Milk a microgrid

Copy of Chris Farm 9

There’s something interesting going on in the Latrobe Valley right now that I thought you ought to know about.

Local residents are being asked to sign up to a local energy feasibility study which, if it gets the go-ahead, will enable people with solar panels or wind turbines to sell any excess energy to others in their neighbourhood on their own terms – determining their own profits.

For dairy farmers, with lots of land and rooftops, it could provide another profitable income stream – not only saving energy costs but turning farms into profit-generating powerplants of the future.

To tell you more about it, here’s Belinda Kinkead, from the LO3 Energy team who are setting it up.

The Latrobe Valley project is such an exciting project for us because it is an opportunity for our technology to provide a significant and much-needed benefit to an entire industry.

We are working with Dairy Australia on this project and understand that reduced revenues are already making it hard to balance the books. We hear you.

Increasing running costs and greater weather unpredictability is only making it worse – and we were surprised to learn that, as a result, one in five dairy farmers are now preparing to quit.

But don’t quit just yet – because this could provide a way for you to turn things around.

It’s all about electricity.

You know better than me that dairy farming spends a lot of money on electricity. It’s used to run milking machines, pump water for irrigating fields, keeping milk chilled, heating water for cleaning equipment and providing light in the early morning hours.

And it’s expensive.

One case study showed a farm with 500 cows, 400 of which were milked twice daily, used 320 MWh of energy per year (875kWh per day). At an average cost of 25cents per kWh, that’s approximately $80,000 per annum[1].

But as farmers, you have extensive land and large areas of rooftops – perfect for solar panels or micro wind turbines.

Installing solar clearly has its benefits – it can reduce the amount of energy you have to buy from the grid, and any excess can be sold back to the grid.

Therein lies the problem. Right now, the only place to sell it is back to the grid, and it’s a closed market. There’s no price negotiation which means the return is usually in the retailers favour.

But, what if you could sell your unused energy to people in the local area – at a price they’re willing to pay? You reap the full benefit of the sale price of your energy.

For example (unless you were lucky enough to be an early solar uptaker) you would probably receive a feed in tariff of 10 – 15c/kWh[2] from your retailer. When you buy electricity from your retailer you would likely pay more than 35c/kWh at peak times, and more than 20c/kWh off-peak. That’s a significant gap.

There’s the prospect of a win-win where you can sell your excess generation to a neighbour for more than the feed in tariff, and they can buy electricity from you for less than the retail price. There are also other benefits associated with keeping your energy spend within your community – supporting local businesses and local jobs.

That’s the idea behind the Latrobe Valley Microgrid, a local energy market place.

It sounds complicated, but actually, it’s simple, and it’s proven – we’ve been running one in Brooklyn, New York for two years and the locals love it.

You might like to know that we have also partnered with SMF, and through the local councils, offer a financing option (Environmental Upgrade Agreement) that could ease your cashflow concerns for solar installations.

Everywhere in the world, technology and the sharing economy is changing business models – from Airbnb to Uber.

Adapting for the future is essential – and this really does make sense.

So if you’re looking to add additional revenue streams into your farm, take a look at what could be the solution. It’s all laid out on www.LatrobeValley.Energy

You can help make it a reality by taking part in the project. Join our feasibility study now. It doesn’t cost anything, we just need your consent to use your energy usage data on an anonymous basis to model the cost/benefits for the project. The more data we get, the more precise the results. Get online and register www.LatrobeValley.Energy.

[1] http://www.aginnovators.org/initiatives/energy/case-studies/energy-efficiency-supports-viability-family-run-dairy-near-wagga-wagga

[2] VIC minimum tariff for 2018/19 is currently 9.9c/kWh (https://www.energy.vic.gov.au/renewable-energy/victorian-feed-in-tariff)

7 thoughts on “Milk a microgrid

  1. Do you think it will ever eventuate for people not on farms as well Marian, or is it just for dairy farmers? Sounding very interesting.

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