Australia’s energy market operator hails ‘the beginning of a new era’ as it provides itself with a significantly increased budget to support the planning, engineering and management work needed to transition the coal-dominated Australian grid to a grid based on renewables and storage.
“Our world is changing at speed and scale, and the changes underway are set to dominate Australia’s energy future,” the operator says in its new business plan.
“The operations, regulations and market functions of the traditional electrical system are being challenged as the provision of safe and reliable power becomes more complex.”
To help address these challenges, AEMO got a significantly higher budget of $434 million, up from $314 million last fiscal year, with most of the increase going to run the mainnet.
This is justified by the need to allocate more resources to the complex engineering challenges of managing a grid dominated by wind and solar, moving to 5-minute settlements, IT upgrades, data management and market rule changes after 2025.
Chief among these “new” challenges is to develop the knowledge and expertise, as well as the engineering solutions, to manage a grid that could be powered – sometimes – by wind and solar only within three years. .
He says a portfolio of technologies will be needed to meet these challenges: utility-scale batteries, electricity storage, gas-fired generation, smart batteries behind the meter, energy efficiency measures, virtual power plants and services. from vehicle to electric vehicle network.
These will be complemented by flexible loads and wholesale demand response to handle peaks and troughs.
“The company clearly expects the pace of change to accelerate,” CEO Daniel Westerman and Chairman Drew Clarke say in the introduction to the business plan.
“This means that (AEMO) is facing the challenges of operating Australia’s power grids at higher levels of renewable energy sooner and with greater urgency.
“The challenges of maximizing renewable energy in the system are multiple, complex, interrelated and
will require a spirit of collaboration between governments, regulators, industry and communities on a more accommodating scale than at any time in the past.
The main challenge is to manage the replacement of coal, which now accounts for two-thirds of the national electricity market’s production, but which will be replaced by large amounts of wind, solar and storage energy over the next eight years.
The business plan highlights (see graph above), a near tripling of wind and solar capacity to 44 GW by 2030, and a sevenfold increase in storage (of varying durations) to 15 GW.
“Real-world experience supports accelerated shutdowns as renewables increase commercial pressures on the future of these power plants,” the report said.
“The electrical system must be prepared for the removal of coal generation and means to replace the stabilizing effect that large rotating turbines have on the electrical attributes of voltage and frequency.”
The AEMO business plan also points to a “wider” and potentially national ISP that would combine the main network (the NEM) with the WA network, known as SWIS, but does not go into further detail. on what it would look like.
Giles Parkinson is the founder and editor of Renew Economy, as well as the founder of One Step Off The Grid and the founder/editor of The Driven, focused on electric vehicles. Giles has been a journalist for 40 years and is a former economics editor and associate editor of the Australian Financial Review.