Seán Mc Goldrick

Emerging Technology

Today’s presentation (Agenda)

Our role in the electricity value chain

Building our business for the future

Emerging Technology – Threat or opportunity?

Electricity network innovation

State Government-owned corporation that builds, maintains and operates electricity network throughout majority of south Western Australia

Governed by an independent Board and reports to Minister for Energy, as owner’s representative

Serving more than one million customers across a network area of 254,920 km2

Customer-orientated organisation that provides a safe, reliable and affordable electricity supply to Western Australians

Provides an essential service through transmission and distribution of electricity across our vast infrastructure of poles, wires, substations and depots

Who we are

Generators

make

electricity

at power

plants.

The network grid is made up

of transmission and

distribution assets.

The network enables

electricity to flow from

generators to consumers.

Retailers issue

accounts to

collect revenue

for the whole

supply chain.

What we do

Building our business for the community

Reviewing performance

Our role in your community: deliver an essential service, power your modern lifestyle, safely, reliably, affordably

Strategy 2012 – 2015: strong results in efficiency, safety, operations, savings

Performance review implementation 2016 – 2018: planned outcomes include savings, efficiencies, lower network costs, reduced borrowings, contained debt

State to national regulation: on the journey to be future fit, nationally benchmarked, customer orientated

Our future business: an entrenched customer business, we do more with less; we utilise the technologies that our customers want and we keep costs down

From asset to customer orientation…

Reducing the cost of electricity

WP has identified $400 million per year in new savings

For the first time in WA’s history - network tariffs will fall

WP to deliver $1.4 billion savings over current 5 year regulatory period

Brings WP in line with best performing utilities in Australia without sacrificing reliability or safety

Threat or opportunity?

Emerging Technology

Source AFR 19/2/16

How do network businesses respond?

Evacuate:

a purely disconnected future…

Incorporate:

force the future to fit the network…

Facilitate:

become the enabler of a faster rate of change...

Possible future scenarios for Australia’s electricity network

Source: ENA Hello Grid

Economics of emerging technologies in WA

Non network solutions make economic sense in edge of grid areas

Large areas of the network cost more to replace/maintain than the revenue collected by Synergy through the retail tariff

Current SWIS model• Central mesh

network • Long transmission

links and branch network radiating from core area

• Fully integrated, sharing generation capacity

Future model with small number of islanded systems

• Bulk of network unchanged

• SPS and islanded micro-grids created at periphery

• Outlying branches disconnected to avoid capital expenditure

Extreme model without centralised network

• Multiple micro-grids / smaller connected systems

Stand alone power systems

(SPS)

Micro-

gridMesh

network

Branch network

Future model with variable network types

• Some SPS and micro-grids in periphery of network

• Thin pipe connections to areas with local generation and storage

Integrated Network Fringe Disconnection Modular Network Fully Decentralised

Possible evolution of WA’s network

The Western Power of the future…

Modular Network Future model with variable network types:

Strongly meshed urban distribution networks;

Some SPS and micro-grids in periphery of network;

Thin pipe connections to areas with local generation and storage;

Micro-grids developing with infill projects; and

Continued relevance of transmission networks in some areas.

Stand alone power systems (SPS)

Micro-grid

Mesh network

Branch network

Our emerging technology program

We are undertaking a broad ranging program of work to understand …

– Which technologies?

– How and when will they emerge?

– What are the potential impacts?

– How do we engage and respond?

Standalone Power Systems

Advanced metering

Battery Storage

Transmission scaled storage

What’s next…

…and Microgrids

Australia’s largest microgrid to be located in Kalbarri

$300k seed funding for a Micro Grid in Kalbarri. Energy solutions firm Enerji undertaking a feasibility study with Western Power

This model provides excess renewable generation to island Kalbarri in fault conditions and push power back to Geraldton under normal conditions

A win win for Kalbarri and the network, with the grid being utilised more sustainably

Kalbarri’s Microgrid

Electricity Networks Corporation trading as Western Power

ABN 18 540 492 861

24/7 Emergency Line 13 13 51

General Enquires 13 10 87

TTY 1800 13 13 51

TIS 13 14 50

Email enquiry@westernpower.com.au

Website westernpower.com.au