Report shows power sector transition well underway

The Australian power sector has been taking action to reduce greenhouse gases since the end of the last decade, new industry data shows.

Electricity Gas Australia 2013 (EGA2013), released by the Energy Supply Association of Australia (esaa), has revealed planning and investment in new power stations began shifting towards renewable energy from 2007.

EGA2013 includes a 10-year review of energy industry planning for new power stations, which shows a major shift in energy business planning at the end of last decade.

New renewable and gas power stations now account for more than 90% of planned energy investment, esaa CEO Matthew Warren said.

“The review shows a clear shift in industry thinking around 2007 towards planning for more renewable energy in the mix, which has only accelerated since the expansion of the Renewable Energy Target in 2009,” Warren said.

Wind farms account for half of all new large-scale generation investment in 2012-13, compared to 11% in 2002-03, with a growing number of hydro, geothermal and solar plants now in active planning.

“One of the major effects of this increased supply of renewable energy in a shrinking national market is to suppress the wholesale price of electricity. The value of the National Electricity Market has shrunk by more than $4 billion, or 40%, in the last four years,” Warren said.

“Low wholesale prices aren’t necessarily a good thing: it makes life tougher for all energy suppliers, including renewable energy generators, and could have long-term effects on reliability and stability.

“What this report shows is that we are well progressed on transforming Australia’s energy supply, but the process is throwing up new challenges and problems that weren’t in the original script.”

Electricity Gas Australia 2013 is available here.