For New Zealand, energy storage could provide valuable services to electricity consumers. A new report from Transpower states that batteries offer the greatest value when located as close to the end electricity user as possible.
The report, Battery storage in New Zealand, outlines six key findings regarding the country’s potential for energy storage, chief among which is that when placed close to the consumer in an electricity supply chain, batteries can provide a range of services both to the end user and upstream to the electricity network.
Other findings include that residential or community scale storage is expected to become economical after 2020. This is thanks to growth in rooftop PV and a decline in thermal power generation, as well as falling costs of batteries as increased production brings economies of scale. New Zealand’s reliance on already flexible hydropower means that grid level storage is not expected to be economical, for the next five years at least, although Transpower does expect them to become viable, and to be a ‘game changer’ for New Zealand’s energy system in the long term.
“Battery projects at lower voltage distribution substations, and at a consumer level are forecast to become economic in the next few years, due to the declining cost of battery systems,” stated Transpower General Manager of Grid Development, Stephen Jay. “Over time, we believe they will also become economic for the high voltage transmission grid, and this will then provide battery resilience across the whole supply chain.”
State owned grid operator Transpower compiled the report based on a series of case studies where storage was integrated at various points in the energy system. The authors also noted that new uses and value for storage could be developed through regulations and market structures for the technology.
“Presently, battery owners are unlikely to be able to unlock the value of their battery until the appropriate market pricing and payment structures are available,” continues Jay. “We believe that there is real potential and benefits from batteries for New Zealand consumers, and we will support industry changes, sucha as market and pricing reforms that allow battery owners to maximize their value”.
According to another report from Transpower, New Zealand’s installed solar PV capacity had grown to 37 MW with generation from residential, commercial and industrial sites by April 2016. UK-based Centre on Innovation and Energy Demand (CIED) recently reported that the country’s installed solar power reached 52 MW (45 MW of which from residential installations) as of the end of April 2017, citing data from Allan Miller of the GREEN Grid research programme of the University of Canterbury, New Zealand. This capacity currently covers only 0.1% of the country power demand.