Australia\u2019s revolution in rooftop solar has left behind commercial and industrial buildings where installations have lagged far behind homes, according to new analysis.<\/p>\n
Australia leads the world in residential solar on per capita terms, with 22GW installed as of last December. But businesses have only installed about a quarter of that \u2013 5.6GW \u2013 despite consuming more electricity than households, a report from the Institute for Energy Economics and Financial Analysis (IEEFA) has found.<\/p>\n
Its authors argued that helping businesses fill roof spaces with solar could play a major role in adding power generation as coal plants close.<\/p>\n
The commercial and industrial sector must \u201cplay a far larger role in accelerating Australia\u2019s energy transition \u2026 if the country is to meet its renewable energy targets\u201d, the report\u2019s authors wrote.<\/p>\n
Sign up for the Breaking News Australia email<\/a><\/p>\n Commercial and industrial solar \u201ccan be deployed faster than utility-scale alternatives, because it generally doesn\u2019t require extensive planning and environmental approval processes, nor new transmission build that can add several years to the rollout of utility-scale power projects\u201d, the report found.<\/p>\n The analysis defined commercial and industrial solar as non-residential, non-utility energy users such as manufacturers, retailers, farms, hospitals and schools.<\/p>\n Co-author Johanna Bowyer, lead Australian electricity analyst at IEEFA, said the power-generating capacity installed on household roofs in Australia was \u201croughly equal to that of the coal plants in our grids\u201d.<\/p>\n \u201cHowever, we have not seen the same scale of action within Australia\u2019s commercial and industrial buildings, even though they consume substantially more electricity than the household sector.\u201d<\/p>\n The forecast capacity of the sector was between 17 and 31GW by 2050. \u201cStorage deployment is well behind households, though demand is increasing quickly,\u201d the report noted.<\/p>\n \u201cThe technical rooftop potential could be higher than that,\u201d Bowyer said. \u201cIf you also include agricultural areas, it could be above 80GW of technical potential.\u201d<\/p>\n Commercial loads in the national electricity market were higher in the middle of the day, the report noted. \u201cThe middle of the day is usually when businesses are operating, and that is very well suited to the solar profile,\u201d Bowyer said.<\/p>\n The IEEFA analysis identified four key barriers to uptake, including: that businesses often rent their premises, making investment in long-lived assets more complex; inconsistent network tariff structures; and slow and often unpredictable grid connection processes.<\/p>\n \u201cTenants might want upgrades because that will reduce their energy bills, but the landlord is the final decision-maker,\u201d Bowyer said, adding that business owners may not \u201chave confidence that their lease is going to be long enough for the upgrades to be paid back\u201d.<\/p>\n The report also suggested business premises are the \u201cmissing middle\u201d because \u201csystems are typically too large for residential incentives, such as the Cheaper Home Batteries Program, but too small for the utility-scale Capacity Investment Scheme\u201d.<\/p>\n \u201cWe\u2019ve recommended that governments look at incentive schemes that can support this missing middle,\u201d Bowyer said, suggesting as an example an increase to the instant asset write-off for systems and batteries over a certain size.<\/p>\n The report also recommends the review and standardisation of network tariffs, and reform of the economic regulation of distribution services.<\/p>\n In Victoria, the opposition has proposed creating \u201curban solar parks<\/a>\u201d to encourage solar and battery installations on commercial and industrial rooftops in greater Melbourne, arguing it would reduce the need for additional transmission lines.<\/p>\n \u201cThere are thousands of hectares of roof space on warehouses, factories, buildings in urban areas where we can be putting up solar farms with battery power and using the energy closer to where it\u2019s stored,\u201d state Nationals leader, Danny O\u2019Brien, said last month.<\/p>\n