This article first appeared on my LinkedIn blog
I’m joining Tempus Energy to develop their business in one of the most interesting electricity markets in the world – South Australia. Many of you know me as a climate change policy maker but energy policy was my first love. In the 90’s I worked in industry as an energy auditor and project manager of co-generation projects. Ever since that time, I’ve been an advocate for energy efficiency, decentralised systems and renewables.
Integrated Energy Systems also did demand management projects, mainly by using ice storage to pull load from day to night. In Belfast, the utility used to fax the large industries to reduce load during peak winter demand, and industry responded because they could save about half their winter charges. I could never get traction for a useful load shifting conversation in Australia. The differences between peak and off peak charges weren’t stark enough or consistent enough. The network price signal was too blunt and the retail price signal too opaque.
Tempus’ software offers the change to forsee the cheap and expensive periods on the electricity market and optimise when we use our energy. The business model offers a chance for both large and small customers to share the savings with their retailer. With a bit of planning (or better still, smart Tempus automation) many loads can shift a few hours – away from a price spike and into a period of surplus, cheap (usually solar) energy. But the truly exciting thing for me is that we have a model that values shifts of even half an hour.
When the market sets up for five minute pricing, the opportunities will be even better. The latter is being driven by the entrance of large scale batteries into the market – 5 minute time-frames are where they can truly make a difference. But do you know what is a whole lot cheaper than batteries? You guessed it, flexible load!
Tempus has plenty to offer South Australia and South Australia has riches to offer Tempus. We have a poorly utilised fleet of energy assets, we are well down the road of distributed energy and customer empowerment, we have a very high penetration of renewable energy for a stand alone energy marketand we have a liberalised energy market
So have I abandoned my work on community energy? Not at all.
There is an underlying tension in the electricity market between local individual ownership of energy assets and large, utility-scale investments. Solar is going Mega, in case you hadn’t noticed, with hundreds of MW proposed in the Riverland and around the Upper Spencer Gulf. And what of the businesses that are being crippled by electricity costs? Do they all need to find the funds to invest in rooftop solar? This is not the business modus operandi – save precious capital for core business and rent what you can, is the way businesses prefer to operate.
I believe that the missing piece of the puzzle here is local, neighbourhood scale optimisation. When individuals can’t use their own solar power, there are others who can, especially if we’ve unlocked the load flexing capacity throughout the neighborhood. Community energy already has emerging models for delivering the assets communities want to see and I am confident we will see this sector grow in South Australia.
Tempus have kindly agreed to me working part time with them so that I can keep the community energy and energy optimisation conversation alive in other circles.
- You can find me supporting Community Energy Action SA over on the Facebook group: https://www.facebook.com/groups/communityenergyactionSA/
- I’ll be keeping my work real by delivering energy advice through Tandem Energy. There are a bunch of great energy companies in South Australia, with new solutions for this market. Working with Tom and Rachel allows me to keep my ear to the ground and I’d love to see these companies collaborating through some sort of Clean Energy SA industry association.
- I will be blogging at https://changingweatherblog.wordpress.com/
- And please get in touch at heather.smith[at]tempusenergy.com if you know someone who needs to reduce their energy costs and discover what load flexibility they have at their disposal.
 In the 90’s I bought into the idea that distributed, neighbourhood-scale systems were the cheapest economic model for an energy system and I have never seen any evidence to contradict this assertion. We have invested in 3000MW of capacity in our power stations and networks and our load averages about half that level. A local transformer might be five times bigger than its average load, in order to manage the summer peak. From an asset utilisation point of view we have a very inefficient system.
 In the 90’s I never forsaw that SA would build the beginnings of a distributed system and customers would start to take control of their energy costs through cheap solar energy. We have seen over 25% of households invest in solar in less than a decade. And this is not the case worldwide. When I traveled on my Churchill Fellowship last year, I saw policy systems that incentivised community scale and utility scale solar before individual investment.
 our distance from the rest of the NEM means that only 25% of our peak load can be provided through interconnection and we need to be able to operate on our own.
 I saw markets that have not liberalised to the extent we have in the National Electricity Market here and that makes a difference too because the changes happen more quickly and are driven financially. (note difference between Coalition rhetoric on the future of coal contrasted with statements by AGL, Origin and the like)