Manager - Integrated Energy Systems, AEMO
Energy storage – a key enabler for a reliable and resilient future grid
With over 13 years’ experience modelling the development of Australia’s energy systems, Andrew leads the forecasting and modelling of Australia’s energy markets to inform the efficient transformation of Australia’s energy market. Andrew’s role as Manager of AEMO’s Integrated Energy Systems team is to lead the medium to long term forecasting of Australia’s National Energy Market, and Australia’s eastern and south-eastern gas markets, assessing the future operability of energy systems and investment outlook for thermal and renewable energy investments. AEMO’s Integrated System Plan demonstrates the expected evolution of the electricity grid will provide strong opportunities for variable renewable energy at both large scale and behind the meter, and these least-cost development preferences will enable large volumes of energy storage solutions. The modelling team that Andrew leads has developed improved modelling approaches to forecast integrated energy developments, examining the role of thermal, renewable, hydro, storage, network and customer solutions.
Prior to joining AEMO, Andrew provided consulting services in the private sector to large renewable generation projects, including examining the opportunities of specific pumped hydro storage projects in Australia’s NEM.
The comprehensive and transformational changes occurring throughout the energy sector are well documented. In previous decades, the Australian and worldwide power industries have experienced structural change through regulatory liberalisation, the formation of competitive markets, and incremental improvements in supply efficiency.
In the current period, the changes are far more comprehensive and fundamental. The industry is now experiencing the simultaneous effects and benefits of digitalisation, ageing infrastructure, a markedly and rapidly changing cost structure in both supply and storage, flattened and even negative demand growth, the impacts of climate change, cyber security concerns, and a profound change in consumer preferences and expectations for the industry. These changes collectively are impacting the production, transmission, and consumption of power at an unprecedented rate. What is not changing, however, are the essential need for cost-effective and reliable power for the overall economic welfare of society, the capital-intensive nature of the industry, and the physical requirements governing the complex and integrated characteristics of the power system.
To support an orderly transition, AEMO’s inaugural Integrated System Plan (ISP) analysis published in July 2018 demonstrated that, based on projected cost, the least-cost National Electricity Market (NEM) transition plan is to retain existing resources for as long as they can be economically relied on. When these resources retire, the modelling showed that energy storage (both utility scale and behind-the-meter), flexible thermal capacity and transmission were key enablers for the economically efficient integration of renewable generation. Within the plan period, the analysis projected the lowest cost replacement (based on forecasted costs) for the retiring capacity and energy will be a portfolio of resources, including solar (28GW), wind (10.5 GW) and storage (17 GW and 90 GWh), complemented by 500 MW of flexible gas plant and transmission investment. This portfolio in total can produce 90 TWh (net) of energy per annum, more than offsetting the energy lost from retiring coal fired generation.
Following publication of the ISP, AEMO has been working to better understand the value of utility-scale energy storage projects that provide energy shifting capability, with particular focus on how large pumped hydro energy storage projects such as Snowy 2.0 or Battery of the Nation (BoTN) and associated transmission, can increase system resilience and add value to consumers. This includes providing cover in case of catastrophic failure of ageing coal-fired generation, or weather events that lead to days of low wind generation output. Work has also been progressing on understanding the value of distributed energy resources if co-ordinated to meet the needs of the whole power system rather than the individual consumer.