Responding to Peak Electricity Loads Using Renewable Fuel

South Australia's existing electricity market is operated as part of the National Electricity Market. This operation works very well for the majority of the year when demand is moderate. Under these conditions normal fluctuations in demand result in predictable supply responses. However when demand is unusually high, in particular during the afternoons of extended heat-waves, the electricity market becomes much more difficult to operate and manage. Under these conditions, market prices peak excessively relative to power consumption variation. This paper evaluates the potential of using large scale storage of hydrogen to enable suppliers and market operators to manage peak loads more effectively. The hydrogen can be produced via electrolysis during periods when the potential supply of renewable power is greater than actual consumption - we designate this as 'excess renewable energy'. Stored energy could be used to supplement supply in response to actual demand during short periods of peak demand during heat-waves. A comparison is made between a preliminary estimate of excess renewable energy, and actual peak demand quantum energy per year. Various alternative peak-demand generation operations, and market operation implications are also discussed.