Microgrid v The Grid: A perspective from the town of Heyfield

MyTown Microgrid Heyfield project graphic
The historic timber town of Heyfield, located two hours’ drive east of Melbourne in the East Gippsland region’s Wellington Shire, hosts the MyTown Microgrid project. It’s a three-year feasibility study to help the Heyfield community decide if a microgrid could work for their tiny corner of the National Electricity Market (NEM) grid, and to guide other communities exploring similar moves. Wattwatchers co-leads the project, and my presentation to a public webinar posed the challenge: Microgrid v The Grid.

Hi everyone, thanks for being here. As a product disclaimer, my presentation tonight is very much a personal perspective, and it deliberately aims to provoke debate. 

While Wattwatchers and myself are deeply embedded in the Heyfield MyTown Microgrid Project, I’m not here tonight as an official spokesperson to give you definitive findings, and I certainly don’t represent the Heyfield community. 

Indeed this contest I’m highlighting – Microgrid v The Grid – is one that challenges households, communities and enterprises everywhere.

To make sure everyone is on the same page, let’s do a quick recap of the project … 3 years in duration, and now past the half-way point … well-funded with over $1.8 million in state and federal grants … with expected outcomes covering both Heyfield’s energy future and decision-making support for other communities on similar journeys.

Importantly, the Heyfield MyTown Microgrid project is a FEASIBILITY STUDY… so it’s not a solution design exercise. Doing a feasibility study means that any given solution proposal might not be feasible.

And it means the idea you start with might NOT be where you end up.

Here’s some early good news … 

Whatever the final outcomes of the MyTown project, the Heyfield community has the opportunity to emerge from it with more data and understanding of its energy scenario and its options than most communities in Australia, or anywhere for that matter.

I like to think of Heyfield as being Australia’s energy data town. That said, however, a lot of the expert modelling and evaluation work for the project is still underway.

As you can see on the right side of the slide below, when the project polled the local community early on it found overwhelming support for 100% renewable energy and a locally-owned energy retailer.

A series of high-level priorities for the community’s energy future have been identified, and to be frank these are objectives that would apply to many communities around Australia and the world.

In the pure sense, a microgrid means being able to separate entirely from the main electricity grid for some or all of time, like a house going off-grid. But if that proves not to be feasible in the particular case of Heyfield, there can be other options – possibly even better options – such as a virtual microgrid aimed at delivering the best of both worlds.

According to the Census, Heyfield and its large, diverse postcode area have a population of around 2000 people, with about 800 homes as well as a range of farm, commercial, industrial, government and community sites.

But not everyone in the area will experience the electricity system in the same way. Living in the heart of the Heyfield town may be quite different – in terms of reliability of supply, power quality and resilience in times of natural disasters – than being out on a farm or in a more remote village.

A key challenge for microgrid feasibility is finding boundaries, and a business model that can work for everyone – or at least for most of the community.

This screenshot from the Wattwatchers ADEPT tool, which is being used to collate data from the whole fleet of sites being monitored for their use of electricity, and their solar generation where relevant, shows the spread of the extended Heyfield community, and how it’s embedded into broader areas of settlement.

3892 is Mallacoota’s postcode. This town in Gippsland’s far eastern zone is another candidate for a microgrid or a similar solution. It’s very different to Heyfield. A permanent population of a bit over 1000 people, but that multiplies nearly 10 times in the big holiday seasons, and all of that at the end of a single power supply line. 

In this case AusNet Services, the network business that delivers electricity to both Mallacoota and Heyfield, is overtly interested in a community solution. Especially after the Black Summer bushfires two years ago.

By contrast with Heyfield, Mallacoota is a much more self-contained community, and now it even has its own TV show on the ABC: The People’s Republic of Mallacoota.

Heyfield is less than 0.01% of the NEM, the National Electricity Market, which is one of the biggest interconnected energy systems in the world.

So at one level you might think no-one would miss it if the Heyfield community opted out of the main grid – which serves nearly 10 million customer sites and has 40,000-plus kilometres of high voltage transmission lines. But if many ‘Heyfields’ left the grid, what would be left?

Several years ago many people were predicting a ‘death spiral’ for the traditional electricity system, with mass defections by consumers and whole communities going ‘off the grid’. But that’s calmed a lot more recently, and the positives of a grid get more airtime these days. 

For a lot of people, what they want more than anything is assurance the lights will always come on when they flick the switch, and the only bits they don’t enjoy are the occasional blackout and getting their monthly or quarterly power bill.

My inner anarchist loves the idea of main grid collapse, with off-grids and microgrids everywhere… but my inner systems thinker worries that this could end in chaos – and fail to make things better!

When we talk about the ‘The Grid’, it’s important to know that it’s not some steady-state infrastructure that’s incapable of change. In fact, in Australia and globally, electricity systems are undergoing revolutionary transformation.

A National Electricity Market with 100% renewable energy may have seemed like a distant dream even 5 years ago, when the MyTown project was first being contemplated. 

But now it’s an inevitability.

Already the Australian Energy Market Operator, AEMO, is planning to manage an electricity system that is capable of handling 100% renewable energy, at any moment of the day, by 2025. 

That’s just 3 years away! And 2 years from when this feasibility study will be finalised.

One dollar and 10 cents is an example of the daily fee for connecting a house in Heyfield to the electricity grid, which gives you the back-up of ‘The Grid’ – 24/7/365 barring the odd blackout. 

It’s a network service charge, and you still have to pay for the electricity that you use on top of that. Over a full year. $1.10 a day adds up to $401.50 a year, and my question is this:

Is about a quarter of a cup of coffee a day a lot to pay to have the security of being backed up by the NEM? Also, for 800 houses in Heyfield, that would be $321,200 a year plus whatever enterprise sites pay, so is that enough income to run a microgrid?

If a Heyfield microgrid had to buy all of the poles and wires and transformers and other infrastructure it would need to run its own power system, and had to keep up with all of the maintenance and upgrades and digitalisation, there would be a price tag. 

$100 million is an order of magnitude guesstimate, although no-one really knows if it would ever even be for sale – at whatever price?

Running an electricity system is more than just a matter of maintaining supply.

230 volts is the target voltage level for mains grid electricity supplied in Australia. It’s a reminder that power quality has to be managed as well as power supply. Higher penetration of solar can disrupt voltage for a microgrid as well as the main grid. 

Under-voltage can cause appliances to stop running, and over-voltage can harm consumer electronics and cause solar inverters to trip off.

As well as getting supply and power quality right, there’s also time of use to contend with.

In Heyfield, the data from the MyTown Microgrid project shows that power use is lowest just before dawn, between 4 and 5AM, and it peaks in the afternoon between 3 and 4pm. This varies across seasons, but it’s a good guide – especially in summer when solar generation is high and power-hungry air-conditioning use is high as well.

Without battery or other storage, which is expensive, locally-generated solar won’t be able to power the town 24/7/365 – unless, of course, it has The Grid still connected as back up.

For many homes, a 6.6kW rooftop solar system is enough to make the household net zero emissions for electricity over the full year. 

I know this from my own house in Sydney, where we have a 6.6kW rooftop solar system, and an electric vehicle and pool pump to optimise the solar by running them when solar generation is available.

Get enough houses on solar, and the whole community could be effectively net zero for electricity within a few years.

This view from a local Heyfield dairy farm highlights the issues around solar variability and availability. 

The loads are very constant, and are driven by the needs of the farm operation. But the solar on its own can’t cover all scenarios.

I needed a segue here.

So if anyone bet I couldn’t get a ginger cat into a microgrid presentation, you’ve done your money!

But, while I’m not into ‘skinning’ anything, when it comes to the future of energy I am reminded of the old wisdom that there’s more than one way to skin a cat!

Disruption is running hot for the electricity system. 

Surging renewables, electrification pushing out gas, the rise of electric vehicles, Net Zero-driven decarbonisation, new market opportunities and even visions for Australia rapidly becoming a clean energy superpower.

This makes decision-making even more difficult than usual, because the risks of getting it wrong are high.

I know this is a very busy slide, so please don’t try to take it all in. But it tells the global story of a vast energy transformation that’s still accelerating.

It predicts ‘Peak Coal’ this year, ‘Peak Oil’ in 5 years from now in 2027, and peak gas-fired electricity by 2030. 

Internal combustion engine vehicle sales would be banned in most countries circa 2036, and over 1 billion EVs would be on the road by 2042, in just two decades from now. 

Global power demand, meanwhile, will nearly treble from 24,000 Terawatt hours in 2020 to over 70,000 Terawatt hours in 2050. 

When things are this dynamic in a global marketplace, you need to be ultra careful about investing in expensive long-term assets!

Heyfield has many energy options. And thanks to the MyTown Microgrid project, you are going to know more about your local energy system and usage than most communities will ever know.

Even if the MyTown project doesn’t find a microgrid that’s feasible now, that could change in the future. Things really are that dynamic and unpredictable.

What’s vital, in my view, is that having come this far, the Heyfield community stays in the game, builds off the current engagement and momentum, and finds its own formula to achieve a better energy future for your community.

For what it’s worth, my considered view is that a ‘Virtual Microgrid’ model beckons, where Heyfield can steadily build its customised community solution on top of its bit of The Grid … and truly get the best of both worlds!

Thank you for your time tonight, and I look forward to the panel discussion and Q&A.

To help get things started, I’ve posed a few questions of my own.

Presented by Murray Hogarth, Wattwatchers’ Head of Impact & Communications, to a public webinar on March 28, 2022. Wattwatchers leads the MyTown Microgrid Heyfield project in tandem with the Heyfield Community Resource Centre and UTS Institute for Sustainable Futures. The project, which runs until mid-2023, has received grant funding from the Australian Government (Regional and Remote Communities Reliability Fund – Microgrid Program Round 1) and the Victorian Government (Latrobe Valley Authority).