Regulating off-the-grid: Stand-alone power systems in Australia

Abstract

With continuous decline in the cost of distributed generation technologies, a stand-alone power system (SAPS), typically comprising solar photovoltaic (PV) integrated with battery storage, can increasingly substitute for a traditional connection to the network. This chapter examines two issues in this context, namely, (1) should the regulatory framework for SAPS-connected customers be the same as for grid-connected customers? and (2) should the regulatory framework for SAPS driven by different parties be the same? The answer to the first question is "broadly yes," if the objective is to minimize the costs of transitioning on-grid customers to off-grid. The answer to the second question need not be "yes." While our discussion is confined to Australia, the lessons learned have universal application.