Australia must embrace the global energy transition

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Global advisory firm, Advisian, has released its first white paper in the series, ‘The New Energy Future: the global transition’, which examines the rapid transformation of the global energy landscape. Utility spoke with co-author of the report Paul Ebert, Global Director, New Energy who stressed the need for Australian individuals, businesses and governments to take heed of this inevitable transition toward a more complex energy landscape.

The maturing of renewable technologies and data collection tools – although a threat to traditional energy businesses – have the opportunity to enhance and strengthen the traditional grid, ultimately delivering customers a more reliable and efficient energy network.

According to Mr Ebert, the solution to attaining the converged value of solar, energy storage and electric vehicles will be the “energy internet” — a vast network of devices that generate, store and consume energy. To allow these technologies to thrive, regulatory reform and restructuring of business models must be developed.

“Businesses, individuals and governments need to be aware that this future is coming towards us quickly, and we need to be prepared for the changes that are already taking place throughout the world. This will be a complex process, and a difficult transition for many, so early preparation is vital.

“Australia has quite a unique opportunity in many ways. We have an abundance of natural resources, as well as the ability to really try and test renewable and data capturing technologies. We also have the commercial and business frameworks that enable those to flourish.

“It is fair to say that in terms of resources, Australia has more energy than we can use. We have lots of sunlight and some of the best solar insulation in the world – 50 per cent of all PV manufactured around the globe contains Australian technology. We have excellent wind, biomass and water resources as well as abundant fossil resources. Because of this, we really are an energy superpower, which is why our economy is linked so importantly to energy.

“We also have one of the most sophisticated electricity markets in the world. It is extremely competitive, relatively small, and operates over a very large area. What this means is Australia is a good test case for trying technology adoption, and analysing its impact on electricity systems.

“We’ve also got regions of the national electricity market that have very high penetration of renewables already.

“In more mature, larger markets, it takes a long time to reach that penetration point, so Australia has the advantage. That gives us the opportunity to actually develop things like integration technologies. This is something that we can do this in our own backyard, and then take our knowledge to the world,” said Mr Ebert.

Transforming the role of utilities

According to Mr Ebert, while there is no certainty on what the energy sector will look like in ten years, the emergence of solar, battery storage, electric vehicles and data collection tools encourage utilities to forge closer relationships with their customers, and change the way they operate the grid.

“The grid is really the backbone of the whole transition. It will mean a change in the way the grid is used, and particularly the way utilities consider their role in this. I think it is actually a fantastic opportunity for the grid to really be enhanced.

“In terms of developing new business models, utilities are already taking action. A lot of the traditional, incumbent utilities are starting to make investments in some of the elements of the new energy technology spectrum. We’re seeing installation of energy storage, installation of more smarter control around loads and smart meters.

“To make beneficial use of this network, and to connect utilities with their customers, entrepreneurs will need to be able to collect and transmit the data that devices capture about energy use on an open platform, and this will likely require significant regulatory reform.

“There is potential for a whole range of communication devices to be involved, and I think initially these tools are going to be created by utilities and new entrants.

“In an urban home, these new tools will allow utilities to see a house’s solar output, or the state of charge on the battery. They will potentially be able to see the state of certain loads, pool pumps, refrigerators and other appliances, and this can be fed back into an program which then makes decisions on what the best thing for that load, given the retail position.

“The flipside to this however, is that not everyone wants their data known. There is a big issue of data security, which has to be worked through. But provided that data security is maintained, there is a great upside for people who use energy, by being able to optimise the way it’s delivered to give them a much better outcome commercially,” says Mr Ebert.

Empowering the customer

Solar, battery storage and smart utility information apps will place the power of choice in the hands of the customer, says Mr Ebert.

“There is a lot of interest in using energy from your own home, and I think a lot of people are very fascinated with the idea of using their roof to generate their own electricity.

“A lot of people call this the democratisation of energy, and the rise of the prosumer, where people are suddenly in more control of where they source their electricity.

“New apps or mobile devices will be the bridge between utilities with their customers, connecting them more closely to the network,” said Mr Ebert.

Commercial benefits and delinking from environmental aspects

According to the white paper, technologies for a new energy future will be adopted, not just for the contribution to conservation, but more for commercial reasons.

“We are noticing that renewable technologies are starting to delink from their environmental aspects, and are becoming more of a commercial option.

“It makes commercial business sense to install these new technologies, as now they have reached a level of technical maturity that is required to be incorporated into a utility system like ours. At the same time, these technologies have a lower emissions output, so it is a win/win situation.” said Mr Ebert.

Staying ahead

According to Mr Ebert, this transformation towards convergence of renewable technologies, data collection and the grid will happen much faster than what is predicted, and for the full potential of Australian resources to be reached, we must act sooner rather than later.

“This transition is going to happen faster than people think, and despite the potential for downsides, the commercial viability is there.

“It’s going to be complex working through all of the technical and social issues that will arise from this energy evolution, but change is happening all around us and if Australia is going to keep up, we must all be prepared.”

This partner content is brought to you by Advisian.

View The New Energy Future: the global transition white paper here.

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