RenewEconomy has recently been flooded with stories from rural areas of Australia about utility operators installing poles and transmission wires where they could have used storage and microgrid technologies for half the cost. This comes from what the utilities feel are valuable and what the incentives are put toward.

So what would happen if the incentives were changed, so that instead of just being there to support a “bigger grid”, they were used to support smarter infrastructure such as storage systems and smart technology such as frequency and voltage controls, load shifting, smoothing etc.

Because if the utilities – instead of hitting everyone with costs to upgrade the grid – focused that expenditure on subsidising battery storage, then the value proposition changes enormously. At $2,000 per kW/kV, the payback to households for installing battery storage with solar PV is 6.9 years; at $4,000 per kW/kVa, the payback is 2.3 years.

The problem with moving toward smart technology and storage is that the regulations haven’t yet caught up with the new technologies. If the regulations were to include storage and smart technologies, utilities might be more inclined to adopt them - simply because of the economic incentive - and better accommodate the demands on the grid as well as reducing the costs of running the grid.

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