The Australian national electricity grid is increasingly becoming unreliable and it’s costing businesses millions.
Over $367 million in economic losses occurred during the 2016 power blackouts in South Australia and over 850,000 people were affected. The blackouts occurred as a result of storm which wiped out 22 high voltage power pylons and the state’s power generators were switched off to avoid permanent damage.
In NSW, the temporary closure of the Tomago Aluminium smelter to divert power supply in the 2017 heatwave nearly cost the smelter $100 million in damages and has exposed them to risk of further power supply issues.
The current demands of Australian industry do not match the outdated build of the national grid. Switching off power in response to weather extremes isn’t a long-term solution, especially when businesses are the ones losing money.
Microgrids, a privately-owned electrical distribution system, can reduce dependency on the volatile pricing and supply of the national grid, while also allowing energy-reliant industries to explore cleantech and renewable options.
Businesses that are concerned with stable, secure energy supply are looking to alternative measures like microgrids to guarantee their business.
BlueScope Steel is one of these.
Power Purchasing Agreements
The largest ever solar power purchasing agreement (PPA) was brokered by Schneider Electric in July this year. The seven-year deal sees BlueScope offtake 66% of the 133MWs generated by ESCO Pacific’s Finley Solar Farm. BlueScope was able to lock in a fixed price for the life of the contract, while also guaranteeing security of supply and a renewable alternative energy source.
“The PPA will help keep downward pressure on our energy costs, and will support the gradual transition to renewable energy,” said John Nowlan, BlueScope’s CEO.
Schneider Electric’s Energy and Sustainability Services were lead consultants on the deal, in conjunction with Schneider Electric’s New Energy Opportunities (NEO) Network, which focuses on driving cleantech and renewable energy. The two were a powerful combination in helping BlueScope get on track for its emission target.
“By investing in solar energy, we are helping accelerate the decarbonisation of the electricity grid by reducing greenhouse gas emissions by around 300,000 tonnes of CO2e each year. This is comparable to taking 90,000 cars off the road and is enough to power 60,000 homes,” said Nowlan.
BlueScope’s deal will lead to the build of a hybrid microgrid, supplying 20% of its total power needs.
These grids enable smart controls, including the ability to monitor and adjust energy use, power and heat demand response, and the ability to store energy for later on-sale.
South Australia making amends
South Australia has for a long time been promoting renewable energy sources as, not only a viable alternative, but a strong decision for the future of power supply in Australia. Around 40% of South Australia’s energy is being supplied by wind power, but renewable sources alone don’t protect against the increasing demands of a power-hungry market.
The South Australian Produce Market (SAPM) is already well underway in building a $10.5 million solar-powered microgrid that will supply 100% of the energy needs to SAPM. The largest single solar panel system in Australia was subsidised by a $2.5 million State Government Energy Productivity Program grant.
The microgrid is expected to reduce the Market’s power costs by $500,000 per annum and the State government has indicated that this independent grid will see downward pressure on electricity costs for residential areas plus protect the produce in its electricity powered refrigeration from grid outages.
The benefits of the microgrids are that they can manage energy consumption on site, provide additional services to the grid, and increase the resiliency of the network. If a storm were to hit, a microgrid can protect SAPM from the effects of market demand spikes.
Microgrids around the world
It’s not the first time that Schneider has executed a microgrid strategy at a massive scale. In Finland, Schneider Electric’s partnership with the global supermarket Lidl has led to the build of their largest distribution centre. A smart microgrid control, backed by Schneider’s EcoStruxure platform, is targeting delivery of 50% reduced energy costs. The delivery of this project is valued at over €1 million (approximately $AU1.6 million).
“More than 150 international organisations are already active in Schneider Electric’s NEO Network including Equinix, with more than 51 other companies in Australia that represent about 5M MWh (5TWh) of energy,” said Brian Morris, Vice President, Energy & Sustainability Services, Schneider Electric.
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