We must be wary of simple statements about the increasingly rapid transformation of the electricity grid.
The government has received a reminder of this after leaning too heavily on pre-election modeling that suggested its policies to boost renewable energy could lead to a $275 cut in bills by 2025. You never know when a bad shaped like Vladimir Putin could interrupt. international fossil fuel markets, destroy your assumptions and accuse you of breaking an election promise.
Peter Dutton has no such excuse. The most generous thing to say about his foray into the electricity debate last week is that he might want to get a wider range of advice.
In his Budget response speech, the Opposition Leader said the Coalition wanted more renewable energy but it wasn’t yet possible, and it was a mistake for the Government to allow aging to be phased out now and expensive fossil fuel energy.
More specifically: “The technology does not yet exist at the scale needed to store renewable energy so that electricity is reliable at night or during peak periods. That’s just the scientific reality.”
To put it mildly, this is not the consensus opinion of experts in the field.
David Osmond, a Canberra-based engineer with global energy developer Windlab, is among those with a markedly different, evidence-based perspective. For more than a year, it has been publishing the weekly results of a live simulation that tracks what would happen to Australia’s main electricity grid if it relied mostly on renewable energy.
Using a live stream of electricity data from Opennem, he adjusted inputs to see what would happen if there were enough wind and solar power to supply 60% and 45% of demand, respectively. It added enough short-term storage, likely in the form of batteries, to meet average demand for five hours.
The results are encouraging. They suggest that almost 100% of demand, 98.9% over a 61-week period, could be provided by solar and wind power supported by existing hydropower and five hours of storage. Almost 90% of the demand was covered directly by renewable energy and 10% had to go through storage. Achieving this would require a major expansion of transmission, as Labor proposes in its Rewiring the Nation policy.
The deficit of 1.1% occurred mainly when there was less sunshine in late autumn and winter. Other technology would be needed to fill this hole. Osmond believes for now that they would probably be quick-start gas-fired power plants that are already connected to the grid, idle most of the time and can be used quickly. There was nothing to suggest that new ones were needed.
It means there is a small amount of fossil fuel generation left on the grid, but less gas would be burned than now and, crucially, no coal-fired power would be needed. In the longer term, backup could come from cleaner sources, probably hydromassage, perhaps hydrogen or biofuels. None of these necessarily make economic sense like solar and wind do (it’s hard to justify a plant that would almost never be used), but they might be necessary in the context of the grid. An alternative would be to overbuild solar and wind power, so that there is always enough capacity online.
By Osmond’s admission, this is a simplified model that assumes, for example, that electricity transmission links between regions can be delivered efficiently. No one should assume that the transition will be easy. The point is that the technology already exists and is relatively cheap. From there it’s a matter of design, engineering and, above all, cost management.
The last bit needed to ensure the lights stay on is likely to represent a disproportionate amount of the total cost. But the evidence says that a system dominated by renewables is comfortably the cheapest form of generation if done right.
Many other studies have reached similar conclusions. Most important is the Australian Energy Market Operator’s Integrated System Plan, a roadmap for the optimal future grid that was published in June. It supported an accelerated build-out of available technology to reach 83% of renewable generation by 2030, 96% by 2040 and 98% by 2050 as the most likely best option.
Presented with this evidence, Dutton and the Coalition continue to opt for none of the above.
They seem to have joined a small band, which includes many in the usual right-wing media echo chambers, convinced that the evidence presented is wrong. Dutton largely dismissed batteries in his budget response, implying that small modular nuclear reactors (SMRs) – a commercially unproven technology that has been repeatedly delayed and more expensive than promised – could be the answer that guarantees cheap energy.
No evidence has been presented to suggest that SMRs are needed to meet demand in Australia, given the country’s wealth of renewable options. Never mind that no independent evidence was offered to suggest that it could compete on price.
If SMRs prove economically viable and safe elsewhere, there is nothing to stop Australia considering their use, perhaps in remote off-grid industrial sites. It would be nice if they were viable, as not all countries have broad alternatives to fossil fuels. But they’re not designed to do the job needed here: to turn on occasionally and fill in the gaps in a system that runs on cheaper renewable energy.
Instead of an endlessly heated nuclear debate (the Coalition is carrying out another review, so expect a lot more of that), Australians would be better served if their politicians looked closely at a major report from the International Energy Agency last week.
For the first time, the IEA predicted that fossil fuel use worldwide would peak in the coming years as Russia’s invasion of Ukraine accelerated the shift to clean fuels. It found that existing policies would soon lead to a decline in coal use and demand for gas would level off by the end of the decade. The declines will be much faster if, as expected, climate action continues to increase.
Australia has one of the largest fossil fuel exporting industries in the world. It is supporting massive developments that are expected to last until the end of the century, as if nothing will change.
The significant climate impact of these developments is still routinely overlooked by the major parties because the gas and coal is burned overseas and is therefore somehow not an Australian problem. But what about the economic and social impact of its potentially rapid decline?
Now there is an issue truly worthy of further parliamentary debate and action.