The Grid Innovation Hub at Monash’s Energy Institute has received $495,000 in funding from the Australian Renewable Energy Agency (ARENA) to conduct the research, which it says aims to inform policy makers and market participants, “rather than to formulate prescriptive policy recommendations.”
The study will include assessing how day-ahead markets combined with balancing markets, similar to markets in parts of the US and Europe, could drive more bulk storage.
The university team will also investigate market structures for new system services such as inertia, and “study the risk of market manipulation by owners of storage assets.”
While Australia’s pipeline of grid-scale battery storage projects has ballooned in the past years, the batteries operating today tend to make the bulk of their income through Frequency Control Ancillary Services (FCAS) markets. Such uncertain revenue streams don’t tend to sit comfortably with institutional investors, so finding new market designs is vital to boosting investment interest.
“Services from battery storage are not valued clearly at present, and this exciting research will reveal ways in which markets can better reflect their value to guide investment,” Chairman of the Monash Grid Innovation Hub, Professor Tony Marxsen, said.
Numerous experts have highlighted this issue, with Enosi founder and CEO, Steve Hoy, noting the current market design does not properly differentiate between technologies. “We need incentives to fill the gaps, not just more solar and that’s where I think the wheels are falling off in the current schemes,” he told pv magazine Australia.
The Victoria Energy Policy Centre has advocated Australia introduce a Renewable Electricity Storage Target (REST) scheme, following closely the design of the existing Renewable Energy Target scheme.
Monash has not given a timeframe for the study’s completion.
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