Australia has been widely hailed as the next place to be for PV uptake. Now its uptake of solar-plus-storage is positive for the whole of Asia.

Solar-plus-storage down under

More than a million and a half solar systems are installed in Australia, which means 17% of its households, according to Sydney-based consultancy Sunwiz. Thanks to a generous feed-in tariff scheme and high levels of solar radiation, Australia’s total solar PV installed capacity stands at 5GW. That is about 9% of the country’s total electricity generation capacity.

Regions with the highest share of homes with rooftop solar PV are Queensland, South Australia and Western Australia.

As happened in Europe — particularly in Germany and the UK — the FiT incentive to support the installation of rooftop solar PV in Australia has contributed towards the growth in demand. It has helped create a competitive market for the technology.

However, the FiTs, which vary between states in Australia, are being slashed — by up to 90% in some cases. This provides little incentive for homeowners to export unused energy generated back to the grid.

With electricity costs also rising, homeowners are seeing great potential for battery storage since it allows them to use their free, solar energy at night at a fraction of their off-peak rates.

Australia’s solar-plus-storage potential made headlines last year, when a host of home energy storage players — Tesla included — announced it as their next export market. Some have formed partnerships with utilities to help unlock demand for their technology.

They include Japanese consumer electronics brand Panasonic, which had already announced in mid-2015 pilots of its home storage system with ActewAGL, Red Energy and Ergon Energy, in homes of those utilities’ customers with solar installed. The batteries are being used for peak shaving and will provide data on how solar-plus-storage systems should be deployed in the residential market.

Several other energy storage system providers are also targeting Australia, including Germany’s Sonnen, as well as US companies Sunverge, which supplies energy storage systems and virtual power plant software, and micro-inverter maker Enphase.

“Australia is seen as a core market alongside Germany and the US because of Australia’s relative wealth, its high energy costs and its high penetration of solar,” says Chris Parratt, who oversees Sonnen’s Australian subsidiary, which was set up in April.

The initial stock of Sonnen’s latest home storage system Eco 8, which is a modular product, has just arrived in Australia. Parratt expects that Australian households will require capacities between 4kWh and 8kWh based on existing solar generation.

Sonnen has signed up several national partners in Australasia that can supply and install its systems across the region, including True Value Solar, Energy Matters, Zen Energy and Madison Australia.

“Payback depends on specific energy rates, which differ across Australia, and household consumption. As long as the system is sized correctly, payback can occur in eight to 10 years,” says Parratt.

Features of Sonnen’s system that will appeal to customers and the grid in Australia include tariff arbitrage and demand response, by responding to high price events from the wholesale market, as well as other grid services.

Peak shaving trials 

Enphase has arranged beta trials for its all-in-one AC Battery with SA Power Networks in South Australia and Genesis Energy in New Zealand. These trials are part of the company’s efforts to reach new customers and enable utilities to use its technology to support the grid as more solar is added, in addition to supplying its micro-inverters, energy storage systems and related home energy products to solar installers in the region.

Enphase is unable to disclose data from the trials, as they form part of its review into how batteries interact with the grid, especially during peak demand times for electricity.

Separately, Enphase also has other programmes and pilots with utilities to see how the company’s micro-inverters can support the feed-in of solar PV electricity.

In Australia, the company announced a partnership with Energy Australia in March 2015, where it has exclusive rights to provide its micro-inverters and access to its MyEnlighten platform to Energy Australia’s residential customers.

This is Enphase’s first utility-level partnership in Asia-Pacific and Enphase micro-inverters are installed with the systems of 98.5% of Energy Australia’s solar residential customers.

“As battery prices
continue to decline
storage will continue to
seem a more attractive
proposition. This
dynamic, coupled with
such a competitive
retail market, will result
in storage moving past
the early adoption stage
in the next two to five
years”— Jason Clark, AGL

The company’s micro-inverters are also qualified in Queensland with an export control feature that meets the state’s energy regulatory requirements. Enphase is in discussions with Ergon Energy and Energex as they can influence regulatory decisions based on solar PV export controls in Queensland.

Following beta trials, Enphase’s AC battery will be available in Australia and New Zealand by the end of the year.

Already the company has registered interest for 60,000 units for installation over the next 12 months from its distribution and installation partners, which include AC Solar Warehouse, One Stop Warehouse, RFI and Solar + Solutions in Australia and Solar Partners NZ and YHI in New Zealand.

Nathan Dunn, managing director of Enphase Asia-Pacific, says: “This has far exceeded our expectations where we had initially forecast for orders of 12,000 units before the end of 2016. We are continuing discussions with our partners as there is a strong interest for battery storage from households, particularly in Australia. It’s been our strongest performing market to date.”

Enphase’s network includes more than a thousand installers in Australasia and based on internal estimates, the company leads the Australian micro-inverter market with an approximate market share of 10% in the overall inverter segment and 40% in New Zealand.

“There is potential for home energy storage to grow in Australia due to the relatively low cost of entry, which will appeal to the PV retrofit market of homes with 1kW-5kW-sized solar systems as well as the demand for new residential installations,” says Dunn.

At a policy level, there has been keen interest in battery storage and how it can potentially alleviate electricity demand during peak periods. In states such as South Australia and Victoria, trials of residential solar-plus-storage systems have been set up to investigate how the technology can support energy use from the grid.

Just over 75% of New Zealand’s electricity comes from renewable resources (primarily hydropower and geothermal power). While the government has not prioritized the uptake of household PV, a study by the University of Otago has found that 58% of households would like to generate their own electricity.

“Australia is seen as a
core market alongside
Germany and the US
because of Australia’s
relative wealth, its high
energy costs and its
high penetration of solar”
— Chris Parratt, Sonnen
Australia

About 9,000 of the 1.6 million households in New Zealand have rooftop solar PV systems. “In terms of storage, we believe the market potential for New Zealand remains smaller at this stage and this can be attributed to the policy neutral environment towards energy — unlike Australia, New Zealand homeowners do not receive any feed-in tariffs or subsidies for rooftop solar,” Dunn says.

Using Enphase’s AC Battery, homeowners can achieve sustainable self-consumption or store solar energy generated for use at times when grid-supplied energy rates are at their peak.

Software is key 

The company has developed a cloud-based energy management platform that can integrate the storage system and other home energy products from Enphase with smart devices for intelligent home energy use. The home’s solar generation, energy storage and consumption can be monitored from any web-enabled device.

Enphase’s hardware is software-defined, networked and monitored by a robust global platform with bi-directional communication capability. This has benefits at system level for homeowners, at fleet level for installers, at grid level for utilities, and at a global level for the company.

Dunn says: “For example, solar PV despite all its potential has brought with it many challenges for the grid. Being an uncontrollable generation source, its output is intermittent and not 100% predictable. Storage holds the key to being able to level out solar’s sometimes sudden impact on grid voltages by acting as a reserve for excess power.

Enphase’s AC battery system: modifiable by smart phone

“To help utilities manage grid voltages, it is essential that the storage assets on their grid are smart and offer bi-directional communication — what Enphase offers. This allows for a much more dynamic, adaptive management of grid conditions.”

Each Enphase AC Battery module provides 1.2kWh and because of its modular design, homeowners can choose the appropriate size of their solar battery storage should they wish to add more Enphase battery storage in the future.

The system is AC-coupled, which makes it compatible with any solar PV system, and means there is no high voltage DC in the storage system, making it much safer than DC-coupled batteries.

AC-coupled systems offer equivalent efficiency to DC-coupled systems with advantages in flexibility, reliability and safety. They are also more incrementally scalable with much better scope to right-size the storage system and avoid over investing in extra capacity that is not needed.

Around a 10-year payback in Australia and New Zealand is possible with Enphase’s home storage system, based on the average increasing market rate for power. The return on investment varies depending on various factors, including grid power prices, the amount of excess solar energy available to store, the level of night-time grid power usage in the home and so forth.

Nathan Dunn, Enphase Asia-Pacific: “Australia’s been our strongest market
to date.”

In New Zealand, Sunverge has installed 300 systems through its partner, Auckland-based utility Vector Ltd. Systems are 11.65kWh to 12kWh in size.

Vector did not have a solar programme in place, which other utilities have had. “However, utility wanted to address the issues that adding more renewables causes the grid, such as capacity constraint. So it decided to enter the solar market with a solar-plus-storage programme,” says Sunverge chief executive Ken Munson.

Customers have been able to buy the system at a discounted price from Vector. Customers benefit from lower bills and reliability. Deploying the assets as a virtual power plant, using Sunverge’s software platform, enables the utility to manage the grid without making big investments otherwise needed.

AGL is one of Australia’s largest utilities and the largest owner, operator and developer of renewable energy generation plants in the country. With every residential solar PV installation, the energy firm provides a monitoring device that analyses customers’ solar power system production performance and home energy consumption so they can see how much electricity they are saving.

Earlier this year AGL completed a demand response trial with 68 residential customers in Victoria, with network provider United Energy. Only a few of the homes had batteries installed integrated with their existing solar PV systems.

The 11.65kWh systems, made by US company Sunverge, were deployed to six individual customers, and controlled to deliver energy in aggregate using Sunverge’s virtual power plant software.

AGL’s general manager for distributed energy services Jason Clark says: “It was important to have storage in the trial as we see demand response being delivered by a fleet of devices, including controllable loads and energy storage. Therefore this trial was devised to replicate what we believe a future state of the industry may look like.”

AGL is planning further trials, building on the knowledge gained from this one and including other elements. The energy retailer wants to increase the size of these trials to be able to demonstrate deliverable outcomes and services to the market and network, with participating customers sharing the benefits.

Two key features of the Sunverge platform that attracted AGL are the software’s ability to integrate multiple hardware technologies within a single platform and a complex rules engine developed specifically for energy storage systems. “This enables us to control a fleet of batteries for multiple stakeholders,” says Clark.

In the trial, AGL’s customers were happy with the storage devices and implementation as well as the delivery. “Our customers were keen to be part of a potential solution. Consumers are looking for greater control of their energy consumption and management. Storage can help them achieve this,” says Clark.

Earlier in 2016, AGL announced an AS$20 million ($15 million) stake in Sunverge.

As well as Sunverge’s battery storage systems, AGL also offers its retail electricity customers a smaller system from AUO, as part of a range that can meet the self-consumption needs of different households, large and small. The energy retailer offers upfront sale and financing options up to five years.

However, energy storage is still an early adopters’ market and will be for a while yet even though there is big interest in the technology. Clark says the company’s online AGL Power Advantage Club, where people can join and be updated on new information about storage and other distributed energy solutions and trends, has a growing base of more than 5,000 subscribers.

AGL has also developed a mobile app that customers can use to monitor and manage all their energy consumption, including gas and electricity usage, as well as solar PV system and battery storage performance, from their smart phone.

The Australian Energy Market Operator forecasts the integrated PV and electricity storage system uptake will “start slowly”, picking up especially after 2020 and reaching about 3.8GW of installed capacity within 20 years.

Clark says: “Storage will play a key role in the future of the Australian energy market. Because we have such a high level of solar penetration, many customers are looking to storage to enable them to use more of their solar output. As battery prices continue to decline, storage will continue to seem a more attractive proposition. This dynamic, coupled with such a competitive retail market, will result in storage moving past the early adoption stage in the next two to five years.”