Around the world, electricity systems are grappling with different versions of the same problem: how to electrify more technologies without compromising affordability or system stability.
Dr John Ward, research director of CSIRO’s Energy Systems Research program, recently spoke to Energy magazine about this challenge ahead of COP31, the United Nations Climate Change Conference taking place in Türkiye in November where he will attend as part of Australia’s delegation.
Dr Ward told Energy that “strategic electrification” was a focus of international discussion following a landmark announcement from the COP31 Presidency in June urging for an increase in electricity as a proportion of global energy demand from 20 per cent in 2026 to 35 per cent by 2035. So, what does “strategic electrification” entail?
Integration solutions for renewables
Delivering increased electrification depends on an electricity system capable of remaining stable through rapid change, while also navigating a shift in the sources and locations of electricity generation and consumer demand patterns.
That includes new demand streams entering the market such as data centres which are reaching profiles “we never envisaged five years ago”, Dr Ward said.
"As conventional coal-fired generation exits the system, the question is: what replaces this that can support system strength and inertia?”
New renewable integration technologies are key to maintaining stability. For instance, grid-forming inverters help manage sudden frequency changes by emulating the spinning turbines of coal and gas generation.
Australia is leading the way in adoption of this technology which also provides voltage support by injecting reactive power to support weak grid areas during faults, among other system stability capabilities.
Another option is to continue the adoption of synchronous generation, through synchronous condensers which replicates the stabilising "spinning weight" of coal generators.
Fast frequency response (FFR), when paired with batteries, is emerging as a digital solution to grid stability. This software-driven option can detect grid disturbances and inject or absorb power, responding in milliseconds, to maintain stability in the system.
Smarter utilisation
While grid-forming solutions are a key component to the ongoing dependability of the National Electricity Market in years to come, Dr Ward argued more could be done for consumers, to drive the transition.
“We’re in a unique position where electricity demand is going up and the cost of generation is going down,” he said. “Despite this, delivered electricity prices have been going up – a byproduct of integration costs and the need to build out networks.
"If we continue to invest in network infrastructure, such as poles, wires, substations and transformers, at today’s costs, with the same utilisation, we're going to see continued substantial increases in our electricity costs on a per-energy-delivered basis."
Dr Ward told Energy the question for Australia’s energy system was how to get a higher output using existing assets, and using them more flexibly.
“If we can do that, even though energy use and infrastructure costs are going up, we've got a golden opportunity to get the cost of energy on a per unit basis down,” he said.
CSIRO has developed FlexCost, a new research project which puts prices on the demand-side resources underpinning the electricity system. As the name implies, flexibility is key both in terms of demand and supply.
FlexCost project director Dr Chris Dunstan told Energy making electricity demand more flexible included ‘shed’ services where equipment is turned down or shut off during peak usage periods, and ‘shift’ services, which involve moving electricity consumption to periods of low prices.
‘Shape’ services will be analysed in FlexCost to a lesser extent, where demand is routinely adjusted to follow a preferred load profile. This could involve pumped hydro or grid-scale batteries absorbing excess solar and wind generation.
Dr Ward said the challenge is to find pathways that decarbonise the system while also delivering affordable energy.
Is energy efficiency the answer?
Dr Ward also spoke to Energy about the role energy efficiency plays in alleviating strains on the electricity system. This is another focus of CSIRO’s FlexCost research, with the cost of demand-side efforts such as improving household insulation or installing more efficient air conditioners to be analysed.
There are already examples of this; the Victorian Government has been active on the energy efficiency front, with the Midday Power Saver Scheme and new staged regulations rolling out from March 1, 2027 until 2030. This will require all hot water and heating appliances that break and cannot be repaired in rental properties to be replaced with a heat pump water heater or an efficient electric reverse cycle air-conditioner. At the start of a lease from March 1 next year, Victorian rental properties must also include four-star showerheads and energy-efficient cooling in the living area.
Elsewhere, the Federal Government is investing $15.2 million to coordinate state and territory energy efficiency measures through the National Energy Performance Strategy (NEPS), while the ACT has also been an active proponent through its Energy Efficiency Improvement Scheme (EEIS).
Next steps
For Australia to hit its target of 82 per cent renewable energy penetration by 2030, coordination between energy generation, use and storage will be key. Australia already experiences periods where renewable generation is sufficient to meet demand, including in South Australia, for example, where the grid has been entirely powered by rooftop solar on multiple occasions.
Dr Ward told Energy that the constraint was ensuring generation was available in the right regions and supported by the transmission capacity needed to move electricity across the system.
“What's stopping us getting to higher renewables penetration? It's not just the existence of variable generation; it's the coordination piece,” Dr Ward said.
“So, if you don't have the transmission in place, is there a way to shift loads, generation and energy storage to hit that target?
"Australia provides a strong case study for what can be achieved. Our network is unique, our technologies are pioneering, and our frameworks offer lessons for energy systems internationally.”
The challenge is making better use of an increasingly renewable system.
This is an abridged version of the full article in Energy Magazine.