Affordable, sustainable energy for all – transforming electricity supply in Australia and Indonesia

Access to affordable, reliable energy transforms communities. For most Australian and Indonesian families and businesses, that energy still comes from national grids – the networks of power lines that connect users
to power suppliers.

But about 67 million Indonesians – almost a third of the country’s population – are not on the grid. They either rely on expensive, non-renewable sources of power – often diesel – or they have no access to power at all. That poses a critical challenge for sustainable development of Indonesia – a nation of islands. To meet the Indonesian government’s goal of 90 per cent electricity coverage by 2020 the country’s electricity generation must grow by nine per cent per year.

Australia also has many remote indigenous communities, island communities and remote mine sites that rely predominantly on electricity generated locally from expensive to deliver, and CO2 emitting diesel.

And the concept of the energy grid is changing. For example, some new Australian suburbs may be going ‘off the grid’. Such suburbs would use renewables such as solar and wind, supported by battery storage and gas to create microgrids that essentially run independently of the national electricity grid.

So what are the best ways to transform energy supply in the two countries? The answers may not be simple.

In communities not yet reliably connected to the grid, there is now the technological opportunity to ‘leap-frog’ into the “future grid” by tailoring development to suit the nation’s geography and local requirements.

Both countries have also large reserves of coal, natural gas and other fossil fuels but have committed to ‘decarbonising’ the energy system.

The Australia Indonesia Centre has created an “Energy Cluster” of applied research projects to explore:
• Local scale solutions by assessing, modelling and trialling microgrids
• National scale strategy development by modelling the deployment of microgrids, assessing future technology options, and identifying the policy and regulatory frameworks needed.

Key Themes

1. Microgrids and remote area networks

This theme will focus on the technical and economic assessment of decentralised electricity provision options configured as microgrids with substantial levels of renewable sources and energy storage. Covering both off-grid and grid connected microgrids, this work is of importance for both Australia and Indonesia. In Indonesia microgrids are being considered as a key solution for remote area and island electrification while in Australia microgrids are being considered for development both within cities, as a cost mitigation mechanism, and in remote area and indigenous communities, islands, and mine sites to provide an affordable alternative to expensive and high CO2 diesel generation.

This theme will focus on development of new and efficient ways of designing microgrids integrating newer technologies such as solar PV, batteries, and smart grid technologies with existing small scale technologies such as biomass and micro-hydro.

2. Energy System Transformation Pathways

This theme will investigate the development of centralised electricity provision including the trade-offs with local area microgrids. The objective of this research theme is to develop an Energy system investment transformation and operation model that can be used to map out the energy future at a system level and inform decisions by investors, policymakers and the community on the best decision strategies in order to ensure an economically optimal mix of technologies under many future scenarios.

3. Technology Assessment

The decisions, models and system designs that are developed in the first two themes are critically dependent on the characteristics of new technologies for the production, transportation and management of electricity. Particularly important are the cost, ease of integration, and deployments times that can all vary over time and context. Additionally their energy feedstocks or energy resource availabilities are often geographically diverse, and their capital costs will decline significantly over time for the newer technologies. The best ways to understand and model how these characteristics may change for new technologies is a relatively new field of study, as is the use of these models for making investment decisions. A rigorous treatment and enhancement of the application of these methods is fundamental to developing confidence in the results of investment models.