Glenn Platt leads CSIRO’s Energy Flagship and will be the keynote speaker for the National Electrical and Communications Association (NECA) conference in South Africa next April. Below is an overview of the changes Glenn believes we will see over the next five years.

The world of electricity is just embarking on an incredible new journey. And there’s going to be a once-in-a-lifetime degree of upheaval associated with the changes we will experience. We’re not there yet though, if Thomas Edison – great-great-grandfather of today’s AC electricity system  –  was alive today, he’d probably still recognise most of the components in today’s electricity system. And that tells you just how slowly things have developed over the past century. But this is all about to change, this change is going to be huge, and it’s going to start happening very soon. Within five years from today poor old Thomas probably won’t recognise many of the technologies that will be commonplace in our system. But the good news is that with these hugely significant changes come enormous opportunities for electrical and communications contractors.

Perhaps the most significant change we’re already seeing in the electricity system is the rise of distributed generation. Today’s large, centralised gas or coal fired power stations will soon be replaced by much smaller electricity generators located much closer to where we use that electricity. Perhaps the most familiar of these generators is the solar electricity generator, which we now see on roofs all over Australia. The amazing thing is that we’re only just starting on the solar revolution. Australia today has around 1.4 million solar installations covering around 12% of our homes. Even the most conservative commentators expect this to dramatically increase in the years to come. In fact many leading organisations, including CSIRO, are expecting distributed generation, like solar, to make up around 50% of our generation in the decades to come. That’s around another 3 million installations to be done!

There are many benefits to generating electricity from solar. But the key drivers for its incredible uptake in years to come won’t be “green”, or related to saving the world or combatting climate change. It’s just going to be simple economics. Today, in many parts of Australia, electricity from solar panels is cheaper than the price of retail electricity from the grid. And the price of solar will continue to drop. In fact it has been decreasing by around 20% every two years for decades now. Incredibly, in many parts of the world the biggest cost when purchasing a solar system today isn’t the price of the solar panels, or the installation labour, or the inverter. It is actually the finance – or more to the point, the interest being charged to fund the system. And whilst this seems incredible, it is in fact a cost that can easily be reduced. As banks and the broader industry get more familiar with the technology, interest rates for funding solar could easily drop.

Of course electricity from solar isn’t without its challenges. What happens on rainy days or at night when there’s no sunshine? Traditionally, storing electricity for these times has been incredibly difficult. Battery systems have been available for years but they are expensive and need careful maintenance, so they have almost never been used in a regular suburban house setting. Once again, this is all changing. And once again, it’s being driven by simple economics. The arrival of new battery technologies such as advanced lead acid and lithium batteries has completely transformed things. Today we are seeing compact, maintenance-free battery systems appearing on the market from major vendors such as Panasonic, LG, Samsung, Tesla and Enphase. These new batteries are specifically targeted at installation in people’s homes. And again, the price of these systems has been decreasing at an amazing rate. Common lithium battery cells have been dropping in price by around 15% per year over the past several years. Again, many independent commentators predict that these batteries will be commonplace in just a few years’ time.

Solar isn’t without its challenges though. For example, a high-concentration of solar systems can make voltage control on the electricity grid quite difficult to manage. Whilst in the past concerns around such issues might have limited the uptake of solar across Australia, once again things are changing dramatically. Now, there are new inverters and Australian Standards (AS4777) coming onto the market, that introduce new functionality for inverters to allow them to help maintain power quality- these new inverters can provide, or absorb, reactive power and actually help prop up the grid around them. Rather than large numbers of solar inverters being considered a risk, they will soon be seen as an asset for the electricity grid.

Earlier this year, these new capabilities were demonstrated on a huge scale in Hawaii, when the electricity grid operator recognised that the amount of solar in Hawaii was now close to the capacity of Hawaii’s largest traditional generator. They therefore decided to reconfigure many of the solar inverters on the island, so they could “ride through” grid disturbances, helping stabilise the grid. With this goal in mind, the grid operator in Hawaii contacted the control room of Enphase, a manufacturer of many of the solar inverters in Hawaii. Operating in real-time, Enphase engineers in Los Angeles (thousands of kilometres away) were able to transmit a command that reconfigured over 800 000 solar inverters, on 51 000 homes across Hawaii, so they would stay online despite rapidly swinging grid conditions.

It’s worth pausing here. Today, solar isn’t just cheaper for the end consumer than conventional grid electricity, solar systems are now even being used to maintain the reliability of the broader electricity grid. Imagine what this will do to the uptake of this technology across Australia.

Unfortunately for poor old Edison, even if he gets his head around all the localised generation, storage, and reactive power control on the power system of the immediate future, things won’t stay this way for long. Further changes are coming. Already in Australia trials are underway of microgrids, and “transactional” energy systems, where local houses and buildings essentially trade energy between themselves. This provides complete independence from the grid, and often actually improves power quality and reliability. In doing so, these systems demonstrate that we don’t really need “baseload” power generation- rather, what’s needed is to ensure that generation is carefully matched to supply at any instant. To achieve this, microgrids are managed by automated controllers that can accurately predict future load and generation, and then pro-actively manage loads and energy storage to keep things in balance with the available generation, all the while maintain power quality to the end user.

Driven purely by economics and their practical benefits, the uptake of distributed solar and battery storage in Australia is akin to the disruption digital photography caused film, or the mobile phone caused traditional telephony. Importantly, whilst the approaching changes will be massive and profound, they aren’t anything to be afraid of. In fact, they represent an incredible opportunity for electrical and communications contractors. Whilst new technologies, solar, batteries, energy management systems and so on operate using same core electrical and communications technologies we’re used to. Yes, there are some additional skills to learn, and new technology to become familiar with, but they aren’t an entire change in direction. And these are labour-intensive industries that can help our economy- already today, the solar industry in the USA employs more people than the coal industry. They even employ more people than Apple, Google, Twitter, and Facebook combined!

The technologies and changes mentioned here are just now becoming mainstream, to the point where massive investment banks like Morgan Stanley and UBS (who aren’t exactly crazy greenies or renewable energy zealots) are now publishing papers on how they expect solar and batteries to be a huge industry over the next few years. For example, Morgan Stanley predicts around 2.4 million Australian homes will install solar and battery systems, and these systems will have a payback time to the household of less than 10 years. Ultimately, this means more work, more challenges, and more opportunities for our industry.

Somehow I think Edison would have been a bit disappointed if he had come back and recognised so many of the things in our electricity system today so many years on from his initial inventions. However, if he knew about the massive changes just around the corner, I think he’d be incredibly excited for us all. Edison once said “Everything comes to him who hustles while he waits…”
Exciting times are ahead – hustle on I say.