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ARENA Announces $120 Million To Roll Out Community Batteries Across Australia

Australia is one of the world leaders when it comes to adoption of rooftop solar. Australia has done so well that nearly 1 in 3 homes in Australia covered in solar panels! As Zach covered in a recent article, rooftop solar panels combine for approximately 20 gigawatts (GW) of power capacity in Australia, and more that 3.3 million households have rooftop solar PV. Another 10 GW are expected to be installed in just the next 3 years. Rooftop solar PV alone is set to surpass coal power capacity soon — once the 1680-MW Liddell coal power plant is fully closed.

With all this clean solar, the Australian Government now wants to help store some of the excess in community batteries. Community batteries provide energy storage in the distribution network that can store excess solar energy for later use, putting downward pressure on household electricity costs, and easing pressure on the local electricity grid. ARENA CEO Darren Miller said community batteries represent the next step in optimizing distributed energy resources in the electricity grid.

Not everyone is able to install rooftop solar, but by storing electricity close to the point of consumer demand, we can reduce network costs and alleviate constraints in areas with high solar penetration. This will ultimately reduce electricity costs for all consumers.”

To get things going, the Australian Renewable Energy Agency (ARENA), on behalf of the Australian Government, has announced $120 million in funding that will be made available for Round 1 of the Community Batteries Funding Program. The program aims to support the deployment of community batteries across Australia to lower energy bills, cut emissions and reduce pressure on the electricity grid. ARENA is now seeking applications for up to $20 million funding to deploy a minimum of five community batteries.

To be eligible for ARENA funding, each community battery must be between 50 kW and 5 MW in size and connected to the distribution network.

ARENA has allocated $120 million in funding for Round 1, split equally across two streams:

  • Stream A: Distributed Network Service Providers (DNSP)
  • Stream B: Applicants that are not DNSPs

“We’re excited to be working on this initiative to support the roll out of these 342 batteries across Australia.” Darren Miller said.

As part of the 2022/23 Federal Budget, the Australian Government allocated $200 million for the Household Solar budget measure to deploy 400 community batteries across Australia. ARENA was allocated $171 million of this funding to deliver at least 342 batteries. ARENA has allocated $120 million to Round 1 and intends to allocate the remaining funding to a future round, based on learnings from this tranche. The Department of Climate Change, Energy, the Environment and Water (DCCEEW) will also deliver an initial 58 community batteries through the Business Grants Hub. This round is now closed, with DCCEEW now assessing applications.

Australia’s Institute of Community Directors lists some of the benefits of community batteries as:

  • help maximize the use of renewable energy that a community produces with its solar panels
  • reduce energy bills by helping people use less energy from the traditional network
  • reduce emissions
  • help the network to become more sustainable and more environmentally friendly
  • help make battery storage and renewable energy available to people who otherwise wouldn’t be able to afford it.

Ausgrid, the largest distributor of electricity on Australia’s east coast, providing power to 1.8 million customers — that’s over four million Australians — lists the benefits of community batteries as:

  • Allows more rooftop solar and electric devices, such as electric vehicle chargers to be connected.
  • They will strengthen the grid reducing the need to limit (curtail) solar exports and help customers maximize their solar investment.
  • Helps share more solar within the local area, including to non-solar households.
  • Creates a positive impact on wholesale electricity prices that could eventually flow through to reduced retail customer offers.
  • Helps to regulate voltage on the network and improves network quality in the local area.
  • Offers a flexible alternative to traditional poles and wires investment and helps lower network costs.
  • Access to an online information hub where the community can see how much energy was stored and used daily.

As the transition to a more decentralized energy system accelerates, we should see more community batteries adopted in other places around the world.

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