Rooftop solar emerges as Australia’s most cost-effective electricity source, with consumers enjoying prices less than a fifth of the average per kWh cost from retailers. The surge in rooftop solar adoption is evident, with one in three homes boasting solar panels by 2022, resulting in a total rooftop solar capacity surpassing 30 gigawatts, outpacing the remaining 21GW from coal generation.
Proclaimed as the world’s largest solar project upon completion, SP New Energy Corp. (SPNEC) is spearheading a solar farm in Nueva Ecija and Bulacan. This venture is poised to yield 3,500 megawatts of solar panels and 4,000 megawatt-hours of battery energy storage. In a strategic move, SPNEC seeks new investors to aid in financing the estimated P200 billion project cost.
The growth of distributed energy resources (DERs), particularly rooftop solar systems, poses a challenge to the existing National Electricity Market (NEM) designed for large fossil-fueled power stations. Urgent reforms are imperative to harness the economic and technical potential of these millions of consumer-owned generators, ensuring a seamless transition to clean energy at minimal cost.
Recent attempts at reform by the Energy Security Board (ESB) included enhanced forecasting of electricity demand and supply and the Wholesale Demand Response Mechanism to facilitate demand-side participation in the market. Despite these efforts, comprehensive market reforms are necessary to accommodate the influx of small-scale renewable energy generators.
Current market rules, rooted in the 1990s, need a radical overhaul to redefine the entire National Electricity Market and align it with the evolving energy landscape. While the focus tends to be on large-scale developments, the untapped potential of small-scale and local generation to supply electricity where needed deserves attention to prevent unnecessary transmission infrastructure costs.
The ongoing transition to clean energy demands a united effort from governments, placing consumers at the forefront. Principles from the National Energy Transformation Partnership agreement offer valuable guidance, emphasizing consumer needs and a robust economy dependent on affordable, clean, and secure energy.
Energy market reform, a complex endeavor, necessitates a holistic systems thinking approach, considering governance, regulatory frameworks, commercial realities, and consumer needs. Community Energy Zones, akin to Renewable Energy Zones, must be a focal point in policy settings and market reforms. These zones can unleash billions of dollars of investment, supporting local ecosystems, technological innovation, and a smooth transition to zero-emission communities.