In the next 5–15 years, batteries will weaken business in large transmission and interconnection projects. Those assets are likely to be built, however, narrowing price differentials and eating into battery yields, predicts analyst Warwick Johnston.
In 2015, Sunwiz CEO Warwick Johnston warned major solar developers that rooftop solar installations were eating their lunch.
“What I’m seeing now is more nuanced and more rounded than that – renewables eating themselves,” he says. pv-lehti Australia. “It takes a long time to build a transmission… while you wait for that transmission, the price of electricity is volatile and higher. The natural answer to this is to install solar on the roof or install storage, possibly local storage, possibly local transfer-enhancing storage, all that sort of thing.”
He said the batteries are being manufactured faster than the shipment, resulting in a decrease in the economic case for the shipment. However, transfer projects are still being developed, which in turn weakens the economic sense of batteries.
While this business issue most affects large battery projects that earn most of their revenue from the spot market, distributed energy resources such as rooftop solar and grid batteries continue to completely transform energy systems.
The demand forecasts that have underpinned much of Australia’s transition modeling to date are increasingly being questioned because, as Kuiper points out, the lack of models relies on a past that is likely to be completely different to the energy future.
Johnston describes the assumption that Australia should build large numbers of infections as something that has until recently gone “unexamined”. A growing chorus of industry insiders is questioning whether the current scale of planned transmission projects is truly vital, but this is also a relatively recent change.
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