Solar Powered Microgrids Might end up Upending the Energy Industry

White Gum Valley in Western Australia has become the center of a very interesting, and possibly industry changing development project. Residents will generate their own electricity and share it through an independent microgrid.

In the center of the City of Fremantle, a possibly revolutionary development site is kicking off in an industry first. Around 80 homes and apartments are being built with solar power, as well as half of those being given battery storage. This may sound like a simple marketing tactic to attract environmentally conscious homebuyers or those keen to make savings on their power bills, however this strata development is taking it a step further. With ARENA backing one third of the development costs, the project is being built with its own independent microgrid allowing the body corporate to sell electricity back to prospective buyers completely separate from monolithic energy giants.

The body corporate will act as a utility as well as grounds management, enabling them to significantly increase the profitability of the project while adding extra incentive for those interested in acquiring property.

So far there hasn't been a decision on whether the electricity will be sold at the market rate of around 21c, or at lesser prices. Ms Green put it this way:

"They can sell it at a discount to attract tenants to the marketplace, so it means the roof space can be commoditised and provide an extra revenue stream to the owners."

All in all the project is estimated to cost $3 million. So far the Curtin University, Western Power, LandCorp, the City of Fremantle and Solar Balance have formed a partnership to pursue the project's commercial viability. They hope that the solar power, alongside battery storage will make up 70% of the required electricity needed to provide for the complexes power needs.

While it is a drop in the water considering the size of the energy market, hopefully this project could have a ripple effect on the industry as a whole. By distributing ownership of electricity, the market will open up to greater competition and in an ideal world reduce our ever increasing power bills. By using solar power, the complex will only have to whether a one off cost before reaping the benefits of providing electricity to residents.

But there are two ways of looking at this. First off, any development that utilises solar over standard grid connected homes is beneficial for a number of reasons including both financial and environmental benefits. However, in this instance of microgrids and pseudo utilities, homeowners and residents still don’t directly achieve energy independence, even if their body corporate does. So if solar is becoming such a smart business decision for those who have the capital, why not just purchase your own system?

The only way that solar will bring about a true energy revolution is if people opt to cough up the initial expense required to install independent energy solutions themselves. When looking at things from a purely financial point of view, what’s the difference between paying for electricity that comes from a clean source of power and traditional fuels like coal, fossil fuels and gas…if the price is the same for the customer.

More and more we are seeing energy investment moving to clean energy, last year was a tipping point for renewables as it received nearly double the investment then coal and traditional fuels. It is becoming obvious that there is real value in solar and wind technology besides removing any guilt you might have accumulated during the heyday of that ‘little black rock’.

If this development does set off a chain reaction in which smaller organisations take the place of traditional utilities through solar powered microgrids, hopefully it encourages communities to adopt a ‘free energy’ model (excluding installation costs). Instead of preventing those who seek true energy independence as well as freedom from the financial burden of purchasing electricity every three months, from attaining it.

// ViewContent // Track key page views (ex: product page, landing page or article) fbq('track', 'ViewContent');