Is a neighbourhood battery what you need?

Last modified: 19 January 2023

Deciding if a neighbourhood battery or batteries is a good idea and how to go about setting them up will be a different experience depending on who you are.

For individuals or households, check if there are already plans for a neighbourhood battery in your area, perhaps as part of a wider initiative. Initiating a neighbourhood battery project is a big undertaking, so it makes sense to join existing plans. Or you may feel motivated to lead a process to build local support for a battery. In both cases, your starting point is probably to talk to your neighbours, look for local community energy groups and/or ask your local council. They will hopefully know of existing plans. For examples of community energy groups or to find ones near you, check out the Community Energy Map (an up-to-date database of Australian community energy groups).

The feasibility of a battery will depend on various features of your network (see Network Services), which are hard to assess without establishing a relationship with your DNSP (see Partnerships & Engagement). However, one of the factors is the number of solar panels in your area, so this is worth researching. It is also helpful to know whether there has been any curtailment in your area and a local solar installation business would have this information. You might also take account of whether there are any significant users of daytime energy, such as schools, shops, centres or businesses, which might use local solar power and therefore balance supply and demand, making a battery less useful).

Whether you want to be a joiner or a leader, start talking to people in your neighbourhood (noting that for a nieghbourhood battery, a neighbourhood can be as large as 200 houses). This will give you an idea of how much interest there is and what people’s needs, aspirations and concerns are, and will be a first step in building relationships that will be important in building a NB project.

For community groups, which could include community energy or sustainability groups, other kinds of place-based groups, or small regional communities, the decision is about whether a neighbourhood battery/ies is the right technology to meet your goals and needs. The first step is to get clear, as a community, on your need and purpose (see Clarifying need, purpose and goals), and to try to separate this from your enthusiasm for a particular technology. The benefits table above may be a good starting point, and there are some engagement tools to help you (see Engagement). You can then assess your needs and goals against the factors listed below (see Are you ready to go?).

If you do believe batteries can meet your group’s goals, you will need to be in touch early with the distribution network service provider (DNSP) that services your local community, as they provide information on network requirements. They will need to be involved if you do decide to go ahead with planning for a neighbourhood battery or batteries.

For community organisations, which might include schools, nursing homes, sporting clubs or business parks, for example, the question is whether a neighbourhood battery will meet your organisation’s needs, priorities and finances. You also need to consider whether to work with your local community to involve them in establishing a neighbourhood battery, or whether you simply treat this as an infrastructure asset for your organisation. This will depend on your goals and which benefits you hope to deliver (see Benefits). You also need to consider whether to establish a battery behind the meter (e.g. storing the energy from solar panels on your buildings) or in front of the meter (connected with the wider community and electricity grid), which will become clear during the feasibility stage.

Local councils could play an important role in implementing neighbourhood batteries. There are, as yet, no council-owned or managed neighbourhood batteries (see Trials and programs), but this scale of battery may align with local councils’ policy goals around decarbonisation and energy affordability. Our research suggests that community members trust councils more than energy businesses and see them as potential ‘honest brokers’ in facilitating neighbourhood battery projects. Local governments could own neighbourhood batteries themselves, or could play a role in financing, leasing land, partnering, providing administrative assistance, conducting community engagement and contributing to ongoing governance.

Distribution Network Service Providers may consider neighbourhood batteries as a ‘non-poles-and-wires’ solution for the increasingly challenging task of managing energy supply and demand in low voltage networks, particularly as they are now required by legislation to integrate distributed energy resources such as rooftop solar and electric vehicles. As well as understanding the technical roles that neighbourhood batteries could play in supporting their networks, DNSPs also need to consider whether neighbourhood batteries offer opportunities to partner with organisations or communities in ways that might help them to efficiently provide reliable, affordable electricity services. These relationships could also build trust.

Regardless of whether they play a central role in implementation, DNSPs play a vital role in providing information and data to support decisions about neighbourhood battery site selection and ongoing operation, as well as enabling integration into the distribution network. A flexible and constructive approach to this role will be important to the rollout of neighbourhood batteries in Victoria, and elsewhere. DNSPs can also support this rollout by identifying ways to value and incentivize a range of network services that neighbourhood batteries can supply.

For energy businesses, including retailers, generators and aggregators, neighbourhood batteries can potentially be added to a portfolio of generation assets, supporting their ability to provide market solutions for network services, new customer offerings, energy market participation (arbitrage and FCAS) and potentially new ways to interact with emerging energy markets e.g. capacity, reliability and congestion services and markets.

These businesses should also recognise that enthusiasm for neighbourhood batteries in part reflects community desires for self-sufficiency and distrust of energy businesses. In this context, energy businesses need to understand community needs, concerns and aspirations, and to understand households and communities as more than customers. They also need to engage constructively and flexibly with groups seeking to implement neighbourhood batteries, in order to support a rollout that meets a range of needs and contexts. Trials to date provide examples of this kind of constructive engagement.

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