South Australian Government unveils plan to build world’s largest Virtual Power Plant

The State Government of South Australia (SA) plans to roll out a network of at least 50,000 home solar and battery systems across South Australia -  comprising 5kW solar photovoltaic (PV) and 5kW/13.5kWh Tesla Powerwall 2 batteries, plus a smart meter - working together to form the world’s largest Virtual Power Plant.

A virtual power plant is created by a network of home solar PV and battery systems working together to generate, store and feed energy back into the grid. The energy generated from the systems will provide electricity for the house on which they are installed. Any excess energy will be automatically dispatched to the grid and it will be centrally controlled to meet the needs of the grid, providing additional energy to the rest of the state, when it is required.

If the household consumes more electricity than is available from the energy system, it will draw from the grid instead.  All electricity consumed by the household (whether from the energy system or the grid) will be metered and charged for through the household electricity bill. 

The programme will begin with trial installations on 1100 Housing SA properties at no charge to the household. The installations will be financed through the sale of electricity. Initial phase 1 installs have already occurred and will continue throughout 2018 and 2019.

Following the trial, systems will be installed at a further 24,000 Housing Trust properties, and then a similar deal offered to all South Australian households, with a plan for at least 50,000 households to participate over the next four years.

The prioritisation of the installations will be determined during the trial phases. Criteria may include geographical spread for installation efficiency combined with optimising the security of the distribution network.

Tesla will review all properties to determine whether or not they are able to support a system and participate in the programme. Renewal SA will also provide advice on suitable properties to ensure installations complement existing regeneration programs.

A registration of interest has been opened for members of the public who wish to participate in the programme. The Government will release a market notice later this week for a retailer to deliver the program, with a preference of bringing a new player into the market.

The 250MW/650MWh plant, which is how big it will be at the end of the 4.5-year schedule, can meet around 20% of South Australia’s average daily energy requirements.

According to analysis by Frontier Economics, the virtual power plant is expected to lower energy bills for participating households by 30 per cent. Additionally, all South Australians will also benefit from the increased generation in the South Australian energy mix, with lower energy prices and increased energy stability.

The State Government is assisting the rollout with a AU$2 million grant and AU$30 million loan from the Renewable Technology Fund. The total value of the project is currently estimated at approximately $800 million which will come from investors. Proposals under the Renewable Technology Fund were received through an open call for proposals in September 2017.

Today’s announcement is the next phase in the State Government’s Energy Plan, which aims to deliver cleaner, more affordable and more reliable energy to South Australians, at an estimated cost of AU$550 million. Initiatives taken under the plan include the construction of a 150 MW solar thermal power plants, which is expected to supply all of the state government’s power needs and the launch of the Hornsdale Power Reserve, featuring the world’s largest lithium ion battery (100 MW/129 MWh) in December 2017. In another recent announcement, the South Australian Produce Market revealed plans for a AU$10.5 million microgrid, with the help of a AU$2.5 million State Government Energy Productivity Program grant. This is understood to be the largest private solar PV system in South Australia.

A recent report by the Australian Energy Market Commission said that energy prices in South Australia are expected to fall by approximately $300 over the next two years for the average household.

Premier Jay Weatherill said,“Our energy plan means that we are leading the world in renewable energy and now we are making it easier for more homes to become self-sufficient”.

“What this project will do is connect thousands of solar and battery systems to make one giant, coordinated virtual power plant. Once again South Australia is at the global forefront of renewable energy and storage technology,” commented Energy Minister, Tom Koutsantonis.

Social Housing Minister, Zoe Bettison, added,We know that people in social housing can often struggle meeting their everyday needs and this initiative will take some pressure off their household budget.”

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