NEXTGEN ENERGY STORAGE GRANTS ROUND 4INDUSTRY BRIEFING

20 May 2019

Presentation overview

1. Policy background

2. Evaluation process

3. Lessons learned and changes for Round 4

4. Next steps and further information

POLICY BACKGROUND

Background

• $25 million Next Generation Energy Storage program

• Opened 18 December 2015

• Three (3) funding rounds awarding close to $6 million

• Supporting the roll out of up to 5,000 batteries (or 36 MW of

‘smart’ storage)

• Over 1,150 systems supported

• Current subsidy is $825 per kilowatt of sustained peak output

• Next Gen mid-term review

Review

• Independent review of program found:

– accelerated battery adoption and stimulation of the local economy

– customer satisfaction and reported savings on power bill

– even installation distribution across the ACT

– stakeholder support for program’s data requirements - seen as

fundamental to unlocking its full potential

– rebates should continue to be paid on sustained peak output rather

than on capacity

Next Generation Energy Storage Program• Competitive grants

– paid for a ‘Certified Installation’ of an ‘Eligible System’

– paid based on the Grant Price ($) per kW of Sustained Peak Output

– installer provides the customer with the discount and then invoices theTerritory

• Government sets requirements of ‘Certified Installation’

• 12 month Deeds to 31 July 2020

• One Deed (or grant) per installer

36 MW reduction in electricity peak (ACT) from energy storage systems in 2020

Total value of reduced peak demand

Savings up to $220M in present value terms on transmission and distribution investment

Context: Canberra’s climate targets

2020• 40% reduction in

greenhouse gas emissionson 1990 levels

• 100% RenewableElectricity

2045• Zero net emissions

2045

EVALUATION PROCESS

Eligibility and evaluation

Proposal Evaluation Criteria Weighting

EV1 Proposed Grant Price per kW (AUD, ex GST) unweighted

EV2 ACT local benefits 50%

EV3 Execution risks 50%

*Application process has been streamlined for existing installers

Key Eligibility Requirements

Canberra office

– Customer sales & support

Future Proof Installations

– ESS capable of responding to changing markets

Installations comply with:

– Min. warranties

– Safety Management and Installation Guide

– Data Specification

General Proponent Requirements

• Minimum indemnities and insurances

• Communication & Reporting• Contractor Management• Work Health & Safety• Qualifications & Training

Equipment and Installation Standards

• Applicable Standards– Equipment and installation

• Transport of dangerous goods• Mechanical Protection• Fire Protection• Signs, Labels & Manuals• Maintenance & Warranty• Building class requirements• Consumer information

Eligible Energy Storage Systems

and must:– be able to be charged from a (behind the meter) solar PV system– be connected to a electricity network– Provide at least 1 kWh of usable energy storage– comply with the Safety Management and Installation Guide

Lower Limit Upper LimitESS Capacity (kWh) 1 kWh None

Sustained Peak output (Grant basis, kW AC)

No lower limit 30 kW

PV generation system size (New or existing, kW DC)

50% of the Sustained Peak Output of the ESS

No upper limit

Data Specification and data platform

• Applies beyond proponent

– outlines roles for ‘data coordinator’ – to be appointed by Government

• Defines data to be collected

– One-off: System & household information, installation information

– Interval: operational. 5 min minimum

• Transition from quarterly reporting to automated ‘live

stream’

EV1 – Grant Price

• Grant Price is expressed in $/kW of Sustained Peak Output

• Sustained Peak Output is the minimum of:a. the maximum continuous one hour output of the

Energy Storage Device*; orb. the maximum rated sustained one hour output of

the Inverter** Based on manufacturer specification

• Proposals with a low but well justified Grant Price will be favoured

• Government may standardise grant price

EV2 – ACT Local Benefits

The ACT Government is strongly committed to being a beacon for cutting edge global clean tech innovation,

led by a dynamic and connected community of businesses, government, consumers and institutions

EV3 – Execution Risks

• Ability to conform to Safety Management and Installation Guide

– Safety, quality and training track record

– Who will undertake the installs?

– Accreditation: CEC design and install (or an ACT approved equivalent training level)

– Appropriate for building type

• Financial stability, insurances/warrantees and capability

• Delivery on-time

– Access to equipment

– Customer business case

• End-of-life plan

What are we looking for?

• Clear understanding of

– Target audience, price-points and customer acquisition plan

– Local investment benefits

• Experience

– Clearly identified installers & experience

– Safety management and end-of-life plans

LESSONS LEARNED AND CHANGES FOR ROUND 4

Key lessons learned so far…

1. CEC Retailer Code of Conduct needed at Deed commencement2. Local investment commitments need to be achievable and

measurable3. Sales and marketing plans need to be realistic and flexible to

deal with industry shifts4. Grant re-allocation capability provides fairness to installers5. Minimum ‘smart’ requirements for systems has led to

important industry collaborations6. Better communication needed between installers and

inspection team and Next Gen Secretariat

Key changes for Round 4

1. Removing the requirement for a new inverter 2. Simplifying the reapplication process for existing installers 3. Clean Energy Council Retailer Code of Conduct accreditation

prior to funding award4. Visible signage on the battery storage system notifying

residents of data collection 5. Universal device registry6. Minimum capacity rating7. Program extension beyond 2020

NEXT STEPS AND FURTHER INFORMATION

Funding Round Timeframes

Milestone Date

Funding Release Date 7 May 2019

Closing Date 11.59pm (Canberra time)2 June 2019

Announcement of Proposal assessment outcomes (estimated)

July 2019

• Governs process for award of Grant

• Advises Minister on which proposals constitute the best ‘value for money’

• Subject to addenda

– Q&As posted on Next Gen websitewww.act.gov.au/nextgen

• Separate submissions for ‘existing’ and ‘new’ installers through SmartyGrants

Next Generation Energy Storage Program Guidelines

Other key documents

Probity

Statutory sources of Probity and Key Probity Objectives

• Public Sector Management Act 1994 • Financial Management Act 1996 • Government Procurement Act 2001 • Fairness, impartiality and identification and management

of conflicts of interest • Accountability, integrity and confidence in expenditure of

public moneys • Appropriate security and confidentiality

Probity – Conflicts of Interest

General • Actual, potential or circumstances of perception • Declarations and disclosures by those who are involved in

the procurement process

Gifts and hospitality • Proponents or their associates must not offer gifts or

hospitality to any Territory or consultant’s employee • Territory officers and consultants involved in the Project

must not accept gifts or hospitality during the procurement, and report offers from proponents

More information

Communications• Unless otherwise notified, in accordance with the Program

Guidelines:in writing to nextgen@act.gov.au

• Questions and answers during the briefing will be published on Next Gen website www.act.gov.au/nextgen

• Induction session may be run following funding award

QUESTIONS?

After today, all questions must be addressed to:nextgen@act.gov.au