Reviewing the Viability of Renewable Energy in Community Electrification: The Case of Remote Western Australian Communities

Governments and utilities are struggling to respond to the increasing costs of energy supply in remote networks while still meeting social objectives of access and availability. Due to vast distances and sparse population, remote Australian communities are generally electrified by distributed networks using diesel generation. This is expensive, environmentally damaging and fails to exploit vast renewable resources available. These communities are often regarded as “low hanging fruit” from a renewable energy deployment perspective. This paper examines why picking that fruit is not straightforward. In Western Australia, the local electricity distribution utility responsible for remote networks, developed a scheme to incentivise renewable energy deployment in remote communities. This scheme aims to facilitate renewable energy deployment from the “bottom up” by providing a feed-in tariff capped at $0.50/kWh, to reduce the supply cost and environmental damage from diesel generation. This incentive is designed to encourage communities to fund installation. However, to date, there has been limited deployment of renewables in remote communities. The viability of renewable energy in three indigenous communities in the Kimberley region of Western Australia all connected to isolated, diesel powered networks is assessed. Both the potential benefits that can arise across remote communities as well as the barriers to deployment are considered. Renewable energy installation is found to benefit the utility but can also benefit communities subject to their cost of capital and to the imposition of connection charges. However a range of barriers are frustrating deployment and a dynamic and adaptive approach that recognises local challenges and provides the communities with a pathway to installation is needed.