Market trials recommended to unlock benefits of solar and batteries

A new report has found distributed generation, like solar panels and batteries, reduces network congestion and delays the need for network upgrades.

The Essential Services Commission has released its final report into the network value of small scale solar units and other forms of distributed generation.

The report is the final part of a broader inquiry into the value of small-scale distributed generation referred to the commission by the Andrews government.

Commission chief executive Dr John Hamill, says the report found distributed generation can and does provide grid services by reducing congestion in the electricity network.

“Reducing congestion reduces the need for network upgrades, thereby saving costs,” he said.

The report found new energy technologies, such as batteries and energy management systems, means distributed generators could deliver higher value grid services in future.

It also found the value of distributed generation to the grid depends on both the location of the generator, and the time of generation. The commission found a feed-in tariff was therefore unlikely to be an effective way to reflect the true value provided to the network.

Dr Hamill says market trials of technology platforms and market mechanisms could help unlock the grid benefits of distributed generation in Victoria.

“Grid services markets could be an effective way of encouraging distributed generators to invest in new technologies that deliver benefits to the grid, and also ensure they receive reasonable and efficient payments for those benefits,” he said.

The Commission has delivered its final report to the Andrews government and looking forward to its response.