by Peter Croft
I think that there are some signs of hope however, starting with the production of electricity.
Electricity generation is one of the major sources of carbon dioxide production. Reducing electricity generation from fossil fuels would be a major step forward in starting to cap carbon dioxide production.
Each day I get the Renew Economy newsletter, edited by Giles Parkinson – former Deputy Editor of the Australian Financial Review newspaper. Giles was brought to Adelaide in July 2014 by Conservation Council SA and the SA Government for a public discussion on the future of renewable energy in Australia. At the outset of that discussion, he noted that South Australia is the world leader in the use of renewable energy for electricity generation. On a typical day, approximately 40% of SA’s electricity comes from renewable sources. Denmark (at around 30%) is the next state! In fact, on several days in September 2014, SA generated the equivalent of 100% of its electricity from renewable sources!
The daily stories in Renew Economy are increasingly painting a picture of the rapid pace at which renewable energy (especially solar) is replacing fossil fuel (especially coal) in the generation of electricity.
The driver of this change is the rapid reduction in costs of the components of solar systems. We have all seen the rapid drop in prices of solar cells over the past five years: the rooftop solar system that cost $20,000 five years ago can now be purchased for $5,000 or less.
The missing component for a full-scale renewable electricity system has been the cost of battery storage. This is also now predicted to drop rapidly over the next decade in a similar fashion to the cost of solar cells.
The combined effect of low-cost solar cells and storage batteries will mean that it will become increasingly cheaper to go “off-grid” than to stay connected to existing (and fossil fuel powered) electricity networks.
We will see this transition in more remote Australian communities first, then rural areas, then cities.
This transition is already happening in some remote communities. But the economics are getting close even for communities near major cities. In August 2014, Renew Economy published an article about the Sutcliffe family living in semi-rural Little River (not far from Melbourne) who have decided to stay off-grid. Their research showed that the costs of being off-grid versus on-grid were relatively close in scale. Once future improvements in battery technology are factored in, the equation will move dramatically to off-grid being the cheapest.
The first community owned retailer is in final planning stages in the Byron Bay-Lismore area. Northern Rivers Energy would build, generate and sell renewable energy in the northern rivers region of NSW. Similar arrangements are popular in Germany, where local councils often own the networks.
All of this is likely to be a possibility within a decade for most of us.
To quote the CEO of SA Power Networks (formerly ETSA Utilities) Rob Stobbe – it will make sense for consumers, even communities, to go off grid, especially in remote areas. Then, others in urban and rural areas will also defect, because they like the idea of renewables and independence. And “no doubt over time”, Stobbe says, some residential developments and communities will either go off totally or use the local grid or a “thin grid” to assist in moving energy around that development or community.
The implications of this are significant. Traditional fossil fuel generators will start to go out of business. Electricity networks will become much less valuable. The rapid reduction in battery costs will also affect the economics of petrol-engined cars: electric-only cars will become much more available and affordable. And their price will drop too. Even oil-rich countries such as Saudi Arabia are moving rapidly to solar based on cost considerations.
One huge impact will be on the nature of the communities in which we live: as Emma Sutcliffe from Little River says “Whether this takes the form of stand alone systems or community based storage banks, the future of affordable off-grid living is now being shaped.”