By I. Hansana, Jadetimes News
Australia's Energy Market Operator Warns Against Delays in Renewable Energy Rollout
Australia's transition to nuclear energy is unlikely to occur in time to replace retiring coal fired power plants, potentially leading to higher costs and disrupted grid supply, the Australian Energy Market Operator (Aemo) has warned. In its Integrated System Plan (ISP), Aemo highlighted the urgent need for firmed renewables to ensure a secure energy transition.
Aemo's latest grid blueprint, published Wednesday, reiterates the findings of its December draft report, which projected the closure of all coal power stations by 2038. To meet decarbonisation targets, the construction pace of new wind and solar farms must double to 6 gigawatts annually by 2050. The report also specifies that solar and wind capacity should increase six fold to 58GW and 69GW, respectively, with rooftop solar quadrupling to 72GW.
Nuclear energy was not modeled in the 25 year plan due to its exclusion from federal and state policies and existing bans. Aemo cited a CSIRO report deeming nuclear one of the most expensive electricity generation methods, with design and construction timelines too slow to replace retiring coal plants.
The ISP's publication is expected to fuel ongoing political debates over Australia's energy future. The federal opposition recently proposed building nuclear plants at seven coal plant sites but did not provide details on their size, cost, or impact on renewable investments. Energy Minister Chris Bowen criticized the opposition's nuclear plan, citing Aemo's findings. He claimed the proposed reactors could cost Australians hundreds of billions of dollars and contribute only 4% of the nation's energy needs by 2050, potentially adding $1,000 annually to energy bills.
Aemo's report also estimated the benefit of each avoided tonne of carbon dioxide, with market rules setting the price at $70 per tonne, rising to $420 by 2050. This adjustment increased the net benefits of 10,000km of new transmission lines from $18.7bn to $22bn compared to the draft ISP.
In 2023, renewable energy supplied almost 40% of electricity across the national electricity market (NEM), peaking at 72% last October. The government aims for clean energy to provide 82% of NEM's supply by 2030. To date, 12.5GW of new utility scale generation, 1.3GW/1.8GWh of storage, and 490km of transmission have been added to the NEM. An additional 20GW of generation and storage, and 2,090km of transmission, are progressing from planning to delivery.
The market will also require 15GW of gas fired generation by 2050, up from the current 11.5GW. These plants, potentially fueled by fossil gas, biomethane, or hydrogen, will serve as a strategic reserve for system reliability and security, typically generating just 5% of their annual potential but crucial during peak demand, especially in winter.
The energy transition will necessitate over 60,000 workers to build and maintain infrastructure over the next 20 years. Aemo emphasized the benefits of the transition, noting that lower cost, lower emission renewables will provide homes and businesses with stable electricity, insulated from international price shocks.
Anna Malos, Australia lead at Climateworks Centre, supported Aemo's findings, stating that their modeling showed nuclear energy to be significantly more expensive than renewables and likely unavailable before 2040, risking higher emissions as more coal and gas are burned in the interim.