5 ways to go green and reduce electric bills forever
Extreme weather events are becoming more prevalent, and unfortunately, this is the world we live in today. Burning coal is still Australia's largest source of climate-damaging greenhouse gases, and as demand for energy increases, so too does our carbon footprint.
The problem with most green energy solutions often boils down to a question of money - how can we cost-effectively reduce our carbon footprint. Or better yet, how can we use innovative technology to monetise clean energy and reduce electric bills? It's time to stop waiting for others to change and start thinking about what you can do now. Your actions will go a long way towards a brighter, more sustainable future.
There’s green on the grid
Our electricity grid combines power generated from multiple sources including coal, natural gas, hydro, wind and solar, and the wholesale price per kWh fluctuates with supply and demand. During the day, solar generation is at its highest which drastically reduces the cost of wholesale energy. As the sun goes down, fossil fuel generation (including harmful black coal and sometimes diesel) is required to meet an increase in demand which pushes the wholesale price up, along with your carbon footprint.
You can make a difference by avoiding using energy-greedy appliances such as your dishwasher, washing machine and clothes dryer until after 9.30 pm or setting it to run during the day. By reducing your usage at peak times, you're alleviating pressure on the grid, which means you're helping to reduce Australia's reliance on fossil fuels.
You can even score yourself some decent savings on your electricity bill by choosing an energy retailer that gives you access to wholesale energy rates, like Powerclub. Powerclub passes on the cost of wholesale energy at the time you use it. Meaning, if you use more energy when solar generation is higher, you'll pay less for it. You will need to upgrade to a Smart Meter, which records how much power you use, and the time you use it and download Powerwatch to track energy prices. For about $100 a year – it's a smart solution to help reduce your carbon footprint and your electricity bills.
Let’s talk carbon offsets
There are lots of opportunities to do damage control through carbon offsets - from electricity offsets to air-travel, car hire and more. Offsetting compensates for the deadly carbon emissions by investing in projects that reduce or avoid CO2 emissions elsewhere such as reforestation, and renewable projects.
Carbon offsetting sends a clear message of intent when it comes to climate change. The more solidarity there is around the issue, the more power we have as a collective force to encourage more significant change from the Australian government. Paying for carbon offsets can quantify the real cost of environmental damage, giving governments and other institutions data to formulate better strategies for carbon neutrality. You can feel good knowing that your investment is helping to expand renewable energy technologies and other projects.
However, without effective behavioural change, you still form part of a supply chain that demands more and more energy generation from dirty fossil fuels. In effect, offsets are like the modern-day equivalent of paying for indulgences. Additionally, the market for carbon offsets is unregulated, and there is not enough evidence to be sure that your carbon offsets will neutralise the damage dirty energy generation does to the atmosphere.
Do your research before you invest in carbon offsets and have the company explain precisely where the money goes so you can make an informed decision about whether it’s worth it for you.
The power of the sun
Our sun is the oldest and most potent source of energy on earth. It delivers more power in one hour than the whole planet needs in a year. However, we don't have the technology to harness all of it yet.
Installing solar panels is a great way to capture some of this clean energy, and drastically reduce electric bill amounts. Energy retailers pay a solar feed-in-tariff (or FiT) for every kWh you export into the grid, which can help to reduce your pay-back period. Having solar on your roof is also known to be a bargaining chip for a higher revenue when the time comes to sell your property.
Energy is a unique commodity in that it must be used when it is generated. That can either be to power appliances in your home, exported to travel along the grid to where it is needed or stored in a battery for later. The average household uses electricity early in the morning before work, and in the evenings after work. If no one is home to use solar power when it is generated during the day, it will be exported onto the grid to be used elsewhere. These exports make a return for the household as the retailer pays you a FiT; however, that is rarely enough to cover the initial cost of your solar installation.
To get a fair return on your solar exports, join a wholesale retailer like Powerclub that pays the wholesale value of your exports. Powerclub helps you track wholesale prices and advises you of spikes so you can drop your household usage to a minimum and export as much as possible into the premium price; making you a nice return!
With your solar-generated energy not being used and exported to the grid during the day, the energy you use in the evening and the morning must come from the grid. These are peak periods of demand, so you're probably using more dirty energy than clean. Effectively, your solar generation will act more like a carbon offset; however, it's unlikely your exports will make your household energy use carbon neutral.
Make it. Store it. Use it.
If your motivation for installing solar is ecological, you should consider a battery to store your solar generation. Your rooftop solar will generate electricity during the day (provided the sun is shining), and your battery will store it for later giving you more independence from the grid and reliability in the event of a blackout.
Solar and battery technology will also help you eliminate or reduce your electric bill, which can account for thousands of dollars in annual savings.
Sounds great right? Well, not so fast!
Solar and batteries aren’t cheap, so it’s important to consider your personal situation carefully before buying. The payback period will vary across different households and system sizes, but most households still find adding a solar storage unit financially inviable.
There is good news on the horizon as the increasing demand for this technology starts to bring it closer to mass affordability. To help support growth in the market, each state government offers rebates to subsidise some of the cost for home and business owners. If you’re in South Australia, you may be able to access up to $6,000 from the scheme, making battery storage a no-brainer.
Turning green into green$
Virtual Power Plants (or VPPs) are gaining rapid traction as they provide a solution to monetise our sustainable ambitions. A VPP is a network of solar panels and battery storage working together to generate, store and feed energy back to the grid when it is most profitable to do so — such as when wholesale energy prices rise to meet peak demand periods. It is generally controlled by a centralised control centre to coordinate energy exports through cloud-based software. As the VPP grows, the combined battery size will be able to export massive amounts of stored, clean energy onto the grid to meet demand.
Wholesale energy prices fluctuate every 5 minutes and can occasionally spike above $10 per MWh for short periods, usually during extreme weather events like a heatwave. Creating a VPP event during this price spike will earn the operator a healthy profit.
There are some attractive offers available for solar and battery storage investors to participate in a VPP, from capped financial incentives to annual credits on your electricity bill. However, without full access to VPP events and wholesale energy prices, they are still unlikely to provide a return on investment.
Unlike other VPPs on the market, participants of Powerclub and Power Ledger’s VPP receive full revenue from VPP events, giving them the power to exploit wholesale energy market fluctuations as operators. By trading their stored energy when wholesale prices are high, the VPP enables participants to pay back their solar and battery faster and start turning their generation into profit. Both Powerclub and Power Ledger charge a fixed daily rate with all VPP benefits going to participants.
Power Ledger’s technology is an energy trading platform that calculates your usage requirements against your solar generation to work out your net energy. That net energy is then traded on the grid when demand increases, earning you a higher sales price per kWh, while your stored energy will provide power for your home.
Additionally and if required, the technology will pull electricity from the grid when wholesale prices are low to either restock your battery to use later or to re-sell to the grid at a higher price. For the greatest transparency, increased automation and reduced possibility of human error, every energy transaction is recorded on the blockchain. Blockchain technology removes friction, streamlines price discovery and allows for energy to be traded easily.
We expect the total savings and revenue to be between $2,500 - $3,000 per year based on daily usage of about 25kWh and anticipate the pay-back period to be reduced to 6 - 9 years. Of course, each participant’s returns will be slightly different depending on how much spare battery capacity they have at the time of export. Participants with lower usage are more likely to have additional capacity and therefore, gain higher returns. The system is fair which is why each household or business gets rewarded in direct proportion to their participation.
In Australia, energy generation is the largest source of greenhouse gas emissions, with 72% of our electricity being produced by coal-burning power stations. By exporting your solar energy to the grid during periods of peak demand, you're helping to alleviate pressure on the grid, which reduces Australia's reliance on fossil fuels. With Powerclub and Power Ledger’s VPP using your solar generation and battery storage to supply power to your home and your community, you're providing another source of zero-emission electricity and a healthy income for yourself.