(Un)common sense in the National Electricity Market grid design

Nov 7, 2022
Aerial view of a high voltage substation.Industrial power tower background.

In a recent (21 October) edition of Pearls and Irritations, Roger Beale suggested (amongst other things) that the Commonwealth should “seize sole control of the national electricity market” (the NEM) to bring stability to the energy transition and stop the states going their own way.

But what if the most sensible longer term option is to have the Commonwealth seize control of the NEM, not to stop the states going their own way, but in order to encourage a much greater degree of decentralisation – down to community/local government level?

One hundred years ago, the grandfather of one of the authors was the electrical engineer for the Borough of Maryborough (Victoria) electrical system. At the time, as was common throughout the state, the borough council provided the town with both electricity and gas from local borough facilities. Within a few years, the State had taken over all of these local electrical generation and distribution systems and consolidated supply through the State Electricity Commission (SEC). Centralised state-based electricity supply from large brown coal burning generators, mainly in the Latrobe Valley supplemented by Snowy hydro has continued up to the present day, with a change to separate privatised providers of generation, transmission, distribution and retailing in the 1990’s. But in the last decade we have had the gradual intrusion of wind and solar generation – and most particularly solar generation from household solar systems (known as “distributed” generation in the jargon). Other states have followed a similar, if not identical pattern.

The urgent need is to move to 100 per cent renewable generation as soon as possible, but the path to this target is not clear. Availability and reliability of supply is still replete with unresolved technical issues regardless of how many ad hoc proposals are made for (scarily expensive) new transmission corridors or this week’s “world’s biggest battery”.

However, with the largest proportion of that generation increasingly coming from literally millions of households rooftop solar systems should we also be considering a return to the community-based electrical systems of the 1920’s? There were 7.5 million separate houses in Australia at the last census and the latest Australian Energy Market Operator (AEMO) Integrated System Plan (ISP) says aggregate power from domestic solar will be in excess of 85 GW by 2050 and will constitute the single largest proportion of total power demand. Currently the NEM’s peak demand is 35GW and 15GW is from rooftops (AEMO 6 October 2022).

Renewable energy generation has confronted electricity supply systems with two problems that did not exist with our legacy systems and which all nations’ systems are struggling to resolve. The first is a capacity to store large quantities of electricity on a scale never previously imagined and the second is to maintain the stability (frequency and voltage) of the electricity supplied.

All of the electrical energy generated must be consumed – by households, as well as commercial and industrial enterprises. Any energy generated and not consumed has to be stored by charging batteries, pumping to increase water level for hydro, lifting weights, compressing air, heating sand or other materials or techniques yet to be discovered. In Australia our proposed storage solution is based around building thousands of kilometres of transmission lines to tap areas of the country where the sun may be shining or the wind blowing, constructing more pumped hydro and building more and ever larger battery farms.

Our stability solutions are a work in progress.

All NEM generator market participants, be they solar, wind or pumped hydro supply their customers (known as “load”) via zone substations fed by transmission lines. Many zone substations are now becoming subject to reverse power flow in periods of high insolation (sunlight) due to our high and growing domestic solar infeed. This can be a serious voltage control problem for the network at those times and will require the installation of very expensive control mechanisms.

The use of batteries in domestic solar and installation of community batteries will reduce reverse power flow during high insolation and also reduce zone substation inflow from external generation sources after sunset. In sum: local generation, i.e., within zone substation connected networks, is increasingly capable of meeting local consumption and therefore less reliant on power delivered via transmission lines.

Should we therefore be putting a hold on some of those multi-billion dollar interconnector transmission links? As technology stands today, the answer is ‘no’! Or rather, not until an engineering review of the NEM has taken place. The problem we have is that for all the infeed and consequent reverse power flow as well as diminishing demand due to batteries, the transmission links connecting zone substations to external generators are still required to provide stable voltage and frequency for the millions of domestic solar systems. This technical requirement is lightly passed over, but shouldn’t be.

But what if zone substations had their own stable voltage and frequency source? That would imply connecting suitable generators in place of the transmission links – in practice, moving proposed new generation to substation locations. Common sense is to put generators close to consumption points (unless there are votes in pork-barrelling a distant electorate!) In the past the capital cost per megawatt for low rating plant has seen investment in large, central plants and capital expenditure in transmission. New technology, for example aeroderivative turbines, and battery-supported voltage forming inverters could be economically-justified solutions for substations with reduced external demand because of large aggregate capacity solar and batteries within their networks.

Following the above line of reasoning, some zone substations with sufficient ‘within network’ capacity could get ‘off the (transmission) grid’ and this opens a new NEM paradigm. In sum, the answer to future grid development doesn’t necessarily lie in more transmission if zone substations are heading towards large periods of self-sufficiency. The question of what happens when the sun doesn’t shine or the wind doesn’t blow is then answered by local zone substation generation (e.g. by aeroderivative turbines) supported by battery or other storage serving voltage forming inverters.

Because the supply of electricity requires a 99.999 level of availability, a certain amount of oversizing of localised generation, as described, would be needed. However, planning of ‘within network’ battery and solar resources would allow picking a safe level of overcapacity.

A consequence of turning distribution networks into basically self-supporting energy systems is that the idea of the interconnected NEM becomes obsolete. As novel as this might appear, we must recognise that Australia is a standout in the adoption of rooftop solar. Having started on the journey, we might well be advised to take stock of where we are rather than apply traditional ‘one way’ electrical power flow models.

A regional approach would allow the combinations of certain zone substations into one ‘self-sufficiency’ region, utilising existing sub-transmission assets connecting them. The continuing development path as suggested here could see the abandonment of the absolute requirement for across-region synchronicity.

The latter, given the long, skinny transmission networks we have in eastern Australia, ones with large voltage angle differences, already poses technical challenges, likely to be exacerbated by more renewables.

The substance of the exposition of independent regional substations as set out above is to focus attention on the urgent need for a centrally directed engineering approach to the NEM grid if we are to have safe, reliable stable electricity for the Australian population and one that is affordable. There can be no doubt that the disparate moves of siting large storage batteries and planning of transmission interconnection links in the absence of the economic considerations attaching to an overarching engineering plan taking distribution networks into account, can at best result in massive overspending.

Worryingly, even in overspend situations we may not achieve the nationally desired reliability and stability standards.

Getting the transition right does have massive upside above and beyond eliminating emissions. Australia is a world leader in the transition and if we can develop solutions to the technical problems involved we will have the basis for a massively expanded high-tech, scientific-based and export-orientated future manufacturing and education industry. This is where we can find the real potential to be a “renewable energy super power”.


Phil Kreveld is an electrical engineer living in Melbourne with many decades of experience working across a range of electrical industry fields in Australia and overseas. He is also a frequent contributor to a range of industry publication.

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