Small and remote Tasmanian communities might benefit from a $50 million scheme to investigate new power generation options.
Federal Energy Minister Angus Taylor on Friday will announce a national program to support feasibility studies into energy microgrids in regional communities.
"Microgrids are stand-alone power systems that can operate independently or maintain a connection to the grid by harnessing distributed energy resources such as solar voltaics and batteries," Mr Taylor said.
"This $50 million commitment to microgrids is to address energy supply issues in regional and remote areas and get more reliable and affordable power to Australians when they're right on the edge of the grid.
"Microgrid technology is becoming increasingly cost-effective, creating the opportunity for a reliable, low-cost, off-grid supply.
"This is especially useful for customers in remote locations, on the fringe-of-grid, reducing the need for expensive poles and wires."
Mr Taylor said supplying remote, grid-supplied customers with self-supporting microgrids could save hundreds of millions of dollars in network infrastructure and maintenance costs while improving reliability
Renewables-based microgrids could reduce the use of diesel generators in remote communities.
The scheme would fund community organisations, electricity distribution businesses and others to do feasibility studies on the viability of microgrids in off-grid and fringe-of-grid areas.
This is especially useful for customers in remote locations ...Angus Taylor
Mr Taylor said feasibility studies were the first step to unlocking investment in microgrids.
Where they were found to be economically viable, more support could be sought from the Australian Renewable Energy Agency (ARENA) or the Clean Energy Finance Corporation (CEFC).
The $20 million first round of the feasibility study funding scheme - the Regional and Remote Communities Reliability Fund - is open to applications.
They will close on November 21.
Mr Taylor said further information could be found at www.grants.gov.au