Integrating solar PV and battery storage systems into facility management represents a strategic approach for Australian businesses seeking to reduce electricity costs, increase renewable energy usage, and achieve sustainability goals.
Properly designed systems can offer significant ROI through frameworks like the Strata Utility Governance model, commercial solar installations with typical payback periods of five years or less, and optimised battery storage systems that can capture twice the value of poorly managed alternatives.
The Strata Utility Governance Framework represents an innovative approach to managing electricity and other utilities within strata schemes, positioning the strata management body as a “citizen utility” that oversees both electricity and financial flows. This framework is particularly relevant for facilities integrating solar PV and battery storage systems, as it provides the legal and operational structure for sharing renewable energy benefits among property owners.
In Australia, strata utility governance is subject to state-specific legislation that establishes clear boundaries for decision-making and management. Since October 2019, New South Wales implemented significant reforms through the Fair Trading Legislation Amendment (Reform) Act 2018, which amended the Strata Schemes Management Act 2015 to limit utility agreements to a maximum of three years.
This change was specifically designed to prevent strata schemes from being locked into uncompetitive, long-term contracts often established by developers before residents had any say in the matter.
Key components of the Strata Utility Governance Framework include:
The framework offers three primary governance models for solar and battery storage integration:
Implementation challenges have emerged in practice. For instance, at the White Gum Valley development in Western Australia, researchers found resistance from strata management companies accustomed to “set-and-forget” utility models. Despite early involvement in designing the governance framework, one major strata company ultimately reverted to business-as-usual approaches rather than implementing the innovative model.
For facilities considering solar and battery integration, the framework provides essential financial metrics for assessment, including Net Present Value (NPV), Internal Rate of Return (IRR), and savings/avoided costs calculations. These metrics help strata committees make informed decisions about renewable energy investments while ensuring compliance with state regulations on spending limits and decision-making procedures.
It’s worth noting that embedded networks—where the owners corporation contracts with an energy retailer for supply to a parent meter and then on-sells to individual residents—are typically excluded from certain utility reforms, such as the three-year contract limitation in NSW. This creates a distinct regulatory environment for strata schemes utilizing this approach to energy distribution.
Commercial solar power systems represent a significant investment for businesses, making Return on Investment (ROI) analysis crucial for decision-making. The basic calculation for commercial solar ROI follows a simple formula: Total Investment divided by Yearly Savings. This calculation provides the payback period in years, indicating how long it will take to recover the initial investment.
For a practical example, consider a Brisbane business installing a 99kW commercial solar system at a cost of $170,000. With electricity costs at $0.26 per kWh, the annual savings can be calculated as:
99 kW × 4.2 hours × $0.26 × 365 days = $39,459 per year
This results in a payback period of approximately 4.3 years ($170,000/$39,459). However, this simplified calculation doesn’t account for all factors affecting ROI.
Several key variables influence commercial solar ROI across Australia:
National data shows significant variation in commercial solar payback periods across Australia. The average payback period for systems larger than 100kW is approximately 5.3 years, with state averages ranging from 2.5 years in the Northern Territory to 5.3 years in Victoria.
A comprehensive ROI analysis should also consider:
Real-time monitoring systems can further enhance ROI by identifying opportunities to shift energy-intensive operations to peak solar production periods, reducing reliance on grid electricity. For businesses with suitable load profiles, adding battery storage can improve ROI by storing excess daytime production for use during evening hours or periods of low solar generation.
When evaluating commercial solar proposals, businesses should request detailed ROI analyses that account for these variables and provide transparent calculations of payback periods, Internal Rate of Return (IRR), and total lifetime savings. This comprehensive approach ensures investment decisions are based on realistic financial projections tailored to specific business circumstances.
Battery energy storage systems (BESS) are becoming increasingly vital in Australia’s renewable energy transition, particularly as coal-fired power generation declines. With AEMO forecasting the withdrawal of approximately 8 GW of the current 23 GW of coal-fired generation capacity by 2030, energy storage solutions are essential to maintain system resilience amid the intermittent nature of renewable energy sources.
optimising BESS performance is critical for maximizing return on investment and supporting grid stability. The value captured by different battery systems in Australia’s National Electricity Market (NEM) varies dramatically, with some systems capturing more than double the value of others. This significant performance gap highlights the importance of effective optimisation strategies.
Several key factors influence BESS optimisation:
Third-party “autobidder” providers have emerged as key players in the optimisation landscape. While these specialized operators support some of the highest-performing individual batteries in the NEM, their performance is not uniformly excellent—some systems under their management underdeliver relative to their potential.
For facility managers integrating BESS with solar PV systems, optimisation strategies should focus on:
As the BESS fleet grows across Australia, benchmarking methodologies are being developed to compare optimiser performance while controlling for factors outside their control, such as availability, constraints, and MLFs.These approaches help facility managers and system owners identify best practices and maximize the value of their energy storage investments.
The optimisation challenge is particularly relevant for microgrids, where BESS integration is indispensable for power stability and reliability. Research on projects like the Kalbarri microgrid demonstrates how enhanced algorithms can reduce generation costs while managing diverse embedded resources and load demands.
Integrating solar PV and battery storage into facility management is no longer a niche strategy but a mainstream approach for Australian businesses aiming to lower operating costs and meet sustainability targets. By adopting the Strata Utility Governance framework, facility managers gain a clear decision-making hierarchy and fair cost-sharing mechanisms, ensuring that both developers and residents benefit from renewable energy investments.
A thorough ROI analysis—encompassing payback periods, IRR, NPV, and all relevant cost and revenue streams—empowers strata committees to make informed choices. Coupled with robust battery optimisation strategies and real-time monitoring, these investments can deliver reliable financial returns and enhance grid resilience, positioning your facility at the forefront of Australia’s energy transition.
Effective optimisation aligns charging with excess solar production and discharging during peak price periods, maximising revenue and value capture—sometimes more than doubling returns compared to fixed-revenue contracts.
There are three main approaches: resident-owned (full collective control), shared ownership (split responsibility) and third-party ownership (external management with resident benefits).
Embedded networks—where a parent meter supplies the building and energy is on-sold to residents—are often exempt from certain reforms like the NSW three-year contract limit, creating different regulatory obligations.
Committees should evaluate Net Present Value (NPV), Internal Rate of Return (IRR), annual savings and avoided costs, as well as projected maintenance, downtime and electricity price escalations.
Autobidder platforms dynamically bid battery capacity into energy markets, responding to price signals; when well-managed they can significantly boost value capture, though performance varies by operator.
