Embedded Networks: a global evolution
Power to the people.
I'm not talking revolution, rather an evolution on a global scale.
On the path to Net Zero, modern countries are looking at cutting edge methods of electricity distribution promoting sustainability, reliability and efficiency.
Right now, Australia is leading the way. Embedded networks allow private investment in solar power, battery storage and EV charging, while reducing power bills for customers.
But while Australia is now reviewing regulations for embedded networks, other countries are encouraging them with generous incentives.
What is an embedded network?
An embedded network is a private electricity network that serves multiple customers within a defined area. This can include apartment buildings, retirement villages, caravan parks or shopping centres.
The key features include:
Single connection point to the main grid, allowing the operator to leverage bulk purchasing power
Shared investment in community infrastructure like solar and EV charging
Greater price stability for customers compared to the regular retail market
They are designed to serve the unique needs of high-density residential, commercial, or mixed-use communities.
A number of countries regard embedded electricity networks as the future of energy supply. Governments in Europe, Asia and the US are supporting embedded networks to reduce grid dependency, lower energy costs, and integrate renewables.
Japan
Following the Fukushima nuclear power plant disaster in 2011, Japan is adopting more sustainable and disaster-resilient electricity supply networks. Decentralisation is key. By having more, smaller power generators, there’s less chance of one major natural disaster wiping out power across a broad area.
Real estate developers, like publicly listed Hulic, are now entering the microgrid and battery storage market. Already focused on generating 100% renewable energy for its developments, Hulic is planning three grid-sized battery storage projects this year.
United States
Embedded networks are also taking off in New York, California and Texas.
Prompted by frequent power outages during a wildfire crisis, California is leading the way, introducing regulations to encourage embedded networks that boost reliability.
The University of California has a daily population of 45,000. Its microgrid uses gas, solar and steam power and battery storage, to power 85% of its campus.
Brooklyn’s Marcus Garvey Village microgrid powers an affordable housing complex of 625 apartments. It reduces demand on the main network and boosts network resilience by being self-contained.
In Texas, even the military is getting in on the act, with the Fort Cavazos microgrid saving USD$125,000 in power costs every day and adding redundancy to a network that’s been hit by severe storms in the past.
Germany
Germany has a policy dedicated to decentralising energy supply. Called Energiewende (energy transition) it is focused on increasing reliability, while reducing the carbon footprint of power production. Energiewende provides generous subsidies and tax breaks to support embedded networks that generate solar power.
The policy has been in place since 1990 and has had its critics – especially in the early stages.
The achievements can’t be ignored, though.
In 20 years, the European powerhouse cut its CO2 emissions by more than one third and boosted uptake of renewable energies, while also phasing out nuclear power.
At any point, various political parties could have walked away. Instead, they held firm, setting Germany up for a cleaner, greener future.
In Texas, even the military is getting in on the act, with the Fort Cavazos microgrid saving USD$125,000 in power costs every day and adding redundancy to a network that’s been hit by severe storms in the past.
Singapore, and more
High density living lends itself to the adoption of embedded networks. In Singapore, they are increasing in popularity, especially as the island pushes an increased take-up of EVs.
Embedded networks will offer private charging stations, paying for the infrastructure upfront, and sharing electricity with its users.
Other countries that are actively encouraging the installation of embedded networks include the Netherlands, Canada and the United Kingdom.
Why are so many countries embracing embedded networks?
All of these countries see embedded networks as part of a solution to a big problem – powering communities, while simultaneously reducing their carbon footprint.
Embedded networks are perfect for this, because they have the capacity to adopt sustainable energy production. Batteries can store excess electricity for peak times.
Embedded electricity networks help build resilience into aging public networks by taking pressure of the grid.
Finally, they are cost effective. A private electricity network effectively subsidises public investment, sharing some of the load of energy production.
Is Australia different?
Yes and no.
Yes, because embedded networks in Australia don’t necessarily generate or store their own power. Solar panels and battery storage remain an expensive investment. Australian embedded network operators need certainty and government support before making such a large financial commitment.
The same goes for EV chargers. Regular energy retailers are unlikely to spend the money. However, private embedded electricity networks can install them in new developments.
A strong commitment from government would give private electricity networks the confidence to invest. The energy market should be strong enough to give electricity customers the benefit of choice.
The similarities between Australia and all these other countries are clear. Like any other country, we are facing a growing population with an aging energy network and the need for rapid uptake of renewables. The benefits all those other countries have seen from moving to embedded networks rings equally true Down Under.
If governments in the United States, the United Kingdom, Germany, Singapore and many more can see the benefit, then so can Australian policy makers.
Embedded networks promise a power evolution that will lower bills and provide better stability for users, while helping Australia to cut its carbon footprint and share the cost of building and maintaining expensive electricity infrastructure more equitably.
What is already a power evolution in Australia could so easily become a revolution, if we are brave enough to back embedded networks and fully embrace their potential, as is happening overseas.
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