FULLY CHARGED: RENEWABLES AND STORAGE POWERING AUSTRALIA CLIMATECOUNCIL.ORG.AU Thank you for supporting the Climate Council. The Climate Council is an independent, crowd-funded organisation providing quality information on climate change to the Australian public. We would like to thank the Australian Communities Foundation for their support in producing this report. Published by the Climate Council of Australia Limited ISBN: 978-1-925573-43-5 (print) 978-1-925573-42-8 (web) © Climate Council of Australia Ltd 2018 Andrew Stock This work is copyright the Climate Council of Australia Ltd. All material Climate Councillor contained in this work is copyright the Climate Council of Australia Ltd except where a third party source is indicated. Climate Council of Australia Ltd copyright material is licensed under the Creative Commons Attribution 3.0 Australia License. To view a copy of this license visit http://creativecommons.org.au. You are free to copy, communicate and adapt the Climate Council of Australia Greg Bourne Ltd copyright material so long as you attribute the Climate Council of Australia Ltd and the authors in the following manner: Climate Councillor Fully Charged: Renewables and Storage Powering Australia. Authors: Andrew Stock, Greg Bourne, Louis Brailsford and Petra Stock. We would like to thank Dr Matt Stocks (ANU), Andrew Blakers (ANU) and Tim Buckley (IEEFA) for their thorough reviews. Louis Brailsford — Researcher Cover image credits: “Gemasolar solar thermal power plant, Spain” by Flickr user Beyond Coal and Gas Image Library licensed under CC BY-NC 2.0 and “Hornsdale 20161212_30cs” by Flickr user David Clarke licensed under CC BY-NC-ND 2.0. This report is printed on 100% recycled paper. Petra Stock Senior Energy and Climate facebook.com/climatecouncil [email protected] Solutions Analyst twitter.com/climatecouncil climatecouncil.org.au CLIMATE COUNCIL I Contents Key Findings ....................................................................................................................................................................................ii Introduction ......................................................................................................................................................................................1 The Facts ........................................................................................................................................................................................... 5 1. The Role of Energy Storage.................................................................................................................................................. 8 1.1 Balancing Supply and Demand 10 1.2 Ancillary Services 15 2. Storage Technology ............................................................................................................................................................. 18 2.1 Types of Storage Technologies 20 2.2 Attributes of Different Storage Technologies 29 3. Prices ........................................................................................................................................................................................ 34 4. Energy Storage Projects in the Pipeline in Australia .................................................................................................40 Glossary ........................................................................................................................................................................................... 53 References ...................................................................................................................................................................................... 56 Image Credits .................................................................................................................................................................................61 II FULLY CHARGED: RENEWABLES AND STORAGE POWERING AUSTRALIA Key Findings 1 2 3 Australia is on the cusp of an The cost of energy storage › Australian households are energy storage boom driven solutions is falling rapidly. increasingly embracing by supportive policies and battery storage units to falling costs. › The cost of lithium-ion batteries complement household has fallen by 80% since 2010. solar. › Energy storage technologies, Costs may halve again by 2025. like batteries, solar thermal › In 2016, there were 6,750 new and pumped hydro, can be › The cost of energy storage household battery installations used to build greater reliability technologies is rapidly falling with the market predicted to and flexibility into Australia’s and becoming competitive with have tripled in size in 2017, with electricity grid. They can store peaking gas plants, particularly over 20,000 new installations. wind and solar power to provide in light of the trebling of the electricity 24/7. domestic gas price over the last › 74% of people polled from across five years. Australia expect household › South Australia is already home batteries to be commonplace in to the world’s most powerful › SolarReserve are building homes in the next decade. lithium-ion battery, which is Australia’s largest solar thermal already benefiting the power plant in South Australia for grid by helping meet peak a levelised cost of no more demand, and responding than $78/MWh - significantly rapidly to coal plant outages. By cheaper than a new coal power 2020 the state will also have a station. Solar thermal plants 150MW solar thermal plant with can both generate and store heat storage. electricity. › Victoria, Queensland and the › Pumped hydro powered by Northern Territory are also renewables is the cheapest form investing in grid scale battery of large-scale energy storage. storage technology, while However, the Climate Council the Federal, Queensland and has significant concerns about Tasmanian governments are the Federal Government’s considering developing large Snowy 2.0 mega-project, as the pumped hydro projects. project is not accompanied by new investment in renewables. KEY FINDINGS III 4 5 Energy storage is critical for › Batteries, solar thermal and Energy storage is a crucial building a reliable, modern pumped hydro technologies are technology for tackling Australian electricity grid for more flexible and can respond climate change. the 21st century. faster to changes in supply and demand than traditional coal › Climate change, largely › Energy storage technologies and gas plants, and therefore driven by the burning of coal, are ideally suited to the needs can enhance the reliability of oil and gas, is worsening of a modern, smart grid Australia’s grid. extreme weather events such providing electricity when and as heatwaves and bushfires where it is needed. › The Australian electricity grid in Australia. Given our heavy and old fossil fuelled power reliance on coal power stations, › Energy storage can complement stations are increasingly the electricity sector in Australia high levels of wind and solar vulnerable to worsening is a major source of pollution. power in the electricity grid extreme weather events, by storing excess renewable particularly as these power › Australia’s electricity supply energy. Countries such as stations age. Over half of needs to reach a minimum Germany, Spain, Ireland and Australia’s coal fleet will be over of 50% renewable energy by Denmark together with major 40 years old by 2030. Having a 2030 and zero emissions well economies like California variety of storage technologies before 2050 to effectively tackle have all successfully integrated will improve the flexibility and climate change. much higher levels of wind resilience of the power system. and solar (20% to over 50%) into › Energy storage technologies their electricity grids without are a vital complementary compromising reliability. technology to renewable energy enabling Australia to transition › Australia could reach 50% to a clean, reliable, affordable renewables by 2030 without electricity grid. significant new energy storage. Renewable energy currently produces just 16% of our electricity supply. climatecouncil.org.au 1 FULLY CHARGED: RENEWABLES AND STORAGE POWERING AUSTRALIA Introduction Energy storage technologies - Rising temperatures and the accelerating batteries, pumped hydro and solar impacts of climate change are affecting all thermal - ensure supply and demand nations, including Australia. Heatwaves are of electricity are kept in balance and now hotter, lasting longer and occurring can strengthen the electricity grid to more often. Australia’s ageing coal-fired overcome major disturbances. power stations are vulnerable to extreme heat. The ocean is also warming. Rising In the past year, energy storage has sea surface temperatures, driven by climate become an increasingly prominent focus change, are increasing the prevalence of for policy-makers and commentators “marine heatwaves”, which can trigger coral when considering the future of Australia’s bleaching events, like those seen in 2016 and electricity grid. In particular, energy 2017 on the Great Barrier Reef. The reef is storage technologies can potentially an environmental treasure, as well as a key address all three elements of the energy tourism and fisheries asset. Climate change policy “trilemma”: energy security and has also increased extreme bushfire weather reliability; affordability; and emissions in the south and east of Australia since the reduction. This report describes how the 1970s, threatening