What do you think of AEMO’s 2020 Integrated System Plan? Here’s what EcoGeneration’s energy antenna picked up from its network of women experts in solar, storage, academia, government and data-crunching.
Lillian Patterson, director energy transformation, Clean Energy Council
The ISP confirms that our electricity sector future is all about renewables. To deliver this future, we need to get on with building the supporting transmission infrastructure. What’s so interesting about the new ISP is how government transmission strategy can change the direction of the whole plan. The NSW government committed to the Central-West Renewable Energy Zone (REZ), and that has now been catapulted up the ISP’s priority list. Other governments should take notice and think about how they can support REZ and transmission developments in their states.
Sally Torgoman, infrastructure lead advisory managing director, PwC
AEMO’s ISP has again reiterated that Australia is open for business and provided encouragements to investors that there is a need for significant investment in the NEM for new renewable generation to the order of 26GW, as well as firming generation such as batteries, gas and pumped hydro to the order of up to 19GW. One of the key challenges is, of course, the grid. My view is that we must accelerate the pace to unclog congestion in the network process, and that will require both a coordinated approach and an open market in transmission. If we succeed, we open up billions of dollars in investment and create a pool of clean energy jobs.
Marija Petkovic, managing director, Energy Synapse
The ISP is a comprehensive body of work which clearly shows the evolution of the NEM from a coal-based system to a highly renewable grid. The growing uptake of zero marginal cost renewables will increasingly put competitive pressure on coal. Our view at Energy Synapse is that coal-fired power stations will find the 2030s to be an extremely difficult competitive environment and will struggle to maintain financial viability. AEMO’s Step Change scenario, which sees 90% of the coal generation fleet exit the market by 2037, is very likely. The economic opportunities for battery storage and demand response to support this transition are significant.
Jemma Green, co-founder and chairman, Power Ledger
The ISP is a good piece of work. It correctly shows batteries winning hands down, even at current prices and even more so as prices come down further. AEMO conservatively predicts a halving over the next decade, and likely much more than that; according to BNEF battery storage will be at $US60kWh by 2030 from $US156kWh at the end of 2019. This will be a combination of grid and household batteries, enabled by technologies to provide grid services to create the energy system of the future faster in Australia than anywhere else in the world.
Jackie McKeon, director energy services, Renewable Energy Hub
The ISP 2020 provides a blueprint plan for a transition to renewables and a cleaner energy future across the NEM. For energy users in the business sector, the ISP provides a stronger foundation for investment and innovation, and support for a renewable energy future through low carbon transition. With a roadmap for 50GW of new large-scale renewable generation and prioritisation of projects such as the Central-West Orana REZ Transmission Link in NSW, the ISP will deliver not only regional employment benefits but an essential precedent and confidence that economic growth can be derived from responsible, forward-thinking investment. Actioning the ISP projects supports corporate and state-based goals for decarbonisation leadership.
Amy Kean, director, Stride Renewables
The Step Change scenario is bold, visionary and ambitious. The plan is achievable if storage can follow solar’s trajectory for price reduction and scale. Yet the ISP is only a map; the challenge is how quickly the AEMC can develop the market rules and regulatory framework to ensure its timely implementation. States or the federal government will also need to implement policy mechanisms to achieve the Step Change. The elevation of the Central-West Orana REZ to an “actionable” project is fantastic. This could be the first renewable energy zone in Australia to begin construction, demonstrating an efficient way of bringing on the necessary capacity at scale.
Beatriz Toribio Lopez, director asset management services, Blueshore
Although the ISP presents an extremely positive outlook for renewables, the answer to the key question remains unclear: how is the system strength challenge going to be managed across the NEM as renewable generation increases? AEMO has previously declared system strength shortfalls in Victoria, South Australia and Tasmania, and most recently we observed how nine solar farms in north Queensland had their output reduced due to the unavailability of synchronous generating units. It will be critical for the growth of the renewable energies in Australia to have a clear path to limit the uncertainty around connection, commissioning and ongoing operation of large-scale solar and wind energy projects.
Dani Alexander, research principal, Institute for Sustainable Futures, University of Technology Sydney
AEMO’s ISP is strong, clearly demonstrating that renewables pave the path of least cost and least regret. This future with a “highly diverse portfolio of behind-the-meter and grid-scale renewable energy resources” builds a strong case for system change towards energy flexibility. Distributed energy resources are predicted to double, if not triple, by 2040, however the ISP acknowledges that technical and market changes are needed to get the most out of this cohort. If this happens, there is a huge opportunity to leverage existing inverter-based (that is, solar PV and batteries) and demand-side resources in a way that I believe can reduce the costs of large infrastructure investments even further. In particular, there is still room for more analysis on how demand-side participation could deliver a greater proportion of the dispatchable resource, better reflecting the true nature of a two-sided market.
Monique Miller, executive director head of solar and dispatchable renewables, Clean Energy Finance Corporation
As Australia increasingly taps into cost-effective and low-emissions renewable energy to deliver a higher proportion of the nation’s power needs, forward planning for the future of the grid is critical to the successful management of this inevitable transition. The Integrated System Plan is an important part of this. Greater certainty about how the grid is likely to evolve from independent least-cost modelling, and understanding what is possible from a technical perspective, will help guide the decisions of investors in the electricity sector, including the CEFC. Alongside an increasing focus on supporting the transition to a stronger, cleaner grid, the CEFC is working closely with other market participants to better understand the most effective contribution of the investment tools at our disposal.