New rules planned by Australian energy authorities add to the good news forstorageproviders in the country.
The proposed rule changes were recently announced after a four-year gestation. They're designed to unbundle the country's grid services -- effectively separating the supply of energy and the provision of ancillary services. This is in contrast to the previous regime, which dictated that a company could only sell all their services to one buyer, the energy retailer.
Now the Australian Energy Market Commission (AEMC) has determined that consumers should be able to sell their ancillary services to the party of their choice, opening up the field to smaller players.
GTM storage analyst Brett Simon said it's an important market mechanism for storage elsewhere.
"Allowing energy storage to provide ancillary services opens up an additional market opportunity for storage in Australia,” he said. “The PJM interconnection in the U.S. became the largest utility-scale energy storage market in the country thanks to the RegD market, which offered an opportunity for energy storage to provide frequency regulation."
In Australia, some of the winners from the change could include demand-side aggregators and software companies with products that will help consumers understand and participate in ancillary service markets.
Examples of these companies include Reposit Power, GreenSync, EnerNOC, Geli and Sunverge. A number of them are already involved in trials funded by the Australian Renewable Energy Agency (ARENA) to demonstrate the effectiveness of their technologies and business models.
The unbundling is one of many steps taken to help encourage a healthy storage market in Australia. A whole slew of measures have been taking place locally and nationally to aid energy storage.
In Adelaide, the city has been subsidizing homes, business, NGOs and other organizations looking to install distributed energy systems since July 2015, including up to AUD$5,000 (USD$3,740) for installing energy storage and an equivalent amount for installing solar PV.
And at the end of last year, the Australian Capital Territory started its own range of subsidies. To date, AUD$20 million ($14.97 million) has been earmarked to help underwrite 36 megawatts of battery storage. The program awarded local companies AUD$600,000 ($449,020) in April to install Panasonic, LG Chem and Tesla Powerwall domestic energy storage units. Another AUD$2 million ($1.5 million) was awarded this month.
The measures come as Australia simultaneously bets on solar. ARENA recently announced 12 large-scale projects, which, said CEO Ivor Frischknecht, will effectively "triple Australia’s large-scale solar capacity from 240 megawatts to 720 megawatts."
He added that the AUD$92 million ($68.85 million) of government support for the projects would encourage billions more in private investment.
ARENA is also directly helping fund storage initiatives itself. For example, AUD$17.4 million ($13.02 million) has been given to Conergy to build and operate a 10.8-megawatt PV plant complete with 5.3 megawatt-hours of lithium-ion battery storage.
The largest storage project in the country -- the Lyon Group's AUD$400 million ($299.34 million) Kingfisher project -- is progressing without any direct government support.
Once completed, it will boast a 100-megawatt battery storage unit paired with a 100-megawatt solar power plant. It is being funded entirely by investors from Asia and the U.S.