General Framework

Twice as much PV was connected to the grid in 2002 compared with 2001 and the grid-connected market segment is now approaching 11 % of the total installed capacity compared with less than 1 % six to seven years ago. The national BIPV support programme (which commenced in 2000 and which has recently been extended) and the renewable energy target for electricity retailers and major energy users (implemented in 2001 and recently reviewed), both discussed later in this report, are widely perceived as important factors in keeping this market segment growing strongly.

The Australian electricity industry continues to play a role in both remote area power supply and grid-connected PV although the degree of interest varies between businesses. This interest lies mainly with the retailing businesses and is largely stimulated by issues of customer contestability, the operation of greenhouse gas reduction agreements or licence conditions in a number of states and, more recently, as a means of reducing peak demand on mini grids.
The public is generally supportive of PV and interested in its use – however, even with rebates, PV is still an expensive option for grid-connected households and community applications.
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National Programme

• Mandatory Renewable Energy Target (MRET) – this target seeks to increase the contribution of renewable energy sources in Australia’s electricity mix by 9 500 GWh per year by 2010. Since 1 April 2001 electricity retailers and large energy users (known as liable parties) must purchase increasing amounts of electricity from renewable sources. A trade in Renewable Energy Certificates (RECs) and financial penalties for non-compliance are features of this scheme.
  A major review of the scheme – Renewable Opportunities: A Review of the Operation of the Renewable Energy (Electricity) Act 2000 – was published in September 2003.

• Supporting the Use of Renewable Energy for Remote Power Generation (RRPGP) – this programme commenced in 2000 and is expected to make over 200 million Australian dollars available over the life of the programme for the conversion of remote area power supplies (including public generators and mini-grids) from diesel to renewable energy sources, and for new renewable installations that would otherwise have been fueled by diesel. The RRPGP may provide up to 50 % of the capital value of the replacement or new renewable generation for off-grid users of diesel-based power generation.
  The programme is administered by state governments and a number of states also provide additional financial support for off-grid renewables.

• Supporting the Use of Solar Photovoltaic Electricity on Residential and Community Buildings, the PV Rebate Programme (PVRP) – this programme commenced at the beginning of 2000 with 31 million Australian dollars available over four years. The programme has now been extended until 2005 with a further 5,8 million Australian dollars available. Funding is provided by the Australian Government, with administration by the State Governments, and provides rebates to householders or community building owners who install grid-connected or stand-alone photovoltaic power systems. Under the PVRP extension, householders are eligible for a rebate of 4 AUD/W (previously 5 AUD/W), capped at 4 000 AUD per residential system (previously 7 500 AUD). Rebates are also paid for extensions to an existing system. Community buildings attract the same rebate except it is capped at 8 000 AUD (previously 10 000 AUD).
  The Australian Government has also made available one million Australian dollars to fund projects by residential housing developers, through a competitive bidding process.

• Renewable Energy Equity Fund (REEF) – venture capital can be made available by the fund manager to small innovative renewable energy companies that can demonstrate that they have an innovative development that is being commercialized. Although the Government is not directly involved in making investment decisions, along with the fund manager and private investors they can share in any profits from REEF.

State government policies are emerging that may have a positive impact on PV market growth. In particular, the New South Wales Government has set a state-wide benchmark of reducing greenhouse gas emissions. The parties who are required to meet targets for greenhouse gas emissions (such as electricity retailers) are called benchmark participants. Each year, the Scheme sets individual benchmark reductions of greenhouse gas emissions for each benchmark participant based on their contribution to the supply of electricity in New South Wales. Each benchmark participant then has to reduce the average emissions of greenhouse gases from the electricity they supply or consume to the pre-set individual benchmark level (or they pay a penalty). To achieve the required reduction in greenhouse gas emissions, benchmark participants purchase and surrender certificates called NSW Greenhouse Abatement Certificates (NGACs). One NGAC represents one tonne of carbon dioxide equivalent that would otherwise have been released into the atmosphere in generating electricity. NGACs are transferable certificates that may be freely traded between any parties. NGACs may be created by any eligible electricity generators (such as grid-connected PV systems) which reduce the average greenhouse intensity of electricity generation.
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Research, Development and Demonstration

The University of New South Wales (UNSW) Centre for PV Enginee-ring continues its world leading research into high efficiency wafer and thin film silicon cells. Other areas of research include buried contact cells, silicon light emission, silicon-based quantum wells and super-lattices, new energy up- and down-conversion concepts and energy collection using optical-frequency antennas.

BP Solar significantly increased both its mono and poly silicon cell efficiencies by installation of new plasma enhanced chemical vapour deposition (PECVD) Silicon Nitride systems on its production lines. BP continues its development of automated production equipment.

Pacific Solar is developing and commercializing a thin film PV technology called Crystalline Silicon on Glass (CSG) based on initial research at the UNSW. In addition to its R&D on CSG modules, Pacific Solar has developed and commercialized its own module inverters and roof mounting systems.

The Centre for Sustainable Energy Systems at the Australian National University (ANU), in conjunction with energy utility Origin Energy, has developed a new thin film PV technology to be known as “Sliver cells”. The ANU team is also developing parabolic trough and paraboloidal dish PV concentrator systems, and a Combined Heat and Power Solar System.

Murdoch University is developing methods of producing low cost silicon from a number of new sources for both wafer based and thin-film silicon solar cells. Sustainable Technologies International (STI) is demonstrating its world-first titania dye sensitized solar tiles and panels after many years of research.

Solar Systems Ltd. continues development and commercialization of its PV tracking concentrator dishes for off-grid community power supplies or end of grid applications. Current systems achieve 500 times concentration and use air or water cooling. System efficiencies of 20 % have been achieved. The systems are currently based on silicon cells, but work is continuing on development of non-silicon devices, which are expected to achieve 40 % efficiency.

PV Solar Energy Pty Ltd has developed and demonstrated a new PV roof tile, based upon a versatile extruded aluminium frame. The tile uses a new low cost pluggable PV junction box, developed by Tyco Electronics and monocrystalline solar cell laminates.
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Implementation

While more than 2,2 MW in over 1 500 household / community building systems have been connected to the grid as a result of almost four years of operation of the PVRP, the programme has also resulted in more than 3,1 MW and over 3 200 off-grid installations during the same period. It is worth noting that industry reported a severe cut in sales early in 2003 as a result of uncertainty surrounding the extension of the PVRP.

In contrast to implementation of grid-connected systems, the off-grid market is also helped by the RRPGP sub-programmes – which have mostly supported PV and have seen 1 MW installed by 2003, with only a small fraction of the allocated funds having been spent. RRPGP implementation is different in the various States and Territories and sub-programmes include: Western Australia’s Remote Area Power Supply (RAPS) sub-programme, targeting indigenous communities, isolated households and commercial operations such as pastoral properties and tourist and mining operations; Western Australia’s Renewable Energy Water Pumping (REWP) sub-programme; Northern Territory’s Renewable Energy Rebate Programme (RERP), targeting small and large communities, households, commercial and industrial operations; Queensland’s Working Property Rebate Scheme (WPRS) targeting family owned working properties; Queensland’s Renewable Energy Diesel Replacement Scheme (REDRS) targeting indigenous communities, households and businesses; Bushlight (Indigenous Renewable Energy Services Project) which aims to both increase industry capacity to service indigenous communities and to build greater understanding of renewable energy issues within communities; and RRPGP sub-programmes in NSW and South Australia.

Green Power sales from twelve Green Power retailers were recorded at about 123 GWh in the third quarter of 2003 (compared with 106 GWh in the third quarter of 2002) and with about 33 % more customers than 2002. However PV electricity accounts for less than 0,15 % of total green electricity purchased by the retailers. Energy retailer EnergyAustralia’s PureEnergy product accounts for about 60 % of the Green Power PV electricity sourced nationally.

Similar to the situation for Green Power, the recent review of MRET found that the ‘lowest cost’ approach to renewable energy implementation under the scheme has done little to stimulate the PV market. In fact, less than one per cent of RECs so far created under MRET have been generated from PV systems, and only about 170 PV systems have been registered as ‘eligible generators’.

Although maintaining a general interest in PV, only a small number of electricity businesses are currently installing PV systems. Some retailers own and operate systems installed during the 1990’s. There is some electricity business interest in using PV to achieve peak load reduction in diesel power stations. It could be argued that the human resources that were available to promote technology innovation and manage demonstration are now non-existent or are too busy dealing with energy policy issues and regulations.
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Industry status

In addition, of the 7 MW of modules manufactured 1,5 MW were exported. Imported cells and modules are also used in the Australian market.

There was a focus in 2002 on large area modules and laminates (140 W). Approximately 80 % of local production was large area modules. This reflects the market demand for lower cost per watt compared to the traditional 75 and 80 watt panels. About 1 % of production is for special building modules such as custom glass-glass atrium panels and PV roof tiles. However, there is increasing interest in this area as the grid-connect market increases. Special modules are manufactured to specification for Telstra, Australia’s telecommunications utility company.

Sustainable Technologies International is manufacturing Titania Dye Sensitized products (first phase capacity of 500 kW) with in-house manufacturing of all the key materials for DSC technology: titania paste, dye, electrolytes, catalytic paste, interconnecting material and internal sealants. The product is aimed primarily at façade integration.

Meanwhile, Pacific Solar continues the development of its thin-film CSG product, but has been forced to sell its business handling the Plug&Power™ ac module system for grid-connected rooftop applications.

Solar Systems is continuing to expand the installation of its successful CS500 solar concentrator PV dishes in remote communities. These parabolic solar tracking dishes consist of 112 mirrors concentrating to the equivalent of 500 suns onto 24 kW water-cooled upgradeable receiving modules. All up cost, including all remote infrastructure costs, is less than 10 AUD per watt. A 220 kW plant is now operating in the Pitjantjatjara Aboriginal community and several other plants are planned for other remote communities currently reliant on diesel power, with production expected to reach 2,5 MW.

Origin Energy is constructing a Pilot Plant to commercially demonstrate the potential of the Slivers TM technology. The plant is being constructed in Adelaide, and is designed to be expandable to approximately 10 MW p.a. capacity.

There are several Australian manufacturers of inverters and controllers. Their products cover both grid and off-grid markets and range in size from less than 1 kVA to over 100 kVA.
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Market growth

Australia’s vast size and sparse population have made effective remote area telecommunications, power supplies, water pumping, navigation aids and transport route signaling critical and expensive. PV continues to provide an important commercial alternative to diesel and central grid supplies for such applications. The telecommunications market sector is likely to remain strong over coming years. The water pumping market is also performing strongly. Increased interest and activity are also evident in the medium sized centralised system market for supply to “mini-grids” for off-grid communities and commercial enterprises. Installations include flat plate and concentrator systems for aboriginal communities and for tourist facilities.

With its relatively low electricity tariffs, PV remains an expensive option for grid applications in Australia and with government grants for grid-connected systems set to cease within a year or so, there is continuing concern that this market sector may well stall. The MRET review has noted that further consideration should be given to special assistance measures that would support the development of the PV industry in Australia, including measures to support increased installation of systems. While stopping short of recommending many of the PV specific changes to MRET that were flagged by various parties, the review panel has proposed some fine-tuning that will remove some of the recognized institutional barriers. MRET is not seen as a vehicle for achieving cost reductions or improving international competitiveness.
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Future outlook

Further reading about Australia

• Australia - Country information