What’s stopping Australia move faster with clearing coal out of the way to be replaced by solar, wind and storage?

The panel

  • Simon Corbell (chair), chief advisor, Energy Estate
  • Nicola Morris, chief operating officer, ARENA
  • Peter Cowling, country head Australia and New Zealand, Vestas
  • Dr Tim Finnigan, director of energy, CSIRO Energy
  • Anne Pearson, chief executive, Australian Energy Market Commission

The clean energy transition must happen – there’s no point paying serious concern to maintaining the status quo – but some major impediments stand in the way. Australia must disengage itself from its heavy reliance on coal and the transmission networks that serve us need to be reconfigured to take generation from far flung places. The technology is available, the money is probably there too, but what’s slowing us down is a tangle of rules that are long overdue for a rewrite.

“The fear from my perspective is just as we find the cost-effective solutions to carbon intensity we’re not putting our foot down on the accelerator,” said Vestas’s Peter Cowling.

Part of the blame can be hung on Australian politicians for their failure to see beyond the electoral cycle and support something that is good economic sense as much as it is good environmental sense – the promotion of renewable energy sources over coal and gas.

Are we stuck, without bipartisan policy support for clean energy, or can governments and institutions find a way around? Energy is the biggest contributor to emissions by far, and let’s not forget that 15% of global emissions originate in Australia thanks to our dominance as a coal and gas exporter. It’s time to face the issue from all angles and apply some “cohesive, national-scale thinking”, said Tim Finnigan from CSIRO Energy. “It all does go together; you can’t really detach [domestic use from exports].”

Welcome to the grid

It’s easy to talk about how renewables and storage could be blended to meet demand on the grid but in practice it’s hard work connecting the current pipeline of large-scale clean energy plants. “I take my hat off to the people involved,” said Cowling. “We’re connecting nearly a dozen projects at the moment and the work involved is dramatically greater than anything we used to do.” AEMO is picking up pace, he said.

“We shouldn’t be too hard on ourselves or our regulators, because it’s not easy. If we push through solutions that don’t work when it’s not windy or sunny and something goes wrong in the grid, no-one’s going to thank us.” It’s all very well to vent frustration about connection delays but let’s accept the complexity of managing Australia’s lengthy, stringy grid. Overall, things are moving in the right direction.

A perennial problem

Regardless of where governments are with policy, Anne Pearson acknowledges the power system is changing fast. Many small generators want to access the transmission system in order to replace few large generators, so that’s one priority for the AEMC, she said. System security is another.

It’s one of the AEMC’s jobs to report to the COAG Energy Council on the national coordination of generation and transmission investment, or what’s called its COGATI review. “It sounds like an Italian motorcycle,” Pearson admitted. The latest report proposed dynamic regional pricing, a hedging market for transmission and more transparency about applications for grid connection. “Access reform has been a perennial market development issue,” she said, and the AEMC started looking at it back in 2015. “For some people we’re going too fast; for some we’re not going fast enough.”

Traditionally, transmission has been built to satisfy consumer demand, “and consumer demand only”, she said. “Once you start to move to an environment where transmission is needing to meet the demand of generators, it seems quite reasonable to consider looking at alternative ways to manage that and look at whether generators should be paying for a portion of that access.”

The NEM in 2050

At the CSIRO, it’s Finnigan’s job to look well over the horizon and ponder the NEM of 2050 and beyond. One big task in his inbox is work with AEMO to create a “digital twin” of the NEM, including the SWIS, gas distribution and financial settlement markets.

“I think we all know the tools AEMO has available to it are not quite up to scratch,” Finnigan said. “There are some very worried people at AEMO thinking about next summer and the summer after that,” when the grid once again be stretched to meet soaring demand.

“We need these real-time science-based tools … it’s uncharted territory; no-one in the world has transformed an energy system of the scale we have at the pace we’re trying to do it.”

If they can, we can

Some investors have been shaken by negative impacts of marginal loss factors to projects, whereas others had thought ahead and weren’t as affected. Transmission needs to be built out to where the resources are, and if Texas can do it then so should we, said Cowling, acknowledging the enormous task for transmission network service providers that are being asked to plan for 20GW of new generation over the next four years.

At ARENA, Nicola Morris sees the biggest short-term boost to the energy transition is simply linking Australia’s clean energy resources with its households and businesses. “A strategic approach to the renewable energy zones could really unlock a lot of potential,” she said. “It’s a complex issue to solve, as to who takes the risk and getting the right investment, but if it’s done well it would make a big difference.”