A solar panel absorbs the sun's rays at Solaray, an installer of solar power solutions in Sydney, November 24, 2015. Solaray Director Jonathan Fisk poses next to a solar panel (L) and an Enphase AC battery at the solar power installation company's Sydney facility, November 24, 2015. But Australia's political roller coaster, which has seen prime ministers dumped four times in the past three years, largely over climate policy, is hampering the battle against climate change and investment in clean energy. Prime Minister Malcolm Turnbull will face intense scrutiny at the upcoming global climate change summit in Paris for signs of a shift from the man he replaced in a September party coup, climate sceptic Tony Abbott. While some believe Turnbull can convince his conservative coalition their fossil-fuel reliant economy must change to meet emissions reduction targets at Paris and beyond, their faith is tempered by realism. "The guy leading the country and leading the Liberal Party is no longer an absolute climate sceptic but somebody who understands the principles," Nathan Dunn, Asia-Pacific managing director for green energy company Enphase Energy, told Reuters. "It will take some time for his thought process to permeate the rest of the party and the government itself, but it's the first step." Close to 200 nations are set to meet in Paris from Nov. 30-Dec. 11, hoping to forge a pact to slow man-made climate change by weaning countries off fossil fuels. Although the world's largest exporter of coal and iron ore pledged to cut emissions by 26-28 percent of 2005 levels by 2030 ahead of the Paris talks, Abbott's Direct Action plan to achieve that has been pilloried by activists and economists. Turnbull, who had been a vocal critic of Direct Action, has reason to fear abandoning it in favor of deeper reforms; in 2009 he was ousted as party leader by conservatives over support for an emissions trading scheme. In fact, the conservative National Party, half of Turnbull's ruling coalition, made support for his leadership coup contingent partly on retaining Abbott's climate policies, and he has shown no sign yet of tempting political fate. Senator Chris Back, a member of Turnbull's Liberal Party and vocal climate change sceptic, doubts there will be any change to targets Australia pledged for Paris or a shift after elections set for next year, regardless of his mandate. "One thing about Malcolm Turnbull is he's no fool," he told Reuters. "He's very happy to be in the position he's in today, and I don't think he wants to do anything to jeopardize that position." Australia has become a leader in solar storage, among the most promising recent developments in consumer green technology, with little federal government support, industry experts said. Tesla in May announced storage systems for homes, companies and utilities that could become part of a fossil-fuel-free lifestyle in which people can use rooftop solar to power homes and recharge electric car batteries. Australia has been chosen as one of the launch countries for its flagship battery product, Powerwall, which debuts in Q4 2015. Enphase's plug-and-play battery will arrive in 2016. Both companies cited high electricity prices, a sunny climate, falling solar panel costs and a phasing out of payments to consumers for selling excess power as reasons to prioritize Australia. More than 15 percent of Australia's 8.4 million households have rooftop solar technology, the world's highest per capita penetration, figures from the Energy Supply Association of Australia show. Electricity prices have soared over the past decade, while battery costs fell an average of 14 percent a year between 2007 and 2014, said Australia's independent Climate Commission. Economically, the arrival of storage technology for solar panels represents a sea change, says Bruce Mountain, director of energy consultancy CME. "It changes things on their head, essentially because it enables people to use inexpensive locally-produced energy." Solar provides 2 percent of the energy mix in Australia, the highest in the world, but a fraction of the 73 percent provided by coal. Although Enphase's Dunn is confident that high electricity prices, economies of scale and technological advances will support his business model, he would like to see some support from Turnbull and the federal government. "If the fossil fuel industry in getting A$10 billion a year to subsidize the work that they do, the big question is why would you not focus that kind of resource from a renewables perspective?" Dunn said. The country's two biggest carbon polluters, AGL Energy Ltd and Origin Energy Ltd, have shown signs they are aware of the trend, which puts at risk some of their A$22 billion ($15.6 billion) a year combined sales. Both have begun selling solar batteries, but, according to advocacy group Market Matters, only 9 percent of AGL's energy production is renewable, while Origin Energy is zero percent.
News Article | November 9, 2015
Australia, the sunniest continent, is luring solar battery suppliers from Tesla Motors Inc. to LG Corp. as the global roll out of the technology for home and business power storage gathers pace. At stake is a domestic market that could be worth A$24 billion ($18 billion), according to Morgan Stanley. Australia leads the world in putting solar panels on roofs, and by 2040, about one in two homes are forecast to rely on sun power. Elon Musk’s Tesla plans early next year to bring its new batteries to Australia, which will join Germany as its first two markets outside the U.S. LG Chem will offer new technology to Australian homes in August, while Panasonic Corp. plans to begin selling its batteries in the country in October. “Australia has all the criteria that you would look for -- high sunshine, high energy prices and low financing costs,” Michael Parker, an analyst at Sanford C. Bernstein & Co. in Hong Kong, said by phone. “It’s a good test market.” With solar power set to draw $3.7 trillion in investment through 2040, according to Bloomberg New Energy Finance, interest in power storage is surging. LG Chem wants to capture 30 percent of the Australian market, the South Korean company said in an e-mail response to questions. The industry could could grow 15-fold in the next two years to more than 30,000 storage systems, it said. Storage Units Samsung SDI Co., meanwhile, is testing its storage units with Australian retailer Origin Energy Ltd., which expects to offer the products to customers later this year, and AU Optronics Corp. of Taiwan is working with AGL Energy Ltd. Government subsidies and falling prices fueled a wave of growth in solar panel installations in Australia, and the country is set to see further expansion. About 6 million, or half of Australian homes, are forecast to have solar systems by 2040, according to Bloomberg New Energy Finance. “The ability to store the energy that’s generated by solar is a huge opportunity within this market,” Heath Walker, Tesla’s marketing manager in Melbourne, said by phone. In coming months, the company plans to unveil battery partnerships with utilities or solar developers in Australia, he said. Battery storage does face obstacles, though, with the cost and the size of the systems needed to maintain a reliable power source deterring some consumers, the Grattan Institute found. Falling Tariffs “Everybody says it’s an emerging market, but I’m not sure many people have bought batteries yet,” Origin’s Managing Director Grant King said in an interview. “Will we see a wholesale migration of customers off the grid because of batteries? My answer is no.” Declining battery costs, surging electricity prices and falling tariffs for feeding excess power to the grid could drive storage, the Australian Energy Market Operator found. Battery storage will allow homes with solar panels to store excess electricity for later use, reducing peak power consumption and potentially energy costs, Panasonic said. “Storage is coming,” Panasonic’s local Managing Director Paul Reid said in a June 2 interview. “There may be things that impact the speed of the roll out, but it will dramatically change the landscape of the energy sector in Australia.”