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A desktop technical investigation into maximising renewable energy generation in the South Australian NEM region

Curran, Shaun (2015) A desktop technical investigation into maximising renewable energy generation in the South Australian NEM region. Masters by Coursework thesis, Murdoch University.

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This dissertation examines the question: what is the maximum level of annual electricity consumption in South Australian (SA) that can be met by renewable energy generation when the SA electrical system is ‘islanded’ from the National Electricity Market (NEM). The term ‘islanded’ refers to the SA electricity network being disconnected from the NEM.

Examination will be through technical desktop analysis of available data, feasibility studies, white papers and reports on the SA electricity network and the NEM. Regulatory, policy and pricing implications will also be examined.

The SA NEM region is identified as having approximately 45% of the NEM’s installed wind energy generation, relatively small demand and therefore at times very high renewable energy penetration and an area with yet still significant untapped renewable resources. It is this criteria that make SA the ideal subject of this dissertation.

A brief overview of the SA NEM is provided, including examination of wholesale spot market pricing, maximum and average generation figures, effects of renewable generation on the operation of the NEM region and on the wholesale spot market, and technical and regulatory issues relating to renewable generation. Renewable generation in SA was found to place downward pressure on wholesale electricity prices and has a level of untapped renewable resources that could generate sufficient electricity to meet a percentage of annual consumption in the state far in exceedance of existing levels.

The Renewable Energy Target (RET) is examined in the context of the South Australian region of the NEM. The RET was found to be responsible for all large scale renewable generation developed in South Australia, noting that residential solar, although substantial in installed capacity, was developed through feed-in tariffs (FiT). The continuation of the RET was found to be of critical importance to the continuing renewable energy generation.

Technical requirements for existing and increased levels of renewable generation is examined. The conclusion was that renewable generation could be increased within existing technical standards. Modern wind and solar photovoltaic (PV) developments have inherent technologies in their power electronics that assist in the maintenance of system stability; strengthening and improving of those technologies may be required for increased levels of renewable generation (ie inertia support).

Future supply adequacy is examined to identify potential opportunities for renewable generation to increase its share of meeting SA’s annual electricity consumption. It was found that there is no new capacity required in the SA NEM region over the next 10 years. This was in part due to the resistance of coal fired power station operators to close down plant that have exceeded their useful operating life. This resistance is in the form of high exit costs, a lack of a price on carbon and in part carbon tax compensation. Repercussions of fossil fuel generation operating beyond design life (and with a low Log Run Marginal Cost (LRMC) due to lack of price on carbon and being at the end of its life and therefore capital costs having been paid off), may be lack of new generation in future years from continuing low wholesale prices and from a perceived surplus of generation. Increased levels of renewable generation was not found to be problematic in terms supply adequacy, if retirement of aging thermal plant is managed.

Localised effects of renewable generation on substations are examined, with the realisation that smart grid technologies will be to be vital to the enabling of further intermittent generation and that benefits such as peak shaving were not being realised. Smart grid technologies would provide Distribution Network Service Providers (DNSP) and Transmission Network Service Providers (TNSP) the capability to determine near real time status of parameters such as voltage level rise, assisting in maintaining the security of the network and ensuring operational activities, such as excessive transformer tap changing, does not reduce equipment life. The often stated potential benefits of renewable generation of peak shaving and delayed infrastructure investment were examined and found to be of little benefit. Alternate methods of enhancing renewable generation would be required to ensure often these benefits are realised, western orientated solar arrays is one proposed solution to realising peak shaving benefits.

Current market distortions are discussed such as market failure to place a price on environmental and health effects of fossil fuel generation (ie price on carbon). A case is also make a case for intervention in the market to achieve optimum social and environmental outcomes.

In summary, there exists the renewable resources and technical capability for significant additional renewable generation in the SA NEM. The extensive analysis and modelling in this area, by Australian Energy Market Operator (AEMO) in particular, has provided the assurance that a significant increase in renewable generation is achievable within the existing NEM operational and technical constraints. South Australia is also well placed with planning laws favourable to renewable generation.

Publication Type: Thesis (Masters by Coursework)
Murdoch Affiliation: School of Engineering and Information Technology
Supervisor: Pryor, Trevor
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