Renewables And Batteries To Increasingly Squeeze Out Gas In South Australia

SA – A Battery Powered Future?

A new report states 2025 could see renewables and batteries in a position to overtake gas in South Australia’s energy mix for managing peak loads.

With no coal-fired power generation remaining in the state, South Australia’s peak loads are currently managed by open-cycle gas turbine (OCGT) plants.

A joint research report by Wood Mackenzie and GTM Research says by 2025, wind energy, solar power and battery costs will fall by 15%, 25% and 50% respectively.

“.. by 2025, battery storage would be cheaper than OCGTs in managing peak loads even at gas price of A$7/mmbtu. OCGTs would then be relegated as emergency back-ups,” said Wood Mackenzie analyst Bikal Pokharel.

Wood Mackenzie estimates that 400MW/ 1,600 MWh of battery storage will be sufficient to handle the highest peaking residual demand in South Australia in 2025.

Just over two-thirds of South Australia’s power-generating capacity would be renewables-based by 2025 if all committed and planned projects come to fruition. In such a scenario, gas demand would plummet by 70%.

The report says that by 2035, renewables and batteries will provide a commercial solution for both base loads and peak loads.

Mr. Pokharel warned flexible gas contracts, on an hourly, monthly and annual basis, would be required to ensure ongoing sustainability of gas-fired power plants; otherwise SA may need to examine other fuels for back-up power generation.

He stated South Australia could become a leading case study for others to follow on managing a power system in transition.

In March this year, the South Australian Government announced its $550 million Energy Plan designed to stabilise the state’s electricity system, which included plans for a state-owned gas-fired power generator and a battery storage and renewable technology fund. The State Government also plans to install power generators in up to four Adelaide locations as an interim measure.

South Australia’s foray into big batteries has already begun, with a  100MW/129MWh Tesla Powerpack 2 based battery system expected to be in place before summer. The system will provide stability services for renewables and emergency back-up power if needed.

In related news, South Australian Premier Jay Weatherill has let fly at “right wing” attackers of South Australia’s renewable energy aspirations, using some rather choice words to describe them.