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5 ways of visualising emission reduction pathways

Many of our services involve the development of emission reduction pathways, which greatly enhance climate change action plans. In this blog post, we will show you 5 common ways to visually display such a pathway. Seeing these different illustrations can help you to shape how you would like to present your own organisation’s pathway towards a low carbon future.

Introduction

What are emission reduction pathways?

Emission reduction pathways allow for the easy communication of

  • where your organisation is currently at in terms of greenhouse emissions (or energy consumption)
  • where you can be through the implementation of reduction measures that are feasible and cost-effective over time
  • where you would be in the absence of any measures to reduce emissions

Pathways usually start with your selected baseline year and end at some point in the future, typically at 2030, or when agreed or proposed targets are to be met.

What do emission reduction pathways cover?

Boundary:

Your emissions boundary will typically consider three things:

  • The level of an organisation or region you want to assess in terms of emissions reduction. This could be a single site, an asset class (e.g. community buildings), a Division in an organisation, a whole organisation, a town or community, and up to State and National levels.
  • The emissions and energy sources that you want to evaluate. For example, electricity, natural gas, petrol, diesel, refrigerants, waste, wastewater and so on.
  • The Scopes of emissions you want to include. Typically Scope 2 (electricity) is included, and material Scope 1 emissions (on-site combustion or direct emissions). Selected Scope 3 emissions may also be included, such as upstream emissions associated with energy usage and waste.

Units of measure:

The unit for reductions or savings to be modelled will typically be tonnes of greenhouse gas emissions, or a unit of energy, such as kilowatt-hours or megajoules.

What greenhouse gas reduction measures are considered in abatement pathways?

For most organisations greenhouse gas reduction measures usually relate to six high-level carbon abatement areas as shown in Figure 1 below, being

  • Energy efficiency
  • Management of waste and other Scope 3 emissions sources
  • Sustainable transport
  • Local generation of renewable energy such as rooftop solar PV
  • Grid decarbonisation
  • Buying clean energy and/or carbon offsets

These high-level categories can be further broken down into as many subcategories as relevant within your selected organisation boundary.

Figure 1: 6 categories for carbon reduction opportunities

The need for a graphical representation of emissions pathways

For many people, it is hard to engage with complex data presented in a table or report. In our experience, it is most effective if abatement potential can be shown in a graph. The visual representation of a carbon abatement pathway allows people to better grasp the overall opportunity for abatement, where this will come from, and the timeframes involved.

It also helps organisations to better communicate their plans to their stakeholders, be they internal or external. Simple and well-presented graphics can also help when seeking decisions to budget for and implement cost-effective measures.

5 ways to graphically represent emission reduction pathways

There are many different ways you can display an emissions reduction pathway; some are more suited to specific circumstances than others. The five examples we are using in this blog post are:

  1. Line chart
  2. Waterfall chart
  3. Area chart
  4. Column chart
  5. Marginal Abatement Cost Curve (MACC)

Let’s look at these examples in detail.



Example #1 – line chart

A line chart is a simple but effective way to communicate a ‘Business-as-usual’ or BAU pathway compared with planned or target pathways at a total emissions level for your selected boundary. Such a boundary could be comparing your whole-business projected emissions with and without action to reduce greenhouse gases.

This type of graph is also useful to report on national emissions compared with required pathways to achieve Australia’s Paris commitments, for example.

Figure 2: Example of a line chart

Example #2 – waterfall chart

A waterfall chart focuses on abatement measures. It shows the size of the abatement for each initiative, progressing towards a specific target, such as 100% renewable electricity, for example. It is most useful to highlight the relative impact of different actions, but it does not show the timeline of implementation.

Figure 3: Example of a waterfall chart

Example #3 – area graph

Area graphs show the size of abatement over time and are a great way to visualise your organisation’s potential pathway towards ambitious emissions reduction targets.

They do not explicitly show the cost-effectiveness of measures. However, a useful approach is to include only measures that are cost-effective now and will be in the future, so that decision-makers are clear that they are looking at a viable investment plan over time to lower emissions.

Figure 4: Example of an area chart that shows reduction actions and diminishing emissions

Another option of displaying an area chart is shown in Figure 5. In this area chart, the existing emission sources that reduce over time are not a focus, and instead, the emphasis is on emission reduction actions. You may prefer this version if there is a large number of reduction measures, or if you include fuel switching actions.

Figure 5: Example of an area chart which emphasises emission reduction actions



Example #4 – column graph

A column graph is similar to the area graph but allows for a clearer comparison between specific years compared with the continuous profile of an area graph. In the example column graph below, we are looking at Scope 1 and Scope 2 emissions, as well as abatement in an organisation over a 25-year timeframe covering past and future plans.

In the historical part, for instance, we can see Scope 1 (yellow) and Scope 2 (blue) emissions in the baseline year. The impact of GreenPower® (green) on emissions can be seen in any subsequent year until 2018.

Going forward we can see in any projection year the mix of grid decarbonisation (red), new abatement measures (aqua) including fuel switching and renewables purchasing, as well as residual Scope 1 and 2 emissions.

Figure 6: Example of a column chart

Example #5 – Marginal Abatement Cost (MAC) Curve

MAC curves focus on the financial business case of abatement measures and the size of the abatement. MAC curves are typically expressed in $/t CO2-e (carbon), or in $/MWh (energy), derived from an assessment of the net present value of a series of investment over time to a fixed time in the future.

The two examples below show MAC curves for the same set of investments across an organisation. Figure 6 shows the outcome in 2030, whereas, in Figure 7, it is to 2040 when investments have yielded greater returns.

MAC curves are a good way to clearly see those investments that will yield the best returns and their contribution to your overall emissions reduction goal.

Figure 7: Example of a Marginal Abatement Cost curve with a short time horizon

Figure 8: Example of a Marginal Abatement Cost curve with a longer time horizon

Please note that no one example is superior over another. It depends on your preferences and what information you would like to convey to your stakeholders.

100% Renewables are experts in putting together emission reduction and renewable energy pathways. If you need help with determining your strategy, targets and cost-effective pathways, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

Shrinking your combined load profile [includes video]

In June, Barbara, our Co-CEO, presented at the Renewable Cities Australia conference at the International Convention Centre in Sydney. The topic of her talk was ‘Reaching ambitious energy efficiency and renewables’.

At the core of her speech was a demonstration of how the combined load profile of a typical metropolitan local council changes after the implementation of energy efficiency and onsite renewable energy.

Please note that a video of the ‘shrinking load profile’ is included at the bottom of this post.

What is a load profile?

A load profile shows how your energy demand changes over a 24-hour period, from meter data that your energy retailer can provide on request or via a web portal linked to your account.

Meter data starts and ends at midnight and is usually in half-hour or 15-minute intervals. The vertical axis shows your energy demand in kilowatts as it changes over this time. The less your energy demand, the lower the curve.

A load profile can also be called ‘interval data’ and is a very useful tool for analysing your energy consumption. For example, a load profile can identify equipment that is running unnecessarily at night or may show you spikes in your energy consumption that hint at inefficient operation of equipment. Changes in your profile from summer to spring or autumn can give you an idea of the energy use needed for cooling in a building.

You use load profiles to help you identify how you can be more energy efficient, and they can also help you to size your solar PV installation.

What is a combined load profile?

A combined load profile adds the demand for all your sites to show you the overall energy demand of your organisation. This information is particularly important when you buy energy via a renewable energy Power Purchase Agreement that is supply-linked.

Building up a combined load profile

In this blog post, we build a combined load profile for a metropolitan local government. Figure 1 shows the combined demand of small sites, like small libraries, amenities blocks, community halls and childcare centres.

Energy demand typically rises sharply in the morning as people start to use these facilities, and it falls as people leave them in the evening. At night there is usually demand for appliances, small servers and emergency and exit lights.

Figure 1: The energy demand of small sites



Now, we are adding the electricity demand for large sites on top of the small sites. Examples for large sites are central administration offices & chambers, depots and aquatic centres. Night demand for depots and offices may be low with good after-hours controls. However, pools are usually heated all the time and can be energy-intensive at night.

Figure 2: The energy demand of large sites

The surprising thing for metropolitan councils is that most of the energy demand happens at night, through streetlighting, which runs from dusk until dawn. Streetlights can consume as much as half of a metropolitan council’s electricity! This creates a combined profile with high demand at night and a big dip in demand during the day.

Figure 3: The energy demand of streetlighting

Lastly, we add parks and sporting fields. Most of the energy demand for sporting fields is lighting and irrigation, so naturally, this demand also occurs from late in the evening (sporting field lights) to early morning (irrigation).

Figure 4: The energy demand of parks, ovals and fields

The impact of onsite energy efficiency and renewable energy measures on the combined demand profile

Now that we have a load profile that aggregates energy demand across all sites, let’s implement onsite abatement measures such as energy efficiency and solar PV.

So that you can see the impact of these measures, we are providing a visual cue to show you where our starting line is, because now we start subtracting.

Figure 5: Implementing onsite measures



Energy efficient lighting for parks and sporting fields

LED lighting replacements and smart controls for parks, ovals and fields can lead to a 40-70% reduction in energy demand. At the same time, you may improve your service provision through better lighting, more activated fields and higher utilisation. The net benefit is shown in Figure 6. A reduction in energy demand brings down the whole load profile from the starting point.

Figure 6: Lighting replacement for parks, ovals and fields

Figure 7 shows the impact of a bulk upgrade to LED lighting for local roads. LED streetlights are 60-80% more energy efficient than older technologies such as Compact Fluorescents or Mercury Vapour.

Figure 7: Streetlighting upgrade for local roads

Figure 8 shows the impact of a bulk upgrade to LED lighting for main roads, with similar levels of savings as local roads. Smart controls such as dimming can further increase savings for streetlights.

Figure 8: Streetlighting upgrade for main roads

Implementing energy efficiency improvements to lights, air conditioning, IT systems, appliances, motor systems and building controls at your facilities can achieve at least a 10% reduction, but more might be achievable. It depends on your individual circumstances and what measures you have implemented in the past.

Figure 9: Energy efficiency at Council sites

Installing onsite solar PV

Figure 10 shows the impact of installing onsite solar PV at your sites. You can see the dip in the load profile in the middle of the day, as the solar energy generation reaches its maximum.

Figure 10: Impact on Solar PV

Battery storage will allow further savings in your electricity and peak demand. Figure 11 illustrates how stored solar energy can reduce a building’s peak demand in the afternoon when peak demand charges might apply, thus reducing power bills.

Figure 11: More Solar PV and battery energy storage



What the load profile was and what it could be

So, we have implemented a number of cost-effective efficiency and renewable energy measures, and we can see that demand has reduced significantly. Figure 12 shows what the load profile looked like before implementation of any actions, and what it could be through energy efficiency and onsite solar PV.

Before you think about switching your electricity supply to offsite renewables (e.g. through a Power Purchase Agreement), you should consider the changes behind-the-meter measures like energy efficiency and solar PV can make to your energy demand, and how this can lower the amount of energy you need to buy over time.

Figure 12: Summary of what load profile is and what it could be

Switching your electricity supply to renewables

Figure 13 shows what remains of your original load profile. The next step will be to switch from conventional electricity supply to 100% renewable energy. This can be staged over time or may be possible all in one go.

Figure 13: Offsite opportunities like PPAs

Goals achieved!

In our experience, by implementing onsite energy efficiency and renewable energy measures, you can save 30-40% in electricity demand. By switching your supply to renewables, you can also achieve 100% renewable energy.

Figure 14: Goals Achieved!

You can watch a video of the shrinking load profile here:

Would you like to see how much you could reduce your load profile?

100% Renewables are experts in helping organisations develop their renewable energy strategies and timing actions appropriately. If you need help with analysing your load profile and with developing your renewable energy plan, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

Challenges with achieving ambitious targets

Challenges with ambitious targets
Challenges with ambitious targets

In part 1 of the blog series, we investigated what the scope of your climate change target could be. In part 2, we looked at the global and national goals you should be aware of. In this blog post, we will shed light on some of the challenges that you may face when setting ambitious goals.

Striking a balance

Setting targets is often about striking a balance between what we know can be achieved with today’s commercially available solutions and what will be available in coming years.

This is why many targets for renewable energy, for example, are 100% by 2030. It is expected that battery storage for solar and renewable energy sourcing for energy supply will be readily available and cost-effective by that time.

Interim targets tend to focus on onsite measures that are known to be cost-effective now, such as energy efficiency and solar panels.

Challenges with achieving ambitious targets

In our experience, both interim and ambitious long-term targets can present challenges for you. Here is a list of some of those challenges.

Ongoing internal support, resources and funding

This is often the most common barrier and challenge; how to gain and sustain the support and funds internally to make efficiency and renewable energy initiatives happen. There are usually limited funds, competing priorities and resources are stretched.

Without internal support at senior level as well as people to develop business cases and implement projects, most programs do not last or succeed.

Strategy tips:

  1. One or a few key staff and managers who want to see continued action on renewables and emissions reduction, and make it a priority on an ongoing basis.
  2. Having clear financing strategies for renewables, efficiency and other emissions reduction measures, including awareness of state and federal incentives such as the Energy Saving Scheme and the Renewable Energy Target, a consideration to fund from Capex or a loan, revolving energy funds or similar.
  3. Alignment of renewable energy and emissions reduction plans with your organisation’s strategy so that this is embedded in your organisational priorities.

Understanding electricity markets and your energy purchasing processes

Energy procurement will most likely deliver the bulk of your organisation’s ambitious renewable energy goals, so without a plan, you may not be able to achieve an ambitious renewable energy goal ahead of the ‘greening’ of the grid.

The ability to meet an ambitious renewable energy goal cost-effectively is heavily influenced by how you source electricity from the market. Whereas in the past, GreenPower® was available, but at a cost premium, many organisations are now able to source energy from renewable energy projects at similar or even lower cost than conventional power.

Strategy tips:

In this rapidly evolving environment, you need to take time to understand how the electricity market and renewables procurement work and develop your energy sourcing strategy accordingly. In particular, investigate the following aspects of energy procurement:

  • The current and future electricity and renewable energy market
  • Contract terms for renewable energy supply
  • Types of contracts for renewable energy purchasing
  • Interest in collaboration or partnering for volume to achieve better pricing are all aspects of energy procurement

Transport and waste

Transport and waste can be sources of large carbon emissions. However, solutions to achieve step-change in energy demand, renewable energy or carbon emissions can be limited, particularly if your organisation is already focusing on emission reduction in these areas.

In our experience, the level of focus on carbon emissions and renewables for these sources is low or lags the focus that is applied to electricity and stationary gas. This often leads to the omission of these sources from targets.

An emerging aspect of this is the potential for electrification of vehicles to change electricity demand and thus increase the amount of renewable electricity that needs to be sourced to meet ambitious targets. Some organisations are beginning to assess their future energy demand with an EV fleet and incorporate this into their long-term forecasts.

Strategy tips:

Consider including transport and waste in future targets if they are not already part of your goal. Make sure that you apply appropriate resources to understand opportunities and future trends.

The emergence of electric vehicles will introduce new challenges for the identification of new opportunities. A good strategy is to forecast what changes will occur and when. This may not be a significant factor for the next 4-5 years but will almost certainly be a more important issue as we approach 2030.

Organisational growth

While you are implementing efficiency and renewables, your energy demand may grow with organisational growth. Your emissions intensity may reduce, but your absolute emissions may still be growing.

Strategy tips:

The greater the level of organisational support and understanding of the nature, scale and timing of opportunities, as well as an understanding of the type and scale of changes that will occur to your assets over time helps to set targets that are realistic and achievable.

You need to take these changes into account so you know what combination of emission reduction options can help you meet your target in the most cost-effective way.

Conclusion

You may find you have only achieved a small part of your goal after a few years, despite the fact you have progressed several onsite solar and energy efficiency projects. Often, building energy efficiency and onsite solar can deliver part of the solution, but each project is individually small.

This is beginning to change with cheaper solar panels making larger-scale systems cost-effective, which in turn has a greater impact on emission reduction and onsite renewable energy generation.

The overall effort towards ambitious goals is likely to include a small number of measures that have individually significant impact (e.g., a renewable energy PPA), plus a large number of small measures that have low impact but are good for the bottom line.

Your strategy to meet ambitious targets should include both these measures.

100% Renewables are experts in helping organisations develop their renewable energy strategies and timing actions appropriately. If you need help with developing a target and action plans that help you meet this target, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

Target setting – Global and national goals you should be aware of

In part 1 of this blog post series, we investigated what the scope of your climate change target could be. In part 2 of this series on target setting, we will look at the global and national goals that you should be aware of.

Global bodies, countries and states are setting targets that reflect global concerns about climate change. An increasing number of organisations are also setting ambitious targets and seeking to provide leadership.

Global context for action

Internationally, there are three primary drivers for urgent action on climate.

Sustainable Development Goals (SDGs)

In 2015, countries adopted the 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals. Governments, businesses and civil society together with the United Nations are mobilising efforts to achieve the Sustainable Development Agenda by 2030[1]. The SDGs came into force on 1 January 2016, and call on action from all countries to end all poverty and promote prosperity while protecting the planet.

Paris Agreement and Science Based Targets

To address climate change, signatory countries adopted the Paris Agreement at the COP21 in Paris on 12 December 2015. The Agreement entered into force less than a year later. In the agreement, signatory countries agreed to work to limit global temperature rise to well below 2°C Celsius, and given the grave risks, to strive for 1.5°C Celsius[2].

Targets adopted by organisations to reduce carbon emissions are considered “science-based” if they are in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement—to limit global warming to well below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C.

If you are interested in reading more about Science-Based Targets (SBTs), please read our blog post on ‘Science-based targets in a nutshell’.

Special IPCC report on 1.5°C warming

In October 2018 in Korea, governments approved the wording of a special report on limiting global warming to 1.5°C. The report indicates that achieving this would require rapid, far-reaching and unprecedented changes in all aspects of society. With clear benefits to people and natural ecosystems, limiting global warming to 1.5°C compared to 2°C could go hand in hand with ensuring a more sustainable and equitable society[3].

GLOBAL CONTEXT FOR ACTION ON CLIMATE
Figure 1: Global context for action on climate change

In addition, the World Economic Forum’s Global Risks Report 2019[4] highlights climate change-related outcomes as among the most likely to occur with the highest impacts to the global economy.

GLOBAL RISKS REPORT – LIKELIHOOD AND IMPACT OF CLIMATE AND OTHER RISKS TO THE GLOBAL ECONOMY
Figure 2: Global risks report – likelihood and impact of climate and other risks to the global economy

National, States and Territories targets

At a national level, Australia’s response to the Paris Agreement has been to set a goal for carbon emissions of 5% below 2000 levels by 2020 and GHG emissions that are 26% to 28% below 2005 levels by 2030. A major policy that currently underpins this is the Renewable Energy Target (RET). This commits Australia to source 20% of its electricity (33,000 GWh p.a., estimated to equate to a real 23% of electricity) from eligible renewable energy sources by 2020. The scheme runs to 2030. These two key targets are illustrated below.

Australia’s renewable energy and carbon goals – National level
Figure 3: Australia’s renewable energy and carbon goals – National level

 

At a sub-national level, most states and territories have established aspirational emissions targets as well as some legislated targets for renewable energy.

AUSTRALIA’S RENEWABLE ENERGY AND CARBON GOALS – STATE & TERRITORY LEVEL
Figure 4: Australia’s renewable energy and carbon goals – state and territory level

Setting a goal for your organisation

In setting a target for your organisation, you should consider global, national and goals of other companies in your sector. You should also evaluate energy efficiency and renewable energy opportunities in your organisation to know what you can achieve with onsite measures. Offsite measures like procuring renewables or purchasing carbon offsets can help you with achieving more ambitious goals.

In part 3 of this series, we will look at challenges with achieving ambitious targets.

100% Renewables are experts in helping organisations develop their carbon reduction strategy and advising on appropriate goals. If you need help with developing your targets, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

 

[1] Sourced from https://www.un.org/sustainabledevelopment/development-agenda/

[2] Sourced from https://www.un.org/sustainabledevelopment/climatechange/

[3] Sourced from https://www.ipcc.ch/news_and_events/pr_181008_P48_spm.shtml

[4] https://www.weforum.org/reports/the-global-risks-report-2019

Target setting – What should be the scope of your target?

This blog post has been updated in Dec 19 to reflect the re-branding of NCOS to ‘Climate Active’. 

Setting climate change targets is an important part of developing a renewable energy or carbon reduction strategy for your business. Targets will provide guidance and direction, facilitate proper planning, set employee expectations and will help you evaluate organisational performance against your stated goals.

With a goal, you will let everyone know about where your organisation is headed. With a strategy that supports your targets, you will know how to get there in the most efficient way.

In this blog post, we would like to share a few common questions about the basics of goal setting and about the scope of your target. In the next blog post, we will talk about global, and national goals you should be aware of.

Should you set yourself a target before or after you develop your renewable energy strategy?

In general, we would recommend that you develop your strategy and action plans first to evaluate what level of reduction will be possible with energy efficiency and renewable energy measures. This will tend to lead to targets that are known to be realistic and achievable. However, an ambitious and inspirational target can signal what an organisation values and wants to achieve. It can also motivate to identify and develop the solutions that will lead to the goal.

Should you set yourself a carbon emissions or renewable energy target?

There are many ways targets can be set. In the context of climate change mitigation, the most common targets relate to either carbon emissions or renewable energy.

Carbon reduction targets

Carbon reduction targets can be in absolute or relative terms. For instance, you could set yourself an absolute reduction target of 40% by 2025 from the 2018 baseline. You could also set yourself a relative reduction target, which measures your reduction activities against a figure like your production output, staff numbers, operating hours or square metres. An example would be ‘achieve a 50% reduction of our carbon emissions/FTE by 2023 from our 2016 baseline’.

Renewable energy targets

Renewable energy targets are usually expressed as the percentage of energy you would like to source from renewable energy. For example, you could have a goal for your organisation to be ‘50% renewable by 2025’.

What should you include within the scope of your target?

Renewable energy targets

In the context of a renewable energy goal, you will need to choose whether you will just focus on electricity, whether you would like to include stationary fuels like natural gas, or whether your goal extends to transport energy as well.

WHAT YOU CAN INCLUDE IN A RENEWABLE ENERGY TARGET
Figure 1:  What you can include in a renewable energy target

Carbon emissions targets

In the context of a carbon emissions goal, you will need to think about what kind of emission sources, or what kind of scopes you would like to include.

For instance, you could focus on

  • Carbon emissions directly associated with the burning of fuel and use of electricity (Scope 1 and Scope 2 emissions respectively per greenhouse gas accounting).
  • Carbon emissions indirectly associated with fuel and electricity consumption – i.e. upstream extraction, production and transport processes for fuels and electricity (Scope 3 emissions),
  • Carbon emissions associated with the running of your operations such as air travel, employee commute, consumables, catering, emissions from your waste, and other upstream and downstream emissions (Scope 3 emissions).

Factors to consider

When considering what should be included in targets, it is important to consider several factors:

  • Energy that you can influence or control. Typically, stationary electricity is easy to include as solutions are available or near-commercial that can make this a fully renewable supply in a short timeframe – e.g., 5-10 years. However renewable energy fuels for transport are not yet widely available or commercially viable but will be in future.
  • Emissions that you can control or have confidence that they are declining. Waste management, for example, is a complex task, and the ability to set emissions reduction targets may rely on whether or not a waste management strategy is in place or planned. If not, then it may be difficult to set a target that is realistic and achievable.
  • Is an emissions source material or not? For example, LPG consumption may be trivial compared with other sources, so should time and effort be devoted to tracking and managing this source?
  • Your ability to account for all of the sources you may want to track so that you can report on its progress towards reaching goals. Often 80%+ of emissions can be readily accounted for with minimal effort or use of pre-existing systems (from simple spreadsheets to proprietary data collection and reporting systems), whereas the remaining ~20% of emissions can involve significant effort to both establish and then track emissions on an ongoing basis. The Climate Active program is working to make this simpler for organisations to report and offset their carbon impact.
  • Consideration of your overarching purpose in setting goals or targets, such as for
    • internal cost-cutting
    • internal management of emissions
    • to provide guidance and leadership
    • to partner with like-minded organisations to share information and knowledge that is mutually beneficial
    • or all of these

What should be your preferred approach for setting a target?

There is no one preferred approach to selecting what should be included in targets.

In our experience many organisations have

  1. good data and renewables or abatement plans for electricity,
  2. good data but limited plans for reducing transport emissions, and
  3. mixed data and strategic plans including emissions reduction for scope 3 emissions like waste.

This tends to influence what is included in the scope of renewable energy or carbon emissions targets, often starting with a narrow scope of significant sources with an intent to expand the scope of targets.

Other organisations may have excellent data and plans across multiple energy and emissions sources, within their operations and their supply chains, and set the scope of targets accordingly.

100% Renewables are experts in helping organisations develop their carbon reduction strategy and advising on appropriate goals. If you need help with developing your targets, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

How choosing a target influences your emissions over time [with video]

100% RE - emission reduction through 100% renewable energy
100% RE – emission reduction through 100% renewable electricity

We recently worked with a regional council to provide their senior management and other key stakeholders with input to the development of their climate change action plan and target-setting process.

An important part of our work was to show council, based on our experience with many other local governments, what different carbon reduction scenarios look like in this sector. In particular, we showed what a no-action scenario would mean for electricity demand, what a focus on demand reduction within council operations would look like, and what an approach that encompasses both aggressive demand reduction and a comprehensive renewable energy supply strategy could achieve.

Presenting and workshopping these scenarios helped our client to set ambitious goals for energy and carbon reduction that are achievable, affordable and can be planned and resourced in the short, medium and long term.

Three scenarios for electricity-based emissions

To illustrate how inaction and action to mitigate climate change can influence emission reductions over time, we created a series of animations. Please click on the video (< 4min) below to view the effect of energy efficiency and renewable energy measures on a council’s business-as-usual electricity consumption.

Scenario 1: no action

For most local councils, rising population, asset upgrades and service improvements are factors that influence the energy demand of council operations.

In the absence of clear policies and practices to reduce energy demand and increase renewables, these factors will lead to increased energy use. As electricity prices also rise, this will result in higher energy costs over time.

Scenario 2: action within council operations

In most organisations, there are numerous opportunities to reduce energy demand and increase onsite renewable energy.

  • Upgrading building lighting systems, air conditioning controls and installing rooftop solar panels usually have an attractive payback.
  • Incorporating lowest life-cycle cost technologies and solar into new developments, and implementing sustainable procurement policies for appliances and office/IT equipment can reduce or reverse energy growth over time.
  • Replacing capital-intensive equipment such as air conditioning systems, water & sewer pumping systems, sporting field lighting and servers with best-practice energy-efficient technologies can similarly reduce or reverse growth in energy demand.
  • Street lighting is often one of the largest energy-using accounts in a local council. As LED technology becomes available, local and main road lighting can be upgraded, leading to large energy savings.

Planning, scheduling and funding implementation of these opportunities over time will lead to a sustained and cost-effective reduction in a council’s grid energy consumption.

However, for most councils, these actions will only take climate mitigation so far, typically a 30% to 40% reduction over time. This would likely fall short of the 2018 IPCC report on ‘Global Warming of 1.5 ºC’, which states that we need to reduce global net anthropogenic CO2 emissions by about 45% from 2010 levels by 2030.

Scenario 3: ambitious action on energy demand and supply

In our experience, it is not possible for a council to achieve deep emissions cuts without focusing on both energy demand and energy supply. In an ‘ambitious action’ plan, there will be a more aggressive rollout of energy efficiency and renewable energy measures, as well as an energy procurement strategy that will source renewable energy for council’s operations.

Energy demand action will:

  • Extend solar PV to more marginal sites,
  • Develop a plan for larger-scale onsite solar with battery storage,
  • Incorporate smart controls with street lighting,
  • Plan for charging of electric vehicles over time, including passenger and commercial vehicles and road plant

Energy supply action will include renewable energy purchasing as part of a council’s normal energy procurement process. Typically, this takes the form of a renewable energy Power Purchase Agreement (PPA) as part of overall energy supply, with the potential to scale up renewable energy purchasing towards 100% over time.

For some councils, building their own solar farm may be another way to scale up supply-side action on renewables.

Ambitious action that focuses on both energy demand and renewable energy supply is aligned with global targets to decarbonise by mid-century. As leaders, local governments have an important role to play in showing their communities that deep cuts in emissions are possible and affordable.

You can read more about achieving ambitious targets in our ‘How to achieve 100% renewable energy’ paper.

Ambitious action is achievable and cost-effective

It is possible to achieve ambitious targets cost-effectively – what is required is to plan and resource ahead, to understand the cost implications as well as the cost savings, and to know what measures can be rolled out at what point in time.

100% Renewables are experts in helping organisations develop their renewable energy strategies and timing actions appropriately. If you need help with setting targets that are achievable and cost-effective, please contact  Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

The beginner’s video guide to assessing the value of buying or building your own renewables

One of our clients recently went to market via an Expression of Interest (EOI) to solicit interest from firms and potential partners with building or sourcing large-volume renewable energy to meet a significant fraction of their electricity demand.

We were contracted to review the responses to the organisation’s EOI and provide our recommendations about sourcing large-volume renewables. The requested interest was for two technical options, to build a solar farm on the organisation’s land, or to purchase renewable electricity from other projects – for example from utility-scale wind and solar projects elsewhere in the National Electricity Market.

Energy markets and evaluating EOI responses is complex, so for our final presentation, we were asked to also cover some of the basics to allow the leadership team to understand how we arrived at our recommendations.

When we created the slide deck for this presentation, we thought about how we could best present the underlying information. Pictures say more than words, so we decided to use animations to

  1. explain the fundamentals of the electricity supply chain,
  2. the components of your electricity bill, and the
  3. difference between installing solar behind your meter versus building a large-scale solar farm, versus sourcing renewables from an offsite project.

You can watch the video with our animations here:

If you need help with going to market or with evaluating responses to your EOI, RFT or RFP,  please contact Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

Nine ways to maximise the financial benefit from your surplus solar energy

9 ways to maximise the financial benefit from your excess solar
9 ways to maximise the financial benefit from your excess solar

Our recent blog posts related to the treatment of surplus solar energy. We considered the carbon accounting treatment of your exported solar, explained peer-to-peer energy trading and its applicability to solar exports. In this blog post, we are investigating nine ways how you can maximise the financial benefit from your excess solar.

Nine ways to maximise the financial benefit from your surplus solar

1 Negotiate a good Feed-in-Tariff (FiT)

Your exported solar electricity has a value, which is equal or close to the wholesale electricity market price. Many retailers will offer feed-in rates with most drawing on annual guidance by IPART on appropriate FiT rates or ranges. Some retailers will offer a fixed rate, while others will offer a credit at the same Time-of-Use (ToU) retail rate that applies when the electricity is exported.

You should review your current agreements for treatment of excess solar energy generation, and look to agree on a fair rate or specify this requirement in your next retail energy negotiation.

2 Find a retailer who is willing to net off your supply and demand

If no FiT can be negotiated, then crediting export to another site could see savings at the receiving building’s full retail electricity rate. Although we are not aware of such an arrangement at a small scale, you may be able to negotiate this with your retailer.

It is possible to assign generation from one site to another, but to do this, the following needs to be in place:

  • You need to find a willing retailer
  • The retailer needs to have a billing system that allows for the assignment of generation on a time of use basis – a tricky issue for tier-1 retailers with legacy billing systems.

There is an example for this scenario with a Power Purchase Agreement undertaken by the University of Technology Sydney (UTS). UTS and its electricity retailer have agreed to ’pass through’ generation from a 200 kW Singleton solar PV farm to UTS’ Broadway campus. However, the electricity from the Singleton solar farm only makes up 2% of UTS’ total load.

3 Ask your network provider for local network sharing tariffs

Historically, network pricing has not considered the proximity of a consumer to a prosumer. However, this needs to change to reflect that the grid is changing to two-way energy flows. If more and more customers ask for this, change can happen.

There are trials underway where network providers have agreed to a new local sharing network tariff. The town of Newstead in Victoria, for instance, has been able to develop a local sharing tariff (for a 2-year trial) with Powercor.

Thus far there are no similar arrangements in place in NSW, though discussions are ongoing. Enova Energy and Essential Energy, for instance, are trying to develop a local generation tariff in the Byron Bay Arts and Industrial Estate.

4 Consider an embedded network

An embedded network is a private network, in which only one parent meter is connected to the grid. Behind that parent meter, several customers are being supplied with electricity, with the Embedded Network Operator controlling how the private network operates.

The operator buys the electricity for the embedded network from a retailer and onsells the energy, usually at a discount to market. In order to set up an embedded network, you need to get a retailer exemption from the Australian Energy Regulator (AER).

Embedded networks are common in caravan parks, business parks, shopping centres, apartment blocks, office buildings, airports and university campuses. They are relatively easy to set up from scratch but expensive to retrofit.

An embedded network may work for you if you are looking to share your excess solar electricity with tenants in the same building that your organisation owns.

5 Use battery storage to increase self-consumption from solar

Instead of sending the excess solar electricity into the grid, you could send it to an onsite energy battery storage system. You can then use this stored energy to supply you with power during times when the sun doesn’t shine, or to help you reduce your peak demand.

Unfortunately, at this stage, the costs of battery storage are still high. This is particularly the case where you export most of your energy during weekends. You would need a large battery to deliver cost savings during working weekdays.

If used primarily to trim peak demand further then the business case will be a little better as a smaller-size battery will be required.

6 Solar with battery storage in a virtual power plant (VPP)

The NSW Government recently announced plans to develop a 200 MW Virtual Power Plant (VPP) that will harness the capacity and stored energy in household and business batteries to provide dispatchable energy during peak network demand periods, typically hot days in summer. This is being developed under the Smart Energy for Homes and Businesses program which is expected to launch early in 2019.

Stored energy can also have value by being capable of being aggregated with other batteries to bid into the wholesale market. This is a key part of some pre-existing VPPs such as Powershop-Reposit’s Grid Impact product, and similar VPPs in other jurisdictions such as the ACT, with a large-scale VPP in development in South Australia.

7 Consider a microgrid

If you are also interested in sharing energy for the purpose of increasing your resilience in the event of a grid failure you can consider a microgrid. Customer-level microgrids and embedded networks are similar, where you are looking to share energy in a private distribution network. The main difference is, however, that the microgrid can disconnect from the main grid.

A microgrid works best in conjunction with battery storage large enough to still supply you with power, even during a blackout.

8 Peer-to-peer solutions like PowerLedger or Greensync

At this time a number of trials of P2P have been progressing, with most commercial projects occurring in strata or similar precincts where energy can be shared behind the main meter. This is because, currently, P2P solutions are easiest to set up in embedded networks.

If the P2P solution is outside an embedded network, where energy is shared between sites via the grid, you need the cooperation of a retailer offering a product that stacks up with credits from the distribution network provider.

For more information on P2P energy trading trials, you can read our blog post on peer-to-peer energy trading.

9 Consider a portfolio approach

Last, but not least, you should always consider a portfolio approach when maximising your financial benefits of solar. Every time you go to market for a new retail contract, you need to evaluate options that give you the bests financial return overall for your portfolio of assets. In addition to evaluating solar export, you may also want to pair this with demand flexibility mechanisms.

 

100% Renewables can help with evaluating these options for you. Please contact Barbara or Patrick for further information.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

The current reality of peer-to-peer energy trading for sharing surplus solar energy

With falling prices for solar panels and with experience gained on previous solar PV projects, many of our clients are thinking about increasing the size of their current solar installation where space allows.

By increasing the size of their system, many clients would be exporting some of their solar electricity, especially on weekends. Naturally, the question arises how to maximise the financial benefits from that surplus electricity.

It is not uncommon for the value of exported solar energy generation to be forgone, whether through lack of management or an unwillingness by a retailer to offer or negotiate a feed-in rate. In this scenario, you would lose any financial opportunity from exported solar.

This is when many of our clients ask about the status of peer to peer trading and local energy sharing.

What people tend to think happens in a P2P energy trading transaction

It seems such a straightforward concept. You have excess electricity from your solar installation on Building A, you assign this to Building B across the road, which can’t have solar (e.g. is overshadowed). Building A benefits by increasing the size of its solar PV array leading to higher bill savings, and being able to assign or sell the exported electricity to Building B. Building B would benefit by potentially having a lower electricity bill, and a renewable energy supply.

100% RE - Expectations for P2P energy trading
100% RE – Expectations for P2P energy trading for exported solar electricity

The reality of current P2P energy sharing for your surplus solar

Unfortunately, the reality is different. When you produce electricity from solar panels that isn’t used on site, you usually export it to the grid. You can’t get the electricity from Building A to Building B without using the network.

And here is the problem: while your buildings might be close to one another, you will incur the full network charges (which for some organisations can be up to 50% of their overall bill). Network charges are made up of transmission and distribution charges. When you share energy locally, theoretically you shouldn’t have to pay the transmission charges, but in reality, you do.

In 2016, the City of Sydney, the Total Environment Centre and the Property Council Australia argued for the introduction of Local Generation Network Credits (LGNCs) with the Australian Energy Market Commission (AEMC). Unfortunately, the AEMC did not go ahead with this proposed rule change.

This means that currently, there is reduced incentive to oversize your PV system and export solar electricity, unless you have a great feed-in-tariff, or have an agreement with your retailer to net off the electricity consumption of your buildings with the surplus energy generation from another building (more on this in the next blog post).

Current reality of P2P energy trading for surplus solar electricity
Current reality of P2P energy trading for exported solar electricity

Recommended approach

At this time the recommended approach is to seek a feed-in rate for surplus solar energy generation with your electricity retailer – either immediately or included in your next contract negotiation. You may also be able to negotiate for the excess solar energy to be credited against the demand of your other building. If you are running an embedded network and you don’t own all the buildings in the embedded network, you can trial blockchain solutions like Power Ledger. We will have more information on these options in the next blog post.

In any case, you should evaluate the tariffs and prices against the portfolio of all your assets and evaluate demand flexibility options to achieve the overall best outcome. And as always, it is important to keep a watching brief on any new developments, as this space is evolving rapidly.

In the next blog post, we will expand on how you can maximise the financial benefit from your surplus solar by looking at nine different options. These include peer to peer trading, installing battery storage and participating in Virtual Power Plants, so stay tuned.

Meanwhile, if you need help with your journey to a clean energy future, please contact Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.

Peer-to-peer energy trading explained

Australia has more than 2 million solar PV installations, making us number one in the world in terms of the highest proportion of prosumers. While previously, the grid was designed to be one way only, it is now changing to two-way energy flows; facilitating exports of electricity as much as imports. One option to enable a two-way energy flow is local energy sharing or peer-to-peer trading.

What is energy sharing, or peer-to-peer energy trading?

Simply put, energy sharing is where one party produces excess electricity and then shares this with another party. Energy sharing is also known as Virtual Net Metering (VNM) or peer-to-peer energy trading.

Peer-to-peer (P2P) energy trading can be compared to file sharing programs on the Internet, like BitTorrent; to eBay in terms of shopping and to Airbnb in terms of accommodation. Fully enabled P2P trading would cut out the ‘middleman’ and allow transparent dealings between equals, as opposed to being treated as a ‘consumer’ by a corporation.

Peer-to-peer energy trading explained
Peer-to-peer energy trading explained

The party that sells electricity is called ‘prosumer’ because they not only consume energy, they also produce it.

Energy sharing could happen between tenants in a multi-rise, between adjacent buildings, or between anyone on the same network.

For example, if my solar panels at home produce excess electricity while I am at work, I could sell the surplus energy to my neighbour who can’t have solar panels. Similarly, your organisation could have multiple assets and wish to sell electricity to yourself or to donate electricity to neighbouring households or businesses as part of your social commitment.

Advantages of peer-to-peer-trading

The biggest advantages of local energy sharing are that:

  • Energy does not have to be transported from centrally located power plants, reducing electricity transportation costs
  • Energy generation can be based on renewables
  • Energy can be bought from a known source (which allows you to claim energy from a specific project)
  • Energy costs can be lower for the buyer
  • The financial benefit for the generator can be better than a feed-in rate
  • There is choice and transparency in dealing with other consumers

Barriers to peer-to-peer trading

Several barriers exist to P2P trading at present, and it is not known at what time these will be overcome so that consumers can begin to participate and benefit from renewable energy. Some of the main barriers include:

  • Not yet commercialised
  • Immature market for solutions
  • Multiple stakeholders that need to be convinced of the business case (e.g. retailers)
  • Regulatory barriers

Supporting technology – Blockchain

P2P energy trading involves a large number of transactions between prosumers and consumers and needs technology that allows for low-cost authentication, validation and settlement while protecting privacy. One of the most promising technologies to enable this is ‘blockchain’, a distributed ledger technology. Blockchain is mostly known as the technology supporting distributed trading, such as Bitcoin.

With blockchain, transactions are stored in virtual blocks, which are connected together in a chain. A complete history of all transactions that have ever occurred within a particular network is retained. Blockchain technology can offer a cryptographically secure, distributed ledger that can track where electricity was generated, where it can travel to and who used it.

There is no question about where a kWh came from and how it was produced. The technology is transparent and secure and does not require a central entity to store and manage shared data and business process. It will also make it easier for new and smaller players to be involved, right down to the individual solar household.

Current status of P2P energy trading

Progress with peer-to-peer trading is slow. A couple of trials in the residential market have been unsuccessful, partially because there was no funding, but mostly due to the current market situation.

On the one hand, regulated network tariffs mean there are little benefits to local energy trading. On the other hand, there are low levels of installed controllable distributed energy resources, which makes it hard for solution providers to provide value to their customers.

There are a number of trials using blockchain technology that have been or are currently being conducted, examples of which you can see below.

Most other forms of energy trading are heading down the Virtual Power Plant (VPP) pathway like AGL’s VPP in South Australia or Origin’s VPP in Victoria. However, like the blockchain trials, these solutions are not widespread and involve mostly the residential sector.

Blockchain-based peer-to-peer trials

AGL Solar Exchange trial in Victoria

AGL previously used blockchain technology in a desktop/virtual trial using solar panels, batteries and smart air conditioning in Melbourne homes. The aim was to understand the value in P2P energy markets.

Now AGL has launched Solar Exchange, which is an online marketplace enabling solar households to trade their excess solar power in the form of solar tokens. These tokens can be sold to other AGL customers residing in Victoria.

Under the right conditions, a buyer could buy tokens at a lower price than buying energy from the grid, while a household with solar could sell excess solar tokens at a higher price than the solar feed-in tariff. A successful trade of Solar Tokens can only be made if the buyer and seller have chosen compatible trade settings and have compatible solar export and grid usage profiles for the same trading interval.

The Solar Exchange is the largest consumer energy trading trial in Australia, with more than 250 Victorian customers participating since the pilot launched in August 2018.

Power Ledger trials in Western Australia

The Power Ledger Platform enables interoperability between diverse market management/pricing mechanisms and units of electricity (kWh) by way of pre-purchased tokens, called ‘Sparkz’, which are backed by blockchain bond called ‘Power Tokens’.

Sparkz are settlement tokens that are pegged to the local fiat currency (e.g. AUD in Australia, USD in the USA). Sparkz can be traded on the Power Ledger platform within defined trading groups through a suite of APIs that interface with smart meters.

The Power Ledger system tracks the generation and consumption of all trading participants and settles energy trades on pre-determined terms and conditions in near real time.

One promising use case for platforms such as Power Ledger’s is an embedded network, such as apartment blocks or housing developments, where residents can trade their solar energy with one another in a semi-regulated environment.

Power Ledger have implemented several successful trials of their technology under this embedded network scenario in Busselton and Fremantle. In the case of fully regulated markets, where a retail license is required to buy and sell energy on the national grid (such is the case in most of Australia), the ability for blockchain to facilitate true peer-to-peer energy trading on a wider scale than just embedded networks is somewhat constrained.

LO3/TransActive Grid in South Australia

LO3 is a US-based firm known for setting up a microgrid in Brooklyn and Germany, and for the fact that their solution is built on blockchain technology.

The company is focused on the physical transaction of energy, not the financial transactions. They see their strength in the need for fast-acting load responses, storage, controllable generation and reaction time. Their first rollout in Australia is the New TransActive Grid in South Australia.

Up to 6MW of distributed solar generation will be made available on a local energy marketplace, using LO3’s peer-to-peer trading platform. The microgrid will begin with a ‘discrete’ market using Yates Electrical Services’ Small Generation Aggregators License and their associated commercial or industrial customers, who will bid on solar electricity supplied by the firm.

A meter will be added onto a household or business which manages all energy inputs and outputs, giving participants access to cheaper electricity generated by local solar farms. The solar power will come from six locally built PV plants ranging from 200 kW to 1 MW in size (two have already been constructed) that are being sited on ‘redundant’ farmland in South Australia’s Riverland region.

deX

In December 2017, Greensync launched the ‘Decentralised Energy Exchange’ (deX). Normally, behind-the-meter generation capacity is invisible to the energy market operator. However, deX is a digital technology platform that allows utilities to see exactly what distributed energy resources are available at any time on customers’ premises and how they are performing.

deX can remotely control those resources, with the customers’ consent, at times of high demand or volatility to avoid shortages. The platform lists buyers and sellers, records agreements between them, manages event handling and verifies both parties met their obligations.

The deX program started with commercial and industrial system-owners and will expand to include about 1,200 battery-owning households, which will make up about 5MW of a total 11MW of network support. deX partners include retailers Powershop and Mojo, storage and power engineering firms Siemens, Tesla and ABB, and consumer technology suppliers like Geli, Jetcharge, Wattwatchers and Power Ledger. AEMO, ARENA, Energy Networks Australia and the Clean Energy Council are also partners.

Next blog post

In the next blog post, we will delve into greater detail whether peer-to-peer technology is suitable for exporting electricity from your solar PV installation.

Meanwhile, if you need help with your journey to a clean energy future, please contact Barbara or Patrick.

Feel free to use an excerpt of this blog on your own site, newsletter, blog, etc. Just send us a copy or link and include the following text at the end of the excerpt: “This content is reprinted from 100% Renewables Pty Ltd’s blog.