13-09-17

Recently there has been a lot of news coverage on rising energy costs in Australia. It has raised much discussion on providing solutions for cheaper and reliable energy. 80% of respondents to The Australian Institute survey believe that purchasing battery storage was the simplest solution to take energy into their own hands and go 'off-grid'. 

OK, got it – you want to take back control. But is going off grid really the solution? 

First, some upsides to going off the grid using a solar and storage combo:

  • You can generate energy free from the sun during the day, and use it at night
  • No expensive, unpredictable energy bills
  • No carbon footprint guilt factor

But the reality is…

Purchasing rooftop solar panels, an inverter and solar battery outright so that you can go off-grid is a considerable outlay for the average person. 

Rooftop solar PV systems are sized according to the power requirements of the household –there is a fine balance between size of the battery, PV system, inverter and household use. Household power usage can change over time as households adopt an increasing number of always-on devices. So then there may come a time in the future where rooftop solar systems may not meet household power needs.

So that is the sizing challenge… but what about if there is little or no sunlight? Or worse yet, what if your system fails? No one will be there to rush out to restore your power, and being off-grid, you are isolated from the safety net of the macro grid!

I'm not here to say not to go off-grid, but some serious upfront consideration would have to be given to managing the household's power demand and supply – especially when there are periods of peak demand or periods of intermittent supply.

Utility death spiral – a possibility…

By now, some of you may have heard of the utility death spiral. "What is this?" I hear you say…

Picture a situation where adoption of solar PV and storage units become even more widespread. If these households disconnect from the grid, then slowly, slowly, demand for traditionally-sourced power from our centralised networks declines.

The fixed costs like the network charges still remain, only to be spread over a diminishing pool of consumers through increased tariffs. Unfortunately, this is likely to affect the lower socio-economic demographic as they are unable to afford the large upfront costs of solar/storage systems, leaving them faced with potentially huge rises in their power bills.

With extreme tariff price hikes, more and more of the lower socio-economic consumer group may be forced off the grid as their bills become completely unaffordable. And so, an even smaller pool of consumers are left paying the fixed network costs, leading to what is known as the utility death spiral.

Virtual Power - A better solution

Virtual power is when a household installs rooftop solar PV, an inverter and a solar battery. They gain the same independence and control over their power whilst remaining connected to the grid.

Power is always available in a virtual grid system – either from the grid itself, or from the household battery. This means you have the tick of reliability.

The software built into solar energy storage systems is often able to pre-empt dangerous weather events and set a program that optimises the system during the storm or other system peak situations.

Imagine if every Australian household with solar panels went virtual; installing a battery whilst remaining connected to the grid. The aggregate of all energy storage systems via a virtual 'cloud-based' system would create by far the largest power plant in Australia. 

In doing so, we can truly optimise the existing infrastructure that is already there, freeing us of the need for billions of dollars' worth of new investment.