Victoria’s coal power hub, the Latrobe Valley, is set to
host Australia’s “largest” renewable energy microgrid, after a $15 million
solar and battery storage project proposed by a consortium of local companies
was announced as the winner of a $3 million state government grant.
The Labor Andrews government said on Monday that a project
led by SGSP Assets (Jemena) subsidiary, Ovida, had won
the grant for the Latrobe Valley Microgrid Program, designed to cut energy
bills for 750 small to medium sized businesses in the region.
The project – Solar Partnering Around Regional Communities –
will deliver 7.5MW of solar PV and 1.5MWh of battery storage across potentially
75 sites (an estimated 10 businesses per microgrid), in partnership with shared
solar tech start-up Allume Energy, the Moreland Energy Foundation and RMIT.
Perhaps most importantly, however, the SPARC project will
target businesses that either cannot afford the upfront costs of solar, or are
tenants, and so don’t own their own rooftops – allowing them to cut their
electricity bills by up to $10,000 per year.
The push to extend the benefits of rooftop solar to business
and residential tenants traditionally locked out of rooftop PV comes from what
is essentially the same team behind a cutting edge shared solar project that
was switched on in Melbourne in May this year.
That project installed
a 7.2kW solar system on a mixed residential and retail building in the
bay-side suburb of Highett, to deliver – using Allume Energy’s technology –
cheap renewable power to five apartments, a baker, a hair salon, and an
occupational therapist.
As we reported at the time, the mix of software and hardware
that made this possible was basically contained within a small box called
Solshare, designed by Allume to allow the solar to be distributed and billed to
individual apartments.
And in August, the same group won
a separate state government grant of nearly $1 million for the Ovida Community
Energy Hub project – to install solar PV and battery systems in three
as-yet unnamed multi-tenanted commercial and residential buildings.
That project aims to help cut energy costs for around 650
customers – all up it is expected to generate 5000kWh of renewable energy and
support 11,000kWh of energy storage.
The Latrobe Valley project takes Allume’s homegrown
technology a major step further, to deliver a solution that Ovida says will
make it the largest concentration of microgrids in Australia.
As Allume CEO Cameron Knox explains, the scale of the
Latrobe Valley project means it is probably more accurately described as a
microgrid turned inside-out – where instead of having one connection point back
to the grid, each microgrid will have a single connection point that goes back
to the solar.
And because it is such a big project, it can leverage at
much lower rates, offering the businesses that take part up to 50 per cent
reduction on their usual power costs, in an area that has been hit hard by
rising electricity prices.
“A key motivator (for our company and these projects) has
been to dispel this fabricated trade-off between clean energy and high cost of
electricity,” Knox told One Step Off The Grid on Tuesday.
“This project really allows us to move the needle in terms
of energy savings.”
The businesses that will take part in the project have yet
to be selected, but the opportunity will be announced, and information and
selection processes will take place, largely coordinated by the Moreland Energy
Foundation.
As with the Hampton and Community Hub projects, Ovida will
install, own and operate the rooftop solar and battery storage systems, using
Allume’s Solshare technology to connect the estimated 75 sites.
Ovida’s key role in the equation is to provide the financial
backing to allow the solar and storage systems to be installed at no upfront
cost through a licence agreement with the landlord or the owners corporation.
Ovida has also obtained a electricity retail exemption from
the Australian Energy Regulator for all states and territories except Western
Australia and the Northern Territory.
Through a power purchase agreement with the tenants, those
who opt in are charged only for the solar electricity they use, at a locked-in
rate of around 50 per cent less than the retail electricity price.
Tenants are not locked in to the PPA, however, allowing them
to terminate the agreement if they move out of the property.
On the battery storage front, Knox says the plan at this
stage is for a small amount of (most likely lithium-ion) battery technology to
be installed at each microgrid cluster, to increase solar consumption and
better manage weekend generation.
Meanwhile, the data generated by the project will be shared
for analysis by government, industry and communities to address other barriers
to solar, such as regulatory and governance issues.
“So far property owners have been the main beneficiaries of
solar technology,” said Ovida’s Shaun Reardon in comments on Tuesday.
“By paying for the equipment and installation, Ovida is
enabling regional businesses, and people who aren’t home owners, to benefit
from solar.
“This (Latrobe Valley) microgrid… will considerably drive
down operating costs, making businesses more cost-effective, enabling them to
reinvest and employ more staff,” he said.
“By building a strong and robust local energy system, it
will bring commercial benefits, social prosperity and be a catalyst for future
innovation in the region.”
And the significance of the region the project is targeting
is not lost on anyone. As noted above, the Latrobe Valley – as the state’s
centre for coal mining and coal-fired power generation – is facing major
change.
Since the Hazelwood coal plant was shuttered early last
year, only the 1,480MW Yallourn power station remains – and that is slated to
close in 2026, when it will be more than 50 years old.
For these reasons, the Valley has been a major focus of the
Labor Andrews government, as it works to deliver its legislated target 40 per
cent renewable energy by 2025.
It is the home base for the new government body, Solar
Victoria, where a team of 15 will soon begin processing rebate applications for
the state’s $1.2 billion rooftop solar subsidy scheme from an office in
Morwell.
A further three government grants have also be extended to
the Latrobe Valley New Energy Jobs Fund, including $8,000 to Federation
Training, to halve the cost of their solar PV installers course for October
participants.
EnviroMicroBio will receive $50,000 for new laboratory and
analytical equipment to support local businesses wishing to explore anaerobic
digestion for energy production and waste management.
And Latrobe Valley Engineering Services and Sundermann Water
Power will receive $48,400 for development of the Sundermann Water Turbine.
“We’re bringing more jobs to the Latrobe Valley and
supporting local businesses – all while driving down energy bills and boosting
the reliability of the local energy supply,” said state energy minister Lily
D’Ambrosio in comments in Tuesday.
“This microgrid program will ensure the Latrobe Valley is at
the centre of the shift to renewable energy and lower emissions.”
As Allume’s Knox puts it, the project will stand as “a great
symbol that the clean energy transition doesn’t mean more expensive
electricity.”
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