This article first appeared on RenewEconomy
by Giles Parkinson & Sophie Vorrath
ARENA has revealed a new focus on using renewable energy sources to create “hybrid fuel” plants with existing fossil fuel power stations, as well as looking to remove grid integration barriers to higher levels of renewable energy penetration.
The new approach was unveiled in the Australian Renewable Energy Agency’s funding strategy on Wednesday, which revealed that it has about $1.9 billion out of its $3 billion budget yet to be spent.
The Agency’s second General Funding Strategy and Investment Plan, covering the years 2013/14 to 2015/16, aims to increase the supply and improve the competitiveness of renewable energy technologies in Australia, and outlines the potential for five new initiatives.
One of those new initiatives, which will begin with a study, will explore opportunities for hybrid plants where renewable energy can be cost competitive with fossil fuel generation.
Subject to the conclusions of the study, ARENA says it would then consider launching a strategic initiative to encourage the broader deployment of hybrid technology, with the objective of demonstrating utility-scale renewable energy.
“This approach recognises that changing the energy landscape is a process of transition and aims to pave the way for stand alone renewable energy plants by first building confidence, knowledge and expertise around new technologies in a hybrid setting,” Resources and Energy Minister Gary Gray said on Wednesday at the plan’s launch.
But the idea of using renewables such as solar and wind to “boost” the output of coal and gas fired generators is a contested one. Many clean energy proponents favour stand-alone renewable energy projects, while others argue it is the only realistic way they have of deploying their technologies. Fossil fuel generators favour the idea because it could extend the life of their assets, lowering costs and reducing emissions.
Currently, the largest solar project in Australia is the 44MW “solar booster” being added to the huge Kogan Creek power station in Queensland. That is using compact linear Fresnel reflector technology developed in Australia by Ausra, and now owned by Areva Solar, the subsidiary of the French nuclear giant.
The idea of hybrid additions to existing fossil fuel plants could be appealing to Alinta, which is looking at solar thermal options in Port August, but favours extending the life of its Northern brown coal power station if the technology can be integrated.
John Robbins, the head of sales for Areva Solar in US, told a conference in San Francisco this week that its technology was targeting the “solar booster” market for fossil fuel plants such as coal and gas, but also biomass and geothermal.
He said the advantages are reduced fuel consumption, increased plant capacity, a partial hedge against future fuel price increases, and taking advantage of existing infrastructure.
However, not all fossil fuel plants could be “boosted” because they needed available flat land nearby, and plenty of sun.
Apart from Kogan Creek, Areva Solar is also building a 5MW booster for a dual-fuelled 158MW coal/gas fired plant in Arizona.
Robbins said the LCOE of compact linear Fresnel needed to be in $100MWh-$125/MWh market to be competitive with new technologies such as SolarReserve’s solar tower with storage technology that is being built at the 110MW Crescent Dunes project in Nevada.
The other main new initiative unveiled by ARENA yesterday was to review grid integration barriers to higher levels of renewable energy penetration, “with the objective of increasing the deployment and utilisation of renewable energy generation systems at both residential and commercial scale.”
ARENA’s focus here will be on demonstration projects, which will be developed in consultation with network and distribution operators.
The Investment Plan also includes a focus on overcoming barriers to commercialisation of renewable energy; expanding R&D activities beyond solar; and developing a world leading commercial readiness index for each renewable energy technology that will help identify how ARENA and other government agencies can best provide support to help each technology progress.
ARENA says that of the $1.9 billion of funds not committed to individual projects as of June 2013, $740 million has already been allocated to ARENA’s newly launched initiatives. $300-$900 million is expected to be allocated to other initiatives detailed in the plan, including: Discovering Renewable Energy Potential through Hybridisation; Integrating Renewables into the Grid; Building Australia’s Next Generation Solar; and Upholding and Identifying Australia’s Top Renewable Research and Development. This leaves $260-$860 million for allocation to future initiatives (see chart below).