The Australian Distributed Energy Roadmap

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1 The Australian Distributed Energy Roadmap Perth, November Stuart White Intelligent Grid Cluster Leader, Institute for Sustainable Futures, UTS

2 CSIRO Intelligent Grid Research Program

3 igrid Research Projects Univ Focus Project P1 UQ Technol Control methodologiesof Distributed Generation for enhanced network stability and control P2 UQ Econ Market and Economic modelling of the impacts of Distributed Generation and Local Co-operating agent based Demand Side Management P3 QUT Technol Optimal Sitingand Dispatch of Distributed Generators P7 QUT Technol The operation ofdg in a mini grid P4 UTS Econ Institutional Barriers, Stakeholder Engagement and Economic Modelling P5 Curtin Social Intelligent Grid Social Impacts P6 UniSA Social The Intelligent Grid in NewHousing estates

4 Elements of Intelligent Grid Power Stations Transmission Distribution Customer Transmission Data Collection and Automation Sensors, data collection and Automation: Predictive and Self Healing Using information, communications and control technologies to integrate the electricity network with distributed energy resources. Distributed Energy: Peak Demand management - DSR Energy Efficiency Distributed Generation Energy Storage Smart Meters, Time of Use pricing Real time displays Advanced Comms Electric Cars Figure Source: Southern California Edison & CPUC

5 Electricity Generation & GHG The electricity supply industry is the biggest source of global greenhouse gas emissions and reducing these emissions is the most urgent challenge facing the industry. The electricity sector is also under pressure to limit cost increases. Deliberate and well designed policy measures are essential to reduce greenhouse emissions and curtail increased electricity bills.

6 IPCC Projected Sectoral Impacts of Climate Change: Tipping points at ~2 o C of warming

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9 Australian Greenhouse Gas Emissions 40% Percentage Change from % 20% 10% 0% -10% -20% -30% -40% Australian target for 450ppm deal at COP15 Current Projection -5% CPRS target -15% CPRS target IPCC Max Rec'n: -25% IPCC Min Rec'n: -40% -50% Year

10 Why Copenhagen matters It is not enough to set any aspirational goal for 2050, it is critically important that we bring about a commitment to reduce emissions effectively by to ensure stabilisation of temperatures at [2 o C], then global emissions must peak by RajendraPachauri, Chairman, Intergovernmental Panel on Climate Change (IPCC) 15 Oct 2009

11 Distributed Energy is crucial to carbon abatement United States could reduce emissions by 31% to 46% by 2030

12 Towards a Distributed Energy Future The Opportunities

13 > Let s look at DE not from a GH point of view but from an electricity system planning point of view

14 The defrosting mammoth in the room

15 Can we afford a smarter grid at the same time as an expanded grid and a renewed grid? 3500 Distribution Network Capital Expenditure NSW $m p.a Qld Vic 1000 SA Financial Year

16 Energy Consumption Forecast to fall (AER Determination, Fig. 6.2, p. 114)

17 Peak Demand Forecast to rise (2.7% per annum) AER Determination, Table 6.4

18 Network Prices to Rise (by up to 172%) 1 Energy Australia Indicative Network Charges [1] Energy Australia, Revised Regulatory Proposal and Interim Submission, January 2009, p. 190

19 NSW capacity projections to ,000 19,000 CAPACITY (MW) 18,000 17,000 16,000 15,000 14,000 13,000 12, / / / / / / / / / / / /20 Capacity - scheduled Capacity - non-scheduled (NEIER) Capacity needed for reliability

20 Scenarios for meeting the capacity shortfall Scenario 1 COAL (approximates Owen Inquiry outcome) 1000 MW coal power station 2017 two 500 MW open cycle gas turbines in 2018 & 2019 Scenario 2 GAS (~NEMMCO projections) combination of open cycle and combined cycle gas Scenario 3 - Cogeneration and Demand Side Response Scenario 4 - Energy efficiency and Demand Side Response Scenario 5 - Combined distributed energy energy efficiency, cogeneration, and demand side response, and Allows 1000 MW coal fired capacity retirement in 2014/15.

21 NSW capacity projections to 2020 with DE 20,000 19,000 CAPACITY (MW) 18,000 17,000 16,000 15,000 14,000 13,000 12, / / / / / / / / / / / /20 Exisiting or planned capacity Capacity needed for reliability Demand side response Cogeneration Energy efficiency

22 Scenario cumulative costs & 2020 emissions $35 $33 $31 $ Mt CO 2 -e per year Billion $ $27 $25 $23 $21 $19 $17 $15 Coal Gas Cogen and DSR Energy efficiency and DSR Existing supply - variable cost New supply - amortized capital cost Million Tonnes CO2-e in 2020 Combined distributed energy Network capital - amortized cost New supply - variable cost

23 The Distributed Energy Roadmap The DE Roadmap consultation was launched in April The consultation involves: Series of consultation forums (around Australia) Series of working papers Engagement with current process Network building DE Roadmap Report & Recommendations The roadmap will be a concise and practical plan to accelerate the deployment of DE across Australia

24 Elements of the DE Roadmap DE Technology Assessment: Costs, Scale, Limitations Institutional Barriers What obstructs cost-effective DE? Assumptions & Scenario Analysis Policy Instruments Can institutional barriers be effectively overcome? Avoidable Network Costs (time and place) Optimisation & Outputs: Costs, Prices, Emissions Recommendations

25 Why a Distributed Energy Roadmap? 1. To guide igrid research program. 2. To communicate to a range of stakeholders. 3. To present coherent, practical research outcomes. 4. To develop solutions and policy recommendations. 5. To foster communication between stakeholders.

26 Proposed Consultation Program Focus Date Location 1. Roadmap introduction and overview 7 April 2009 Brisbane 2. DE Technology Assessment 14 July 2009 Melbourne 3. Policy Instruments for DE 11 November 2009 Sydney 4. DE Roadmap in WA context 11 March 2010 Perth 5. Avoidable Network Costs May 2010 Brisbane 6. Scenario Analysis & Optimisation June 2010 Sydney 7. DE Roadmap Launch (incl.conclusions&recommendations) August2010 tba

27 Intelligent Grid a key enabler for Distributed Energy a key enabler for Greenhouse Gas Emission Reduction Thank you. For more information on the I Grid Research program: Web: Tel: (ISF) Stuart.White@uts.edu.au