National Electricity Market gives Green Light to Renewables.
by Michael Gunter

Massive changes have been underway in the Victorian electricity industry in 
recent times. The strong privatisation push is associated with the Kennett 
Government. This was however preceded by significant corporatisation reforms 
under previous state Labor Governments.

If you thought that we had arrived at a new status quo, then think again. 
The process of setting up a "national grid" in the Eastern States has been 
underway for about 4 years and is now gathering pace. The proposed market 
structure is being defined and refined by policy developers from State and 
Federal jurisdictions. They are each represented on the National Grid 
Management Council (NGMC), the engine for creating the national electricity 
market.  The market rules or "Code", although still the subject of hot 
dispute by the different sectors of the industry, have been refined by an 
extensive industry consultation process to the point where the market will 
soon be open for business, albeit in a transitional mode. It is envisaged 
that the participants will just have to "suck it and see". The market will 
be operated and administered by NEMMCO, the National Electricity Market 
Management Company Ltd.


"So what?" What relevance could this possibly have for ordinary mums and 
dads, or potential renewable energy producers. Surprisingly perhaps, the 
answer is "Quite a lot!": With a little bit of prodding from the Federal 
Department of Environment, Sport and Territories, the NGMC has recently 
broadened the definition of electricity generators in the industry Code to 
acknowledge a role for intermittent small-scale production from sources 
such as wind, solar and micro-hydro. 

In trying for 18 months to formalise financial arrangements for grid 
connection and sale of energy from the Breamlea wind generator, it has 
certainly become apparent to me that the present Victorian market rules are 
lacking in detail on how to handle small-scale generators connected to the 
distribution part of the network ("embedded generators").  It is to the 
credit of CitiPower and Powercor that they have allowed network access and 
energy trading from Breamlea in the absence of formal arrangements. However 
this is certainly not the sort of commercial environment to encourage the 
development of large-scale wind farms: there is just too much uncertainty 
for any new proposal to get off the drawing board. 

The National Code could be in force as early as 1 October 1996, at which 
point it will be theoretically possible to write to  your local distribution 
company and put forward a proposal for connecting your renewable energy 
system to the national grid. 

Not surprisingly, there is a raft of technical requirements that would have 
to be fulfilled to meet acceptable standards of power quality, including 
voltage fluctuations, harmonics and "negative sequence voltage levels".  
There are also requirements for protection of the generating unit itself, 
and for system security  to be maintained. Presumably if you are not an 
electrical power engineer, you may have to employ a consultant to check the 
technical aspects of your system, and possibly to represent you in 
negotiations with the distribution company.

The recent amendments to the National Code, which allow for small-scale 
generators to connect to distribution networks, seem to give a very free 
hand to the networks to determine your technical requirements. The goodwill 
of your local distribution company will therefore be crucial. The value of 
your energy to them will depend on how far you reside from major population 
centres (the further the better for you), and how much it is worth as a 
public relations exercise to them to be seen to be promoting renewables. 
The national market may well be providing another stimulus to the value of 
renewable energy: any Victorian distributor wishing to compete in the New 
South Wales market will have to comply with the NSW Government's 
requirements for reduction of greenhouse gases. One obvious way to achieve 
this is for the distributors to buy renewable energy.

What scenarios are likely to be economic? If you have an existing 3 phase 
induction generator being powered by hydro and are currently dumping large 
amounts of energy into a dummy load, you probably already have the network 
representative knocking at the door! If a 3-phase grid connection can be 
done cheaply, it might return a good income. Just about any other scenario 
I can think of, short of a full-scale wind farm in remote coastal locations, 
is something you would only do for its value to you in reducing the 
greenhouse effect. This is because all photovoltaic and most small wind 
turbine systems require a very expensive grid-interactive inverter to be 
able to feed excess energy back into the grid. If your distribution company 
is willing to pay a price for your excess energy similar to the price they 
charge your neighbours, then the benefit of not having to have a large 
battery bank replaced every 5 years would eventually repay the cost of your 
grid-interactive inverter.

Anyone seriously contemplating putting up a big grid-interactive solar array 
or wind generator would be well advised to study information published by 
NGMC on the internet at http://www.electricity.net.au/
There is a huge amount of information to sift through to find the relevant 
bits, but the most relevant appear to be chapters 5,6 and 10 of the Code. 
These are only available as zipped Word 6 files presently, although if 
there is sufficient interest from Soft Tech readers, I will try to "mirror" 
these documents on the ATA's Web pages in plain text format. Some relevant 
recent amendments to Chapter 5 of the Code are not yet on the Internet, but 
email me mickgg@suburbia.net if you need this information. 

Thus it seems that for the majority of urban or rural electricity users, 
people without huge amounts of cash to splash, it would make more economic 
sense to have a conventional independent electrical system of PV's battery 
bank and inverter, complemented by a gas fridge and stove.  There may well 
be a role for people in country (coastal) towns to form a local wind farm 
co-operative, following the example of the Dutch. For those concerned about 
the greenhouse effect, the most cost effective way to combat it, apart from 
trading in your car for x bicycles ( x = number of family members!) is to 
install a solar water heater: do it now! I have had one on my roof for 15 
years, and it's still going strong.

Despite these sobering conclusions, it will be exciting to see if the big 
boys in the industry will facilitate the rapid roll-out of wind farms, and 
whether coastal landowners and their neighbours will kill wind farms with 
the NIMBY ("not in my back yard") syndrome. 
