Smart Grid Future: The business case for urgent energy upgrades

Executive Summary

South Australia’s business community is paying the price for a grid that is no longer fit for purpose.

The meeting of COAG’s Energy Council on 19 August must take action to start the transition from the current ‘Dumb Grid’ based on an increasingly outdated and costly centralised distribution model, to a 21st century ‘Smart Grid’ to overcome the challenges the Australian energy system is facing, unlock new investment and reduce electricity costs.

The future of the national energy market is 100 per cent renewable. The grid must be reimagined with this reality in mind and build to enable diversified generation and simple import and export throughout the national energy market. The sooner the renewable energy transition is achieved, the sooner the business community benefit from lower prices.

The following changes must be a priority to fix the grid, support the business community and enable the transition to a future powered by renewable energy.

The Future Business Council calls on COAG to commit to the following actions:

  • Build a second interconnector between South Australia and Victoria, and a direct connection between South Australia and New South Wales;
  • Incentivise investment in a complementary mix of renewable energy and battery storage. Investment must be increased in large scale solar farms, solar thermal towers, and tidal energy to better levelise generation, alongside work to accelerate the uptake of energy storage including battery’s, electric vehicles and pumped hydro projects;
  • Restart the national rollout of electricity smart meters informed by the lessons from the Victorian experiment.

Australia’s energy future is bright. The country has the world’s richest renewable energy resources and the opportunity to create the lowest cost base of energy for industry in the world. But there’s a risk this will be missed without work to reimagine the structure of the grid and enable rapid investment growth in renewable energy.

A smart grid reflexive to a diversified energy market, capable of meeting the needs of “prosumers” (companies and households that both produce and consume energy), and that supports Australia’s ability to achieve its Paris Climate Conference commitments is critical.

Australia must prioritise the transition from the current ‘Dumb Grid’ based on an increasingly outdated centralised distribution model, to a 21st century ‘Smart Grid’ that unlocks new investment, jobs and an affordable energy future.

We look forward to supporting COAG’s Energy Council as it embarks on the greatest transformation of the grid since its inception.

Tom Quinn, Executive Director, Future Business Council

Download Report

Overview

Australia’s National Energy Market is hamstrung by an out-dated, ‘dumb’ grid, and must be updated to face the realities of low carbon, low marginal cost energy generation.

  • Greater inter-connectivity is the first critical step needed to ensure sufficient competition in the market to drive down prices, and allow the continuity of supply in periods of low renewable generation.
  • A diversified energy mix is required to ensure continuity of low carbon energy supply and growth of investment opportunities. Continual and increasing investment in increasing efficiency of wind and solar photovoltaic power, as well as in alternative methods of generation such as bioenergy, geothermal, concentrated solar power, and tidal power is required.
  • Sufficient advances in smart grid and energy storage technologies must accompany advances in generation capacity.
  • Cost reflective price signals should be implemented to ensure efficient use of energy and assets.

Give your company a voice at the table. Contact the Future Business Council to discuss becoming a  Member today.

Future Business Council
490 Spencer Street, Melbourne, VIC, Australia
p (03) 8327 8427
e info@futurebusinesscouncil.com