The remarkable energy transition in South Australia

South Australia could become a textbook case for the transition to a low carbon electricity grid. AEMO’s (Australian Energy Market Operator) National Electricity Forecasting Report for 2014, shows that solar is already turning the tables on incumbent generators. Nowhere is this better illustrated than in South Australia, where AEMO suggests that rooftop solar PV and energy efficiency will account for more than 20 per cent of South Australia’s projected electricity demand by 2023/24. That will reduce overall grid demand at that time from an estimated 14,500GWh, to around 12,000GWh, despite a growing population and economic growth.

This is a textbook case of the technologies that need to be adopted, and changes in consumption that need to be seen in any grid. Given that the demand on centralised generation is further reduced by a trebling in rooftop solar PV by nearly 15 per cent, then it could be argued that within a decade, 5,000GWh, or nearly one third of demand (business as usual) is being accounted for by rooftop PV and energy efficiency. Remarkable. South Australia is currently the state with the highest percentage of solar power, with 5.2 per cent contribution of total demand from an estimated 704 GWh of generation from rooftop solar in 2013-14. By 2023/24, AEMO estimates this will grow to 2,034GWh.

That is a stunning transformation – achieved in just 15 years. Even if the numbers don’t work out exactly that way – there is every chance they could be higher if the RET is retained – it gives a fantastic demonstration of the scale of change that can be achieved.

The biggest losers from this transformation? The incumbent generators of course. Alinta, which owns the two brown coal generators, is seeing its plant marginalised well before it had planned, so it is arguing of the RET to be ended immediately. The gas fired generators are also suffering, because they are being marginalised from acting as base load generators to only intermediate and peak roles. The peaks in the state’s grid have also been pushed back at least one hour, and shrunken in duration – which is good news for consumers, but not for generators. That is another extraordinary result, and one that was simply not predicted just a few years ago. So, don’t let anyone tell you that such a transformation is not possible.