A report by the Australian Energy Market Operator (AEMO) and Energy Networks Australia last year calculated that distributed energy resources (DERs), co-ordinated in a transparent two-way energy system could begin to deliver $1 billion of benefits to energy consumers from 2030.
SwitchDin, an early innovator in the DER space, provides a platform for building virtual power plants or microgrids that incorporates secure gateway devices to help manage flexible electricity loads. This month, solar giant Hanwha Q Cells recognised the value of SwitchDin to future coordinated solar installations, and invested $5 million to become a minority shareholder and partner in developments by the company.
Here Andrew Mears, CEO and founder of SwitchDin, talks to pv magazine about how developments in the DER space are coming to fruition, and how Australian trailblazing will help solve the challenges of integrating rooftop solar into grids all over the globe.
How has the understanding of DER-orchestration software change over recent years?
When we, when we attended our first expo in 2016, people were asking us, well what’s a software company doing here at a solar and battery Expo. The next year, there were no questions along those lines. People understood exactly what we were there for, what our goal was, and since then opportunities have been progressively maturing. Most of the key players are looking to factor virtual power plants and micro grid services into their core offering. It’s clearly going to be at the centre of new energy services moving forward. And then of course the energy regulator, and AEMO have have been following suit and we’ve seen some significant developments in terms of enabling policies and regulations that will make these types of aggregated DER services deliver value.
On what kinds of sites is SwitchDin technology deployed?
We’ve got just on 2,000 sites at the moment and they’re a mix of residential, commercial and industrial sites. We’ve moved beyond pilot sites into a business-as-usual type deployment. For example, our solution has been deployed in the microgrids of Energy Queensland since mid-2018, and that’s now a standard sort of pipeline of delivery for Energy Queensland. Similarly in the Horizon Power network in Western Australia, whenever a home in the Onslow region gets solar on the roof they also get one of our Droplet controllers, which will enable that house for DER orchestration of their solar, their battery and their air conditioners. I think that’s a really interesting shift.
What’s driving this adoption of DER services?
The real underlying business case here is the high penetration of PV. That’s the imperative. Batteries are a great opportunity for customers to extend participation and take more control, but really, the need to manage the high penetration of PV is the business case. For example, in Western Australia in general, they’ve recognised that without this type of service they just won’t be able to offer customer-owned PV, because the network won’t be able to coordinate with them. So WA’s DER Roadmap is really looking to steer towards a DER orchestration future. We’re seeing similar things in South Australia and Victoria.
How does SwitchDin technology compare to what’s already available in Europe and elsewhere?
Australia really is the lead market, and I guess what SwitchDin brings is many years’ head start in addressing these orchestration challenges. At the core of our products we solve a very basic problem around how to integrate lots of different vendor products, not just batteries, but also solar and some key loads; how to cost effectively connect heterogeneous fleets of DER assets into virtual power plants and the distribution management systems of the utility. The core of our technology is this vendor-agnostic solution. What that means, of course, is that our customers don’t need to lock into a single vendor; they can allow their customers to choose the solution which best meets their needs, or they or the installer and integrators can offer the most effective solution for a particular application. At the core of our product we’re differentiated by the fact that we integrate pretty well with all the key products in the market — that’s very enabling.
How much tailoring do your systems need to be effective in other countries?
In terms of connecting solar and batteries and loads, because we’re the software, and through our Droplet controller device we connect digitally to these devices, we don’t actually face a lot of the compliance issues that the devices themselves face. From that aspect, there are no more barriers than any other sort of software platform or consumer electronic device would take in entering the market. On the upstream side we do integrate with the distribution-management systems of the networks, and we also provide tools for bidding into the energy markets and obviously there are a lot of differences between those various markets. Some of the capital that we’ve raised in the latest round will go towards enabling us to adapt our market interface to those local conditions.
How long have you been working on the SwitchDin technology?
Personally I’ve been in the sector for 20-25 years. I’ve worked in Australia and all around the world, developing renewable energy projects, but also in terms of policy and strategy and this included a lot of work in emerging markets. I was the chief advisor for renewables for the UN in Southern Africa, and also heading up climate change and renewables in Southeast Asia. In that role I really discovered that data and control are key enablers of scale, so in 2014 I kicked off development of SwitchDin. In 2015 I raised my first round of capital and we had our first commercial release. So, since 2015 we’ve grown to employ 24 people, most of whom are based here in Newcastle. We’ve got really good traction with most of the major networks in Australia and most of the large retailers. And we’ve got some early market traction in Europe.
What are you excited about? What new milestone are you striving towards?
Well, at the moment, we’re working hard so that by the end of quarter three we hope to release our new energy market-optimisation function, which will enable optimised bidding into the market for connected assets.
What will that mean to your customers, and to people who incorporate SwitchDin on their systems?
The dream of the industry is that when a customer buys a behind-the-meter asset — solar or batteries or even air conditioners — that firstly they’ll be able to get the value that comes from having those assets behind the meter; that is, they can reduce their electricity consumption or shape their load to reduce their costs. But that asset can also be plugged into other opportunities: it can be used to provide services to the networks, helping them to manage demand, or to reduce reverse power flow; and it can also be used by retailers to generate value from an energy market. So the ultimate goal is to enable access to all these different value streams, to be able to optimise and get the absolute most value out of the asset. And that’s really what we’re looking to make possible; we’re looking to realise, for a whole range of different DER assets, the full stack of value that can come from DER services and energy markets.