Prepared by the Australian Energy Market Operator (AEMO) in consultation with key industry stakeholders, the National Transmission Network Development Plan (the Plan) and the Gas Statement of Opportunities provide comprehensive information on current and future requirements of both the electricity and gas transmission networks.

In developing the Plan, AEMO said that it used sophisticated scenario modelling to show how the electricity transmission network would develop, depending on a range of factors including growth in demand, a carbon price, gas prices and the scale and location of future power stations.

˝The modelling indicates that a growing Australian economy and population will lead to a 30 to 70 per cent increase in electricity demand in the National Electricity Market (NEM) over the next 20 years,˝ said AEMO.

˝Demand growth of this scale will require investment of $40 billion to $130 billion in new power generation and upgrades to the NEM’s shared transmission networks.˝

AEMO CEO Matt Zema said that the scenario modelling had provided ˝a NEM-wide view of the areas where future generation facilities may be ‘clustered’ to make the best use of both renewable (biomass, solar, geothermal and wind) and non-renewable (coal and gas) resources.˝

According to AEMO, the Plan forecasts that climate change policy will drive extensive investment in renewable energy technologies, particularly where the renewable resources are close to the transmission network.

˝Our modelling shows that the large-scale renewable energy targets are materially achieved under all scenarios except those with no carbon price,˝ Mr Zema said.

Federal Energy Minister Martin Ferguson said that the inaugural plan was an important, independent piece of work that would influence the future low-carbon Australian energy policy.

On behalf of AEMO, Mr Ferguson also released the second annual Gas Statement of Opportunities.

˝In all scenarios, demand for energy is growing and gas will play an increasingly major role in Australia's future energy mix.

˝Well-planned investment across all aspects of electricity generation and transmission is critical to ensure continued reliability of supply as demand increases,˝ Mr Ferguson said.

In conjunction with the Plan and the Gas Statement of Opportunities, the National Energy Scenarios Modelling document has also been released, which examines the sensitivity of electricity generation technologies to long-term changes in key factors such as economic growth, population growth, global fuel prices, and climate change policy.

The modelling was managed by AEMO, and different aspects of the exercise were undertaken by consultants with expertise in the Australian energy market.

The Department of Resources and Energy said that the results re–affirmed the need for a carbon pricing mechanism, alongside the existing Renewable Energy Target, to achieve the transition to a lower carbon economy.

The National Energy Scenarios Modelling is the fourth piece of work published as part of the Government's Energy White Paper process. It builds on the three reports already released:

• The Australian Energy Resource Assessment, released on 1 March 2010
• The Report of the Prime Minister’s Task Group on Energy Efficiency, released on 8 October 2010
• The Australian Electricity Generation Technology Costs – Reference Case 2010, released on 25 November 2010.

To see the Australian Energy Resource Assessment, the Report of the Prime Minister’s Task Group on Energy Efficiency and the Australian Electricity Generation Technology Costs – Reference Case 2010, visit www.aemo.com.au