In Australia, the production of electricity from the sun has begun to outpace what the system is capable of absorbing. This apparently paradoxical situation is the fruit of a fast-paced and profound energy transition. Beginning in July, millions of families in three large regions of the country (New South Wales, south-east Queensland and South Australia) will enjoy access to at least three hours of free solar energy per day, even if they don’t have panels on their rooftops. It’s a measure that does far more than any slogan could to demonstrate how renewable energy is changing not just the production mix, but the very rules of the electricity market.
At present, Australia is a global leader in distributed photovoltaics, with over 4 million solar systems installed, largely in residential contexts, against a population of around 26 million inhabitants. It’s thanks to this that overall photovoltaic capacity has reached about 40 gigawatts, with growth over the past ten years unequalled among advanced economies. Moreover, the photovoltaic power installed on Australian rooftops is greater than that of the country’s entire remaining fleet of coal power substations. During the middle of the day, particularly in spring and summer, solar production can cover more than 60-70% of instantaneous electricity demand in various regions of the nation. The result is a structural excess in offer that pushes wholesale prices towards zero, and often into negative territory. This situation is what has convinced the federal government to transform the surplus into public policy.