Submission: Resilient and adaptive residential assets
5 October 2023
IGCCs submission to the Senate inquiry on residential electrification discusses demand-side investment opportunities via the aggregation of actively controlled Distributed Energy Resources (DERs). The submission considers how such scaled, orchestrated DER opportunities can reduce long-term electricity price inflation and create enduring social, employment, and health benefits for Australian families.
Decarbonising the electricity sector over the next 10-15 years is central to achieving net-zero emissions for Australia by 2050 and electricity grids powered by 82% renewables by 2030. During this time, Australian homes will electrify, contributing to the 6GW of additional capacity required annually to 2035 to be in-line with least-cost national emissions pathways.
Residential electrification plays a key role in Australia meeting it renewable energy targets. Aggregated residential Distributed Energy Resources (DERs) – household solar arrays, batteries, heat pumps, electric vehicle charging infrastructure, etc. – can be orchestrated to reduce electricity demand during critical periods of limited supply, such as winter weeks with low wind and solar outputs. This reduces the required spend on electricity supply infrastructure, reduces electricity prices, and provides stability during peak events.
The net cost of providing resource adequacy from aggregated residential electric infrastructure has been modelled to be roughly only 40% to 60% of the cost of the alternative options, including gas peaking plants and utility-scale batteries.
Aggregated residential demand, generation, and storage can create new market opportunities for sophisticated investors searching for low-carbon investments. Such demand-side opportunities can accelerate the uptake of residential electrification, with investors able to generate a trifurcate of social good by reducing household energy bills, improving health outcomes, and creating jobs; all while contributing to decarbonising the grid and assisting Australia in meeting its Paris targets.
Residential electrification can assist IGCC members in meeting their own net-zero investment targets and deploying more capital to assist in the decarbonisation of the Australian economy.
The IGCC supports the Government’s existing efforts to decarbonise Australian residences, most notably through the Clean Energy Finance Corporation’s Household Energy Upgrade Fund, and encourages more efforts to be made.
Read the full submission.