Finance Finance News Why we should terror-proof our energy grids

Why we should terror-proof our energy grids

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The detailed energy policy released by the Greens at the weekend is the most ambitious plan yet for boosting renewables, which leader Richard Di Natale thinks should supply 90 per cent of the nation’s power by 2030.

That’s a step change from Labor’s plan for 50 per cent renewables, or the Coalition’s plan to cut carbon emissions by 26 per cent, over the same period.

The policy calls for the creation of a new agency – ‘Renew Australia’ – to oversee a blend of private and public investment in various renewable technologies, and puts a lot of emphasis on ‘smart grids’ powering the country.

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A smart grid is one that is powered by numerous sources – large-scale solar, wind, hydro, biomass and wave-powered generators, small-scale rooftop solar systems, and some conventional coal and gas generators.

The ‘smart’ part of the network is the way consumers can generate their own power, store it in new-generation battery devices, and sell what they don’t need to other network users.

The economics of home power generation and storage have changed rapidly in the past two years. That has mainly been driven by cheaper rooftop solar panels, and by developments such as the home-storage lithium-ion batteries being produced by Elon Musk’s ‘giga-factory’ in the US.

Rooftop solar panels have helped consumers in more ways than one. Photo: AAP

That process needs to be managed carefully, however, as consumers rushing to go ‘off-grid’ could not only destroy the business model of existing generators and retailers, but could leave behind large ‘Mad Max‘ pockets of energy poverty – hence the Greens’ suggestion to allocate $100 million per year to their Renew Australia agency to oversee that transition.

It’s an expensive plan, but as the Greens’ policy documents point out, it is one that aims to pre-empt major economic challenges that are already unfolding.

Foremost among these are the tougher constraints on carbon emissions expected to be negotiated at the Paris climate conference next week.

But regulation of carbon emissions is not the only force at work in the energy markets. The cost of renewable energy and storage technologies has plummeted in recent years, and demand for conventionally generated power has been falling – the so-called ‘death spiral’ in which conventional grid operators respond to falling demand by increasing power prices, which further depress demand.

Meanwhile, another reason for shifting to smart grids became shockingly clear at the end of last week’s spate of terror attacks.

Crimea energy
Almost two million people on the Crimean Peninsula were left without light or heat after explosions damaged power lines from Ukraine. Photo: AAP

On Friday, Ukrainian nationalists blew up electricity pylons carrying power to two million people in Crimea on Russia’s western border.

The nationalists attacked lines supplying power from Ukraine to the Crimean territory annexed by Russia in early 2014.

That resulted in Crimea declaring a state of emergency, with authorities saying that it would take four days to get things up and running again.

What the attack illustrates is the strategic vulnerablity of grids with highly centralised power generation.

The smart grid model is not vulnerable in the same way, because it is predicated on highly decentralised power sources.

In Australia’s case, that would include more than a million solar PV systems already installed on the nation’s rooftops.

Mr Di Natale told The New Daily on Monday: “With smart grids, you’ve got a lot of local generation and storage – we call that the democratisation of energy. But looking at it through the security lens, it’s also a way of safeguarding that infrastructure against deliberate harm.”

The economic forces pushing Australia towards energy efficiency, towards a more diverse mix of energy sources, and towards more technologically advanced energy distribution have been clear for some time.

But if another reason were needed to accelerate that process, the current burst of extremist violence and destruction has highlighted a vulnerability that new energy technologies and smarter grids will largely remove.

Read more columns by Rob Burgess here


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