Donald and Tarnagulla Microgrid Feasibility Project
The Central Victorian Greenhouse Alliance (CVGA) partnered with the Centre for New Energy Technologies (C4NET), Powercor, Victorian universities and Loddon and Buloke Shire Councils on the Donald and Tarnagulla Microgrid Feasibility project.
Donald (1034 customers, 76% domestic) is fed mid-way along a long rural feeder from the Charlton Zone Substation. The Charlton Zone Substation itself is fed from a single very long radial subtransmission line from Bendigo, which has a high reliability risk. The smaller community of Tarnagulla (147 customers, 80% domestic) is at the end of a long rural line fed by the Maryborough Zone Substation. The Maryborough Zone Substation is fed in a sub-transmission loop from Bendigo and Castlemaine. These contrasting towns have been selected based on their strong community aspirations for new energy solutions and increased reliability.
The project balanced the technical, cultural and social elements of understanding the feasibility of microgrids. Key project milestones included community engagement, area hosting capacity assessment, concentrated generation and storage impact, network assessment, islanding design and cost analysis, microgrid impact study, stakeholder impact investigation, economic and risk assessment, microgrid assessment tool development and recommendations to regulators. The multi-year project concluded in 2023.
This study was supported by the Department of Industry, Science, Energy and Resources and C4NET.
Donald (1034 customers, 76% domestic) is fed mid-way along a long rural feeder from the Charlton Zone Substation. The Charlton Zone Substation itself is fed from a single very long radial subtransmission line from Bendigo, which has a high reliability risk. The smaller community of Tarnagulla (147 customers, 80% domestic) is at the end of a long rural line fed by the Maryborough Zone Substation. The Maryborough Zone Substation is fed in a sub-transmission loop from Bendigo and Castlemaine. These contrasting towns have been selected based on their strong community aspirations for new energy solutions and increased reliability.
The project balanced the technical, cultural and social elements of understanding the feasibility of microgrids. Key project milestones included community engagement, area hosting capacity assessment, concentrated generation and storage impact, network assessment, islanding design and cost analysis, microgrid impact study, stakeholder impact investigation, economic and risk assessment, microgrid assessment tool development and recommendations to regulators. The multi-year project concluded in 2023.
This study was supported by the Department of Industry, Science, Energy and Resources and C4NET.
Key Findings
- Clearly defining microgrids is critical to distinguish them from other types of sub-networks.
- A clear regulatory definition of microgrids is also needed.
- Communities wanted greater reliability and more self-reliance.
- The community experiences and understands the nature and value of reliability differently from the DNSP and regulators. As such, the community may value the integration of additional renewables and DER more than network operators. Historically, Distribution Network Service Providers (DNSPs) have had an obligation to provide reliable, secure, and affordable energy supply. However, the role of helping communities evaluate their energy needs is not currently within this scope and there are commercial barriers to DNSPs investing resources into investigating such outcomes. To develop community-scale microgrids that meet the needs of individual communities, DNSPs would need to engage with commercial and community/consumer concerns and aspirations in new and nuanced ways. If this is sought then the regulated entity frameworks would need to better align interests to incentivise such engagement and solutions.
- The existence of significant reliability problems is a key indicator that a microgrid might yield a net benefit to a community.
- Communities also wanted to be able to prioritise critical loads when supply was limited.
- Deeper and wider community engagement is needed to build a better understanding of community goals and values.
- A microgrid could help stabilise local grid voltage, deliver lower energy costs through direct wholesale purchasing, earn revenue from wholesale market arbitrage and provision of ancillary services, reduce peak demand and increase minimum demand, reduce network costs, and increase reliability and resilience. The more revenue streams that can be accessed the more favourable the business model for ownership.
- Further exploration of innovative community ownership and operating models for microgrids may be beneficial. Under current settings, there are significant hurdles for communities seeking to develop sustainable governance structures to manage risk, investment, and operational complexities of microgrid assets. More research may inform community benefit energy providers and social enterprise models and feasible means of addressing the associated complexity of ownership and operation.
- A fully islandable microgrid requires significant upfront investment that requires significant revenue to recoup the capital cost – but the magnitude of this depends on the degree of islandability and the ability to access available value streams.
- A microgrid is not an economically feasible solution for Donald or Tarnagulla at the current time.
- Smaller scale community energy projects are likely to help address some of the communities’ objectives; and
- Microgrids are likely to be a more viable option in some regional communities, with similar characteristics to Donald and Tarnagulla, in the medium term (10+ years)