to deliver 90TJ of much needed gas per day, with 70 per cent of available capacity in year one having already been contracted to support manufacturing and jobs in Northern Australia. In June 2018, Jemena announced its agreement with Incitec Pivot Limited (IPL) to transport at least 32TJ of gas per day to supply its Gibson Island facility. This follows Jemena’s foundation agreement with the Northern Territory’s Power and Water Corporation to transport 31TJ of gas to IPL’s Phosphate Hill facility for ten years. “Discussions with other parties are also well advanced, and we remain confident that the NGP will be fully contracted by the time it is operational later this year,” Mr Boey said.

www.energymagazine.com.au


NEWS

STORAGE SOLUTIONS TO STABILISE THE GRID

A

ustralia is aiming to increase renewable electricity generation to 33GW hours by 2020, with hydroelectric power stations expected to play a huge role in achieving the goal. According to a study by the Australian Renewable Energy Agency (ARENA), a project in Germany proves that wind farms, combined with pumped storage power plants, can help achieve the energy transition and stabilise the grid. The procurement and investment costs for renewable energy sources, such as solar and wind farms, are steadily declining since solar panels and wind turbines have now become massproduced, which in turn has lead to falling production costs. To ensure the success of the energy transition, power generation from volatile energy sources needs to be secured with energy storage. To this end, a study commissioned by ARENA identified 12,000 potential sites for pumped storage power plants throughout Australia. According to ARENA CEO Ivor Frischknecht, “Pumped hydro is the most common and most mature form of energy storage. We are exploring the potential for pumped hydro to play a greater role in delivering Australia’s electricity needs. The findings of this study prove there are opportunities across Australia worthy of further investigation.” The Water Battery from Max Bögl Wind AG is a completely

Semi Dispatch Solutions for the Renewable Energy Industry

new and innovative large-scale storage system that combines renewable power generation with a modern pumped storage power plant. The first Water Battery project is currently being developed near Stuttgart, Germany. It consists of a wind farm with four wind turbines – including the highest in the world at 178m – and a pumped storage hydroelectric power plant with an installed capacity of 16MW. This storage concept is extremely flexible and can switch between electricity generation and storage within 30 seconds, which makes it possible to make short-term adjustments to the demands of the electricity market. The storage concept uses the tower base of the wind turbines as water storage facilities, with a storage capacity of 70MW hours. A penstock connects them with a hydroelectric power station and its lower reservoir located 200m further down the valley. “The Water Battery is a natural storage facility that stands out due to its durability and high degree of flexibility,” CFO at Max Bögl Wind AG, Jürgen Joos, said. Josef Knitl, Board Member of Max Bögl Wind AG, added, “Without large-scale and forward-looking projects and ideas, the energy transition cannot succeed. With Water Batteries and Hybrid Towers, we are making wind energy a more attractive and efficient source of clean energy.”

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September 2018 ISSUE 1

7


NEWS

NEW TECHNOLOGY TO INCREASE SOLAR EXPORTS

I

nnovative new technology being rolled out by Ergon Energy will assist electricity networks, allowing more homes and businesses to export power from solar PV systems into the grid. Manager Intelligent Grid New Technology, Michelle Taylor, said the first low voltage static synchronous compensators – commonly known as statcoms – were installed in Mossman

and would continue to be rolled out to other parts of regional Queensland. “This is an Ergon initiative that will assist the network, which was designed in an era of one-way power flows, to adapt to the rapidly changing network environment where many homes and businesses are both consumers and exporters of power,” Ms Taylor said. “Queensland has one of the highest rates of solar PV penetration of any state in the world, with more than 140,000 systems connected to Ergon’s grid." “This has resulted in some sections of Ergon’s network reaching their acceptable voltage limits due to rising voltage levels caused by solar PV systems.” Statcoms regulate the voltage on sections of the network where they are installed, enabling more households to feed solar power into the grid and managing peak load voltages. While statcoms are not a new concept, Ergon’s innovative application of the technology uses small-scale statcom devices to help manage the low-voltage network. “Ergon’s technology innovation engineers successfully delivered a proof of concept for the statcom equipment in 2014 and successfully trialled test versions of the technology in 2015. This device can now be a new tool in the toolbox for solving network issues,” Ms Taylor said.

In the November issue of Energy, we’ll run an exclusive interview with Ergon Energy, looking at their new statcom technology, and the impact it can have on solar grid integration, in greater detail.

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September 2018 ISSUE 3

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NEWS

CONSTRUCTION BEGINS ON GRANVILLE HARBOUR WIND FARM

C

onstruction on Tasmania’s $280 million Granville Harbour Wind Farm has begun. Once completed, the wind farm will have 31 turbines providing 112MW of capacity, enough to power more than 46,000 homes. Construction comes after Hydro Tasmania announced in 2017 that it reached an in-principle agreement with Westcoast Wind in relation to a power purchase agreement. In addition to Granville Harbour, construction on Cattle Hill Wind Farm in the Central Highlands is progressing, and Hydro Tasmania is continuing with its $1 billion ten-year upgrade to facilities to increase generation by 250GWh, which is enough additional generation to power over 30,000 Tasmanian homes. The Granville Harbour Wind Farm will contribute towards plans to double Tasmania’s renewable energy capacity, and connect to the network at Reece Power Station. Hydro Tasmania's Director of Wholesale Energy Services, Gerard Flack, said the business will buy about 360GWh of energy and renewable energy certificates per year from the new wind farm.

“The birth of Granville is another sign that Tasmania’s national energy revolution is really taking off,” Mr Flack said. “We’re delighted to be supporting the Granville Harbour Wind Farm, and helping to make it happen.” Tasmania currently has about 300MW of on-island wind power capacity, providing almost 10 per cent of Tasmania’s electricity. The Battery of the Nation initiative, including plans for more interconnection, will open the door for up to 3000MW of Tasmanian wind power. “Tasmania has huge natural advantages, including an existing hydropower system, exceptional wind resources, elite expertise and the headstart we’re already taking,” Mr Flack said. “Pumped hydro energy storage supports and complements wind development. Our work to identify Tasmania’s best possible pumped hydro sites under Battery of the Nation is progressing well. “We’re pleased that the Tasmanian and Federal Governments have committed to pursuing the next stage of a business case for a second Bass Strait interconnector.”

AUSTRALIA’S FIRST HYDROGEN INNOVATION HUB ANNOUNCED

W

estern Australia will soon be home to the country’s first green hydrogen innovation hub, with the Australian Renewable Energy Agency (ARENA) announcing that the project will be based in Jandakot. In Jandakot, ATCO will trial the production, storage and use of renewable hydrogen to energise a commercial-scale microgrid, testing the use of hydrogen in different settings and applications including in household appliances. The $3.3 million development project will evaluate the potential for renewable hydrogen to be generated, stored and used at a larger scale. ATCO aims to assess the practicalities of replacing natural gas with hydrogen at a city-wide scale across a municipality. Green hydrogen will be produced from

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September 2018 ISSUE 3

on-site solar using electrolysis, fuelling a range of gas appliances and blending hydrogen into the natural gas pipeline. The project will also build upon ATCO’s distributed energy hybrid energy system trial called GasSola, which includes the installation of rooftop solar with battery storage and standby natural gas generation for nine residential sites in Western Australia’s south west. ARENA CEO, Ivor Frischknecht, said the ATCO trial could lead to hydrogen being used more widely across Australia. “Green hydrogen offers opportunities to provide carbon free energy to cities and towns, while leveraging existing natural gas infrastructure,” Mr Frischknecht said. “Along with ARENA’s research and development funding round focused on exporting hydrogen, this project will explore the opportunities for hydrogen in Australia, which could also include the development of standards for green

hydrogen production, distribution and use.” ATCO Managing Director and Chief Operating Officer, Pat Creaghan, said “Securing this grant is a major accomplishment. We intend to play a leading role in the development of forward-thinking, clean energy solutions, and our Clean Energy Innovation Hub is at the very heart of those plans. The project has many exciting elements, but what truly sets it apart is the use of excess renewable energy, which would typically be lost to the system, to produce hydrogen.”

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INDUSTRY INSIGHT

Ed McManus.

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September 2018 ISSUE 3

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INDUSTRY INSIGHT

MAKING IT WORK: GENERATING AND RETAILING IN THE NEW ENERGY PARADIGM Ed McManus, CEO of Powershop Australia and Meridian Energy, hasn’t been involved in the energy industry for a long time, but in the four years since he joined the sector, he’s made a big impact. At the helm of a company with the mandate no more simple, or more complex, than to be “a better power company”, he has his work cut out for him. Managing Editor Laura Harvey sat down with Mr McManus to discuss his thoughts on the energy trilemma, whether the market or policy is the best way forward, the integration of renewables into the grid and gaining back the trust of energy customers.

I

t’s the puzzle everyone in the energy industry is currently trying to solve – how do we provide users with energy that is cleaner, affordable and reliable, while taking into account things like our existing electricity grid, prevailing market conditions and the evolution of energy? Over the past 12 months, the conversation within the industry has frequently focused on whether the trilemma is something that can be solved by the market, or whether policy intervention is required. And if policy intervention is required, what exactly would that look like? Despite the lack of clarity, according to Mr McManus, the last 12 months has been promising for the industry. He refers to the range of large projects being committed to and under construction as a sign that the market does work – the industry has responded to the record wholesale prices we have recently seen by investing in renewables projects and other forms of new generation, which will increase supply and serve to drive prices down. “When the market works, you get more investment in generation, and that investment is predominantly in renewables – not solely, but predominantly – and the positive there is that consumer bills will track downwards as a result of that.” Given this faith in the market, it does raise the question – if the market is working, why then is it so common to see leaders in the energy industry calling for policy certainty? “This is a central issue I’ve been grappling with,” notes Mr McManus. “Firstly, I think some policy certainty is important, because the investment is not sustainable long-term unless you have that. “Secondly, if we want to meet our Paris target to reduce emissions to 26-28 per cent on 2005 levels by 2030, we will really need the electricity sector to overdeliver against other sectors, such as agriculture, where reductions will be much harder, and potentially much more costly to achieve.”

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For Mr McManus, it ultimately comes back to what we want to deliver. “If you just want to deliver market reform and for prices to come down, we probably don’t need a pull mechanism to drive more renewables into the market. But if we really want the electricity sector to overdeliver, then perhaps we do.”

Reliable renewables The other key element of solving the energy trilemma is the need to provide energy that is reliable, and with more renewables entering the grid, we need to look at how we can firm these up. “I’m pretty optimistic about meeting that challenge because we have got lots of options there,” says Mr McManus. “The in vogue word at the moment is firming, and there’s a few organisations that have released firming products. There’s also a huge debate at the moment about Snowy 2.0, and there is work that’s been done at ANU looking at potential sites for pumped hydro across the country.” These technologies, along with others such as grid-scale batteries, and the potential to improve the efficiency of existing, regular hydro projects – are all examples of why Mr McManus is optimistic about the potential to firm the capabilities of some of the renewable technologies we have access to today. “There’s also the next generation of technology, things that are either experimental or things that are no longer experimental but probably don’t stack up on a cost perspective, like thermal solar and tidal energy – eventually, these technologies will likely become viable from a cost perspective, further enhancing the arsenal of technologies we have to work with. “I think it all adds up to a future where – and I’m not saying we’re going to get to 100 per cent renewables tomorrow – but we’re certainly going to see a lot more renewable, reliable power in the grid.”

September 2018 ISSUE 3

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INDUSTRY INSIGHT Managing the demand Mr McManus also feels that demand management will play an ever increasing role in the way we manage, and solve, the energy trilemma. Traditionally, in the national grid, demand management has been the domain of larger loads – when demand has been high in the grid, we look to large users, such as aluminium smelters, and turn them off for a short period. But now, with residential demand management increasingly being recognised as having an important role to play too, Powershop has been one of the first retailers to put a demand management program in place for its customers. Currently, approximately ten per cent of Powershop customers are subscribed to Powershop’s demand management program, which sees them sent a text message as periods of high demand are approaching, asking them to curb their usage by approximately ten per cent for a short period of time. “We give our customers suggestions for what they need to do,” says Mr McManus. “When the temperature is 42 degrees, we’re saying turn the air conditioning from 17 degrees to 23, or cook on the barbeque instead of using the oven, or don’t do the washing at that time.” It’s a relatively simple process, and according to Mr McManus, getting people to respond is pretty easy, which is impressive given that the financial incentive isn’t huge at this point in time. “What we find is that many customers are interested in doing it not for the financial incentive, but because they feel it’s the right thing to do and it is part of the future.” In the future, Mr McManus believes that we’ll start to see retailers sharing data and sharing their experiences in customer demand management as part of the process towards getting customer demand management right. “For consumers, and for us as an organisation that essentially manages risk, that’s the core value we can add,” says Mr McManus.

“Having customers with peak demand when prices in the market are high is a huge risk for us, because that’s the price we pay as the retailer. “Demand management is a win for customers, it’s a win for the grid and it’s a win for retailers. We’re quite bullish that it will become another form of firming, like gas peakers, pumped hydro, and batteries – all these things will be in the mix to manage the system. “I think it’s very feasible for us to be able to turn down system peak demand by 20-30 per cent into the future,” says Mr McManus. “Think about large buildings for example, you could switch off the air conditioners for five minutes without people in the building having any negative discernible impact. “And in the future, businesses will be more adaptable. Some businesses need to run 24/7, but others can chase load when prices are cheaper, like in the middle of the day when all the solar is running.” Given the benefits that demand management can offer, it begs the question – should governments be mandating demand management programs from retailers and participation from customers? According to Mr McManus, the answer isn’t so simple. “I wouldn’t favour a system where it’s mandated, because in the end, the financial incentives will take care of participation. “Don’t get me wrong, I’m a big supporter of demand management, but for individual consumers, the market will find the lowest cost.” Mr McManus believes that as our energy system evolves, and more renewables enter the grid, it will effectively make the market more “peaky” – and more susceptible to price volatility. “In the future, managing risk for a retailer will be more expensive,” notes Mr McManus. “So as a consumer, we might be able to say to you, ‘Hey instead of giving you $10 to reduce your load at certain times, we’ll give you $50’. And when it’s $50,

The Hume Dam.

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INDUSTRY INSIGHT people are more likely to do it. And as a retailer, instead of having 10 per cent of your consumers on board, you might have 50 per cent. “That’s just an example of the market working and finding the cheapest way of doing things. And I would always advocate for letting the market find the way because central planning will not find the cheapest way.”

A better power company Against the backdrop of the greater issues affecting the energy industry, Mr McManus, through the two companies he leads, is working to provide customers with a better power company. “What does that actually mean? It means things like investing in renewable generation, which brings prices down; it means not door knocking people’s homes to bring customers on board; it means providing customers with an app that shows them how much of the product they’re buying each day – they’re the sorts of things we’re trying to do to improve how consumers view us as a company and the whole industry. “And we’re seeing that has impact beyond us. Many of the large companies have stopped residential door knocking, and we’re not the only ones with an app now – although we were the first! “That’s innovation though, that’s how it works. So we have to be on our toes and keep delivering the next thing, because others will follow when the innovation is good.” So where to from here? Powershop has a long generation model, so a key focus will be on securing the customers to match the load the company currently has sourced. One of the key ways the company will do this is by launching retail gas in Victoria. 80 per cent of electricity retail customers in Victoria have gas as well, and most of them prefer to purchase both fuels from the one retailer. Also key will be continued experimentation to get the customer offering right. “We don’t do big bang,” notes Mr McManus. “We try lots of different little things to see how they go. We have a culture where people feel like they can try things and not be penalised when they don’t work. No one in Powershop ever gets penalised for having a go at something and it not working.” With its history of innovation in the sector, there’s little doubt the industry will be watching closely to see where Mr McManus steers his ships next.

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The Mt Millar Wind Farm.

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INDUSTRY INSIGHT

MOVING WITH THE CURR

OF ENERGY CHAN by Mark Butler, Shadow Minister for Climate Change and Energy Like every advanced economy in the world, Australia is faced with an energy sector undergoing rapid technological change. Yet for the last ten years, Australia’s transition has been hampered by the “climate wars” waged in Parliament and beyond. The heightened politicisation of climate and energy policy has resulted in a policy paralysis which threatens to stifle new generation investment from 2020, undermine a managed modernisation of our energy sector, undermine any decarbonisation efforts and expose the sector and the broader economy to heightened financial as well as operational risks.

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hile the technical and policy challenges that our energy transition entails are substantial, they pale into insignificance alongside the political challenge of establishing a bipartisan policy consensus on energy. What is often lost in the debate is the fact that, were climate change not an issue at all, we would still be facing a national need to replenish large parts of our electricity generation infrastructure. In particular, ageing and increasingly unreliable coal generation built in the 1960s, 70s and 80s will need to be replaced in the next two decades. With large and small-scale renewable costs continuing a long-term downward trend, and coal costs remaining relatively constant, even without a climate imperative, we would expect to see fundamental change in how and where we generate electricity, as well as how we use it. Managing this transition would be a national challenge, even in the best of all possible worlds, but we don’t live in the best of all possible worlds and we cannot ignore the imperative of climate change. Australia has rightly signed up to the Paris Accords, which commit Australia to do our fair share of greenhouse gas abatement to limit global warming to well below two degrees. The Paris Accords include a process for increased ambition, and Australia’s initial Nationally Determined Contribution (NDC) of a 26 per cent economy-wide emissions cut is only the first in what is meant to be a series of commitments that increase over time to deliver the overarching Paris Accord goal. We cannot ignore our obligations under the Paris Accords and we should not pretend they are fully exhausted by the Coalition’s initial NDC. This means the transition we would expect in the electricity system will need to be larger and faster than would occur without a climate change imperative. Given the scale of the transformation we are facing, we need

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INDUSTRY INSIGHT

RENTS

NGE

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sound policy to guide and manage the transition. After several false starts with an Emissions Intensity Scheme and Clean Energy Target, the National Energy Guarantee (NEG) is now the policy we are debating to deliver this transition. The design of the NEG has come a long way since it was first released in an eight page letter from the Energy Security Board. While significant progress has been made, the core and seemingly intractable difference between Federal Labor and the Federal Coalition remains the emissions reduction obligation under the NEG. We take the view that the NDC of a 26 per cent economy-wide emissions cut on 2005 levels by 2030 falls short of what we need to deliver. Labor has accepted the Climate Change Authority’s advice on our fair contribution to Paris, and adopted a 45 per cent emissions reduction target. But this isn’t the only point of contention. The Government has decided the electricity sector should only do its pro rata share of any economy-wide emissions reduction task, placing an equal abatement task on the rest of the economy. But electricity has the lowest abatement cost of any sector, and decarbonisation in electricity will drive decarbonisation in other sectors like transport and industry. The Energy Security Board’s final design paper for the NEG shows by 2021, Australia would have already reduced emissions by 24 per cent, on a 2005 baseline – due to the current rush of renewable investment being driven by the LRET – essentially leaving the abatement task of the NEM over the 2020s to just two per cent by 2030. In contrast, the agriculture, transport and industrial sectors will need to cut their emissions by over 40 per cent over the same period, according to the government’s latest emission projection data. These are sectors that have far fewer abatement opportunities, and whose opportunities come at much greater cost. It is not only economically efficient for the electricity sector to take up a greater burden of emissions cuts; it is increasingly seen as an opportunity by the sector itself. For example, Origin Energy has been clear that it sees the Government’s electricity abatement target as too low, saying “the electricity sector can do more than its pro rata share of the target, as it has costeffective abatement options available to it which could be unlocked given the right policy settings”. It is clear to all the energy experts and industry insiders the transition of our energy sector, while being a challenge, is also a huge opportunity. It is an opportunity to better serve customers, to modernise our infrastructure, to create

new businesses and jobs, to develop new supply chains and export markets, and to take advantage of our massive human and natural renewable energy resources. In order to make sure this transition benefits the Australian people, creates new wealth and doesn’t leave people and regions behind, we need government policy that works with the currents of technology and economics, not against them. The role of government, especially when large transitions occur, is to manage risks, protect equity and guide the country to a more prosperous future. It is not to fight against an inevitable future. The debate in Parliament has been reduced to the Prime Minister proclaiming coal may be in the energy mix “possibly forever” and signalling further market intervention into extending ageing, increasingly unreliable coal-fired power stations. While coal will continue to play a part in our energy mix for years to come, to ignore the inevitable transition to a clean energy economy is a farce. It flies in the face of the need for what we call a “just transition” plan for communities that will inevitably be confronted with the closure of their power stations. Just transition puts affected workers and communities at its centre. It means industry, workers and governments coming together and doing what’s needed to ensure no one is left unemployed and without support. But central to any just transition is a cooperative and collaborative approach between workers and their unions, industry and government, regardless of party affiliation. While working towards a bipartisan solution to the energy crisis has been our preferred solution, Federal Labor has had a clear commitment to emissions reduction since the 2016 election. Our targets, a 45 per cent cut in emissions (on 2005 levels) by 2030, net zero emissions by 2050 and 50 per cent renewable energy by 2030, need to be workable under any energy policy. The complexity and divisiveness of energy policy make it easy to get bogged down in the details. That’s why it is crucial to remember the big picture. Any sensible energy policy must do one central thing: support the modernisation of our energy system. That means replacing old coal generation that will close in coming decades with cleaner and more flexible renewables backed up by dispatchable technology, whether battery or pumped hydro storage, gas generation or demand management. Delaying this inevitable transition isn’t a plan for cheaper, cleaner or more reliable power; it is a recipe for wasted time and resources, higher prices and pollution.

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INDUSTRY INSIGHT

HOW DID ENERGY GET SO OFF COURSE?

by Sarah McNamara, Chief Executive, Australian Energy Council

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INDUSTRY INSIGHT

In July, the ACCC released the final report from its inquiry into electricity supply and prices in Australia. Here, Sarah McNamara takes a comprehensive look at the recommendations in the report, and highlights the one critical factor we need to get right to avoid being faced with another detailed report in the not too distant future.

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he National Electricity Market is one of the most examined, reviewed and regulated markets in Australia. Last year we had the comprehensive Finkel Review, and more recently, extensive work on the proposed National Energy Guarantee (NEG). Rounding out consideration of the electricity market is the Australian Competition and Consumer Commission’s (ACCC) forensic report into electricity prices. The 400-page ACCC Retail Electricity Pricing Inquiry is an exhaustive survey of more than 10,000 documents from across the sector and delivers 56 recommendations on how to ‘reset’ the National Electricity Market (NEM). The debate which has followed its release highlights a simple truth known by anyone who works in the industry: we are living with the results of at least a decade of fumbled energy policy at various levels of government. So there are no real secrets why energy prices are high for the average household. The Australian Energy Council doesn’t accept all the characterisations in the ACCC’s report, but it is a valuable outline of how we arrived where we are now. While many of its recommendations appear straight forward, others will take time to properly assess – this is highlighted by one of the report’s key points, that there can be unintended consequences with significant repercussions from not getting it right. In fact, it is how we got here in the first place. The lead up and final release of the ACCC report revived strong debate on what is needed to ‘fix’ the NEM – ranging from more renewables to new coal-fired plants, price re-regulation, limits on ownership, asset breakups and government-backing for new entrants. It also encouraged renewed finger pointing variously at networks, at wholesale markets and generators, government green schemes and at retailers, privatisation, market interventions and government ownership to name a few. Overall the report makes it clear that the electricity market has been compromised

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by the approach of policy, regulatory design and promotion of competition: “At all stages of the supply chain decisions have been made over many years by many governments that set the NEM on the wrong course,” it says. So at different parts of the electricity supply chain, decisions were made over many years by governments of all persuasions and in different jurisdictions that ultimately led to the claims that the NEM is ‘broken’. Despite this commentary, the NEM has operated as it was designed. The big bumps in the road have come from various interventions, with the biggest being in the form of not having bipartisan policy to manage the transition to lower emissions generation. The ACCC has pointed to increased spending on networks, driven by reliability standards for some networks that were set too high. It also points to state government decisions over generation assets, excessively generous solar feed-in tariffs – like the so-called premium feed-in tariffs that effectively led to an ‘arms race’ as jurisdictions appeared to outdo their neighbours in supporting rooftop PV at a time when the costs of solar panels were much higher than today. The result, as noted by the ACCC, was that the subsidy to consumers for the energy they produced outweighed “by many multiples” the value of the energy. The cost of these premium schemes continue to be felt by all electricity users in their bills. While political parties argued over the best way to shift to a lower emissions generation sector, the main pillar that was used to encourage low emissions electricity generation was the Renewable Energy Target (RET). The RET has been effective at drawing wind and solar generation into the system, but has blurred investment signals for investors. The only policy for years was to support renewable generation, which accelerated the closure of older, firmer generation. And as this dispatchable generation closed it pushed up wholesale prices – again this is what the market was designed to do.

In fact, the ACCC notes that the NEM was designed to have high prices to prompt new investment in new generation. And because there was no emissions policy in place (aside from the RET, which drove just one type of generation) older, dispatchable plants were pushed out and not replaced. The report suggests that existing generators had not invested and taken advantage of higher spot prices. But there was nothing to invest against – dispatchable generation tends to be long-life assets, so investors had not wanted to commit to generation until they understood what might be coming. They also find it harder to get financing given this carbon risk. Higher prices were additionally exacerbated by an increase in gas prices, with gas generation becoming the price setter in NEM regions like South Australia with the exit of older, coal-fired plant. The ACCC has also pointed to retailer discounting and electricity customer confusion as a factor in households paying more for their electricity. There is work underway to look at ways to address this and an acknowledgement from retailers that discounting can be confusing and requires addressing. Already we are seeing fixed price products entering the market. We can expect to see more changes. If the ACCC’s work has told us anything, it is that getting policy wrong will ultimately lead to higher prices and distortions which, ironically, then require intervention to achieve a change in direction. The ACCC has provided a rear view mirror look at how we got off track, and it has tried to present a map so we can navigate back onto a firm base. We still have a way to go until we have smooth running, but all that is needed for consideration has been put forward and now it is up to government at all levels and of all stripes to agree. If they don’t, things will continue to go from bad to worse and we will be discussing another detailed report in the not too distant future. So now the hard work begins – implementing the myriad of suggestions on how to reset the electricity market.

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ALL-ENERGY

RECORDBREAKING RENEWABLES: The Clean Energy Council, the peak body for the renewable energy and energy storage industry in Australia, recently released its annual Clean Energy Australia Report. The 2018 report provides a comprehensive overview of the current state of the Australian clean energy sector and the latest key figures and statistics on the national energy market.

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t is the only analysis that includes the National Electricity Market, the Western Australian electricity grid and other major regional grids across the country in areas such as the Northern Territory. Approximately 700MW of renewable projects were completed and began generation in 2017. With seven times that amount either under construction or with financial support at the end of 2017, the clean energy industry is on the verge of a major breakthrough. According to Bloomberg New Energy Finance data, large-scale wind and solar project activity pushed investment in Australia up 150 per cent to a record US$9 billion in 2017. Globally, clean energy investment amounted to US$333.5 billion last year. This was three per cent higher than 2016 and the second

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highest annual figure ever – just seven per cent less than the record US$360.3 billion reported in 2015. Almost 1.1GW of solar PV was installed in the small-scale market in 2017, which was a record for the rooftop solar industry. Considerable growth also occurred in the medium-scale solar sector, with 131 projects adding 53MW of new capacity. There is now 167MW of cumulative capacity in the medium-scale solar sector, representing an increase of more than 500 per cent over the past five years. Four new large-scale solar projects were completed in 2017, with the largest being the 50MW plant built by Genex at Kidston in North Queensland. Total installed large-scale solar capacity reached 450MW at the end of 2017, compared to just 34MW at the end of 2014.

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ALL-ENERGY

A YEAR IN REVIEW The wind sector also experienced a large amount of activity in 2017, with 15 new wind farms either under construction or financially committed at the end of the year. The 547MW of new capacity added in 2017 was the third highest amount added in the history of the Australian wind industry, bringing total generation capacity across the country to 4816MW. For the first time ever, wind and hydro generation contributed an almost identical amount of electricity – approximately 5.7 per cent each – to total national electricity generation during the year. Early in 2018, the Clean Energy Regulator (CER) announced that there were enough projects at a sufficiently advanced stage to meet the large-scale Renewable Energy Target (RET). The CER has previously estimated that approximately 6000MW of large-scale generation capacity would need to be announced and built between 2016 and 2019 to meet the target of 33,000GWh of additional renewable energy by the end of the decade. There has been 6532MW of new large-scale generation firmly announced between 2016 and the time of the CER announcement in January 2018. The majority of this is either under construction or already operating, and the rest is expected to begin construction in 2018.

Clean energy performance by state Australian Capital Territory The Australian Capital Territory has the most ambitious renewable energy target in the country, and is on track to deliver on its goal of 100 per cent clean energy well before its 2020 deadline. The ACT was the first state or territory to run a reverse auction scheme for new renewable energy, a process that invites companies to bid on the construction of new wind and solar projects for the lowest cost. The first reverse auction for 40MW of

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large-scale solar projects was held in 2012 and 2013, followed by three 200MW wind power reverse auctions in 2014, 2015 and 2016. The feed-in tariffs awarded as part of the auctions are fixed for 20 years, helping to protect Canberra residents from sharp rises in wholesale electricity prices. The last project to be built under the scheme will be Union Fenosa’s Crookwell 2 Wind Farm, which is due for completion in the second half of 2018. All the other projects have now been completed. New South Wales Although New South Wales does not have a specific renewable energy target, the State Government has set a long-term target for NSW to have zero net emissions by 2050, including in its energy sector. As part of this goal, the government’s Climate Change Fund Strategic Plan aims to double the state’s level of renewable energy capacity to more than 10,000MW by 2021. NSW was one of the leading states for new large-scale renewable energy projects at the beginning of 2018, with the government approving eleven largescale solar energy plants in the previous 12 months. State renewable energy penetration was recorded as 11 per cent but this figure includes the ACT. Northern Territory The Northern Territory has set itself a target of 50 per cent renewables by 2030, but renewables only accounted for four per cent of its power generation in 2017. In late 2017, an independent expert panel produced the Roadmap to Renewables report, which provided eleven recommendations on how the NT Government can achieve its target. These included making renewable energy a central pillar of the NT Government’s economic policy and a series of other financial, regulatory and technical recommendations. Meeting the 50 per cent renewable

energy target will allow NT to move away from its reliance on gas and diesel, which currently accounts for 96 per cent of its energy generation. Queensland Queensland has set a 50 per cent renewable energy target by 2030, but in 2017, only eight per cent of the state’s electricity came from renewables. As part of its $1.16 billion Powering Queensland plan, the government’s Renewables 400 initiative held a reverse auction for up to 400MW of new renewable energy capacity, including 100MW of new storage. Renewables 400 attracted 115 proposals from 79 businesses, adding up to more than 9000MW of new capacity – more than 20 times the amount needed. Several areas of the state have emerged as large-scale solar hubs, including Townsville in North Queensland and the Darling Downs west of Toowoomba. Queensland already has the largest number of rooftop solar installations of any state or territory, as well as eight of the top ten solar postcodes in the country. South Australia South Australia set a target of 50 per cent renewable energy by 2025, which it had almost achieved in 2017, with 45 per cent of the state’s electricity coming from renewable sources. In March 2018, after 16 years of Labor in power, the state elected a Liberal government. The effect that this will have on renewable energy in the state is yet to be determined. The new Premier has promised support for storage at the household level, and pledged to build a new interconnector to NSW. He has also backed the solar thermal plant planned for Port Augusta. Electranet is conducting extensive analysis about whether the proposed transmission line to NSW will be a positive for South Australia. Its report is due mid-2018.

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ALL-ENERGY Tasmania With its extensive hydro power network supplying almost 90 per cent of the state’s energy needs, Tasmania has traditionally been Australia’s renewable energy leader. In April 2017, Hydro Tasmania announced its Battery of the Nation plan, which could double the state’s renewable energy capacity from 2500MW to 5000MW through pumped hydro storage, wind farms and upgrades to existing hydro power facilities. A number of new wind farms are under development in Tasmania, with the state’s north-west being touted as “Australia’s wind farm capital”. The Robbins Island Renewable Energy Park is a proposal for a 450MW project, with the possibility of being expanded to 1000MW if a second interconnector is built to the mainland. This would make the wind farm the largest in the Southern Hemisphere. Victoria The Victorian Government has committed to two renewable energy targets: 25 per cent by 2020 and 40 per cent by 2025. Renewable energy penetration in 2017 was 16 per cent. This will be supported by the Victorian Renewable Energy Auction Scheme, a reverse auction to fund 650MW of new renewable energy, with 100MW of this specifically for large-scale solar. The scheme is the largest renewable energy reverse auction in Australia and will result in a significant increase in renewable energy projects in Victoria.

The Victorian Government has also announced the outcome of tenders under its Renewable Certificate Purchasing Initiative, which involves the government procuring renewable energy certificates directly from new Victorian projects. The 31MW Kiata Wind Farm and the 132MW Mt Gellibrand Wind Farm were the successful projects under the first stage of the initiative, while the 88MW Bannerton Solar Park and 34MW Numurkah Solar Farm were awarded tenders under the second stage of the competitive tender process. Western Australia Western Australia has traditionally lagged behind the eastern states when it comes to renewable energy, but during 2017 more than 1000MW of wind and solar projects were seeking connection approvals and finance in the state’s south-west. However, WA is the only state or territory in Australia that hasn’t committed to a target for renewable energy or zero net emissions. Renewable technologies accounted for 14 per cent of the state’s total electricity generation in 2017. In late 2017, the WA Government announced that state-owned power utility Synergy will set up a green power fund with investment from the Dutch Infrastructure Fund, providing an opportunity for investors to finance a portfolio of renewable assets to diversify risk and reduce costs. The Australian Energy Market Operator (AEMO) estimates that another 700MW of new renewable energy capacity will be

Renewable generation by technology type Large-scale solar PV 1.8% Bioenergy 9.7% Small-scale solar PV 9.7%

Medium-scale solar PV 0.5% Solar Thermal 0.1% Hydro 33.9%

Wind 33.8%

Annual national electricity generation in 2017 Renewables 17%

Fossil Fuels 83%

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ALL-ENERGY required to meet WA’s share of the Renewable Energy Target, and Western Power estimated in mid-2017 that more than 1000MW of new projects are in the pipeline.

Boosting employment and understanding pricing challenges Increased confidence in renewables has resulted in an unprecedented level of industry activity, with the rooftop solar sector reporting a shortage of qualified electricians in some areas. By the end of 2017, many established solar retailers were reporting that the increased level of activity sometimes made it difficult to find enough qualified electricians to complete all the work that was coming in, and these market conditions helped trigger a steady increase in the number of accredited solar installers. By the end of 2017, the number of installers accredited with the Clean Energy Council had grown to 4941. This was slightly more than the 4824 registered at the end of 2012, which was the previous highest year for the sector. The number of new accredited installers per month increased by 60 per cent in 2017 compared to the year before. If the demand for solar continues throughout 2018 – and many of the factors that drove the strong results in 2017 are still in place – the level of opportunity will lead to more electricians doing the necessary training to expand into the solar sector.

Increased project activity for large-scale wind and solar also resulted in a growing number of jobs in regional areas across the country. Affordability challenges continue across the National Electricity Market, following significant price rises over the past decade. According to the Australian Electricity Market Commission (AEMC), the national average annual residential electricity bill in 2016-17 was $1424, up from $1296 in the previous financial year. The prediction for 2017-18 is a further rise to $1576, before falling to $1495 in 2018-19 and $1387 in 2019-2020. The AEMC found wholesale electricity costs – the cost of generating power – has been the single biggest driver of residential electricity bill increases recently. Earlier price trend reports had identified network costs as the main upward driver. High gas prices and the closure of several coal-fired plants combined to lift wholesale electricity prices by almost 11 per cent nationally. A report by the Australian National University showed that between 2006 and 2016, electricity price rises were highest in the states with relatively low levels of renewable energy and a high reliance on gas and/or coal generation (136 per cent in Queensland, 118 per cent in Victoria and 109 per cent in New South Wales). In contrast, South Australia, which now generates almost half of its energy from renewables, experienced a far lower electricity price rise (87 per cent) over the same period.

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ALL-ENERGY ENERGY PARTNER CONTENT

SCALABLE, MODULAR AND EFFICIENT SOLAR

DIESEL HYBRID

POWER GENERATION For communities and businesses in remote areas, the choices with regard to reliable power sources have traditionally been somewhat limited, but Aggreko’s solar-diesel hybrid package has been designed to change all of that.

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raditionally, these customers would rely on generators powered by fuel sources such as diesel. And while such fuel sources are very reliable, they’re often expensive, and they’re not the best energy choice as far as the environment is concerned. With decreasing costs in recent years, solar power is rapidly becoming an attractive proposition for remote customers. However, the reality is, it is an intermittent fuel source – night falls or clouds come in, and power is lost. Seasons change and power capacity drops, which means that businesses cannot rely on it as a sole energy source.

result delivers the best of both worlds – uninterrupted power 24/7 at an affordable cost. Battery storage is the third pillar of Aggreko’s offering, and key for a stable and reliable power supply. It strengthens a customer’s grid by buffering the impact of fluctuating power demand and supply; and at the same time, the lifespan of generators is increased, and associated operations and maintenance costs decrease because the generators are run less often and more efficiently. The hybrid package seamlessly combines solar, diesel and battery storage thanks to a state-of-the-art energy management system, minimising operating costs without compromising on reliability. The result is constant, reliable power around the clock, with significant cost savings – all packaged into a single contract, for customer peace of mind. Aggreko’s hybrid package is designed to benefit any customer or industry with a power need in locations with limited or no access to permanent power. These include remote communities, and the construction, mining and utilities sectors. For more information about Aggreko’s solar-diesel hybrid package, head to www.aggreko.com.au.

KEY BENEFITS Significant cost savings Looking for a solution that combined the benefits of diesel and solar, and counteracted the weaknesses of each fuel source, Aggreko developed its solar-diesel hybrid package. Combining solar with diesel-generated modular power to complement, the

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Available, reliable power 24/7 A single turnkey contract for solar and diesel No upfront capital outlay

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ALL-ENERGY ENERGY PARTNER CONTENT

AUSTRALIA’S RENEWABLES LEADERS TO GATHER IN MELBOURNE Australia’s most comprehensive clean and renewable energy exhibition and conference, All-Energy Australia, is expected to hold its biggest event ever as it celebrates its tenth anniversary on 3-4 October 2018 at the Melbourne Convention and Exhibition Centre.

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ll-Energy Australia’s 2017 event was attended by more than 6500 renewable energy industry professionals from across the country and overseas, making it the largest attendance on record. Robby Clark, Exhibition Director of AllEnergy Australia, said the event’s success is reflective of the remarkable progress in the renewable energy industry. “Last year’s attendance exceeded our expectations, with queues of people lining up to get into the plenary sessions and exhibition floor. The tremendous success of the event is an indication of the rapid growth of the renewable energy industry. “All-Energy Australia has provided the perfect venue to celebrate the industry’s successes and discuss the challenges and new market opportunities for Australia’s energy system. We’re confident that this year’s program will maintain the event’s reputation as the must-attend event for the renewable energy industry,” Mr Clark said. Kane Thornton, Chief Executive of the Clean Energy Council, strategic partners for the event, echoed this sentiment. “The robust conversations and meaningful connections that come from this event are of immense value to an industry

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in the midst of an unprecedented boom. “All-Energy Australia 2018 takes place at an important stage as we continue to work towards achieving our vision of an Australia powered by clean energy,” Mr Thornton said. Now in its tenth year, All-Energy Australia 2018 will remain Australia’s largest all-encompassing clean and renewable energy event, featuring more than 180 industry speakers, over 180 exhibitors, six conference streams and four networking opportunities.

World-class speakers The conference program will be divided into six streams, with more than 180 industry leaders sharing exclusive insights and projections on how to tackle the future of the energy sector. The speaker list includes representatives from Federal, State and Local Government, the Clean Energy Finance Corporation, CSIRO, KPMG, Redback Technologies, DNV GL, Hydro Tasmania, the Clean Energy Regulator, Smart Commercial Solar and Siemens. The first day will kick off with an opening plenary, featuring a ministerial welcome by

This year’s All-Energy exhibition will be bigger than ever.

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ALL-ENERGY ENERGY PARTNER CONTENT

Victoria’s Energy, Environment and Climate Change Minister, Lily D’Ambrosio, and a ministerial keynote by Federal Environment and Energy Minister Josh Frydenberg. On Day 2, Powershop’s Chief Executive Officer Ed McManus and Zen Ecosystems’ Chief Financial Officer Michael Joffe will take part in a panel discussion in the opening plenary, discussing the game changers of the energy industry and looking at bringing positive disruption to the future energy system. This will be followed by a presentation from Shadow Assistant Minister for Climate Change and Energy, Pat Conroy.

Exhibition floor This year’s All-Energy Australia is over 40 per cent larger than the 2017 event, which means more industry-leading companies showcasing more innovations and emerging technologies, more expert advice and more live demonstrations. Over 180 companies have already confirmed to be part of

the exhibitor lineup at All-Energy Australia 2018 including ABB, NEXTracker, Tesla, Jinko Solar, Fronius, Canadian Solar, SolaX Power, Array Technologies, Flex, Clenergy, Delta Energy Systems and Ecoult.

Networking All-Energy Australia has scheduled a number of networking opportunities for attendees to meet like-minded professionals, such as the Grand Networking Event where All-Energy Australia will celebrate its tenth anniversary, and the Clean Energy Council will hold the Solar Design and Installation Awards. Other networking opportunities include the Clean Energy Council’s Women in Renewables lunch, the all new lounge called the Power Club and the Meet the Speakers social. To access the 2018 program and register for free, please visit the All-Energy Australia website, www.all-energy.com.au.

Delegates will hear from a range of speakers, including Victorian Energy, Environment and Climate Change Minister Lily D’Ambrosio.

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RENEWABLES ENERGY PARTNER CONTENT

SELECTING THE RIGHT FOUNDATION FOR GROUND-MOUNTED PV PANELS

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electing the right foundation for a ground-mounted solar PV installation is critical for its success as the use of an incorrect foundation can result in premature refusal, costly change orders and project delays. Selection should be based on a geotechnical study of the project area to determine the best option. Here, we will look at the different types of foundation, and how to select the right one for your installation. Jeff Lawson, National Construction Equipment Sales Manager at Vermeer, said there are four main types of foundation that can be used for ground-mounted solar PV systems. “There are four major types of foundations that are commonly used: helical piles, earth-screws, ballasted foundations and helical piles,” Mr Lawson said. “When selecting a foundation type, and the machinery that will be used to install it, it is important to understand the positives and negatives of each type of different ground condition. “For example, areas with loose sand and a high water table or low soil cohesiveness require the foundation to be embedded at a greater depth so a helical pile or ballasted foundation would be the best choice. “However, in areas with harder, more difficult terrain, earthscrews and ballasted foundations are better. “Driven piles on the other hand are best suited to areas with good soil cohesiveness and low water tables.”

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Helical piles Helical piles are best suited to areas where soil cohesion is poor as they are easily installed using auger attachments on excavators or other equipment that can rotate it into the ground. Once installed, they act as an anchor and lock the structure into the soil. They require only a small amount of earth to be dug out, so contractors can save time and money. They also have minimal environmental impact as there is little noise pollution and little to no ground movement. A pull test needs to be done before installing helical piles to determine the embedment depth and ensure there is enough resistance to satisfy the load requirements of the PV support structure. Earth-screws Earth-screws can be installed by pre-drilling holes into the ground before they are screwed in using excavators and other equipment which use auger attachments. They can also be installed straight into the ground if there are no refusal issues. Earth-screws can have a higher cost of installation than other foundation types if a separate machine is needed to be brought in for pre-drilling. Ballasted foundations Historically, ballasted foundations have been more expensive than driven or screwed foundations, however over time prices have declined and they have become a more viable option. They www.energymagazine.com.au


ENERGY PARTNER CONTENT RENEWABLES

are particularly suited to areas where there is a high refusal rate and low soil cohesiveness, where helical pile and earth-screws are not as effective. However, ballasted foundations have some limitations, especially if the area is sloped or uneven as there are extra calculations that need to be made to accommodate the slope and relative change. Soil settling, erosion and heaving also need to be taken into account before installation as ballasted foundations can be subject to stresses from soil movement. Driven piles Driven piles are best suited to areas which have clay, gravel, dense sand and low water tables, where the ground has good soil cohesiveness. They are commonly used on large-scale projects as they have a number of advantages over other foundation types, including speed of installation, accuracy, lack of cure time and low cost. While driven piles are a cost-effective option for large-scale projects, they may not be the best option for small-scale systems as specialised equipment needs to be used, equating to a higher cost per unit.

Equipment driving down costs “Driven piles are commonly used in Australia on large-scale solar PV projects due to their suitability to ground conditions and their low cost. One of the key factors reducing the cost of driven piles www.energymagazine.com.au

construction methods and making them considerably cheaper than other foundation types is the availability of highly sophisticated equipment,” Mr Lawson said. “Equipment such as Vermeer’s PD10 pile driver has a number of features which can help drive down project costs and make contractors more competitive. “The PD10 partners with leading GPS guidance systems to increase efficiency and productivity while an incolmeter with auto-plumb and laser-controlled post-depth-control feature ensures every pile is installed accurately.” Mr Lawson said that features such as these, which increase accuracy, are important for ground-mounted solar PV systems as the piles need to be driven into the ground at precise levels no matter the ground conditions. “The piles need to be installed correctly as they provide the foundation on which the solar panel systems will be built. “That’s why machines like the PD10 are important for large-scale projects, because it not only eliminates the guesswork but does so consistently. “The foundation forms the backbone of a solar mounted PV system so it’s important to not only select the right foundation type for the prevailing ground conditions, but to also choose a contractor with equipment that increases productivity and keeps project costs low.”

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RENEWABLES

RENEWABLE ENERGY SCHEME

FOR TONSLEY TENANTS

South Australia continues its leadership in sustainable energy with the introduction of a District Energy Scheme at Tonsley Innovation District, to be powered by one of Australia’s largest rooftop solar arrays.

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hen complete, approximately 20,000 solar photovoltaic panels will be installed on the expansive eight-hectare roofs of the Main Assembly Building (MAB) and adjoining TAFE SA building, with a total installed capacity of up to 6MW providing power for Tonsley businesses, organisations and residents. Enwave Energy was selected as the preferred proponent, through an Expression of Interest, to deliver a renewable energy solution for Tonsley, in keeping with the district’s commitment to sustainability and innovation and its Six Star Green Star Communities Rating. The company will build, own and operate the district energy facility, drawing on its experience in owning and operating similar district energy services at Sydney Central Park and Sydney Airport. The company will invest approximately $40 million over a 50-year period for battery storage, photovoltaics, smart technologies and future MAB electrical assets. The system will optimise solar energy generation and battery storage for the peak load of the entire Tonsley precinct, enhancing security of energy supply and providing competitive energy pricing to all customer classes, including commercial and residential. Tonsley is managed by Renewal SA on behalf of the State Government, and is the home of leading firms in the renewable energy sector, including SIMEC ZEN Energy, Tesla, AZZO and Siemens. Renewal SA General Manager Property Mark Devine said the District Energy Scheme would further consolidate the district’s role as a hub for investment and innovation in this sector. “To help make the most of this on-site expertise, Enwave Energy will subcontract SIMEC ZEN Energy to install and maintain the solar panels infrastructure and will engage Siemens to provide smart network design services,” said Mr Devine. “Initially, the District Energy Scheme will include access to electricity and recycled water services for the entire Tonsley community, and gas and domestic hot water services for the residential community only.

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An aerial view of the roofs at Tonsley Innovation District that will house 20,000 solar photovoltaic panels.

“There are also plans to expand the scheme to include a thermal network for the entire site for building space heating and cooling requirements.” Businesses at Tonsley have the choice to buy their electricity from Enwave Energy at competitive market rates, or from the energy retailer of their choice. Enwave Energy will employ five full time staff in professional roles, as well as contracting local businesses to provide ongoing services. There is also potential for collaboration with Flinders University and TAFE SA to train people to work in the energy sector. All costs and risks associated with operating and maintaining the utility infrastructure will be the responsibility of Enwave Energy. Enwave Energy is backed by Enwave Australia, a wholly-owned subsidiary of Brookfield Infrastructure, which designs, builds, owns and operates water, gas and energy networks for entire communities. Mr Devine said the Enwave proposal would deliver on Tonsley’s commitment to become a climate smart district. “It will offer a world-class District Energy Scheme, incorporating on-site renewable power generation, battery storage and smart technologies that can be scaled up as the district grows." The scheme will supply businesses and organisations at Tonsley with a reliable, competitively priced and secure electricity supply generated by renewable energy.

The scheme will help consolidate Tonsley as a hub for renewable energy investment and innovation, and help to attract more businesses keen to establish in an environmentally sustainable innovation district. Tonsley Innovation District is located at the premises of the former Mitsubishi car manufacturing plant in Adelaide’s southern suburbs. The district is home to over 30 businesses and more than 150 members of the two co-working spaces on-site, plus the Flinders University College of Science and Engineering and TAFE SA. Over 1400 people are employed on-site – more than when Mitsubishi ceased manufacturing cars on the site in 2008, and there are about 6500 students at Tonsley each year. Enwave Australia Chief Executive Cameron Evans said the company was thrilled to have been chosen as the incumbent utility provider at Tonsley. “We look forward to working with Renewal SA and local companies to develop innovative solutions for the community’s energy and water needs,’’ said Mr Evans. “Enwave Energy delivers innovative energy solutions,” he added. “We aim to create, maintain and provide a smart and sustainable service. “Our bespoke solutions are both cost and resource efficient and, because we aren’t encumbered by legacy systems, we pursue all forms of proven technology to deliver the best outcomes possible.”

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AUSTRALIA’S FUTURE ENERGY HUB Tonsley Innovation District, only 10km south of the Adelaide CBD, has established a unique position in Australia.

Join these innovators and seize the opportunities of the future together.

Tesla, GFG Alliance’s SIMEC ZEN Energy, Brookfield Infrastructure’s Enwave Energy, Siemens, SAGE, AZZO and Phoenix Contact are just some of the leading renewable energy and cleantech organisations located at Tonsley.

Find out more at:

tonsley.com/ FutureEnergy


DISRUPTION

THE CUSTOMER-LED CHALLENGE OF PLANNING FOR DISRUPTION by Pene Newitt, Insight and Analytics Team Leader, Western Power

Pene Newitt from Western Power shares the insights she and her team are drawing upon to help the energy utility plan for a drastically different future.

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he natural tensions that occur between the various governments, regulators and technology providers within the Australian energy sector are tugging harder and faster than ever before. The convergence of multiple technological enhancements becoming more readily accessible and cost-effective in the same era (solar, batteries, electric vehicles, advanced metering), as well as the growing appetite among energy networks and their experts to lower costs by building these technologies into micro and nanogrids, means that there is a major shift coming for the energy sector. One where customers are at the heart of change. Behavioural change driven by lifestyle needs, coupled with a better understanding of new technology, is challenging the old energy norms. It is leading to a point where all pieces of the puzzle must work towards a singular, more nimble goal of what Australia’s energy future looks like. A comfort zone, if you will. Under the current framework, the regulatory and government side is lagging behind technological advancements and customers’ changing behaviours. Disruptive technology and behaviours weren’t considered early enough. Spending time with a number of national and international innovators and thought leaders at a recent energy innovation conference has further galvanised this thought in my mind.

The natural tensions between regulators, governments and technology are intensifying as customers become better educated about their energy options and as their own behaviours evolve.

Planning for disruption? Planning for disruption sounds like an oxymoron – how do you plan for the unknown? When change hits, it can be swift and unforgiving. Just ask the Nokias or Kodaks of the world. Trying to predict the future is a major challenge, but there are ways to build this disruptive behaviour into your forecasting and planning.

DISRUPTION

Our Grid Transformation team is using data to build the complex connections between what our network looks like now and what it might look like in the future. We’re making “no regret” plans that will deliver the best value service for customers in a more nimble environment.

We’re doing it right now – strategically rebuilding our business to be nimble and flexible. We’re looking at how we can pivot quickly if the network we are planning suddenly doesn’t look like the right model – or needs to be tweaked to account for new, innovative products or services. In some ways we can broadly forecast where disruptive technologies will be – but how quick the change will be and how pervasive it is are great unknowns. When looking at our forecasts, we have multiple teams analysing the short, medium and long term customer and network needs. Our major challenge – and one that is shared by many of our energy network peers – is how do you bridge the gap to make sure you’re effectively planning for long, medium and short term, without overcommitting to any singular network path that could be disrupted? This involves understanding how customers will use energy in the future. Our forecasting team is building scenarios that map energy profiles across the network, to the customer rather than to the substation. This is designed to be independent of the network that currently exists. Customer profiling allows us to align disruptive behaviour, forecasts and scenario modelling in order to understand their needs moving forward from a cost, service, reliability and environmental friendliness (renewable energy) perspective. What will this mean for the government, regulator and technology energy trinity? Basically building a future network that is for the people. We just need to get everybody on the same page.

We have five core customer segments. Research shows customer intent to adopt new technologies. Considering we have more than 1.1 million customers, widespread adoption of these technologies will have a significant impact on the grid. We are planning for how the grid can enable and support these technologies and other disruptive forces that enter the market in the future.

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DISRUPTION

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DISRUPTION

THE ONGOING BENEFITS OF VICTORIA’S SMART METER ROLLOUT by Steven Neave, General Manager Electricity Networks, CitiPower and Powercor

Ten years ago, the State Government made a decision to rollout a piece of technology into every Victorian home. It was controversial and unpopular, but is now proving to be one of the biggest drivers of innovation across the state’s network businesses. CitiPower and Powercor’s General Manager Electricity Networks Steven Neave reflects on some of the changes the technology has delivered.

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DISRUPTION

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hen we talk about disruption or innovation in the energy sector, it’s always solar, batteries, electric vehicles or mini-grids that come to mind. And while these technologies will disrupt how our society generates and distributes energy, it was a decision by the Victorian Government that has created some of the biggest change on our networks. This technology has provided our industry with a taste of what we can do differently – it has driven innovation and change. And it’s found in most Victorian homes. What I’m talking about is the smart meter. While the technology itself couldn’t be described as disruptive, it’s provided the foundation for future disruption and innovation on the grid that will benefit customers and the sector. Importantly, it’s disrupted how we, as an industry, manage and operate our networks. And we are continually discovering new ways it can deliver benefits. The Victorian Government-mandated mass rollout was controversial. There were claims about potential health impacts, cost blow outs and questions about whether consumers would even benefit from this change. There were protests outside Victorian MP offices, people moved out of their homes, and meter installers were threatened. There was a push for the program to be scrapped, but it kept going – and I’m pleased it did. Across the CitiPower and Powercor networks, we have now installed more than one million smart meters as part of the mandated rollout.

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Many consumers still wonder what benefits the smart meters have delivered. For those in the sector, we see these benefits every day – and we know customers do too. The meters and associated network have allowed us to drive a smarter, increasingly cost-effective network. They have allowed us to better manage load through price signalling which ultimately drives down network costs over the long term – this is a competitive advantage unique to Victoria. The mass rollout didn’t just give consumers the ability to monitor their own energy use – it’s delivered Victorian networks valuable data. This data is giving our engineers the ability to innovate our sector and others around us. The meters and the associated network has allowed us to incorporate a Meter Outage Notification service, access to timely, accurate consumption and generation to grid data, and the ability for customer side outages to be identified without the need to dispatch fault crews. This has driven a reduction in fault restoration times. We are using them to improve the safety of our network. For example, we are now able to use these meters to detect neutral faults in a customers’ home before they become a safety problem and we are acting on these. They give us the ability to identify and maintain critical supply points, such as life support customers, during outages and load shedding emergencies. They allow us to detect potential issues on our other electrical assets, allowing us to fix them before they fail. We are also testing how we can harness the smart meter network to monitor air quality and enable innovation in public lighting.

This summer, the mass smart meter rollout allowed us to contribute to AEMO’s Reliability and Emergency Reserve Trader program, which is about helping reduce demand during high-peak demand days and keeping the lights on for industry and households. Known as the Smart Meter Voltage Management system, it involved lowering voltages quickly and at scale to reduce the pressure on networks. While this process has been used in the past to help ease demand, smart meters are allowing us the ability to drop voltage lower than we have been able to previously by monitoring voltage at every customer premise. While we are now seeing smart meters rollout in other states, this is being done on a small scale and in a contestable manner. What this means is that any company, whether it’s a retailer, network or dedicated metering business, is able to sell a customer meter. They then own the data. What sets Victoria’s smart meter program apart is that networks are able to leverage the technology in a way that provides wide insights across the network and allows us to deliver better reliability and safety for the customer. It’s also allowed Victoria to get ahead of other states when it comes to network innovation and, in time, disruption. Due to the unique visibility of the low voltage network provided by smart meters, Victoria is now in the privileged position of being able to install more solar and batteries, without the need to build more network to support this growth, setting us apart from other states. What’s exciting is that a decision to rollout an innovative technology a decade ago has changed networks in a way that we are still uncovering.

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DISRUPTION

SMARTLY SECURING YOUR GRID FROM CYBER ATTACKS by Simon Vardy, Managing Director, Accenture Australia Utilities Strategy Practice

The threat of cyber attacks on power infrastructure is a cause of global concern, with their critical systems a prime target for cyber attackers to inflict serious damage and disruption. In the past twelve months, hackers have breached the networks of energy providers in Germany, Ukraine and the US using sophisticated malware, causing power outages of various scales and prompting serious concern amongst providers and governments.

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rrespective of motive or source, a successful attack in Australia could see large populations across the country suffering major power outages, as well as causing enormous business disruption and resulting in substantial economic damage. Additionally, energy providers in Australia are increasingly experimenting with “smart grid” trials, in the hope of providing consumers the power to use energy more efficiently and alleviate risk of future blackouts, as seen in South Australia in 2017. Despite the benefits, the evolution to smart grid technology that connects IT, energy management systems and consumers is blurring traditional boundaries and creating new security vulnerabilities. Microgrids are increasingly being investigated by Australian energy providers, heralded for their flexibility, resilience and integration with renewable power. Microgrids provide the ability to “self-island” from a distribution network and can use distributed, self-healing architectures to maintain energy delivery. If

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a physical event or cyber attack causes a power outage, microgrids can also contain the impact by shedding non-essential loads and continuing to energise critical loads. However, they themselves are vulnerable as a result of their increased penetration of monitoring and control capabilities, which open up the possibilities for breaches of security. As we transition to a more digitised energy world, there is a fear that the same greater connectivity enabled by smart grids and microgrids could also create even greater opportunities for cyber criminals to launch crippling attacks.

A rapidly evolving risk landscape Australian energy providers are fully aware of the potential damage cyber attacks can inflict on our electricity networks. Accenture’s Digitally Enabled Grid survey revealed that more than half (57 per cent) of distribution business executives cite interruptions to supply as their greatest cyber attack related concern, closely followed by potential impacts on customer and employee safety (53 per cent).

While distribution utilities are wellpracticed at restoring grids after traditional disruptions like adverse weather or asset failure, Accenture research showed only half of utility executives thought they were well-prepared for the challenges of an interruption from cyber attack. Further to this, the latest Accenture High Performance Security research shows that fewer than 40 per cent of electricity utilities globally have methods, tools and skills comparable to the highest level of performance. Our experience has also shown that the greatest challenges to effective preparedness and response to cyber threats are often internal, rather than external factors. In fact, obstacles are often created by the cultural and organisational silos that exist between operations and technology business units; as well as the dwindling number of personnel available to operate the grid without technology, which can significantly strain utilities’ capabilities. The current technology landscape for many utilities operators features control systems that work on old or vulnerable

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DISRUPTION Investigate a platform approach to cyber security capabilities With increased regulation and greater customer requirements, distribution businesses are finding it difficult to prioritise projects and may therefore find themselves lacking the resources required to address and develop cyber security capabilities. It may therefore be productive to find ways to pool resources or look to platform-based models and technology solutions that could help address common cyber security challenges, removing the need to build their own internal capabilities. Integrate resilience into asset and process design Most utilities still operate systems and assets that were designed before the advent of computers, and definitely before the emergence of cyber attacks. Including cyber security into asset and process design will certainly make the distribution system more resilient. As an extra step, integrating natural hazard hardening as well as security into the design of distribution grids will make these more resilient at a lower overall cost.

operating systems – commonly without sufficient processing power to run effective virus scans, or a lack of encryption or authorisation on communications channels – accompanied by limited or no security for endpoints, such as programmable logic controllers and intelligent end devices.

Developing a resilient delivery system Cyber security needs to become a core industry capability for energy providers, one that protects the entire value chain and extended ecosystem from end to end. The increasing convergence of physical and cyber threats requires the development of capabilities that go well beyond simple compliance. Utilities should invest in cyber resilience measures, as well as effective response and recovery capabilities. There are some strategies utility companies should consider to strengthen resilience and response to cyber attacks. These steps could allow the building and scaling of cyber defence capabilities:

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Share threat information Distribution businesses are likely to be facing the same common threats. Sharing intelligence and information between businesses is a critical activity that could help create situational awareness of the latest threat landscape and how to prepare accordingly. However, data privacy and security regulations may impact greater openness and transparency between businesses. In the absence of information sharing between utilities, external cyber experts could be consulted to help create a much-needed situational awareness. Develop security and emergency management governance protocols Developing a cyber security governance model should reflect the prevailing corporate culture. For example, a topdown, centralised business should mirror its culture in its cyber security governance model. Similarly, a business that is less centrally controlled and managed should adopt a similar decentralised approach to the governance of cyber security. There is no single approach – each distribution business needs to consider its organisational and operational context in order to devise the most effective approach. Develop relationships with regional security officials and with cyber response experts Whether national security and intelligence officials or private sector cyber response and legal experts, expertise will

be required to help contain, investigate and manage the consequences of the response. Developing these relationships now, modelling the interactions and planning the response will be critical to an effective, efficient response to cyber attacks.

Embracing security at the core Grid operators in Australia are at varying stages in the cyber protection maturity curve. While some are only working toward compliance with security standards, others are already working on developing cyber security as a core business capability. To combat cyber risks, distribution businesses need an agile capability that creates and leverages situational awareness, based on changing threat factors and that can quickly react and intervene to cyber attacks. Leaning on the wider energy ecosystem, Australian transmission and distribution utilities must engage with government and industry forums so that new threats are managed quickly and effectively. To meet the security imperative from within, a smart grid, or microgrid, must integrate consolidated, end-to-end IT and physical security into its design, ensuring system “irregularities” can be flagged seamlessly between grid control, security operations, network operations centres and beyond. In Accenture’s view, the optimal approach to cyber security is an effective segmentation of risks, with the implementation of the most advanced security for highest-risk, high-value assets or highest-impact customers. At this level, utilities will have greater operational control, improved situational awareness, lower risk, superior control of operations and maintenance costs, and are better prepared for the impact of future disruptive technologies. This should be achieved through certificate-based, device-level authentication (where feasible), network protocols that support encryption, application security, network segmentation, security monitoring, incident response and a hardening process to manage vulnerabilities in a timely fashion. Cyber attacks to Australian utility infrastructure could cause chaos and mass disruption, from motivated ransom attacks to completely disabled networks. As utilities go digital, Australian energy providers must be proactive in both their adoption of smart and microgrid technology, as well as implementing powerful, adaptable security systems that minimise risks posed by cyber attacks.

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MICROGRIDS

Aerial view of the Mooroolbark Mini Grid.

THE FUTURE WILL BE DISTRIBUTED Solar power, energy storage, smart control technology and microgrids are making continued inroads into the way we produce, use and sell electricity in Australia. For utilities to stay relevant to consumers, they need to be at the forefront of these new technologies. We spoke to Justin Harding, AusNet Services’ Distributed Energy and Innovation Manager, to learn more about the work they are doing in this space.

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he penetration of solar power in Australia is growing rapidly – in 2017, Australia’s homes and businesses collectively reached the milestone of 6000MW capacity, enough electricity to power more than 1.8 million homes. And with battery technology improving, it’s clear that this level of penetration will only continue to increase. The way consumers view and use electricity is changing – and for utilities to stay ahead of the curve, they need to start thinking

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beyond the traditional model of electricity generation and delivery. As a result of the changing energy paradigm, solar and other distributed energy resources (DER) are a major focus area for AusNet Services, to empower communities and their energy future. The business has launched several initiatives in the space, from making the DER connection process easier for customers, to managing the technical impacts of integrating customer-driven DER into the network.

As we move toward the use of more DERs, microgrids, with their ability to enable cooperation between different resources, will be critically important. Microgrids offer the prospect of localised resilience within the overall energy system, and we expect that the future of the grid will exhibit a diverse mix of projects that offer increased energy affordability, security and reliability,” said Mr Harding.

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MICROGRIDS

According to Mr Harding, a number of different parties within the AusNet Services electricity distribution network are actively investigating microgrid solutions. Some of the proponents include: »» Community groups and organisations that are looking to achieve local emissions reductions or supply reliability improvements or both »» Councils that are looking to deliver cost savings and increased energy resilience to communities and businesses »» Property developers that are looking to add value and points of differentiation to their development projects »» Renewables developers that are looking to invest in renewable energy projects »» Energy retailers that are looking to retain customers and derive wholesale market benefits

Testing the waters Given the importance of microgrids across the future grid, AusNet Services has established a significant project to gain a deeper insight into the impact microgrids will have. The Mooroolbark Mini Grid is an innovation project testing a future scenario of high DER uptake combined with smart controls and optimisation. It’s Australia’s first mini grid in an established community, and it explores how energy is utilised at both the household level and more broadly across the community, including both DER customers and non-DER customers. “The project is providing us with technical insights as to the role that microgrids and other DER constructs can play more broadly across our network, and paves the way for network control schemes that can orchestrate fleets of DER,” said Mr Harding. In March, the project recorded a significant milestone by successfully separating the houses that form the Mini Grid from the main power grid for almost 22 hours, while enabling a steady and secure power supply to customers by sharing renewable energy. Only 14 of the 18 homes which separated from the main grid had solar panels and batteries. These are shared with the network, demonstrating the benefits power sharing can play during power outages. The testing, which saw Mooroolbark Mini Grid isolated from the main grid for up to 22 hours was conducted over a two day period.

Total base energy consumption (kWh)

220

Total solar generation (kWh)

189

Total energy stored in house battery before start (kWh)

126

Total energy stored in stabiliser battery before start (kWh)

75

Energy left in batteries at the end of islanding (kWh)

62

Table 1. Power flows within the Mooroolbark mini grid.

Both days had maximum temperatures of 31°C. The relatively high temperature contributed to an increased cooling load for customers and also reduced the performance of the household battery systems. With cooler conditions or with higher performance batteries, AusNet Services believes a longer duration of islanded operation could have been achieved. Over the course of the test, the mini grid generated 189kWh of solar energy, and consumed 220kWh across the entire 18 customers Complete statistics around the power flows within the mini grid are summarised in Table 1. The state of charge of the household batteries and that of the stabiliser battery across the test are shown in Figure 1. This demonstrates the successful orchestration of individual household batteries in order to maintain the stabiliser battery within a target window of state of charge. While separated from the main grid, AusNet Services’ Distributed Energy Network Optimisation Platform (DENOP) was used in conjunction with GreenSync’s MicroEM solution to control the batteries and share the stored renewable energy among all 18 homes – even those without solar – before successfully switching all homes back to the main power grid. During the trial, excess generation was absorbed into customers’ own battery systems. When all customer batteries filled up, the control system would then divert excess generation into the

Figure 1. Battery state of charge during mini grid islanding test.

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MICROGRIDS 101

Microgrids can come in all shapes and sizes and there are no established definitions around how many customers constitute a nanogrid, microgrid or minigrid. At the smallest end of the scale, a single customer that can power themselves independently of the grid can be considered to be a microgrid. This customer could be a residential customer or a large commercial facility or campus that has multiple sources of generation and multiple loads. Clusters of houses in rural areas are often in the tens of customers and even at this small scale, there is value in the diversity of loads between customers such that it is much more economic to power the cluster as a microgrid rather than power each customer separately with stand-alone power supplies. This scale of project may be interconnected by the low voltage distribution network.

central community battery. If the central battery filled up the system would then signal the solar systems to reduce their power output in order to keep supply and demand balanced. “As you can imagine, the suite of control systems that manage this process in real time need to be very sophisticated and our project team worked hard to achieve this capability,” said Mr Harding. “This included close collaboration with our main partners GreenSync in deploying their microgrid control product, Power Technology Engineered Solutions in deploying their PowerCache microgrid stabiliser product, as well as our internal development of DENOP to manage data flows and deliver advanced control functions.” The islanding tests at Mooroolbark were conducted with customers using power as normal. Mr Harding said that while it would have been possible to operate the microgrid for longer if customers limited their usage, the focus for this project was to prove the possibility of providing customers with increased levels of network service. What this trial ultimately shows is that the process can be adapted over time to dramatically reduce the impact of power outages, especially in remote and rural areas. But Mr Harding said that while the trial has shown that local supply resilience is technically achievable, it has also shown that this constitutes a very

Victorian Energy Minister Lily D’Ambrosio launches the Mooroolbark Mini Grid Project alongside AusNet Services’ Managing Director Nino Ficca and Executive General Manager of Regulated Services Alistair Parker and some residents from the trial.

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Townships may be in the order of hundreds or thousands of customers. Projects of this scale might need to involve the high voltage (22kV) distribution network. It is even possible to form microgrids in the tens of thousands of customers, although the scale of generation required and the complexity in managing the system starts to blur the line between grid and microgrid. “Whatever the scale of microgrid, the control system must ensure that supply always equals demand on a real-time basis,” said Mr Harding. “There will indeed be times when there is excess generation within the microgrid, that if unmanaged, could cause power flows to become unstable or for assets to become overloaded. “Rather than limiting the number of customers with generation, we would prefer to see a smart control system that dynamically manages the level of generation to keep the microgrid stable.”

different use of the distribution network. This will require a step-change in the level of sophistication in AusNet Services’ network management and safety protection systems. “More specifically, throughout the trial we needed to employ a voltage-based protection scheme in parallel to our legacy network over-current protection scheme, based on traditional circuit breakers and fuses,” said Mr Harding. “Therefore we expect to be closely involved in any customer driven microgrid projects that seek to provide backup supply capability.”

Microgrids: where to next? The Mooroolbark trial has provided significant insight into the way microgrids operate and the role they will play in the AusNet Services’ network in the future, and according to Mr Harding, the utility is open to utilising a range of different types of microgrid in the future. “The operating profile of the microgrid will ultimately depend on the purpose that the microgrid is serving and the technical capability of the equipment involved,” said Mr Harding. “We are open to employing any type of generation within a microgrid, to the extent that the options are technically fit for purpose, economically attractive and acceptable to customers. “In most cases solar power is the cheapest form of small-scale renewable generation, but there will be unique applications where wind, hydro, biomass or other forms of renewables will be suited.” For example, AusNet Services has worked closely with the Warburton community and the Yarra Ranges Shire Council on a micro-hydro project, and has initiated some investigation into whether the hydro plant could in future form the base of a local microgrid. According to Mr Harding, some projects will also be suited to the incorporation of non-renewable sources of generation, including hybrid systems of renewables and non-renewables working in tandem. Hybrid systems can leverage the benefits of both types of technology to deliver low emissions energy at an affordable cost. “We also see the emergence and growth in ‘virtual’ microgrids,” said Mr Harding. “This involves the localised management of solar, battery and other energy resources to enhance individual customer and community benefits, while still being grid connected. “These virtual microgrids are more about driving increased value

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MICROGRIDS

Solar panels being installed at a house as part of the Mooroolbark Mini Grid.

from the distributed energy resources than about the resilience of their electricity supply, and have the benefit of generally not requiring the complexity and functionality of microgrids that can operate independently to the main grid.” Looking at the ways microgrids will be able to isolate themselves from the main grid in the future, Mr Harding said there are no theoretical limits to how regularly a microgrid could disconnect or reconnect to the main grid. That said, in practice this would likely only be undertaken when there is a current or near-term network outage or blackout on the main grid, or when adverse weather conditions are imminent, such as risk of bushfires or storms. Typically the connection and reconnection process can be achieved in a matter of seconds. Some individual customer backup battery systems can disconnect almost instantaneously, but entire microgrids would normally experience a short outage of less than a minute before re-establishing power. “We are however currently collaborating with another of our technology partners ABB on developing a seamless disconnection process for large microgrids that could provide communities with uninterrupted supply,” said Mr Harding. “This is a leading edge field of investigation within the industry and we are very excited by the benefits that this could provide to our customers.”

The grid of the future Moving forward, for AusNet Services, its future work in microgrids will focus on specific applications and value streams, such as managing increased levels of solar uptake, providing backup power to increase supply reliability to customers, and leveraging the capabilities of microgrids to provide cost-effective network services that can help reduce network costs for all customers, whether or not they have their own DER. The organisation has also been active in supporting several project applications under the Victorian Government microgrid funding program and the ARENA funding round for Distributed Energy Resources. “In terms of deploying microgrids more broadly, we are continuing to look for opportunities for microgrids or other non-network solutions to act as alternatives to traditional network projects,” said Mr Harding. “A specific project that we are currently excited about is the potential to create a large-scale microgrid at a remote township at the fringe of our network. “This microgrid would power the town from a local hybrid battery and diesel generator system in the event of a network outage that may be caused by extreme weather, animals or natural disasters".

Siham Knowles and Project Manager Marinda De Villiers accepting an innovation award from the Clean Energy Council for the project, together with some of the project partners.

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GAS PIPELINES

JEMENA AND SENEX FAST-TRACK DOMESTIC GAS Explorer and developer Senex has teamed up with Jemena to bring gas from its Project Atlas resource to market through the construction of a new pipeline and gas processing facility.

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enex was awarded the Atlas acreage, in southeast Queensland’s Surat Basin, by the Queensland Government in September 2017 following a competitive tender. Atlas is a high-quality resource and Senex is developing the 58 square kilometre block for the Australian domestic gas market. After a competitive tender process, in June 2018 Jemena was selected as Senex’s preferred partner to build, own and operate the Atlas Gas Processing Plant and Pipeline (AGPP). The new pipeline will provide direct access to the Wallumbilla Gas Hub, offering Senex flexibility to sell its gas to a broad range of Australian gas customers. A model of efficiency Jemena’s approach to develop this project by pursuing the build, own, operate business model for open access gas processing and compression infrastructure make it quite unique. According to Jemena’s General Manager Business Development, Dave Green, the upstream gas industry has been calling for a capable operator to step into this space, and the open access model should drive greater capital efficiency in the development of this type of infrastructure. Importantly, it means that gas upstream developers can focus their attention and resources on exploring for gas, and it also means that these projects need not incur significant upfront infrastructure costs. Historically, gas projects typically build their own dedicated gas processing and compression facilities. This is the type of inefficiency that saw three LNG projects developed side by side in Queensland, each with its own gas transmission network, jetty and liquefaction facilities on Curtis Island. And ultimately, it is gas customers who end up paying for these capital inefficiencies. For the AGPP, Jemena identified other potential users of the facility in this particular area of the Surat Basin, and is designing the facility such that the infrastructure is designed for expanded use, so that new customers can cost-effectively be connected to the facility. An appealing partnership In its proposal for the AGPP, Jemena endeavoured to offer Senex as much flexibility as possible in terms of whom they could market their gas to, by offering a multi-asset gas transportation agreement. This provides transportation access to Jemena’s broader Queensland pipeline network, by connecting the Atlas facility and pipeline to the Darling Downs Pipeline at a nearby section of

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pipeline that had available ‘trapped’ capacity, that could otherwise have not been accessed if not for this connection. This also avoided needing to incur costs to build additional capacity within the existing pipeline network. Jemena’s Queensland pipeline network includes the Queensland Gas Pipeline, stretching 627km from the Wallumbilla gas hub to the Gladstone domestic city gate, and the Darling Downs Pipeline, stretching 292km from the Darling Downs Power Station at the eastern end of the network, to the Wallumbilla gas hub and Spring Gully north of Wallumbilla. Once connected to this network, Senex will have a direct route from its Atlas tenement to the Wallumbilla gas hub, and from there access to: »» The large Australian industrial gas customers along the QGP who require long-term, affordable gas supply to support their chemicals, aluminium and alumina production plants »» Access to southern gas markets via direct connections to the South-West Queensland Pipeline at various delivery pressures »» Access to customers on the Roma to Brisbane Pipeline »» Access to the Darling Downs Power Station »» Access to the APLNG and GLNG projects

Senex Energy Managing Director and CEO Ian Davies.

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GAS PIPELINES

Building the network Jemena will invest around $140 million to build the gas plant and 60km pipeline, which will be capable of initially transporting approximately 40TJ of gas per day. Around 200 jobs will be created during the planning, construction, and commissioning phases of the AGPP, which will bring new gas to the domestic market by late 2019. Construction will occur in two discrete parallel packages: the processing and compression facility, and the gas transmission pipeline. Construction of the processing and compressor station is set to commence early in 2019, while pipeline construction is planned to commence in mid-2019. The remainder of 2018 will be used to complete approvals planning, progress the procurement of long-lead items and detailed design. Initial requests to market have been for principal construction contractors for the pipeline construction package; and for the processing and compression facility package. These tenders commenced around May this year. Jemena intends to formally engage the pipeline contractors shortly for early contractor involvement to support the design and approval processes, and to shortlist the processing and compressor station contractors later this year. Supplying the domestic market With the development of the gas field, Senex and Jemena will initially be delivering approximately 32TJ/day to domestic gas market – about the equivalent gas supply of the daily needs of a large industrial user such as a fertiliser plant or an aluminium smelter. Senex Energy Managing Director and CEO Ian Davies said “We are extremely pleased to be partnering with Jemena to fast-track Project Atlas to provide additional gas volumes into the domestic market. “Last year we made a commitment to deliver gas to the domestic market by the end of 2019. We are systematically bringing together all the critical elements to do just that. “This investment will not only create new jobs and support the local economy in the Western Downs region, but will result in generating royalties and benefits beyond the region and the state.” Jemena's Paul Adams said the AGPP will provide additional volumes into the domestic market for a range of commercial and industrial gas users. “The Atlas gas field is the first of 13 gas exploration tenements awarded by the Queensland Government as part of a broader move to fast-track the development of new gas to the domestic market. Jemena will construct the AGPP on an expedited schedule in order to deliver first gas by the end of 2019,” said Mr Green. www.energymagazine.com.au

Northern pipeline strategy This latest pipeline represents another piece in Jemena’s northern growth strategy, which is centred on developing an interconnected supply chain of gas infrastructure assets across northern Australia. “We know there is continued demand for gas across the east coast and that northern Australia will play a leading role in meeting this demand by bringing new gas to where it is most needed, via the most direct and economic route,” said Mr Green. “The AGPP is another crucial addition to our plans in northern Australia and allows us to play a leading role in bringing a new source of gas supply and greater competition to the market.” In July, Jemena completed construction on the Northern Gas Pipeline (NGP), with all 622 km, and approximately 34,000 lengths of pipe, being welded, lowered in and fully buried in the trench. The NGP will initially bring around 90TJ of gas to the east coast, and Jemena is already progressing plans to expand and extend the NGP so that it can transport around 700TJ of gas – that is enough gas to meet the average daily gas needs of Sydney, Brisbane and Adelaide combined. First gas is set to flow through the pipeline before the end of the year.

Jemena’s Paul Adams.

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ASSET MANAGEMENT

THE FUNDAMENTAL PRIORITIES FOR ASSET MANAGERS

The current landscape of asset management can be a labyrinth of new standards and evolving processes and technologies. Here, Steve Doran, Director of Infrastream and Chair of the Asset Management Council’s Sydney Chapter, outlines some of the most pressing challenges and opportunities that asset managers face in 2018.

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ccording to Steve Doran, the one critical factor “True asset management might mean having no asset, or asset managers need to take into account is replacing it with a completely different solution,” Mr Doran said. the adaptability of their asset plans. While challenges in asset management are formidable, “Societal shifts from technological they are balanced against sizable opportunities. One advancement are very hard to advantage lies in the steadily increasing global predict, and so our challenge is to attention that asset management receives, due in create asset management methods that sustain large part to the shared language of ISO 5500x. value over the long lifecycle of critical assets.” “The ISO 5500x suite of asset management In addition, asset managers must know how standards is creating the platform for a common to accurately convey what asset management is language as it gathers momentum internationally,” and isn’t. Mr Doran said. “This shared language greatly “Common misunderstandings about asset facilitates the exchange of ideas, information, stories management are that it’s the same as maintenance and knowledge about what brings the highest value in management, or that it doesn’t require attention until the asset management.” asset is acquired,” Mr Doran said. Steve Doran. “Governments and authorities responsible for In reality, asset management is a multi-faceted process delivering, operating, maintaining and regulating critical that involves a range of work disciplines, including planning, infrastructure are realising that asset value is far more greatly economics, stakeholder management, information management expanded and gained using a whole-of-lifecycle approach, and and safety. they are forming directions accordingly,” Mr Doran said. “The most important stage for asset management is before “As asset management techniques are incorporated more the lifecycle of the physical asset, where the true value to the into early planning and concept design stages, significant value stakeholder can be understood, risks can be assessed, and design improvements unfold over the working lives of assets.” for maintainability and operability can be effectively influenced,” Mr For those that are interested in hearing from Mr Doran about Doran said. asset management strategies, he will be MC for Asset Asset management isn’t as simple as trying to squeeze the most Management for Critical Infrastructure, running from 12–13 efficiency or effectiveness out of an asset. The underlying priority September at the Swissôtel in Sydney. should be alignment with stakeholder value requirements.

STAKEHOLDER MANAGEMENT WORKSHOP Steve Doran will co-host the workshop Beyond Stakeholder Management: Influencing the relationships that can make or break your project with experienced stakeholder engagement specialist Mirella Di Genua, on 11 September at Swissôtel Sydney. The workshop forms part of the upcoming Asset Management for Critical Infrastructure event, being held from 12-13 September at Swissôtel Sydney. For more information, or to register for the workshop, head to www.assetmanagementevent.com.au/workshop-and-conference

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SMART INNOVATION, BUILT FOR THE FUTURE

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ASSET MANAGEMENT

ASSET MANAGEMENT: KEEPING PACE WITH THE RATE OF CHANGE With the advent of new technologies, network digitisation, and an evolving regulatory and technical standards environment, energy asset managers need to keep pace with the rate of change. Asset Management for Critical Infrastructure 2018 will bring together leading experts across the energy, utility and infrastructure sectors for two days of thought-leading discussion around the most pressing issues in asset management.

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he two-day conference, running from 12-13 September in Sydney, is the place to be for updates on technologies, projects and processes that help to better manage critical assets in Australia, from energy networks to water pipelines, railway tracks, and transport infrastructure. It’s the only event where different sectors come together to give delegates the opportunity to hear about each others successes and learn from past mistakes. Past attendees have highlighted the benefits of seeing what others are doing in the asset management space and how they have overcome similar challenges. Sometimes all it takes is to see what someone else is doing to spark an idea or innovation, with delegates able to take these ideas back to their organisations. Last year’s conference was attended by energy infrastructure asset owners, senior figures within the utility sector and others working in the asset management space, which gave delegates the opportunity to network with the industry’s best. If you feel your organisation can improve the way its assets are managed, you can find out how at Asset Management for Critical Infrastructure 2018.

What to expect While managers of critical infrastructure have more tools available than ever before to manage these assets, the amount of public scrutiny has also never been higher. This event is a chance for anyone working in the asset management space to explore practical applications that can help improve the way assets are managed. The aim is for delegates to leave the event with new ideas or perspectives, that they can then implement in their organisation. This year, you can expect presentations and panel discussions on topics such as: »» Big data, data analytics and technological disruption »» Predictive maintenance »» Utilising the Internet of Things (IoT) and digital twins across your organisation »» ISO 55000 – the asset management standard »» Achieving sustainable asset management »» Managing renewable assets in a time of rapid change »» Asset management best practices »» Sustainable asset management strategies »» And much more This year also features an exhibition where leading companies will showcase the latest technology and innovations in the sector.

ASSET MANAGEMENT FOR CRITICAL INFRASTRUCTURE 12-13 September 2018 Swissôtel Sydney assetmanagementevent.com.au

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ASSET MANAGEMENT

Dedicated streams and panels Day one will feature keynote and individual presentations exploring asset management challenges and solutions, technologies and processes across the energy and infrastructure sectors. Day two takes this a step further and splits the conference into dedicated streams so delegates can delve deeper into their chosen area of interest or specialty. These streams will run as moderated panel sessions to give a broader scope into the topics. The lineup of speakers will include senior figures from infrastructure asset owners and Australia’s power utilities, as well as representatives from government and key industry bodies. These include: »» Steve Doran, Director, Infrastream and Chair, Sydney Chapter of the Asset Management Council »» David Singleton, Chair, Infrastructure Sustainability Council of Australia »» Lutfiye Manli, Senior Asset Management Strategy Advisor, Powerlink Queensland »» Iain Pople, Head of Asset Management, Edify Energy »» Jim Hickey, Electrolysis Engineering Officer, Network Test and Measurement, Ausgrid »» Darren Davis, General Manager, Asset Management & Engineering, Snowy Hydro »» And many more.

SPONSOR OR EXHIBIT There are limited opportunities available to exhibit or be an event sponsor. If you want to get your business and products in front of key decision-makers in the energy and asset management sectors, please email events@monkeymedia.com.au, or visit assetmanagementevent.com.au.

Bonus stakeholder management workshop Before the conference begins on September 12, there is the chance to get a head start on building strategies around key issues in asset management at the full day bonus workshop Beyond Stakeholder Management: Influencing the relationships that can make or break your project. The workshop is running the day before the event on September 11 at Swissôtel, and will be co-run by event MC Steve Doran, Director of Infrastream and Chair of the Asset Management Council’s Sydney Chapter, and Mirella Di Genua, Owner of Tre Sorelle Trading. Tickets can be purchased on their own or with a conference ticket for a discounted price from the website.

LAST YEAR'S EVENT ATTRACTED THE By organisation type FOLLOWING ATTENDEE PROFILES

Association 4% Dr Lutfiye Manli, Senior Asset Management Strategy Advisor, Powerlink Queensland.

Iain Pople, Head of Asset Management, Edify Energy.

Darren Davis, General Manager, Asset Management & Engineering, Snowy Hydro.

More networking opportunities In addition to networking opportunities in breaks and at the networking drinks after day one, the event will also feature multiple speed networking sessions where delegates are guaranteed introductions to like-minded colleagues from their industry. This structured and fun activity will get conversations flowing and allow delegates to make new connections. The event will be attended by a range of professionals working in the asset management industry, including: »» Asset owners from across the utility and infrastructure industries »» Senior managers and their colleagues from Australian water, gas and electricity utilities »» Asset managers in the rail and transport sector »» Technology and solutions providers servicing the asset management community

assetmanagement FOR CRITICAL INFRASTRUCTURE

www.energymagazine.com.au

Supplier 1%

Contractor 7% Government 12% Consultant/Engineer 14%

Water Utility 23%

Energy Utility 22%

Other Asset Owner 16%

94.44%

of last year's attendees said the event met or exceeded their expectations

REGISTER NOW FOR ASSET MANAGEMENT FOR CRITICAL INFRASTRUCTURE 2018 Head to assetmanagementevent.com.au to view the full program and book your tickets to this must-attend asset management event today.

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ASSET MANAGEMENT ENERGY PARTNER CONTENT

SECURING EXECUTIVE SUPPORT

FOR MOBILE TECHNOLOGY

by John Graff The use of mobile technology has now become mandatory in the energy sector. Every worker, regardless of their job, is now expected to maintain a certain level of communication and visibility with colleagues, customers, partners and suppliers.

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hat notion is not easily achieved by desk bound employees, or fixed computer setups. Field servicecentric organisations such as utilities, solar installers, and energy infrastructure maintainers understand this more than anyone else – or at least they should. The majority of their workforce spends their days either in a vehicle or on foot in the field, often in remote or rural locations; mobile technologies are the most efficient way to ensure mission-critical data and workflow applications are accessible in real time, at all times. Yet, a recent seven-country study conducted by Arlington Research on behalf of Xplore partner and Enterprise Mobility Management (EMM) firm SOTI found that many CEOs are “‘failing to grasp’ the impact of mobile technology on business practices”. This is highly concerning given that properly-executed mobility solutions are proven to increase worker productivity levels, improve business process efficiency and enable the expansion of service models. In other words, mobile technologies directly impact a company’s ability to introduce – and sustain – new revenue generating streams that can boost their bottom line. A recent Frost & Sullivan report even indicated that CEOs and other executives who have expanded their organisation’s use of mobile technologies are seeing significant returns on their investment. Why, then, are other CEOs of highly mobile workforces struggling to “understand how vital mobility has become in the basic ‘arsenal’ of business tools”? While I might not understand all that is keeping them from embracing mobility, I do have some advice. Regardless of why you want to spend on new mobile technologies, make sure you secure executive buy-in for your mobility project before you start shopping for a single mobile device or software solution. As evidenced by SOTI’s research, and

reinforced by our own customers’ experiences, it is hard to get anywhere fast without an executive sponsor backing your project and approving your budget.

"Two in five remote workers say their bosses do not understand the importance of having the best mobile devices and apps." *SOTI 2017 study If you really want to get your project greenlighted quickly, submit a thorough and detailed business case to justify why mobile technologies are essential to achieving the business objectives that they have set forth for your team and the overall company. Clearly articulate how a better quality rugged tablet-based solution, for example, will directly solve your business challenges – such as employee downtime – and mitigate the risk of missed deadlines, quality issues, or costly data input errors during inspection reports. Ask for the KPIs your company uses to assess performance and define success, and show how business process improvements via new mobility solutions line up. And plan to conduct a benefits analysis to support your case. Project sponsors will want to see the value before they sign off on any project. Remember: 49 per cent of CEOs only care about business mobility when downtime occurs as a result (according to the feedback SOTI received from executives and their employees). By demonstrating the direct, and positive, correlation that a particular mobility solution can have on employee productivity – and the correlation between failing mobile technology and downtime – the odds of executive signoff increase.

Want to know which other benefits you should be showcasing, or need help qualifying and quantifying the benefits in terms your CEO will understand? Download the full mobility buying playbook at www.xploretech.com/EnergyAU

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MAKE THE SMART RUGGED CHOICE Power Your Energy Business with Field-Proven, HazLoc-Certified Mobility Solutions

Xplore’s powerful mobile devices are engineered from the inside out to survive common environmental hazards, especially the hostile field conditions of the energy sector. Whether repairing power lines, installing rooftop solar panels, monitoring plant performance, or maintaining remote wind turbines, Xplore’s mobile computers will stay by your workers’ sides to help them effectively plan their day and power through mandatory logistical and compliance tasks without error – even in the harshest weather and most Hazardous Locations.

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MARKETS

SECURING THE FUTURE FOR

RENEWABLES

by Suzanne Falvi, Executive General Manager, Security and Reliability, Australian Energy Market Commission

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undamental changes to our energy system are underway, as old coal-fired power stations continue to close at the end of their operational lives. At the same time, we now have a much larger proportion of weather-driven generation capacity in the mix, along with rapid uptake of rooftop solar, battery storage and smart energy management systems at the distribution level. The increasing penetration of wind, solar and distributed energy resources in our electricity system provides both opportunities and challenges. They are opportunities because they offer a way of decreasing carbon emissions in the electricity sector and therefore contributing to our international commitments. Also, renewable technologies and distributed energy resources offer variety in the energy mix, and with this variety comes the ability to offer customers more choice and control. But the rapid penetration of these new technologies also creates challenges for a system that was built around large, centralised power stations that are synchronised to the grid. These challenges fit into two basic categories: »» Challenges to the reliability of the system – having enough generation and network capacity available to meet demand »» Challenges to the security of the system – the ability of the system to operate within its technical limits On the reliability front, variable generation like wind and solar cannot always be depended upon as a dispatchable source of energy. That’s why the AEMC’s Reliability Frameworks Review is looking at how regulatory frameworks should change to help deliver long-term electricity reliability at least cost to consumers. This includes exploring ways to improve the transparency of demand forecasting, and also Finkel Review recommendations relating to demand response, providing day-ahead information, and designing a strategic reserve. On the system security front, it’s becoming harder to manage frequency as synchronous generators – the ones the system relies on to keep everything in check – retire and new invertor-connected technologies replace them, but without providing the characteristics that are necessary for system security. Also, the increasing penetration of distributed energy resources is starting to present challenges for grid operation. This is because distribution network businesses have very limited information on the ability of their low voltage networks to manage the electricity which is exported from distributed energy resources. All of this adds up to a power system that is harder to manage, so we need to make it work by managing the system differently. And we are.

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MARKETS

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MARKETS

A targeted, least-cost approach to solving the system security problem Keeping the system secure as it continues to transform involves many, small technical measures, along with making sure we have the right incentives to support market-based solutions wherever possible. This targeted approach is laser-focused on getting the balance right between cost and system security for consumers. We’ve recently made a suite of changes to the rules that set the foundations for a new way of operating: »» New rules to manage the rate of change of power system frequency by requiring networks to maintain minimum levels of inertia. For example, networks can contract with suppliers to provide inertia substitutes like fast frequency response from batteries or demand response, with approval from the Australian Energy Market Operator (AEMO). »» New rules to make networks provide services necessary to meet minimum levels of system strength at key locations in the power system when shortfalls are identified by AEMO. The rules also require new connecting generators to pay for remedial action if they are going to negatively impact on minimum system strength levels. »» A requirement for generators and networks to give AEMO more detailed information about how their equipment performs. »» New “last line of defence” schemes to help AEMO better prepare for, and respond to, a system security emergency. We are also working on further reforms related to other emerging system security issues. Questions we’re tackling include: »» What kind of information do we need about distributed energy resources like small-scale battery storage systems and rooftop solar to keep the system secure? As a key first step, we’re working on a rule change request to establish a national register of distributed energy resources to give network businesses and AEMO more data to help plan and operate the power system. »» What characteristics do new connecting generators need to bring to the system? We will be making a final determination later this year on changes to technical performance standards for generators seeking to connect to the grid, and the process for negotiating those standards. These standards include technical

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»»

capabilities related to voltage and frequency control, and the ability to stay connected even when there is a major disturbance to the power system. This major piece of work is the result of a rule change request from AEMO and months of crossindustry collaboration. What is the best way to address deteriorating frequency performance in the grid? This has been the focus of our frequency control frameworks review, and includes investigating how to enable and appropriately reward frequency response from newer technologies.

Harnessing the potential of new technologies A key focus for the AEMC’s work program is the potential for harnessing new technologies like batteries, wind farms and distributed energy resources to help maintain system security. We’re already seeing this happen. In 2017 EnerNOC, a provider of energy intelligence software and demand response services, registered as a Market Ancillary Service Provider and is now participating in the frequency control markets by offering a reduction in its aggregated portfolio of mostly commercial and industrial loads. This was made possible by a rule change we made in 2016 to increase competition in ancillary services including frequency control. This is just one example of how the AEMC has adapted regulatory frameworks to facilitate new technologies and business models. Other recent rule changes include: »» Opening up competition “behind the meter” so network businesses don’t lock out innovative solutions or limit the value streams a project can get. »» Extra scrutiny when networks are looking to expand – to make sure a range of technologies can be considered as viable alternatives to poles and wires. »» Changing the settlement period for the electricity spot price from 30 minutes to five minutes, starting in 2021. Five minute settlement provides a better price signal for investment in fast response technologies, such as batteries, new generation gas peaker plants and demand response. These fast responders are needed to support the increasing penetration of variable generation in the market. And we will continue to redesign the energy market as much and as often as we need. However, the Commission relies on

feedback from stakeholders – whether that be industry participants, governments, or market bodies or consumers – about how the market and the regulatory frameworks are working on the ground. If there are barriers to new technologies or business models entering the system, we rely on stakeholders to flag them. Everyone has the power to request a change to the rules – and to help us find lasting solutions that will work in the long term interests of consumers. If stakeholders have ideas on how to do this – at lowest cost – then we want to hear from them.

Market signals to enable a technology-neutral approach In our business – the rule making business – we focus on the signals the market is sending to investors. We make sure that “what the system needs” and “what customers want” are valued appropriately in the market so they are actually delivered. We think about and look at the price of energy in the spot market, the price and availability of long-term contracts, how the system is performing in terms of security and reliability, and the activity in the ancillary service markets. All these signals say something about what the system needs to be able to deliver secure and reliable electricity to customers. So, the characteristics of the future energy mix, not simply the mix itself, are important. The rules we write allow for the best solutions that will maximise benefits to consumers. Rules that are technology-specific will be irrelevant as soon as the next invention comes along, and they stand in the way of innovation we can’t even imagine yet. We focus on making sure the system has the right information for the investment and operational decisions that need to be made, as well as providing the necessary tools to intervene if there’s an emergency. The new-look grid The National Electricity Market is now a closely interconnected system of renewable and nonrenewable energy generation sources and technologies that need to interact effectively. We are working to secure the future of renewables and new technologies in this new-look grid. Together with the other energy market bodies, industry, governments and consumers, we’ll continue to work on finding the lowest cost ways to keep the lights on by addressing the technical complexities brought on by changing energy technology.

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SECURITY

CYBE

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SECURITY

ER SECURITY A VITAL LINK FOR ENERGY NETWORKS

by Michael Paparo, Policy Manager, Standards Australia As electricity network owners face increasing cyber security threats, standards have a significant role to play in keeping our networks safe from attack.

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he rapid increase in the use of digital products and services across the globe is happening at an incredible rate, with no signs of slowing down. Australian consumers and businesses have widely embraced digital technologies, from online banking and shopping to government services. Concurrently, the energy grid in Australia is adapting to this new digital reality to meet the needs of energy consumers now and into the future. This trend presents new opportunities for economic growth across Australia, but also presents new challenges and risks. According to the Australian Cybercrime Online Reporting Network, in the six months to July 2017, there were nearly 23,700 attempted cyber attacks reported with the Australian Cyber Security Centre. This demonstrates the possible range of potential victims, including energy networks, particularly with the rise of state and non-state actors conducting attacks for a range of economic, political and social reasons. To ensure the energy grid continues to be able to maintain the same high level of security available to consumers and distributors, standards have a clear role to play. In with the new Like many sectors in the Australian economy, the energy and electrotechnology sector is evolving. Not only is the physical infrastructure changing to incorporate a growing mix of renewables, but the storage of energy and decentralisation of the grid is also increasing in prominence. Gone are the days of every single consumer drawing electricity from a centralised grid. More and more consumers are turning to things like their own rooftop solar panels to power their homes, with surplus energy fed back into the grid. These new consumers and producers of energy are referred to as “prosumers�. According to one report, as at March 2017, almost one in four Australian households owned home solar panels, proving just how widespread user-generated power is becoming.

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Standards Australia and the energy sector Standards Australia has been around for almost 100 years, developing standards with the help of industry, consumers and government across many different sectors. The energy sector is one of the core fields of work with a portfolio shaped heavily by the incredible pace of innovation, and the need for safety for the thousands of professionals relying on standards every day. The safety also extends to consumers with daily interaction with hundreds of different electrical installations. There are standout publications, such as the Wiring Rules, which are used heavily by industry, and there are some new and exciting projects underway. For example, at any one time there are a number of standards open for public comment. In the energy sector at the moment, these standards available for public comment cover areas such as electricity metering equipment, safety of transformers, reactors, power supply units and combinations, as well as safety of some household electrical appliances. Just as significant as the standards guiding electrical professionals in the energy sector are the growing number of cyber security standards, particularly those internationally developed standards. The 27000 series of cyber security standards, published by the Joint Technical Committee 1 of International Organisation for Standardisation and the International Electrotechnical Commission, provide guidance for organisations on how to manage information and risks. Alarmingly, Australia has a low rate of uptake on this particular set of standards, at half the rate of the rest of the world, exposing all sectors of the economy to a greater threat of cyber attacks.

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The energy sector is significantly driven by the need for safety; however there is also a focus on the standards in this industry being able to promote and facilitate clean energy, reliability of supply and performance. These additional pressures on the standards in the sector prove how vital the role of standards has become as energy networks across Australia undergo sweeping change. The many decades of developing standards for the energy industry have also seen some pioneering projects delivered, but it is the recently signed agreement with Energy Networks Australia that is combining the innovation in the energy sector with the need for increased cyber security measures.

Roadmap for the plan ahead Standards Australia and Energy Networks Australia are working towards developing a standardised method of increasing security of the electricity grid. There is a transition happening in the energy sector, and the work underpinned by this agreement with Energy Networks Australia has been largely borne out of the rapid pace with which digital technology has been coupled with traditional energy infrastructure. This technological growth is changing business models, physical infrastructure requirements and presenting new security challenges for operators, businesses and consumers. The changes are presenting increased cyber security threats with more points at which malicious cyber activity can enter the network, made possible by more consumers being able to directly access the grid. This project will result in a Roadmap Report, developed by Standards Australia in consultation with Energy Networks Australia and relevant stakeholders. The Grid Cyber

Security Standards Roadmap Report will include: »» A collation of stakeholder perspectives on the existing Australian grid cyber security standards »» Recommendations for Australian participation in any relevant international standards committees »» A recommendation for the development of new or the adoption of relevant international standards to support grid cyber security in Australia »» An explanation of the standards development pathway and the process used by Standards Australia including a prospective timeline Once complete, this comprehensive report is expected to give industry, government and consumers faith in the continuing rollout of even more advanced technology to support the energy networks of the future.

Early days for tomorrow’s energy While the agreement between Standards Australia and Energy Networks Australia is in its early stages, there are dozens of projects underway in Australia and at an international level to ensure the standards guiding the energy sector are doing so to benefit industry and consumers alike. On this specific project, the Roadmap Report is expected to be completed towards the end of 2018, with the recommendations to be aimed at preparing the energy network for many years to come. It is following these types of projects that standards are developed to encourage innovation and security. The application of internationally aligned Australian Standards will continue to support a strong and secure Australian energy grid for industry, government and consumers.

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ASSET INSPECTION AND DRONES

DRONE AUTON

FOR IMPROVED POWER

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ASSET INSPECTION AND DRONES

NOMY

R POLE INSPECTION The energy industry is already enjoying some of the benefits drone technology is able to provide, but now a team from Queensland University of Technology and the FrontierSI are researching ways to enhance the benefits for the industry.

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ccording to a recent PwC report1, operational safety and increased automation are two of the biggest challenges – and opportunities – in the application of remotely piloted aircraft systems (or drones) to the power and utilities sector. Globally, there is an estimated loss of $169 billion annually related to network outages. And while using drones to improve asset inventory and maintenance management is on the rise, we are still faced with some critical technological gaps. While current commercial-off-the-shelf drone platforms come equipped with collision avoidance features, these are insufficient to address the needs of the utilities sector, especially when it comes to the automated detection and avoidance of wires in real-time. The research team from the Institute for Future Environments at Queensland University of Technology has developed a 20-month rapid proof of concept program to address key operational safety issues in the routine use of drones for aerial robotic inspections. Bringing together researchers from industry (Ergon Energy Corporation Limited) and academia (QUT), the successor entity for the CRC Australia and New Zealand for Spatial Information, FrontierSI, has managed the project and allowed the team to answer the following questions: 1. How can wires be detected for collision avoidance and other robotics purposes? 2. What are the most appropriate sensing and automation techniques for maintaining user defined precision standoff distances from infrastructure? 3. To what level can the outcomes from steps 1 and steps 2 be faithfully applied to achieve semi-autonomous pole infrastructure inspection? Piloting a drone close to any object (and not hitting it!) is a challenging task. But when it comes to flying these drones close to power lines, it’s even more challenging, because the pilot has to precisely estimate and control the drone’s location relative to the infrastructure. We needed to increase the autonomy on the drone – that is, to make the drone capable of recognising and avoiding obstacles in real-time, so the onus isn’t solely on the operator. The benefits from adopting this technology are many – the productivity of data collection is improved, as the operator can concentrate on getting the best quality data, and can also capture that data at a faster rate. The drone pilots also have a reduced cognitive load, meaning that they can operate with reduced risk of damage to the drone and the infrastructure from unintended

impact. Pilots can also trigger precision standoff inspection at an operator defined set distance to suit the requirements of the inspection task. And finally, the system allows partial automation of inspection methods, generating and flying self-determined paths between assets under review. Ultimately, when applied in conjunction with the appropriate regulatory instrument from the Civil Aviation Safety Authority (CASA), this technology may enable the routine adoption of infrastructure inspection using drones in a beyond visual line of sight (BVLOS) environment – opening new markets not economically feasible with current technology.

¹ https://www.pwc.pl/en/publikacje/2017/clarity-from-above-leveraging-drone-technologies-to-secure-utilities-systems.html

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ASSET INSPECTION AND DRONES The team has made significant progress toward the development of such a solution, having conducted an evaluation and selection of sensors after laboratory and in-situ condition testing. Our team has also fused these sensors into a prototype autonomy package, and integrated this solution onto a professional hexa-rotor platform. Additionally, the team has developed a concept of operations and analysis of sensor coverage for pole, cross-arm and wire detection – key requirements to address the operational specifications of Ergon Energy.

So, what have we found? The advancements have been tested in simulated environments using the Robotic Operating System for prototyping and testing of the collision avoidance controller. This has then been proven under real-word conditions on the real-life model of power lines at our disposal. The team behind this work is led by Distinguished Professor Peter Corke, Director of the QUT-hosted ARC Centre of Excellence for Robotic Vision (ACRV), and Associate Professor Jason Ford, from QUT’s Robotics and Autonomous Systems discipline. Associate Professor Ford has a rich history of delivering projects in support of the utilities sector, having been the architect behind the development of the automated flight path planning and control system that enables the Fugro ROAMES data capture via general aviation aircraft (typically Cessna 206 light aircraft). That project, also conducted with Ergon Energy and FrontierSI (formerly CRCSI), has seen the deployment of a solution that saves Ergon Energy an estimated $40 million per annum in vegetation management costs alone. Working closely with QUT’s Research Engineering Facility and the Ergon Energy RPAS team, the research group comprising Professor Corke, Associate Professor Ford, Dr Feras Dayoub, Dr Aaron Mcfadyen, Dr Steven Martin and Mr Matt McTaggart have been able to make accelerated progress toward implementation of a prototype solution, and have tested it in real-world environments – critical to the delivery of a robust system suitable to the end-user requirements. This type of client-focused engagement is typical of the applied research undertaken by the QUT team, with collaborative research projects currently being undertaken with industry partners from a range of sectors, including mining (Mining3, Caterpillar), agriculture (RIRDC, GRDC, CRDC, HIA, The Yield), marine (Great Barrier Reef Foundation, Google), manufacturing (IMCRC, UAP), medical (Stryker), autonomous vehicles (iMoveCRC) and aerospace (Boeing,

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PBCRC, CRCSI). These research projects are often leveraged against State or Commonwealth funding agencies such as the Australian Research Council or the Advance Queensland Initiatives. A key focus for the group is in the domain of robotic vision – QUT is the headquarters of the ARC Centre of Excellence for Robotic Vision. While robotics is about machines that interact with the physical world, and computer vision is about analysing and understanding the world through images, robotic vision expands the capabilities of robots, allowing them to see and understand the world in which they are working. ACRV sees three critical challenges facing the world that robotic vision can assist addressing: »» Environmental – robots to manage, protect and repair our natural and built environments »» Healthcare – robots for improved and affordable healthcare in the home and hospital »» Resources – robots to safely and effectively harness our natural resources, in particular sustainable food production These three challenges assist the group with prioritisation of the projects that they take on – with robotics becoming a “must have” in the innovation space, careful selection of projects from the perspective of what is achievable and what will have the greatest impact is becoming increasingly important. Fortunately, the three domains are sufficiently broad enough to encompass the majority of sectors that approach the group for partnership. With the project coming to a close in the next few months, the focus for the team is to finalise delivery of a semi-automated inspection of a series of power poles. This will see the drone automatically ascend relative to a power pole (and maintain minimum separation from detected obstacles such as poles, cross-arms and wires), conduct an orbital inspection of the crossarms from a fixed position above the pole top, then automatically detect and follow the wires to the next pole in order to repeat the inspection regime. Coupled with this deliverable is the composition of a business case to affect the maturation of the sensor package into a commercially viable solution – progressing it through technology readiness levels – something the team has previously delivered for multiple parties in similar domains. Ultimately, it is hoped that the adoption of technologies such as those being developed by the QUT team will yield both economic and safety improvements for the sector and make drones just another tool to be deployed by the field service teams.

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DISTRIBUTED GENERATION

INTEGRATIO THE GREAT LE FORWARD FO RENEWABLES Earlier this year, the Australian National University (ANU) launched a new international research program to improve ways to integrate battery storage with the electricity grid.

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he ANU Battery Storage and Grid Integration Research Program has been established to undertake activities related to the development, integration, operation, and optimisation of energy storage in electricity grids and electricity markets globally. Dr Lachlan Blackhall was appointed to his role as Head of the Program in April this year, following almost two decades in the entrepreneurship, innovation, technology and investment domains. Dr Blackhall is probably best known in the energy industry as the co-founder and former Chief Technology Officer of Reposit Power, where he pioneered the development of distributed control systems to monitor, optimise and control grid-connected energy storage. During his time at Reposit, Dr Blackhall was also involved in the development of virtual power plant technology to aggregate distributed energy storage to deliver services and capabilities to energy networks, markets and utilities. Following his time at Reposit, Dr Blackhall is relishing the return to academia, and is excited to be leading a Program that will be designing and implementing the building blocks for powering our future electricity system. The activities being pursued by the Program are categorised into

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four thematic streams: energy storage; data and analytics; devices, optimisation and control; and regulation, markets and models. In the energy storage stream, the focus is on designing, characterising and understanding the behaviour and performance of new energy storage and battery devices, based on advances in materials, electrolytes and device construction. Research and development activities will target the critical issues and bottleneck problems that can affect battery performance and lifetime; with further R&D work in this area likely to include hydrogen generation and storage, supercapacitors and kinetic storage. The data and analytics stream will work to progress the state of the art modelling, forecasting and prediction that is critical to the effective operation of energy storage capabilities in the electricity system; and their participation in energy, ancillary and network services markets. This will include activities related to individual and aggregate load and solar forecasting, modelling and analysing the low and medium voltage distribution network, and the development of new approaches to understanding the delivery of dynamic stability and inertia-like services from distributed energy resources including battery and energy storage. The devices, optimisation and control stream will be investigating and developing distributed optimisation and control capabilities

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DISTRIBUTED GENERATION

ON: EAP OR S (both hardware and software) to allow the effective and efficient operation of distributed energy resources, including battery and energy storage. In particular, this stream will focus on developing distributed optimisation and control capabilities that are modular, low cost, safety-critical and secure. In the regulation, markets and models stream, the team will undertake activities to identify, understand and contribute to the design and implementation of policy, economic and market models for the deployment of energy and battery storage into the electricity system and electricity markets globally. This will include understanding the economic, social and regulatory barriers for the use of energy storage in various grid, community, embedded and microgrid operating models.

Integrating renewables: the three key challenges Through the four streams, all work comes back to the ultimate end goal of assisting the integration of renewables into our existing electricity grid. According to Dr Blackhall, there are three key challenges when it comes to integration. First, many renewables, like wind and solar, are intermittent generation sources, meaning it is not possible to predict exactly how much energy will be generated in any given time interval. Because supply and demand must always be equal in the grid, Dr Blackhall and his team are working to ensure that various different types of energy storage and batteries can solve these issues, ensuring that the energy we store can be used to “fill in the gaps” of this intermittent generation when we need it. www.energymagazine.com.au

Dr Lachlan Blackhall.

Secondly, many of these renewables, particularly residential solar PV, are being installed on the demand side of the grid where there was previously no generation. Where previously energy only flowed from the generators to the household, energy is now flowing in reverse in many cases. This requires substantial work to better understand how the distribution network can be used as the “electricity superhighway”, where electricity now flows bidirectionally. “While this is a dramatic change from how the grid was initially designed, it is opening up new opportunities for interesting models like peer-to-peer and community retail models,” said Dr Blackhall. Thirdly, as we install more renewables, we are offsetting the amount of fossil fuel-fired generation in our grid. Most of this fossil fuel-fired generation is produced by synchronous machines, and there are concerns from some that the loss of synchronous machines (and the inertia they provide) could result in stability issues for the electricity system. In this area, Dr Blackhall and his team are working to demonstrate that energy and battery storage will be able to provide the stability services required to keep the grid secure and stable, even with very high penetration renewable generation.

Challenges leading to opportunity While there are tremendous challenges being faced, this is also creating some very interesting opportunities for the development of new technology, new operating models and new approaches for energy retailing. September 2018 ISSUE 3

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“In my opinion, one of the most interesting opportunities is to address how we will we integrate these demand side resources into the electricity system alongside the existing market, network and generation assets and systems,” said Dr Blackhall. “Beyond this question is the even more challenging question of how we will coordinate and orchestrate large numbers of distributed energy generation, storage systems and demand response capability to provide energy reliability and security.” To this end, the Program will have a number of projects in this area. One of the existing projects at The Australian National University is the CONSORT Bruny Island Battery Trial, a collaboration between The Australian National University, The University of Sydney, The University of Tasmania, TasNetworks and Reposit Power with funding support from ARENA. The lead researchers on this program, including Sylvie Thiebaux, Evan Franklin, Paul Scott and Dan Gordon, have been working to demonstrate how their software, Network Aware Control, could coordinate residential solar and battery systems to

deliver energy and network services to reduce the amount of diesel generation required to run the Bruny Island network. Results from this trial have shown that even a small amount of residential solar and battery storage can significantly reduce the diesel generation required to ensure that all customers still have access to the energy they need, as well as ensuring that the grid remains stable and efficient. From here, the Program has big plans to roll out a number of projects over the next few months. The team is already working with a number of partner organisations nationally to develop projects related to data and analytics, optimisation and control as well as to develop new approaches for coordinating distributed energy resources including energy and battery storage.

The future grid Dr Blackhall believes that the future electricity grid is going to require lots of modelling, prediction and forecasting. “As we deploy more distributed energy resources, including solar and battery storage on individual residences, we need to have a much stronger understanding of

the forecast individual and aggregate load and solar generation at each residence,” said Dr Blackhall. “We also need to have a significantly better understanding about the operation of the low and medium voltage distribution network where many of these distributed solar and storage technologies are being deployed.” According to Dr Blackhall, this understanding will then allow new technologies like distributed solar, battery control systems and home automation to be developed to allow these resources to participate in energy, ancillary and network services markets, and contribute to energy reliability and security. Technology, of course, is only part of the equation, and Dr Blackhall shares the sentiment from many in the industry that the right policy and regulatory settings will also be required if we are to see renewables reach their full potential. “It will not only be new technology that really drives the revolutionary changes we are seeing in the electricity grid at the current time,” said Dr Blackhall. “I think the most important changes over the

Bruny Island residents with their new battery storage systems.

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DISTRIBUTED GENERATION

coming years will relate to the policy and regulation of distributed energy resources. Ensuring that these resources are able to participate in energy, ancillary and network services markets is crucial to supporting the increasing amount of renewables being installed.” Two key regulatory and policy changes that the Program is looking at closely include new network tariffs and new regulatory requirements for electricity retailers. New network tariffs are needed to allow new retail and community energy models to prosper, and to allow the sharing of energy in peer-to-peer relationships. New retail regulations are important to allowing new retail models to be tried and tested. “In both cases we need to ensure that regulatory reform encourages innovation whilst also ensuring that customers are protected,” said Dr Blackhall.

The end goal With four streams to work across, and a trilemma that’s been puzzling the entire industry to focus on, it’s certainly a significant undertaking for Dr Blackhall and his team. But for Dr Blackhall, the end goal

Battery storage and grid integration program

Energy Storage

Data and Analytics

Devices, Optimisation and Control

Regulation, Markets and Models

The activities within the Battery Storage and Grid Integration Program are categorised into four thematic streams.

of the Program is clear – to build a globally leading program in the area of energy storage and grid integration. “For me, an ideal outcome of the program would be for us to contribute to an electricity system powered by renewables, that is cost-effective and equitable for everyone in our community,” said Dr Blackhall. Central to this goal is also ensuring that the work delivers benefits for the community, industry and government. The Program will also have an ongoing focus on energy equity. Throughout all projects and activities, the team will be

focused on ensuring that the changes they’re designing and proposing to the grid are ultimately for the benefit of everyone – even those who may not directly be able to buy solar or batteries. “Protecting vulnerable consumers and those who cannot install solar and battery storage where they live is at the core of ensuring we achieve energy equity going forward,” said Dr Blackhall. “This is an important area of work, and one that we are providing significant resources for as part of this new program.”

Aerial view of some of the homes in the Bruny Island Trial.

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ORCHESTRATING

RENEWABLE GENERATION

INTO THE GRID Australia leads the world in household solar penetration and with many solar owners now looking at adding energy storage to their systems, there are technical and policy challenges we must address for electricity grids.

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n response to these challenges, in June this year, Energy Networks Australia and the Australian Energy Market Operator (AEMO) launched a joint consultation paper seeking stakeholder input on how to redesign the system. The objective is to enable better integration and coordination of solar and energy storage into local electricity networks in a manner that releases maximum value for customers. Open Energy Networks proposes options for improving the electricity system to ensure household solar and storage can interact harmoniously with the grid. Australia’s energy system, like those the world over, was designed as a one-way centralised flow of electricity from sources of large-scale generation to customers’ premises. Fast forward more than 100 years and the grid has become increasingly decentralised, thanks to new technology that allows households and businesses to feed power back into the grid, creating a two-way power flow. While this presents new opportunities for customers to use energy, such as managing demand intelligently or providing access to energy markets, these changes can also pose significant technical challenges for the distribution and transmission of

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electricity. These challenges require changes from the networks and system operator to ensure they maintain an economical and secure system, while enabling all customers to have the opportunity to connect their systems to the grid. To date, it has been relatively easy to predict and manage supply and demand from standard rooftop solar. However, household storage systems such as batteries have changed this, because energy flows can reverse in a millisecond and could exceed a network’s technical limits. Energy Networks Australia CEO Andrew Dillon said Australia led the world in household solar installations and many of those customers were now adding storage to their systems as costs came down. “From a network point of view, when the sun’s shining it’s relatively easy to predict how much electricity solar panels are generating, and therefore what is being injected into the grid at any point in time. However, when you start talking about adding storage, you’re talking about a totally different story,” he said. “Customers with solar and storage can have various reasons for wanting to charge their batteries at certain times of the day and inject back into the grid at other times of the day. It could be in response to a wholesale price signal or a possible weather

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DISTRIBUTED GENERATION

event, but if it is not coordinated with the network, it could lead to significant technical challenges.” Mr Dillon said without coordination, there could be voltage and frequency issues or even localised outages, which had occurred already in some areas. “We certainly don’t want to see networks having to say to customers, sorry, you can’t connect, we are at full capacity – and we don’t want networks having to spend significant amounts of capital just to accommodate solar for certain periods of the day,” he said. “The way to avoid all three outcomes is to optimise and coordinate these distributed energy resources (DER). So it’s finding a regime that can incentivise people who have solar, and particularly storage, to allow their systems to be utilised in a way that helps the network and can avoid the capital expenditure, rather than creating more.” The 2017 Network Transformation Roadmap Report that Energy Networks Australia produced with CSIRO identified that getting optimisation right to ensure solar and storage work in harmony with the electricity system could avoid some $14 billion worth of investment, and lower household electricity bills by $414 a year. Mr Dillon said this was the only solution that made sense and it was no accident that the Open Energy Networks consultation paper had been jointly produced with AEMO. “Distribution networks have a vested interest in grid security and stability and operation at a local level. However, the system operator, AEMO has similar concerns at a system wide level. AEMO needs to harness storage at a local level and be able to use it to inject into the grid at various times in a managed and coordinated fashion. This is not currently possible, as they have no visibility of distributed energy resources at the distribution level,” he said. One way to manage some of the excess generation into the distribution system is through demand response schemes. In Queensland, Energy Queensland is moving traditional off-peak hot water, that’s programed to come on at night, to the middle of the day to make it a ‘solar sponge’ to avoid zero or negative demand in those areas that have significant solar penetration. This type of management can be applied to existing load like hot water, pool pumps and freezers. Mr Dillon said this was a smart way to ensure energy wasn’t wasted. However, demand response schemes will only solve some of the system challenges that must be addressed. Rather than imposing limits on customers, optimisation can help provide financial incentives to coordinate all elements of the system to work together. This will provide a safe and reliable integration of increasing levels of household solar and storage into the grid, while also providing customers with a significant opportunity to reduce power bills and gain new value from their investment in DER. “The aim of this consultation is to start a conversation with all key stakeholders to get some broad agreement, at a high level, on the sort of functions and frameworks we need to start managing this,” he said.

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“We need answers to questions about how we appropriately forecast short and long-term energy demand on our systems. We must ensure they are coordinated to get the best out of the resources, minimise duplication and over-investment and consider what this means for the roles of networks, AEMO, aggregators, retailers and customers. It is an ecosystem of different parties and we are working to make sure the system can function for everyone’s benefit.” To deliver this new functionality, there are several ways the system could be designed and delivered. The Open Energy Networks Consultation paper identifies three potential framework options that could deliver the required functionality. They are: »» The single integrated platform – which would be an extension of the wholesale market, and would use a set of standard interfaces to support the participation in the integrated multi-directional market by third parties (i.e. retailers, aggregators etc.) »» The two step tiered regulated platform – where there is a layered distribution level platform interface operated by the local distribution network and an interface with AEMO, with distribution networks providing an aggregated view per the transmission connection point taking into account local level system constraints »» The independent platform – where an independent body separate to AEMO or the distribution network, would work with the local network to optimise dispatch of DER based on local system constraints and provide aggregated bids to AEMO for incorporation into the wholesale market During the consultation period, Energy Networks Australia and AEMO held stakeholder workshops in Sydney, Melbourne, Perth and Brisbane to explore multiple business models and approaches. Energy Networks Australia General Manager of Network Transformation Stuart Johnston said engagement had been exceptional, with fully subscribed workshops. “We saw peak bodies, regulators, government departments, consultants, educators, community groups, network businesses and industry bodies come together to discuss their views and strategies on Open Energy Networks and help us co-design our future platform,” Dr Johnston said. “This is a complex issue and extensive consultation is essential – which is why we extended our engagement period from seven to eight weeks. This consultation has given us a platform to navigate a way forward, outline next steps and explore ongoing opportunities to collaborate.” This process is the first stage in a 12 month project to develop an agreed pathway to design the platform required to deliver Australia’s energy future.

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WIND

WIND ENERG

A BREEZY FUTURE WITH by Andrew Bray, National Coordinator, Australian Wind Alliance

Australia is one of the windiest countries on earth, so it is unsurprising that our wind energy sector has enjoyed a decade of rapid growth, even in the face of a constantly shifting policy landscape. But if we want wind to continue to play a central role in moving Australia to a cleaner energy future, we cannot be complacent – sustained effort will be required to continue to grow this vital industry.

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oday, wind is the cheapest source of large-scale renewable energy in the country, and is now equal to hydro power1 in its contribution to renewable energy generation in Australia. The 82 operational wind farms around the country account for about a third of all the country’s renewable electricity, and five per cent of total electricity generation. This latter figure is set to double by the end of the decade as wind farms that are planned or under construction come online, adding four gigawatts of capacity to the energy grid. As the pragmatic case for wind energy

becomes stronger by the day, recent research conducted by the Australian Wind Alliance has highlighted yet another upside of this renewable energy source: significant financial and social benefits to the regional communities which host wind farms. We found that wind farm construction has delivered a $4 billion economic boost to regional Australia. The industry has created direct jobs as well as boosted local businesses that supply to the projects, provided much-needed funding to rural areas for infrastructure and community projects, and ultimately, contributed to the resilience of regional areas. A key mechanism through which this is

done is Community Enhancement Funds (CEFs); voluntary payments made by a wind farm to channel funds into community groups, programs and projects. Through these CEFs, wind farms channel between $19 and $21.5 million directly into regional communities every year – money that supports initiatives like vital school bus services, community gardens that feed those in need, and solar hot water, solar panels or energy efficiency measures in rural homes. When the 14 wind farms currently under construction come online, CEFs will increase to between $30 and $32 million annually, providing valuable support to

¹ https://www.cleanenergycouncil.org.au/policy-advocacy/reports/clean-energy-australia-report.html

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WIND

GY:

HIN REACH

Australia’s wind farms account for about a third of all the country’s renewable electricity. Image: Acciona Energy Australia.

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WIND the volunteer work that is the lifeblood of every regional and rural town. All in all, over their 25-year lifespan, Australia’s existing wind farms and those under construction could deliver an estimated $10.5 billion to host communities. These facts speak for themselves: wind energy can provide affordable, clean and renewable energy to Australians on a large scale, and at the same time deliver financial benefits, jobs and other positive social outcomes. And it’s about to get a lot better. Wind’s viability as a competitive player in Australia’s energy market will only be strengthened as the industry adopts technological advances such as larger turbines, energy storage and frequency control technologies. Until recently, only coal, gas and hydroelectric power stations have been able to provide frequency control and ancillary services (FCAS), a crucial function which keeps the electrical system at a stable frequency by quickly adding or reducing energy from the grid when necessary. But in January this year, the Hornsdale Wind Farm, operating alongside the Hornsdale Power Reserve (aka the “Tesla Big Battery”) in South Australia, bid wind power into the FCAS market2, slashing FCAS prices from an expected $9000/MWh to below

$300/MWh. This episode should be a shock for the naysayers who continue to underestimate wind’s key role in a reliable, renewablepowered grid. Further trials continue at the Musselroe Wind Farm in Tasmania. FCAS capability will boost wind energy’s market viability, creating a new revenue stream for wind projects and setting up a virtuous cycle of economic benefits in the sector. Looking forward, one area that will require constant vigilance from the wind industry is its social licence among the communities that host wind farms. As more wind farms, with much larger turbines are built throughout rural Australia, it becomes more important to ensure that financial benefits are shared as equitably as possible among host communities. If some parts of the community feel like they’ve got a poor deal, this could result in a shift in public opinion away from wind farms. To avoid this, wind energy companies must continue to do right by the communities in which they operate, engaging early and effectively, and creatively employing benefit sharing opportunities through CEFs, community ownership and investment programs and other corporate responsibility efforts. Almost as importantly, they must shout their achievements from the rooftops. Acceptance of wind power and acknowledgement of

Research conducted by the AWA has shown significant financial and social benefits to the regional communities which host wind farms. Image: Acciona Energy Australia.

2

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https://www.smh.com.au/business/the-economy/australian-first-trial-shows-wind-can-provide-energy-security-20180313-p4z451.html

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WIND

Wind power has been a remarkable renewable energy success story in Australia to date, and the sector’s strong economic, environmental and social track record line it up for even greater success. Image: Hepburn Wind Farm. Image: Acciona Energy Australia.

The wind industry’s social license to operate is a make-or-break asset for its future growth.

its benefits has been a hard-won fight and has required years of debunking myths about the health impacts of wind and countering “not in my backyard” syndrome – but it’s too early to be complacent. Wind energy companies need to talk to community members about the impact of CEF-funded projects, and to tell the media and all policymakers – from local councils to federal members – about the positive benefits of wind power. The wind industry’s social license to operate is a make-or-break asset for its future growth; and companies cannot drop the ball on nurturing and sustaining this goodwill. One other factor that could knock the wind out of the industry’s proverbial sails is backward-looking government policy. The lack of a commitment to setting a target for renewable energy after 2020, the absence of a plan to increase Australia’s international emissions reduction pledge – which has been widely criticised as inadequate – are deeply concerning. Supportive government mechanisms such as the Renewable Energy Target (RET) have helped accelerate growth in the renewable industry and brought downward pressure on wholesale power prices. Despite the Abbott government’s threeyear halt on new renewables through the RET Review, we are on track to meet the target of having 23.5 per cent of Australia’s electricity generation from renewable sources by 2020. But what happens next? With no clear target or policy plan to transition Australia

3

towards 100 per cent clean energy, experts predict investment will "fall off a cliff”3, and the industry’s vast potential will remain unrealised. A program to replace our ageing coal-fired sector with renewable energy is needed to drive emissions reduction and ensure that coal workers are given time and support to transition to new, long-lasting renewable energy jobs. Businesses and state governments are doing what they can to pick up the slack, with ambitious targets at the state level. Commitments such as ACT’s plan to be fully renewable by 2020 and Victoria’s aim to have 40 per cent of its energy from renewables by 2025, mean the states are leading the way. These commitments show that much higher levels of renewable penetration in the grid are eminently achievable. They also show how paltry the Federal Government’s targets for renewable energy adoption and emissions reductions are. Much higher targets will be required from the Federal Government if Australia is to achieve net zero emissions well before 2050 and fulfil our global climate responsibilities. Wind power has been a remarkable renewable energy success story in Australia to date, and the sector’s strong economic, environmental and social track record line it up for even greater success. But this windfall is not a given – it will take sustained and deliberate effort from all of us in the industry, as well as policymakers, to take hold of the breezy future that’s within our reach.

http://www.abc.net.au/news/2018-01-18/renewable-energy-investment-hits-new-high/9339482

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NUCLEAR ENERGY

NUCLEAR CAN

SOLVE THE ENERGY

TRILEMMA

by Dr Mark Ho, President, and Dr John Harries, Secretary, Australian Nuclear Association

The Australian Nuclear Association is an independent incorporated scientific institution whose membership includes business, government and university professionals with an interest in nuclear topics. http://www.nuclearaustralia.org.au

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NUCLEAR ENERGY

As the energy industry continues the hunt for sources that are clean, affordable and reliable, Dr Mark Ho and Dr John Harries from the Australian Nuclear Association argue it’s time to bring nuclear energy back to the forefront of the energy debate.

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he world currently has 451 nuclear power reactors in operation, providing 10.6 per cent of the world’s electricity, carbon-free. In the US, nuclear generated 792TWh of power in 2017, more than all renewables, including hydro power, combined at 625TWh. This figure is testament to nuclear’s high capacity factor (approximately 90 per cent dispatchable) which stands in stark contrast to wind (approximately 30 per cent nondispatchable) and solar (approximately 20 per cent non-dispatchable). Because most reactors are conservatively designed and meticulously maintained, the average lifespan of reactor systems stands at an incredible 60 years, with new reactors projected to last even longer at 80 years. And since nuclear provides synchronous baseload electricity generation, it offers the additional benefit of grid inertia and frequency stability, a feature which has become more important with the increase of intermittent generating sources on the grid. Trends in nuclear power The country with the most power reactors is the United States, with 99 units responsible for 20 per cent of US electricity supply. However, the European Union taken as a whole has a combined total of 130 nuclear reactors generating almost 30 per cent of the electricity in the EU. The EU’s leading country, France, has 58 reactors which supplied 72 per cent of the electricity in 2016 at a carbon-emission intensity one-tenth of neighbouring Germany1, a nation of similar sized grid and generation capacity. On 17 December 2017 in a news conference after the EU summit in Brussels, Belgium, the French President Emmanuel Macron said “I don’t idolise nuclear energy at all. But I think you have to pick your battle. My priority in France, Europe and internationally is carbon dioxide emissions and (global) warming. “What did the Germans do when they

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shut all their nuclear in one go? They developed a lot of renewables but they also massively reopened thermal and coal. They worsened their carbon dioxide footprint, it wasn’t good for the planet. So I won’t do that.”2 Macron’s sentiments demonstrate a growing realisation that nuclear plays an integral part of the world’s energy mix, and must be recognised as a clean energy working alongside renewables. To this end, the US, Canada and Japan issued a collective statement to include nuclear as a clean technology at the Clean Energy Ministerial meeting in Copenhagen in May 2018.3 Recently, the Trump Administration indicated it was ready to use Executive Powers to protect US energy security by bolstering nuclear baseload generators in the face of historically low gas prices. US states are also realising this, as reported in The New York Times: “New York and New Jersey, have offered subsidies to their struggling nuclear plants in the name of fighting climate change.”4 In the UK, the decadal effort to establish new nuclear builds is coming to fruition, with the EPR (European Pressurised-water Reactor) construction underway at Hinkley Point C and plans for building GE-Hitachi Advanced Boiling Water Reactors (ABWRs) and Westinghouse AP-1000s under negotiation. In the United Arab Emirates, after a construction period of seven years, four units of the South Korean APR-1400 are now coming online, on time and on budget, a major feat given that the UAE only decided to introduce nuclear power as late as 2008. China, presently operating 39 power reactors, has 19 reactors under construction, 41 planned and a hundred more proposed; this is by far the most active in new builds worldwide.5 Overall, 58 nuclear power reactors are under construction internationally and 154 nuclear power reactors are on order or planned with approvals, funding or major commitment in place.

1

http://environmentalprogress.org/big-news/2017/2/11/german-electricity-was-nearly-10-times-dirtier-than-frances-in-2016

2

https://www.reuters.com/article/us-france-macron-nuclear/nuclear-renewables-to-help-french-co2-reduction-goals-macron-says-idUSKBN1EB0TZ

3

http://www.cleanenergyministerial.org/initiative-clean-energy-ministerial/nuclear-innovation-clean-energy-future-nice-future

4

https://www.nytimes.com/2018/06/01/climate/trump-coal-nuclear-power.html

5

http://www.world-nuclear.org/information-library/country-profiles/countries-a-f/china-nuclear-power.aspx

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NUCLEAR ENERGY Small modular reactors At the same time, the world is moving ahead with smaller and safer forms of nuclear power. Five small modular reactor (SMR) designs of less than 300MW are within an eight year deployment timeframe, including NuScale in the US (recently uprated from 50 to 60MW per unit), the Argentine CAREM (32MW), South Korea’s SMART (100MW with desalination as bonus), the Chinese ACP-100 (100MW) from CNNC and the Russian KLT-40S with two barge-mounted 35MW units. All these SMR designs have large water reservoirs supplying passive cooling to safely remove fission-product decay heat after the reactor is shutdown. This eliminates the type of “station blackout” accidents seen in Fukushima. Factory fabrication of modular components will reduce build times from seven years to three to four years, and the smaller size will also mean cheaper reactors which are accessible to more countries. The IAEA (International Atomic Energy Agency) is establishing SMR deployment guidelines, having just convened the first SMR Technical Working Group meeting in Vienna.6 The target markets for SMRs include both established and new-tonuclear countries, all of which are facing the imminent retirement of coal-fired power plants. The smaller size and superior safety of SMRs means the traditional EPZ (Emergency Planning Zone) around large 1GW reactors can shrink from a 10 mile (16km) radius to as small an area as the site boundary, making SMRs ideal brownfield replacements for retiring coal-fired power plants.

An example of a small modular reactor. Source: NuScale

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Radioactive waste A nuclear fuel bundle usually stays in the reactor for 18 to 24 months, undergoing fission and supplying energy. It is then taken out of the reactor and stored in a spent fuel pool for about ten years to allow the decay-heat to reduce. After this time it can be geologically disposed or reprocessed to make new fuel. The very radioactive component of the spent fuel generating decay heat is from the fission products of the split uranium. After the spent fuel has cooled for ten years, the most important of these fission products are strontium and cesium, with half-lives of 28 and 30 years respectively. Half-life is the period it takes for half of the quantity of a radioactive element to disappear via radioactive decay. What’s important to note is that after ten successive half-lives, the radioactive content is reduced to 0.1 per cent of its original radioactivity and down to 0.0001 per cent after 600 years. This means that after 600 years, the radioactive strontium and cesium content in used fuel will have all but disappeared, resulting in the radioactivity in spent fuel being similar to the radioactivity in the uranium ore from whence it came. More significantly, although spent fuel is very radioactive, its volume is small and it can therefore be safely contained in fuel casks, as has been the practice in nuclear plants around the world. To take the final step of radioactive waste disposal, Sweden and Finland are close to commissioning their radioactive waste disposal facilities after a prolonged and careful study of the sites’ geological suitability – thus proving that there are technical solutions for the disposal of high level nuclear waste.

The Australian context Currently, Federal legislation prevents the consideration of nuclear power plants by prohibiting their environmental assessment and regulation by Federal departments and agencies as covered in the Environment Protection and Biodiversity Conservation Act 1999 (the EPBC Act) and the Australian Radiation Protection and Nuclear Safety Act 1998 (the ARPANS Act). This stands in conflict with assertions of technological neutrality in the Finkel Review7 and is in contrast to observations made in CSIRO’s Low Emissions Technology Roadmap (2017) that states SMRs can contribute to Australia’s low emissions energy.8 Indeed, the legislation banning nuclear power was written 20 years ago, without the beneficial development of safer reactors and without the urgency of the Paris Agreement where countries have pledged to reduce carbon emissions, in a collective effort to arrest global warming.9 Nuclear power can contribute to Australia’s carbon reduction and offers distinct advantages in doing so. Nuclear is a concentrated form of energy, a feature in keeping with traditional baseload generators that don’t require large areas of land or grid build outs for harvesting diffuse sources of energy. Unlike intermittent power sources, it doesn’t require capacity duplication in the form of backup generation. Nuclear power works 24/7 with a minuscule carbon footprint on par with wind and solar in its lifecycle. Thus nuclear in itself solves the energy trilemma of providing baseload, clean and affordable electricity, and so must be considered in Australia’s future energy mix. To do so requires the removal of Federal legislative prohibitions on nuclear power.

6

https://www.iaea.org/newscenter/news/iaea-launches-technical-working-group-on-small-medium-sized-or-modular-nuclear-reactors

7

https://www.energy.gov.au/sites/g/files/net3411/f/independent-review-future-nem-blueprint-for-the-future-2017.pdf

8

https://www.csiro.au/en/Do-business/Futures/Reports/Low-Emissions-Technology-Roadmap

9

https://unfccc.int/process-and-meetings/the-paris-agreement/the-paris-agreement

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NUCLEAR ENERGY

ENERGY INNOVATION HUBS AND NUCLEAR POWER

by Robert Pritchard

This article discusses how, with a view to accelerating investment in energy research, development and deployment, it could be of great strategic value to Australia to establish energy innovation hubs with modern nuclear power as one of the anchor technologies.

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t is easy to criticise the prohibition on nuclear power in Australia as archaic (which it is) and call for it to be removed. The more challenging task is to outline an energy strategy that is visionary and innovative, one that the community can understand and support. I see no reason why Australia should not be able to capitalise on its small but worldclass knowledge base developed from 60 years’ experience in successfully operating research reactors and manufacturing nuclear medicine. Embarking on the establishment of Australia’s first hub for energy innovation could signal a breakthrough in the quest towards a modern, secure and decarbonised power system that guarantees dependable supply to our homes, schools, hospitals, transport systems and other essential facilities. Siting and anchoring an energy innovation hub: don’t leave the regions out A key feature of an energy innovation hub would be proactively designing and facilitating the introduction of safe, lowemissions technologies that complement each other. It would be a stage beyond the mere assembly of knowledge and the establishment of cooperative research centres. A hub would of course need some land, but a hub would not need to be sited in the

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middle of a big city – a regional location with local community support would be ideal. A hub should also not be islanded – it should be connected to the transmission grid in order to optimise whole-of-system operations. In the modern digital era, an energy innovation hub can very easily reach around the world and collaborate with other hubs. Initially, a hub just needs to be anchored to a particular technology in a particular place. In this context, the unique advantage of modern small modular reactor (SMR) technology is that an SMR does not require a water supply for cooling and can be sited inland, near a point of regional demand.

Solving the energy trilemma – a top-down or bottom-up approach? For more than a decade, Australia’s federal, state and territory governments have struggled to find the solution for the trilemma of energy problems: reliability, affordability and the need to reduce greenhouse gas emissions. Finding the right solution at the right scale has proven to be time-consuming, challenging to manage and very costly. The main policy approach so far has

been top-down regulatory reform of energy markets, leaving time for technological solutions to come through, as well as financial incentives for particular solutions. The most recent example of top-down regulatory reform is the National Energy Guarantee (NEG) scheme proposed by the Energy Security Board. The NEG is a welcome initiative in addressing the energy trilemma. However, communities often find it hard to accept or even understand regulatory solutions. Communities find it easier to grasp bottom-up approaches. This is why they have been attracted to renewable technologies like wind and solar. However, communities have little appreciation of the deleterious impact that weatherdependent, renewable technologies can have on system reliability and whole-ofsystem costs. Governments have been generously handing out grants and allowing tax deductions for research. Some of these grants could be channelled to energy innovation hubs.

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NUCLEAR ENERGY Short-term or long-term solutions? The ACCC’s recommendation To achieve significant reductions in emissions within the timeframe set by governments, without also harming GDP, it will be necessary to continue relying for some time on coal, natural gas and hydro technologies. There could have been more attention paid in Australia to the longer-term technological options, such as CCS, nuclear power, synthetic hydrocarbons and hydrogen. Recently, the Australian Competition and Consumer Commission (ACCC) recommended a program to the Commonwealth to boost competition in the generation market. Its idea was to offer energy offtake agreements to qualifying new generation project developers to help them secure long-term debt finance. The ultimate aim is to support long-term, low-cost electricity supply to commercial and industrial customers. The lack of an energy vision Four years ago, the Energy Policy Institute suggested that Australia lacked an energy vision. We suggested an energy vision should have four dimensions: Diversity The first dimension would be to develop a diverse, competitive and resilient domestic energy system, supplying energy reliably and affordably to the nation, at the same time as progressively improving our energy efficiency and energy productivity. Exports The second dimension of an energy vision would be to aim to be the most reliable and competitive supplier of energy products to our trading partners.

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Reduction of emissions The third dimension would be to help reduce global greenhouse gas emissions in the most affordable way. Energy innovation The fourth dimension would be to exploit Australia’s skills and resources in pursuing these goals in the most innovative and technology-neutral way. Australia would promote collaboration on efficient energy technologies, building our reputation as a stable and safe place to invest, and encouraging our energy buyers to participate in the further development of our domestic energy resources. The establishment of the ESB has been an important step forward but its resources are thin. More effective institutional arrangements, greater stakeholder engagement and greater accountability appear to be needed. In a world that is rapidly changing (economically, environmentally, socially, geopolitically and technologically), energy policy should be methodically, transparently and regularly reviewed over the long term. Safeguarding the power system: where to start? Above everything else, each state must safeguard its power system; that is, it should ensure that it has an internationally-competitive, dispatchable electricity supply capability. In this context, the ACCC’s recommendation of long-term offtake agreements could be a gamechanging mechanism to ensure there will be investment in long-term generating capacity for the benefit of industry and the overall economy. New South Wales is the obvious place to start. Over the next 25 years, the Liddell,

Vales Point, Eraring, Bayswater and Mount Piper power stations will reach their 50-year operating lives and will require replacement or major refurbishment at a cost of billions of dollars. NSW should aim to convert its primary resources of coal, biofuel, gas, uranium, water, wind and solar to electricity by the most efficient mix of technologies. This mix could include pumped storage, other storage options, CCS and small modular nuclear reactors at inland points connected to the transmission grid. The NEG will not guarantee that the most efficient long-term investments will be made in every future circumstance in every NEM region. Constitutional responsibility for generation planning and approving generation developments remains with the states. The states have constitutional authority to intervene in the event of market failure or force majeure events that threaten the reliability and affordability of power supply. Timely information is vital. Last December, the NSW Energy Security Taskforce (the O’Kane Report) far-sightedly recommended that “the Government develop an electricity strategy for NSW that identifies objectives for an ideal electricity system in NSW and can inform trade-offs, decision-making, regulatory arrangements, and program design in NSW”. Development of conventional, baseload coal-fired generation, on which NSW presently depends for around 80 per cent of its electricity supply, typically requires at least two years for planning and environmental approvals, a further year for financing and financial close, and

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NUCLEAR ENERGY three years for construction, a minimum of six years. Investment depends on the maintenance of electricity market rules for the first 15-20 years of project life. Development of alternative baseload generation, such as pumped storage or small modular nuclear reactors, could take over a decade. As the ESB itself acknowledged in its February 2018 draft design consultation paper, “The Guarantee is just one part of a multiple pronged approach to meeting the future reliability and security needs of the power system”. For system reliability, as the ESB also acknowledged, there will be a need for a buffer or strategic reserves: “The Energy Security Board’s Health of the NEM report noted that system security health is critical. Managing system security is becoming challenging, particularly in some regions. The risk that essential requirements for security are not present is increasing, along with the market interventions required by AEMO. While the Guarantee will not directly address these other concerns (although it may in part by driving more dispatchable capacity in the NEM), the Energy Security Board still considers these matters important, and that they should be addressed. “Specifically, the Energy Security Board considers that, in addition to the Guarantee, the consideration of strategic reserves, day-ahead markets and demand response are priority issues.” A system failure cannot be acceptable to the health, education, transport, essential services, agricultural and manufacturing industries. Nor can it be acceptable to

communities. States cannot shirk their responsibility to ensure adequate, reliable and affordable electricity supply to their constituents within their state borders. Electricity infrastructure is essential public infrastructure, perhaps less obvious than roads, railways and ports, but more important to the community and the economy.

The benefits of modern nuclear technology Significant scientific, educational, skillsdevelopment, employment and other flowon benefits could flow to the first Australian state to embark on the development of what the O’Kane Report described as an “ideal electricity system”. The arguments for creating an energy innovation hub and anchoring it to modern nuclear technology include: 1. Nuclear power is reliable and dispatchable 2. Nuclear power can facilitate grid stability 3. Nuclear power is likely to be affordable over the short and long term 4. Nuclear power is a zero-carbon energy source that will assist Australia to meet its present and future international obligations to reduce emissions 5. Modern SMRs are “load followers”, enabling them to support the penetration of intermittent renewables into the power system 6. Educational and job opportunities would emerge for both skilled and semi-skilled workers 7. Nuclear power would not only make use of Australia’s skill base, but would further develop Australia’s

capabilities in associated industries and technologies 8. There may be special economic development benefits for regional locations that are close to mining areas 9. Australia’s reputation in the AsiaPacific region may be enhanced and opportunities for export of Australian skills, services and technology may be opened up 10. Australia has ample uranium resources that will underwrite security of fuel supply over the long term The first step? In July, the Australian Energy Market Operator (AEMO) released its first Integrated System Plan addressing future transmission system requirements in the NEM over the next 20 years. Surprisingly, AEMO ignored the potential role of modern nuclear power as one of our future generation options. The ten arguments listed above make a compelling case for it to be included. As a first step, NSW could establish an expert, politically-independent, technology-neutral, energy planning and advisory body with the responsibility and capacity to address future system risks, to consult with communities and to make recommendations to government, including new generation project support as recommended by the ACCC. The archaic nuclear bans at Commonwealth and State levels could then be confidently lifted. This is what I would call visionary. It is something that an informed community would be able to prosper from.

Robert Pritchard is a lawyer and independent consultant who serves as executive director of the Energy Policy Institute of Australia. The Institute is an independent, apolitical, technology-neutral energy policy body unconnected with government. The views expressed in this article do not represent the official views of the Institute or its members.

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FEATURES SCHEDULE

FEATURES SCHEDULE

November 2018

Deadline: 19 October 2018

MAJOR FEATURES

Energy efficiency Energy utilities Biofuels Gas turbines

SPECIAL FOCUS

Electric vehicles IoT & cloud communication Mobility

EQUIPMENT & MACHINERY

Switchgear

EVENT DISTRIBUTION

National Energy Efficiency Conference NSW Annual Electric Energy Conference

JUNE 2019

March 2019 MAJOR FEATURES

Solar Green gas Future fuels

SPECIAL FOCUS

Smart networks (encompassing big data, smart meters and smart grids) Consumer and industrial retail

EQUIPMENT & MACHINERY

Deadline: 12 April 2019

Deadline: 14 December 2018

EVENT DISTRIBUTION

Spatial & GIS

Smart Energy Conference & Exhibition Digital Utilities 2019

September 2019

Deadline: 19 July 2019

MAJOR FEATURES

Energy networks Storage Hydro power Waste-to-energy

MAJOR FEATURES

Wind Nuclear energy Gas pipelines Disruption

SPECIAL FOCUS

Automation Security Inspection & condition assessment

SPECIAL FOCUS

Microgrids Asset management Distributed generation

EQUIPMENT & MACHINERY

Transformers and substations Vegetation management

EQUIPMENT & MACHINERY

Asset inspection & drones/UAVS

EVENT DISTRIBUTION

TBC

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ADVERTISERS’ INDEX Aggreko............................................................................................................................................................................. IFC All-Energy Conference......................................................................................................................................................26-27 CBI Electric......................................................................................................................................................................25, 55 Century Yuasa......................................................................................................................................................................37 Cromarty.............................................................................................................................................................................. 7 EESA NSW Annual Electric Energy Conference......................................................................................................................IBC National Energy Efficiency Conference...................................................................................................................................63 Energy Power Systems Australia.............................................................................................................................................. 8 GNB Industrial Power............................................................................................................................................................. 9 Optimal Group Australia.........................................................................................................................................................11 Position Partners.................................................................................................................................................................. 59 Tonsley Innovation District.................................................................................................................................................... 31 Vermeer........................................................................................................................................................................... OBC Wilson Transformer Co..........................................................................................................................................................47 Xplore Technologies.............................................................................................................................................................. 51

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September 2018 ISSUE 3

www.energymagazine.com.au


NSW ANNUAL ELECTRIC ENERGY CONFERENCE 2018 Adapting to the major changes reshaping the electric energy industry

November 27th 2018, Dockside Conference Centre, Sydney For more information and to BOOK NOW visit www.2em.com.au/nsweesa2018 Earlybird prices available until 30th September2018

A TECHNICAL TRAINING INITIATIVE OF THE ELECTRIC ENERGY SOCIETY OF AUSTRALIA Find us on Facebook: Electric Energy Society of Australia

Find us on LinkedIn: Electric Energy Society of Australia


PD10 SOLAR PILE DRIVER

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[Speed] Designed from the ground up for solar array installation, the PD10 brings cycle times down to unprecedented lows. [Precision] Laser or optional GPS guidance and an innovative hammer design means outstanding accuracy, less pile damage—and less rework.

[Local product support] Get your project underway with the peace of mind that only the backing of a truly nationwide dealer support network can offer. Contact your local Vermeer product specialist to learn more.

PD10 SOLAR PILE DRIVER. GET EQUIPPED. WWW.VERMEER.COM.AU | 1300 VERMEER / VermeerAustralia Vermeer and the Vermeer logo are trademarks of Vermeer Manufacturing Company in the United States and / or other countries. © 2018 Vermeer Australia. All Rights Reserved.

Profile for Monkey Media

Energy September 2018 Digital Edition  

Moving with the currents of energy change, a record breaking year for renewables, and drone autonomy for improved power pole inspection.

Energy September 2018 Digital Edition  

Moving with the currents of energy change, a record breaking year for renewables, and drone autonomy for improved power pole inspection.