{"id":4191,"date":"2014-10-31T14:37:28","date_gmt":"2014-10-31T05:07:28","guid":{"rendered":"http:\/\/www.solarquotes.com.au\/blog\/?p=4191"},"modified":"2023-06-22T14:29:11","modified_gmt":"2023-06-22T03:59:11","slug":"utility-scale-solar-australia-doomed","status":"publish","type":"post","link":"https:\/\/www.solarquotes.com.au\/blog\/utility-scale-solar-australia-doomed\/","title":{"rendered":"Are millions of solar roofs making solar farms pointless?"},"content":{"rendered":"
\"solar<\/a>

Are solar roofs making solar power stations uneconomic?<\/p><\/div>\n

Utility scale solar, or solar farms, are fields of PV panels which generate electricity that is fed directly into the grid.\u00a0\u00a0Currently we don’t have much of this in Australia.\u00a0\u00a0Over 99% of our solar capacity is point of use which is mostly on rooftops and the juice it does produce is first used to power the household or business it is on top of and then after that the excess is generally fed into the grid.<\/p>\n

While there are countries that have gigawatts of utility scale solar, sunny Australia had none until 2012 when a small 10 megawatt solar farm was opened in Western Australia and no more was built for two years until the completion of the 20 megawatt Royalla solar farm<\/a>\u00a0near Canberra last month.\u00a0\u00a0This new development resulted in utility scale solar soaring from about a quarter of a percent of the country’s total PV capacity to a not at all massive eight tenths of a percent.\u00a0\u00a0But there is still more to come.\u00a0\u00a0A small slew of solar farms have either been approved or are under construction.\u00a0\u00a0A 56 megawatt facility is under way in Moree and 102 megawatts in Nyngan.\u00a0\u00a0Several additional small solar farms have been approved for the ACT and a 53 megawatt solar farm will be built in Broken Hill.\u00a0\u00a0Altogether they could take the portion of Australian PV in utility scale projects to over 6%.\u00a0\u00a0It certainly looks as though solar farms are finally taking off and soon the sun soaked Australian landscape will be dotted with fields of solar panels, not at all gently waving in the wind, supplying the nation with clean electrical power for air-conditioners, hair dryers, shock therapy, and cattle prod Tuesday down at Fight Club.\u00a0\u00a0This is a reasonable conclusion to arrive at, but it is wrong.<\/p>\n

The solar farms under way now only got the nod because the current Coalition government could not stop them.\u00a0\u00a0For some reason they do not seem to like renewable energy.\u00a0\u00a0I mean, they really don’t like it.\u00a0\u00a0My impression is if it would not cost them votes they would be quite happy to agitate their caucus until it was raucous and then rush out and smash solar panels with hammers, jump up and down on the pieces, and then train dingos to eat the fragments until their kidneys’ turned fetid.\u00a0\u00a0Now pieces of silicon don’t have that effect on dingo kidneys, but my opinion of the acumen of Australia’s current leadership is so low I doubt they have even a cursory understanding of dingo urology.<\/p>\n

It seems very likely the Coalition will prevent any further expansion after the current projects are completed.\u00a0\u00a0However, an unpleasant political climate is not the main difficulty that utility scale solar faces\u00a0\u00a0in Australia.\u00a0\u00a0After all, government policies change.\u00a0\u00a0And they will do so either when we get a new government or perhaps close to the next election when the stinkiest part of a rotting fish is likely to get the chop.\u00a0\u00a0But that won’t be enough to save utility scale solar in Australia.\u00a0Economics also gets in the way because utility scale solar simply cannot compete with rooftop solar.<\/p>\n

The cost of utility scale solar in Australia is quite frankly embarrassing.\u00a0\u00a0Not one single project so far will be able to install PV at a lower cost per watt than local installers putting it on\u00a0\u00a0rooftops.\u00a0\u00a0That is the opposite of how it is supposed to work.\u00a0\u00a0To pay more for solar off in a field somewhere when it is cheaper to put it on your roof is, quite frankly, nuts.\u00a0\u00a0With experience the cost of building utility scale solar should come down, but it is not going to have the opportunity to get that experience, as its situation is only growing worse.<\/p>\n

The main reason why rooftop solar knocks its competitor into a cocked hat is that solar farms compete with the wholesale price of electricity during the day which averages about five cents a kilowatt-hour, while rooftop solar competes with the retail price of electricity which averages about 28 cents a kilowatt-hour.\u00a0\u00a0In other words the price that rooftop solar has to beat to turn a profit is more than five times higher than for solar farms.\u00a0\u00a0Currently utility scale solar is not competitive in Australia without the government picking up a large portion of the costs while rooftop solar is extremely competitive and is the cheapest source of electricity available to Australian households and small businesses.\u00a0\u00a0And that leaves utility scale solar lying in a hat full of cocks where it will no doubt be clawed and pecked and terrified by their horrible red wattles.<\/p>\n

What really dooms utility scale solar in Australia and ensures we’ll never be likely to have more than a paltry amount is that rooftop solar pushes pushes down the wholesale price of electricity during the day.\u00a0\u00a0People are installing PV panels on their roofs right now because it saves them money and the more that is installed the lower wholesale electricity prices go.\u00a0\u00a0And since the retail price of electricity is so high in Australia and the cost of installing solar so low, people have an incentive to continue to install it even if wholesale prices during the day drop to zero and people get no feed-in tariff for the electricity they export to the grid.\u00a0This means the natural end point is people keep installing rooftop solar until it ends up supplying the majority of Australia’s daytime electricity use.\u00a0\u00a0So if you listen very carefully you may be able to hear solar photons banging into silicon in the panels on your roof.\u00a0\u00a0Those utterly imaginary tapping noises are the sounds of trillions of little nails being hammered into utility solar’s coffin.<\/p>\n

Rooftop solar is already clearly pushing down wholesale electricity prices across the nation.\u00a0\u00a0In South Australia where we get about 6% of our total electricity use from rooftop solar it is not uncommon for it to supply over a third\u00a0of total demand\u00a0around\u00a0noon<\/span>\u00a0on weekends.\u00a0\u00a0It did not take us long to get to this point and our capacity is continuing to expand.\u00a0\u00a0If you want to see an example of what wholesale electricity prices may be like across the country in the future take a look at this 30 Minute Demand and Price Graphs for South Australia that I nabbed from the Australian Electricity Market Operator<\/a> at 12:43 on Saturday:<\/p>\n

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