OXYGEN FILES: Powering the energy grid without coal isn’t going to happen without storage and other technologies to ensure reliable supplies at any time and in any weather. While policy from the top is still lacklustre, other shifts are underway that may help speed the transition.
This month, Standards Australia released the long-awaited Australian Standard for energy storage batteries, delivering two key pieces of good news.
First, lithium ion batteries do not – as was feared during the draft stage – have to be housed in a concrete bunker, according to a spokesperson for Standards Australia.
Second, the standard is voluntary not mandatory.
The spokesperson told The Fifth Estate the standard will remain voluntary unless other legislation, such as state-based building rules or other regulations around electrical installations, require battery installation to comply.
The development of AS/NZS 5139:2019, Electrical installations – Safety of battery systems for use with power conversion equipment involved extensive engagement with industry representatives, government and regulators, consumer representatives and technical experts, said Standards Australia head of stakeholder engagement, Daniel Chidgey.
“Given there has never been an Australian standard for this new technology, developing this guidance has been a huge task and is a testament to the dedication of those involved,” Chidgey said in a statement.
He said the standard is expected to be further refined as the industry evolves.
The standard is expected to be used by manufacturers, system integrators, designers and installers of battery energy storage systems.
It applies a risk-based process to ensure appropriate installation methods are applied depending on the hazards that are identified, according to Sandy Atkins, a member of Standards Australia’s Technical Committee.
“This standard aims to ensure battery systems are safe, consistent and reliable for the benefit of the Australian community,” Atkins says.
In addition to specifics around how batteries should be installed, key topics covered by the standard include impacts due to battery technologies being used more widely and more applications, particularly in residential electrical installations.
It also addresses recent production and application innovations, such as lithium technologies, flow, and hybrid ion technologies, and new developments with interconnection equipment, which can result in batteries being continually connected to the grid.
It’s quite a lengthy document – 170 pages, according to Renew energy analyst Andrew Reddaway.
Lithium ion batteries
Reddaway tells The Fifth Estate the main change compared with business-as-usual installation approaches is the specifications around where batteries can be installed.
Where lithium ion batteries are being installed on an external wall, they must be 600mm away from a hot water system, gas, windows, doors or air conditioning units, so a “fairly wide” area of wall is required. Where the wall has a habitable room on the other side of it, 900mm of fireproofing, such as fibre cement board, must be installed behind the battery. If the battery is close to eaves, they also will require fire proofing.
Unless a battery is approved by the Clean Energy Council (CEC), it may not meet the standard’s requirements if it is installed underneath a habitable room. He notes that only lithium ion technologies are currently on the CEC’s approved products list.
Lithium ion batteries “get an easier run” in the standard.
Where a battery is being installed in a garage, which Reddaway says is quite common, a bollard needs to be in place to prevent a vehicle backing into the battery.
Reddaway says that the standard’s requirements mean a battery installation should be planned in the early design stages of a building to ensure the requirements are met.
While the standard is voluntary, it makes sense to meet its requirements from the point of view of future proofing against regulatory changes and so that the building owner is better protected if there is a safety incident.
He suspects insurance companies might ask whether a battery installation was compliant with the standard.
“In general, I think the standard was needed. I think it is too restrictive in some cases, and it doesn’t distinguish between some battery technologies as well as it could.”
For example, some lithium ion technologies are “inherently stable” so there is no fire risk.
How’s the market tracking?
Despite the advantages of storage from the point of view of being able to operate a building using its own solar even when the sun isn’t up, Reddaway says the market hasn’t taken off “as much as some expected”.
The economics still don’t stack up for many households. Price drops tipped back in 2015 have not been as steep as predicted.
That means most households are exporting significant quantities of electricity into the grid, he says.
A recent story in the Australian Financial Review about feed-in tariffs in Queensland suggested those feeding into the grid in the Sunshine State might soon receive zero feed-in tariffs. That would mean households who had been getting zero or even credit energy bills might be in for a shock.
The Fifth Estate asked Reddaway if this might make batteries a sounder economic proposition for those households.
He ran a couple of Sunulator simulations for a household in Brisbane consuming 23 kWh of electricity per day with an existing north-facing 5 kW solar system who were considering adding a battery. The simulations modelled batteries sized 5 kWh and 13 kWh, and feed-in tariffs of 10 cents and zero cents.
With a 10c FiT, the payback times for the small and large battery were 18 and 29 years, respectively. With zero FiT, the payback times for the small and large battery were nine and 17 years, respectively.
“This shows that for a typical household receiving a zero FiT, battery economics would improve from today but still be marginal at best,” he says.
“These payback times assume a 10-year battery life and no degradation, which is optimistic for the battery. They don’t include the opportunity cost of money used to pay for the battery, which is again optimistic.”
The battery including installation is assumed to cost $1000 per kWh of usable energy storage capacity.
Reddaway says he is “sceptical” that Queensland wholesale electricity prices and hence FiTs would drop to near-zero for extended periods.
“The electricity system will evolve to make better use of cheap surplus solar generation, for example, additional transmission to NSW, water heating moving from midnight to midday, large-scale energy storage (for example, an expanded Wivenhoe pumped hydro facility operating under the new CleanCo organisation), electric vehicle charging and production of hydrogen gas.
“Such developments will dampen any sharp drop in daytime wholesale prices.”
City of Sydney’s announcement it is going to 100 per cent renewable and the ACT’s 100 per cent renewable milestone have something in common – both pledges will be underpinned by a degree of reliance on fossil-fuel generation unless storage at scale is part of the plan.
As a recent blog post by Energy Matters notes, while an entity such as the ACT may be purchasing enough renewable power to offset all energy use, what the grid actually supplies contains coal-fired and gas-fired power also.
And at night, when the sun isn’t shining, or when windfarms are not pumping out the watts, it means it will be brown power keeping the lights on.
The New South Wales government is progressing with storage at scale in the state, with its recent announcement of the next stage in its $75 million Emerging Energy Program.
Ten projects shared $7.1 million in funding for feasibility studies, including a proposal by Canada’s Hydrostor for a compressed air technology storage project at Broken Hill. Hydrostor is preparing to break ground on its first Australian project in partnership with Terramin in South Australia, which will see a former zinc mine repurposed as a renewable energy storage battery capable of delivering dispatchable power at short notice.
Another 21 projects have been shortlisted for capital funding to assist with the construction of on-demand electricity. The shortlisted projects include over 700 megawatts of on-demand electricity capacity across six technologies, including pumped hydro, gas, biogas, solar thermal, virtual power plants and batteries. The winners will be announced in the first half of 2020.
“The transformation of our electricity system is going to drive an energy construction boom, as the projects awarded feasibility grants could see almost $2 billion in private investment,” NSW minister for Innovation Matt Kean said in a statement.
ARENA has also put storage on the priority list as one of three key focus areas in its newly-released Investment Plan.
“Our new investment priorities are geared towards future proofing our energy system and economy and helping to further unlock the vast renewable resources Australia has,” ARENA chief executive Darren Miller said.
“We need to overcome the challenge of integrating renewables into the grid as we switch to an electricity system that is more complex, more decentralised and more variable.”