AEMC moving ahead with Finkel review recommendations
The Australian Energy Market Commission (AEMC) has released a consultation on a proposed rule change on technical standards for generators. The rule change request has been preceded by collaboration between the Australian Energy Market Operator (AEMO), generators, network businesses and power systems engineers. The rule change, originating from one of the recommendations from the Finkel review, will ensure that all new generators will meet required security and reliability targets. The targets will be set at a local level by the network companies and are dependent on local requirements. It is anticipated that by only requiring new generators to commit to certain requirements at this local level, rather than a national blanket requirement e.g. only requiring voltage control if there is a need for it in an area, then this should be able to reduce new connection costs and the savings will be passed onto customers.
Consultations are open until 13th July 2018.
ENA release guidelines for DER connections
Electricity Networks Australia (ENA) have released guidelines this week to enable a consistent national approach for the connection of DER to the electricity system. Previous to this technical requirements and connection processes were dependent on the particular network company policy. This has led to inconsistencies between and within states where there are more than one distribution network company operating. The guidelines, which are not compulsory and will be reviewed every two years, are due to be adopted by all Australian network companies.
Tesla owners create EV charging highway
Rather than waiting for government and industry to deliver the infrastructure needed for a transition to electric vehicles (EV) the Tesla Owners Club of Australia (TOCA) and the Australian Electric Vehicle Association have funded a EV agnostic Round Australia Electric Highway. The route circles Australia covering 17,000km, with charging ports spaced at a maximum of 400km apart. The Highway also crosses the Nullarbor desert, the Stuart Highway and Top End.
California Demand Response Program Determination Pushed Back
The California Public Utilities Commission has extended the 2018-2022 demand response programs application proceeding after determining that an evaluation of the demand response auction mechanism (DRAM) pilot requires more time. In 2015, regulators launched the DRAM pilot to begin testing utilities’ ability to procure aggregated demand response for resource adequacy. The ruling extends the deadline of the proceeding by a year, until July 17, 2019. California has been operating the DRAM program in pilot phase for a few years now, but it is not a permanent program yet. California held its third DRAM auction in 2017, and utilities acquired 200 MW of resources. In October, the PUC directed utilities to hold another auction this year for demand response resources to be delivered in 2019.
Offshore Wind finally getting going off New England
Following a goal set in 2016 to build 1.6GW of offshore wind by 2027, two contracts have been awarded to build a combined total of 1200MW. An 800MW wind farm is to be built off the coast of Martha’s Vineyard backed by Iberdrola’s Avangrid Renewables and Danish investment firm Copenhagen Infrastructure Partners whilst Deepwater wind will build a 400MW offshore farm off Rhode Island.
The projects are estimated to support between 6,870 and 9,850 jobs over the next 10 years and to generate an economic impact for Massachusetts of between $1.4 billion and $2.1 billion.
New study of impacts of high percentages of wind and solar
A new report released from the Berkeley Lab Electricity Markets and Policy Group has researched the effects of variable renewable energy (VRE) on wholesale electricity price patterns. The report conclusions suggest that electricity costs will go down and system operation needs will become more complex, requiring new and more sophisticated regulation.
Will small be beautiful under EU electricity regulation?
About a year ago Europe’s regulators proposed the removal of priority dispatch from renewables. The European Council is now considering the future regulation of electricity markets, and a group of associations, acting within the ‘Small is Beautiful’ campaign, have written to the Council to exclude small-scale renewables form such a move, as well as continuing to exempt them from balancing responsibilities. Changing the status quo would, according to the letter, place small-scale renewables ‘at an extreme disadvantage’.
More steps towards renewable hydrogen
In Spain, gas firm Gas Natural Fenosa has launched a power-to-gas pilot near Barcelona in collaboration with the Institut de Recerca en Energia de Catalunya (Irec) and the German spin-off Ineratec. The project is supported by the regional Catalonian government. In related news, France is launching a €100m hydrogen plan, aimed in part at capitalising on French dominance in value chains in this area.
More delays for Germany’s coal commission
The official launch of Germany’s coal commission has been delayed for the third time with quarrels over membership and leadership indicative of the huge task ahead to agree a coal phase out date by the end of 2018. The government suggests that delays will not affect the commission’s timetable with a first report to the government due by October and the final report by year-end. See here and here for more detail on the debate and disagreements characterising the set-up of the commission.
The latest plans suggest that eight ministries will be involved in the task force, which will be headed by four people. Representatives of six German states together with utility, industry, renewables, union and environmental associations will also participate. Recently climate and energy economist Barbara Praetorius was reported to be the forth head of the commission, after the original three commission leaders were criticised by environmental organisations and opposition parties as showing bias towards the interests of Germany’s coal industry.
Energy efficiency alliance challenges German government on building energy efficiency.
A broad alliance of environmental NGOs, trade unions, and the energy efficiency industry has urged the German government to honour its coalition pledge to support measures to lower the energy consumption of buildings. The alliance challenged the government on its failure to mention the issue in its current draft budget and highlighted the role building energy efficiency will need to play in the achievement of 2030 climate targets.
IEA Report of Power Sector Transformation
The International Energy Agency has published a report on the transformation of the power sector and notes that ‘flexibility has become a global priority.’ The report points to the fact that a lack of flexibility will not only reduce the resilience of the system but also lead to higher curtailment of electricity produced by variable renewable sources, such solar and wind. However, the focus of the paper is on the opportunities for increasing the flexibility of the system using power plants, rather than storage or demand side measures and so is telling only a part of the story. It highlights the opportunities for the power generation sector to become more flexible by changing current operational practises, retrofitting or the construction of new more flexible power plants.
Renewable Energy and Jobs
Globally there are now 10.3 million people employed in the renewable energy industry, according to the annual review undertaken by the International Renewable Energy Agency, which is a 5.3% increase in the previous year. The solar PV sector now employs 3.4 million people globally, biofuels – 2 million and wind power – 1.1 million.
Not surprisingly the country with the highest renewable employment is China, with 43% of the total and 3.8 million jobs, of which 2.2 million of these in the solar PV industry (a rise of 13% from 2016). Brazil is next on the global list, due to its large production of liquid biofuels and large hydropower. Third on the list is US, which employs about 250 000 solar workers, 237 000 direct and indirect jobs in liquid biofuels and 100 000 in the wind sector.
McKinsey: Future role of the Electricity Utilities
The consultancy company McKinsey has written a note on the state of the electricity sector and what it means for power companies. The report highlights the poor performance of major utilities that has resulted in, “average total cumulative returns to shareholders of about 1 percent from July 2007 to July 2017, compared with 55 percent for the MSCI World Index”- a broad global equity index. The report advises utilities that they need too: Get scale – through divestment and consolidation -, but it also noted that “geographic diversification might become a better option to get scale versus vertical integration, to hedge regulatory risks”; embrace new technologies – utilities should adopt technologies as soon as possible, because they could become mainstream in just a few years; focus on regulatory management –with the importance of “anticipating regulation, and possibly helping to shape it, will become the name of the game”; explore adjacencies – to move into similar industries in other sectors for example – T&D players might decide to expand their role within the telecom infrastructure, on the basis of operational synergies. The report also concludes rather surprisingly that ‘nor do we think that distributed generation, storage, or electric transportation will be major factors for the next few years’. Which seems to go against much of the views of the transformation of the power sector.