$160 feed-in-tariff in three hours - it’s a Win-Win equation…

It was 2pm on Tuesday 13th February (we were all trying to get Tay Tay tix) when I received a rather unusual alert from my resi retailer Amber Electric's app: “Wholesale electricity prices are very high, consider turning off devices to reduce your load.” My home solar and battery system controlled by Amber’s software spent the next three hours trading the incredible highs (and subsequent lows) of the wholesale electricity market.?

Following the alert a quick check on AEMO’s site showed prices had just spiked at $16,600 MWh! What the hell just happened to cause that spike in the middle of the day? The answer was of course that six transmission towers collapsed near Geelong causing chaos in a highly volatile and strained grid.?

A quick 101 for those not aware: AEMO, the Australian Energy Market Operator manages the energy markets that connect electricity generators with buyers. While a typical wholesale price for electricity is around $50MWh (or 5￠ kWh - a similar value to solar feed-in-tariff), the market can go as high as $16,600 ($16.60 kWh) or as low as -$1000 (-$1.00kWh) - yep, you’re paid to consume electricity or charge your battery in negative priced events. These price signals drive behaviours in consumers that protect the physical grid: too much generation is bad and not enough is also bad - you need the ‘goldilocks’ amount of electricity to be matched between generation and consumption.?

With the exception of the considerable number of people who lost power, most people were oblivious to the market price that was being paid for power. It had no financial impact on retail consumers - your power price is locked in and you just pay what you pay - typically around 30￠ kWh. For consumers with the right battery however, Amber Electric, have been able to expose these households directly to the wholesale market. This has some risk of course because if my battery was empty and I had the power pumping (aircon, etc), I’d be paying $16.60 kWh for power. As it happens, the event began around 1:20pm on a very warm day and my battery was at 100% capacity.?

My battery, along with a host of other batteries, was being orchestrated by the software at Amber HQ and immediately began to discharge into the grid. My solar was also active so at times I was exporting without using any of the stored battery power, meaning I could do this for longer. High-priced events do happen relatively regularly but typically only for short periods. Given prices change every five minutes, it’s amazing that the $16,600 price remained for approximately 3 hours (60 intervals)! IN addition to this, as soon as the event concluded (i.e. some of the physical network constraints were resolved), the price went to - $1000 and I was paid handsomely to re-charge the battery.?

The outcome? $160 credited to my account in just over three hours. It’s not millions, but it kind of is if you consider scale. The Victorian Big Battery is 30,000 bigger than my system and that extrapolates out to nearly $5M. Batteries are supporting the energy transition by stabilising the grid and in return, they’re paid handsomely.?

So whether you’re a home-owner, a farmer or industrial warehouse owner, batteries are providing a win-win for the grid and investors.?Now, what to spend my $160 on!?