Written by Charles Walker, CEO RedEarth Energy Storage
The old fashioned way of making power in one place and sending along a wire, sometimes very long distances, with Australia’s large land size and low population density, is now uneconomic compared with the renewable alternatives. Nearly half of the average electricity bill is attributed to maintaining these long wires and poles. (Source: Solar Market)
Modern electricity usage now requires much higher electricity reliability to cater to an ever-expanding list of electrical appliances at home and at work that we rely on. These uses include computerised business processes and new uses including the charging of electric cars in the home. Couple this with the fact that it is now cheaper to make a unit of electricity from renewable sources than it is from fossil fuels, it makes sense to choose renewable forms of electricity in Australia in 2020. Solar battery storage systems are already economically viable, leading to the current change in how our population is choosing to generate, store, and consume energy.
This energy disruption is not primarily driven by the desire to go green. With rising costs every year being paid to electricity companies, the desire to make the most economical financial decision is at the forefront of homeowners’ decisions. Electricity prices in Australia have increased by 117% over the ten years to 2018 (ABS – CPI) and they are not looking to get any cheaper in the next ten years.
The average household stands to pay their electricity company an average of over $16,000 AUD over the next ten years (Average is $1,600 AUD per year, Canstar) and is still subject to price rises, blackouts, legislation, and expenditure governing electric vehicles. At today’s prices, even a basic solar and battery system can return effectively over 15% per annum, after taking into consideration tax advantages, and a solar system will return over 20% per annum. Both of these are some of the most attractive investments available for households to offset costs with the added benefit of modernising their asset.
Now that we have the ability to economically make, use, and store our own power, it means the traditional electricity grid is being forced to evolve. This disruption has already started for early adopters and is expected to become mainstream over the next ten years. This progress is being further rushed along by prices for solar batteries reducing by around 20% over the last six months and solar panels continuing to drop in price, which has continued over the last ten years.
For those affected by the catastrophic bushfires this summer, it could be a time to reconsider future energy supply, not just for homes but for communities. The benefit of making, using, and storing one’s own power has been brought to front of mind during these Australian bushfires where some properties were faced with an uncertain wait before power was restored. Having either a backup solar and battery system to provide cover in blackouts, or entire off-the-grid systems could have been helpful in some of these circumstances. Couple that with positive investment returns and it makes such systems a very sound economic, energy secure, and environmental proposition.
If towns, councils, communities, and homeowners are rethinking their energy supply, it is prudent to consider solar as not only a good investment return but to also consider the value of energy self-sufficiency and a more sustainable way to power their towns. We are seeing enquiries for micro-grids pop up in towns around Australia as they look to evolve the resilience of their energy supply which is really exciting for our country. We now have the ability to create these micro-grids where generation is 100% renewable, where residential or community storage is available to provide the firming requirements; to maintain power supply when the sun does not shine.
Australian towns including Tyalgum (NSW), Lismore (NSW), Byron Bay (NSW), Coffs Harbour (NSW), Uralla (NSW), Mullumbimby (NSW), Newstead (VIC), and Yackandandah (VIC) are leading the way in their switch to 100% renewables goals. The suburb of Huntlee (NSW) is one of the first Australian suburbs that will go 100% off-grid, supported by the Australian Renewable Energy Agency. (Source: Climate Council)
Over the last twelve months at RedEarth Energy Storage we have seen a dramatic increase in the demand for home battery systems around the country as homeowners move toward renewable energy as their energy source of choice. More than 70,000 Australian households are expected to install battery systems this year (Source: BloombergNEF). Over the next four years, RedEarth is expected to manufacture more than $70 million worth of battery systems for Australia. RedEarth is committed to investing in additional research and development to ensure its products remain at the forefront of Australia’s growing sustainable energy needs.