In this latest edition of Expert Insights, we discuss the opportunities and potential for the widespread rollout of FPV systems in Australia with Ross Warby, Founder and Managing Director, and Craig Jones, Chief Operating Officer, of Enervest.
Enervest is an Australian-owned and operated company specialising in the design, construction and operation of energy generation and storage assets with over 15 years’ industry experience. Its proven track record is driven by the development of solutions that bolster energy resilience and facilitate the shift to low-carbon emissions and net-zero goals.
What do Singapore, China, India, France, Indonesia, the U.A.E and the U.S.A have in common?
They all have utility-scale floating solar power plants.
A floating solar farm or a floating photovoltaic (FPV) system is a renewable energy generation system that is installed on bodies of water including dams, lakes, reservoirs, ponds and in some instances, the sea. The technology involves mounting solar panels on floating or fixed structures on bodies of water which keep the panels afloat while also exposed to sunlight.
Of the numerous benefits generated by FPV systems, land conservation, improved efficiency and water loss reduction rank the highest. Water scarcity is a persistent issue in Australia and an exceptionally valuable commodity with the annual water market turnover for 2020-2021 estimated at $6 billion1. However, it is estimated that 40% of the capacity of Australia’s total open water reservoirs is lost annually due to high rates of evaporation2 with climate change threatening to exacerbate this loss even further3.
Depending on their location, FPV systems provide other benefits such as reducing algae bloom and producing higher energy yields due to the regulation of solar panel temperature. It is estimated that with just 30% FPV coverage on the 114,555 global reservoirs the potential for electricity generation is 9,434 TWh per year4.
On the prospects of widescale FPV deployment in Australia, Ross says, “The deployment of large floating solar farms in Australia is quite an obvious step in the country’s clean energy transition. Everyone knows Australia has a water issue, so why aren’t solutions combining water conservation and climate change objectives?”
While FPV installations in Australia are limited, known projects such as the project at the wastewater treatment facility in Jamestown, South Australia, the 100kW system at Happy Valley Reservoir, Adelaide, the 99kW installation in Lismore, New South Wales and the 500-kW project under construction at Warrnambool’s Brierly Basin5 in Victoria showcase the growing interest and potential for FPV systems.
When we asked about the more important technical considerations in relation to FPV Craig says, “Key considerations are anchorage of the FPV system and dam safety. There are many unique characteristics present in water bodies depending on whether they are natural or artificially built, their economic and cultural uses. Existing regulations can vary from state to state and water resource to water resource. This also affects the type of technology that can be used.”
According to Ross, while in many respects FPV projects relate closely to ground mounted solar power projects, the issue of anchorage can result in long delays – particularly if the FPV system will affect the integrity of the structure of the dam, pond, or waterway.
“One way to balance this risk is through de-scoping the anchorage risk from the other construction risks. Even if this is done, the poor management of anchorage risk affects overall implementation of the project. You just cannot start construction without resolving anchoring first.”
“Early engagement with key stakeholders such as the regulatory authorities and the design and engineering teams is vital”, adds Craig. “It’s easier to predict where issues will arise if the key players are engaged at the earlier stages so that everyone can brainstorm and come up with a workable solution that helps the project progress. Prevention is always better than the cure, right?”
Both Ross and Craig agree that what FPV projects require is a ‘stakeholder manager’ or someone who can connect the parties who will benefit the most from FPV projects such as water corporations and agricultural producers, with developers and financiers. This is because FPV systems are yet to become part of mainstream discussions making it unlikely that parties will actively seek each other out.
This is also in part due to a lack of information and information asymmetry. For example, in order to design anchorage and floatation systems, extensive data about the relevant body of water and the movement of water is required. Bathymetric studies would provide helpful information, but such studies and surveys are expensive and not performed in the ordinary course of running, for instance, a farm. Fractured control and ownership over viable bodies of water complicate this issue further.
“The information asymmetry issue becomes critical at this juncture because financiers need financial data. While some parties who own or control viable water bodies will have this data, most will not,” says Craig highlighting a ‘chicken-and-egg situation’ hindering the financing and roll-out of FPV projects.
In respect of costs, anchoring and floatation equipment design and installation expenses can drive up capital expenditure making it more expensive than ground mounted solar projects. However, it is important to highlight that project revenue is not limited to the sale or use of the electricity generated. Savings from lower water evaporation, higher yields from the water protecting the solar panels from extreme temperature variations and lower maintenance costs are additional, quantifiable returns on the investment in the FPV systems.
“You’re probably thinking, ‘Who will cover the costs of these tests?’. In the long-term, the cost of testing will be absorbed by the project’s revenue and contribute to the overall success of the project. [In the short term], it’s a risk requiring the right project sponsor/s that either have belief or experience in FPV systems.
Ensuring that we have enough skilled personnel to deliver reliable services is another vital component. Such challenges present a wonderful opportunity for engineers, analysts, scientists and project managers who want to use their skills in new and exciting ways,” says Ross.
In principle, however, the primary element of FPV systems is solar energy generation which has proved its bankability and technological reliability. It is the technical consideration relating to anchorage and floatation that is unique. Even a complex regulatory framework does not necessarily sound the death knell for FPV projects. Ultimately, it appears to be a lack of awareness about the benefits and the transferability of technology.
“Right now, we need a few sponsors to help mainstream the technology and validate its potential. The experience from just a couple of large projects will trigger scalability and network effects after which it’s just a matter of natural progression. The Government is best positioned to help de-risk FPV projects and to coordinate data and information gathering,” observes Ross, while adding that Government initiatives, especially in highly regulated industries like water can catalyze exploration into FPV projects and eventually, their widespread deployment.
The opportunities created by the clean energy transition will be wasted if industries fail to recognize that new-energy technologies can be adapted to overcome traditional boundaries maintained between the industries. Inter-sector collaboration and cooperation is the need of the hour; and those with the risk appetite and ability to allocate appropriate time and resources to this end may stand to benefit.
Ross concluded, “The ingredients for success are there, someone just needs to go into the ‘kitchen’ and put them all together,”.
The Hamilton Locke team advises across the energy project life cycle – from project development, grid connection, financing, and construction, including the buying and selling of development and operating projects. For more information, please contact Matt Baumgurtel.
1Australian Bureau of Meteorology, Australian Water Markets Report 2020-21 http://www.bom.gov.au/water/market/documents/The_Australian_Water_Markets_Report_2020-21.pdf .
2Craig, I., Green, A., Scobie, M., Schmidt, E., Controlling Evaporation Loss from Water Storages. Report, 2005.
3Fernanda Helfer, Charles Lemckert, Hong Zhang, Impacts of climate change on temperature and evaporation from a large reservoir in Australia, Journal of Hydrology, Volume 475, 2012, Pages 365-378.
4Jin, Y., Hu, S., Ziegler, A.D. et al., Energy production and water savings from floating solar photovoltaics on global reservoirs, Nat Sustain 6, 865–874 (2023).
