Students pointing at rooftop solar

24 November 2020

By Lachlan Blackhall, Head, Battery Storage and Grid Integration Program, ANU

A team at the Australian National University has undertaken a significant project to explore the potential benefits of community batteries, as well as the attitudes of residents towards them. Here, they share some of their findings and explore the next steps for the energy industry.

Australia is a global leader in the uptake of renewable generation including wind and solar PV.

Renewable wind and solar generation is already the cheapest form of new build generation, and as prices continue to decline over the coming decades, the rapid uptake of renewable generation is set to continue.

To support this massive uptake of renewable generation we are going to need a significant amount of energy storage.

This energy storage is needed to fill in the gaps of renewable generation and ensure that we continue to have a reliable, secure and efficient electricity system.

In large part, this energy storage is going to come in the form of battery storage including both lithium and flow battery chemistries.

Since 2015, we have seen an increasing uptake of battery storage in Australia, initially in the form of residential batteries.

The uptake of residential battery storage has largely been driven by customers who already have solar PV on their roof and who are keen to capture the energy generated during the day and use it at night when the cost of electricity is often higher.

In 2017, residential battery storage began to be complemented by the installation of large utility-scale battery storage. The first notable utility-scale battery was the Hornsdale Power Reserve (HPR), better known as the Tesla Big Battery.

Since that initial installation, we have seen a number of other utility-scale batteries being installed all over the country.  These batteries are largely transmission connected and often co-located with utility-scale wind and solar farms.

As we start a new decade, we have big utility batteries at the centre of the grid and little residential batteries at the edge of the grid, but what about medium batteries in the middle of the grid?

It is these medium-sized batteries, something we refer to as community or suburb-scale batteries, that are of interest to us at the Battery Storage & Grid Integration Program at ANU.

For the last 18 months, we have been undertaking an ARENA-funded project titled Community Models for Deploying and Operating DER.

Through this project, we have been investigating the social, technical and economic considerations for how to deploy and operate community and suburb-scale battery storage.

We have been working on this project with a collection of partners including several distribution network service providers (DNSPs) and multiple community energy groups, retailers and consumer representatives.

Now that we have concluded this project, we are excited to share the results. So, first things first, what is a community or suburb-scale battery? These are batteries that are installed in your street or in your suburb, connected to the distribution network and have power capacities of up to 5MW.

By being situated close to customers, they are uniquely suited to providing social, economic and technical benefits for customers, distribution networks and to the broader system.

To highlight how a community or suburb-scale battery might work, consider the following example. Instead of everyone in a suburb installing their own behind-the-meter battery in their house, local customers could instead access a virtual slice of the community battery.

In this way, customers could export their solar generation during the day into the community battery, and then use the energy stored in the community battery during the evening when electricity prices are higher.

In addition to storing excess local solar generation, the community battery could provide services to the local network, as well as participate in markets for energy and ancillary services.

The ability to provide benefits to many stakeholders is one of the key reasons why we felt it was important to comprehensively investigate the opportunities for community batteries through this project.

For this project, we first identified the four key elements that describe a range of possible community-scale battery models.

These elements include:

» Battery ownership – who will own the battery, and what regulatory considerations might arise due to ownership? Crucially, how might battery ownership influence the prioritisation of benefits to different stakeholders?

» Stakeholder participation – who is a stakeholder in the battery’s operation, and what is their legal and operational relationship with the battery? How do stakeholders benefit from their participation, and what technology is necessary to enable the battery operation?

» Network tariffs – what network tariffs are applied to energy flows into and out of the community battery, and how do network tariffs unlock or impact the benefits that can be delivered to stakeholders?

» Services delivered – what market services, such as energy arbitrage and frequency support, can community-scale batteries deliver? What non-market services, such as network support (demand response, voltage regulation), do community-scale batteries deliver? How can services be value stacked to maximise the battery’s utilisation and cost-effectiveness?

By undertaking a socio-techno-economic analysis of various permutations of these four key considerations, we were able to assess how different community energy models created value for energy users, distribution networks, electricity retailers and the broader electricity system.

Ultimately, we discovered that community batteries can deliver five essential benefits. They can:

  1. Improve the fairness of the energy system
  2. Build trust in the energy system by sharing value transparently
  3. Increase the hosting capacity of the network
  4. Bolster local resilience, including socially, economically, and electrically
  5. Be cost effective by delivering services to many stakeholders

Unlike residential batteries, community batteries also potentially unlock the value of battery storage to all energy users, including customers who rent and do not own their own home.

The potential for novel subscription services that we identified through this project also means that customers who couldn’t afford a battery in their house would still be able to access the benefits of a community battery.

As part of our project, we conducted interviews and forums with industry stakeholders and members of the public.

These revealed a set of themes that are central to people’s attitudes towards community batteries. Many energy sector participants saw significant potential benefits of community-scale batteries, including over behind-the-meter residential storage.

Through our work with customers, we identified that their interests are complex and nuanced, and they are interested in far more than just affordability – for example, there was strong concern over questions such as battery life-cycle, promoting local energy use, reducing carbon emissions, questions of fairness and how this technology would support the broader energy transition to renewables.

We also discovered that customers were optimistic about the opportunity to rebuild trust and engagement with the energy sector, so long as trusted organisations were heavily involved in the operation of community batteries.

While we identified that there are no immediate barriers to deploying community batteries, we did identify that there are still some challenges that need to be resolved before the at-scale adoption of community batteries can become a reality.

Perhaps key amongst these is to implement new tariff structures that do not penalise community batteries.

Consequently, one of the key outcomes of the project was that we identified the need for more comprehensive trials and demonstrations to allow all stakeholders to better understand the implementation and operational complexity of using community batteries.

Notwithstanding the fact that there is still work to be done, it is exciting to understand the many benefits that could emerge from the at-scale adoption of community-scale batteries.

We are confident that there is now a path for community and suburb-scale battery storage to complement residential and utility-scale battery storage to power our electricity grid into the 21st century.

This article originally appeared in Energy Magazine.