Clean Energy Council chief executive Kane Thornton has underlined the role for renewables and energy storage in taking the load of coal-fired generators as the Australian Energy Market Operator spells out its concerns about supply shortages this summer.

“The older Australia’s coal plants get, the less reliable they are. The answer isn’t to keep the oldest, least reliable plants open as long as possible – it’s to replace them as fast as possible with renewable energy and storage technology which can do exactly what our old power plants can do, but cleaner, cheaper and more reliably,” Thornton said.

AEMO has released its 2019 Electricity Statement of Opportunities, which forecasts tight electricity supply-demand conditions in several states this summer and highlights the need for short- and longer-term investment in dispatchable resources and transmission.

The 2019 ESOO forecasts a continued elevated risk of expected unserved energy (USE) over the next 10 years.

Thornton lamented a lack of direction from Canberra.

“Without policy certainty to ensure investments in our energy system are made efficiently where they are most needed, we are left with using emergency measures to keep the power on over the hottest parts of summer,” he said.

“Record amounts of renewable energy will be built over the next few years and this will help provide additional power generation to push power prices down and make the system more reliable. We need policy that will encourage new clean energy projects to be built before the old coal plants close – not leave us scrambling after they have already closed down.   

“New transmission is urgently needed to ensure power can be directed to the parts of the country which need it most at any given time. This will help to relieve the pressure on the power system and make the best use of the electricity we already have available. Major new pumped hydro projects in Tasmania and Snowy 2.0 will have a major role to play in years to come.”

Where to next

In its report AEMO has identified several pragmatic actions that should be taken to avoid consumer exposure to an unreasonable level of risk of involuntary load shedding during peak summer periods. Some of these actions are currently underway, such as AEMO’s Summer Readiness Plan and the planning and commissioning of targeted transmission augmentation, and others require changes to rules and/or additions to AEMO’s authority.

Further actions identified include several changes that will support better outcomes for reliability and affordability. These include:

  • the introduction of a new reliability standard designed to assure that each region has sufficient resources to meet peak demand requirements during 90% of the time (a more typical standard used internationally;
  • the development of new markets for essential services so AEMO can more efficiently pay suppliers for all resources required to maintain the reliability and security of the physical system;
  • the acceleration of critical upgrades and construction of interconnectors and transmission to enable better use of existing and new supply resources, and;
  • the ability to procure and operate a three-year strategic reserve to minimise the need to pay a premium for emergency power.