This study was undertaken to quantify the potential benefits of installing concentrating solar thermal power (CSP) generation at constrained network locations in the Australian national electricity market (NEM). The primary objectives were to identify and map locations where CSP could provide cost-effective network support services, quantify the potential effect of network support payments on the business case for CSP, and engage network service providers regarding the potential for utilisation of CSP as an alternative to network augmentation.
Concentrating solar thermal power electricity generation has been in commercial operation at utility scale for over 20 years. By the third quarter of 2013, there was 3GW of installed CSP capacity worldwide and close to another 2.5GW under construction (SolarPACES 2013). However, despite excellent solar resources and considerable research and development expertise in CSP, Australia, to date, has only deployed one demonstration plant. The Australian market is very challenging, with a gap between current estimates of the levelised cost of electricity (LCOE) from CSP and likely revenue for grid-connected systems, of between $100/MWh for large systems, to more than $200/MWh for smaller systems (Lovegrove et al. 2012).
Little attention has been paid to the potential for CSP systems to alleviate grid-constraints in electricity networks. Australia’s electricity network experienced a dramatic increase in capital investment over the last six years, with over $45 billion in electricity network infrastructure planned for the period 2010 to 2015 alone.
The fact that CSP may be developed with or without storage, at a variety of scales, and may be hybridized – for example with biomass or natural gas – means grid integration is relatively straightforward, in comparison with some other renewable energy options. Further, the potential network services offered by CSP are both reliable and flexible.
The central premise of this study is that rather than continuing to invest, by default, in increasing the capacity of a transmission and distribution network system designed for centralised power generation to meet growing peak demand, facilitating distributed generation or demand reduction options may provide cost effective alternatives. Increasing the deployment of these decentralised energy options, and CSP in particular, could concurrently enable greater deployment of renewable energy in the electricity system, and reduce total system greenhouse gas emissions.