Evaluation of Australia’s Generation-Storage Requirements in a Fully Renewable Grid With Intermittent and Flexible Generation

Abstract

Energy storage is crucial for grids with high renewable penetration to ensure reliable power supply during low renewable generation periods and address the intermittency associated with weather-dependent resources. However, sizing grid-scale storage is challenging due to its interdependence on renewable generation and load profiles. This paper investigates the minimization of storage requirements for Australian grids as a case study in a fully renewable scenario and examines how inflexible generation (such as solar and wind) and flexible generation (such as hydro) affect the capacity requirements. We extend our analysis to the economic trade-off between investing in increased storage versus intentional excess renewable generation. Subsequently, the optimum generation-storage requirement is analyzed, and regional requirements with and without interconnectors are estimated. Finally, we analyze storage annual utilization and present a sensitivity analysis to variations in technology costs. The quantitative results suggest that optimal storage size is contingent upon the renewable mix, and while solar generation is cost-competitive, higher contributions from wind generation and strategic dispatch of hydro generation are required to achieve an optimum generation-storage solution. We show that storage with a power capacity slightly lower than the mean annual demand with a duration of one day is required for Australia’s National Electricity Market (NEM). These findings underscore the importance of carefully balancing the renewable mix to achieve an efficient and cost-effective grid. Based on estimated future costs for long-duration storage and generation technology, the optimum generation-storage solution will translate into an investment of approximately 9.8% of the country’s Gross Domestic Product (GDP)—this investment is achievable when amortized over 10–15 years for the transition to a near-100% renewable grid.