Distributed energy storage in Australia: Quantifying potential benefits, exposing institutional challenges

Abstract

The rapid development of distributed renewable energy systems and the pressures associated with increasingly variable energy demand in electricity industries worldwide have highlighted the importance of more efficiently managing temporal and locational supply and demand balance throughout the electricity network. At the same time, progress in a range of distributed energy storage technologies offers new opportunities to assist in this regard. This paper presents findings from a study investigating the potential applications for distributed energy storage (DES) in the Australian National Electricity Market (NEM). It first identifies and then provides estimates of the potential value of some key applications of DES in the NEM. These highlight particular opportunities in improving customer reliability and avoiding network expenditure. The paper then presents a framework developed to assess the extent to which the current institutional environment of the NEM enables, or constrains access to those applications. The findings suggest that a raft of institutional arrangements currently restrict access to DES applications and that aggregation and integration of DES benefits associated with these applications, across both spatial and temporal scales is particularly problematic. Show more