Australian researchers have developed a high-resolution energy modeling framework to assess how PV and batteries can provide 24/7 electricity to heavy industries, taking into account costs, grid interaction and load flexibility. They found that while reductions in technology costs help, smart grid integration and flexible industrial operations are much more effective at reducing electricity costs and enabling 100% sustainable energy use.
Researchers from the Australian National University have explored the techno-economics of PV and battery integration in heavy industry through energy simulations and a new high-resolution energy modeling framework that includes life cycle degradation and production intermittency.
“Our research focuses on a core question: can PV and batteries reliably supply electricity 24/7 for energy-intensive industries such as steel, aluminum and cement?” told the study’s corresponding author, Bin Lu pv magazine. “Using an integrated modeling framework, we compare three strategies: technology cost reduction, network interaction, and industrial load flexibility. This comparative assessment provides new insights into how each strategy shapes the cost-effectiveness of PV-based electricity supply for heavy industry.”
The key feature of the new methodology is its ability to co-optimize electricity generation, storage and use with hourly temporal resolution over a 25-year economic lifetime. Furthermore, PV intermittency is captured at multiple timescales, meeting the operational needs of heavy industries under a variety of weather conditions, while also reflecting the decline in electricity generation and storage capacities over time. Computational limitations are addressed using a nonlinear net load method within the energy balance modeling framework.
Image: The Australian National University, Solar Energy, CC BY 4.0
The modeling assumes that a 24/7 continuous industrial operation is powered by on-site solar and batteries, with gas turbines as backup. A heavy industrial plant in Western Australia is used as a case study, with a continuous industrial load of 100 MW modeled as the base case. Both PV and batteries are modular and can be easily scaled to meet the size of any industrial enterprise depending on the scenario.
The team examined three strategies. The technology cost reduction strategy explored various scenarios of falling PV battery prices; in the grid integration strategy, the industrial facility was allowed to import and export electricity to and from the grid; while in cases of industrial load flexibility the facility could shift production of some industrial processes to sunny hours. The PV efficiency was kept constant at 21% for the Li-ion battery storage at 85% and at 50% for the gas turbine.
Image: The Australian National University, Solar Energy, CC BY 4.0
The degradation rates for the PV unit were 0.6% per year and 1.8% for storage, while the discount rate was 6% over a 25-year lifespan. Operation and maintenance costs for PV were estimated at AUD 12 ($7.9)/kW/year, and 1% of the capital cost/year for the batteries. Capital costs for PV ranged from AUD 300/kW to AUD 1,500/kW across scenarios, and battery ranged from AUD 100/kW + AUD 100/kWh to AUD 500/kW + AUD 500/kWh.
“The most surprising result is that even if the cost of solar energy and batteries falls by 80%, electricity costs for heavy industry will only fall by about 40%. The reason for this is energy waste. When solar energy generation exceeds what the industry can consume or store, the excess energy must be curtailed,” Lu said. “Our research points to effective ways to overcome this limitation. Smart grid interaction and flexible industrial operations significantly improve solar energy utilization, reducing costs more effectively than simply reducing technology costs. These strategies enable industries to extract more value from solar energy generation and achieve deeper decarbonization at a lower cost.”
The research team also found that interacting with the electricity grid reduces reliance on gas-fired backup power and could reduce electricity costs by up to 42%, while achieving 100% renewable energy integration. Tax flexibility achieved by adapting industrial activities to the variability of renewable energy could reduce electricity costs by as much as 80% while enabling 100% renewable energy integration.
“Our next step is to work with steel, aluminum and cement companies to translate these findings into industrial applications,” Lu concluded. “Future demonstration projects will help optimize flexible operational strategies under practical industrial conditions and inform large-scale implementation across industry.”
The research work was presented in “Decarbonizing heavy industry operations with low-cost solar photovoltaics and on-site battery storage”, published in Solar energy.
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