Rooftop solar energy to soon eclipse coal, gas and hydro
Roof-top solar panels will produce more electricity than all of Australia needs within decades. Around 30 per cent of households already have solar panels installed and that number is increasing.
Transcript
00:00 There are a few reasons. One, we've got good sun. The second is we have a very efficient
00:08 industry in installing solar. So, for example, the cost of a solar system in Australia is
00:13 about half what it is in the US. And also we have quite high residential retail electricity
00:19 prices compared to many other countries around the world.
00:22 And so to what extent is that going to grow over the next 30 years?
00:27 Look at the moment, solar PV, rooftop solar PV is already a greater amount of capacity
00:32 than coal. But really within the next decade, it will also surpass the combined capacity
00:39 of not just coal, but gas and hydro as well and get to a level of scale where in the middle
00:45 of the day, when it's at its peak generating, it will get close to supplying the entire
00:52 grid's electricity demand.
00:53 So if it's going to continue to grow strongly, what are the possible benefits for Australia
00:58 apart from people with the panels saving on electricity?
01:03 Well, the people that don't have the panels actually benefit to a very large degree because
01:10 they end up seeing very low electricity prices on the wholesale market. So, for example,
01:15 South Australia, which has the highest rate of rooftop solar uptake, has been experiencing
01:21 wholesale electricity prices close to zero on average in the middle of the day. And that
01:27 then gets passed through to other consumers that don't have solar. So actually, other
01:32 consumers are significant beneficiaries of solar. But in addition, there will be some
01:38 changes with the structure of electricity tariffs such that the retailers can charge
01:46 lower prices in the middle of the day. Unfortunately, they will probably charge higher prices in
01:50 the late afternoon and evening, but that will be a way of also passing through those benefits
01:55 to other consumers.
01:56 But the biggest thing that we need to do to really, truly exploit this opportunity of
02:03 low cost solar and rooftop solar is we need to roll out both batteries and also energy
02:12 consuming devices like electric water heaters that are timed to consume electricity in the
02:18 middle of the day. So we can exploit this huge amount of what will be a substantial
02:24 excess of cheap energy in the middle of the day. So we need to be smarter with our energy
02:31 usage as well and encourage greater shifting out of gas, for example, into electric appliances
02:38 and making sure that those appliances are timed so that they consume most of their electricity
02:43 in the middle of the day.
02:45 And what's the availability and the efficiency of those batteries now and how is that going
02:49 to improve over the coming decades?
02:52 Well there was tightness in supply around a year ago and that has substantially frayed
02:59 up so demand for electric vehicles was stretching exceeding supply around a year ago to two
03:09 years ago. But that has now been largely relieved. And it wasn't because demand for electric
03:14 vehicles was not growing. Demand for electric vehicles grew by 40 percent last year. But
03:19 we were able to expand supply far faster, which is fantastic. And that means prices
03:24 are now finally coming down. And that should mean that there's also plentiful supply of
03:33 energy storage for households, not just electric vehicles. Now that was a challenge 12 months
03:39 earlier but it's now freeing up. But there's still a lot of room for progress in reducing
03:44 the price of batteries and they still need to come down substantially in price before
03:48 they can become an economically viable and attractive option for households to lower
03:53 their energy bills. And I think really we need to approach batteries just like what
03:59 we did with solar. With solar it benefits substantially from government subsidies both
04:04 here in Australia but also overseas. That helped drive economies of scale, helped drive
04:09 experience with installers and the industry itself such that we got quality up and prices
04:14 down and we can do the same with batteries. So could Australia feasibly be run off rooftop
04:19 solar without any other generation or will there always be the need for other forms of
04:27 industrial scale generation? Yeah, no, there will be. There will be a need for other sources
04:32 of electricity, in particular wind, but there will be other things that we'll need for quite
04:38 some time to come. We'll continue to need some level of gas fire generation although
04:42 its usage is substantially declining over time but it plays a little bit of a balancing
04:48 and a backup role. Wind is very important. Obviously overnight there's no sun so that's
04:53 very important. You can't just do it all with batteries. That would be probably a more expensive
04:59 option than also complementing it with wind and also hydro will continue to be very important
05:05 into the future using both the existing capacity and potentially also some new pumped hydro
05:10 but the existing capacity can be more cleverly utilised over time. So all of those things
05:15 are needed but really the most urgent thing is we've got to drive the usage of, I think
05:22 in particular, household batteries. Government are putting a lot of effort and support into
05:26 large scale batteries, large scale wind, but we're really not taking advantage of the opportunity
05:34 that we have with household solar being stored. We could actually really lower the cost of
05:40 energy for everyone if we were to roll out batteries at the sort of household scale as
05:46 well.
05:47 [BLANK_AUDIO]