$12b plug-in for power

MORE than $12bn of investment in transmission projects are needed to ensure electricity supply for the next 30 years.

The Australian Energy Market Operator on Thursday published its 2022 integrated system plan, outlining a 30year map for supplying affordable and reliable electricity to the national market while also achieving net zero by 2050.

There needs to be a ninefold increase in grid-scale wind and solar capacity, triple the firming capacity (dispatchable storage, hydro and gas-fired generation), and a near fivefold increase in distributed solar to provide “valuable insurance” against coal-fired power stations closing faster than expected.

Only by doing that will Australia’s east coast energy market remain stable and avoid a repeat of the frenzy witnessed earlier this month.

Integral to market certainty are five “actionable” projects across NSW, Victoria and Tasmania that should start “as soon as possible” – HumeLink, VNI West, Marinus Link, Sydney Ring and New England REZ Transmission Link.

This is in addition to seven other transmission links under development.

AEMO chief executive Daniel Westerman said earlier delivery would provide “valuable insurance for any faster transition or additional benefits to consumers”.

“Australia is experiencing a complex, rapid and irreversible energy transformation,” Mr Westerman said.

“These transmission projects are forecast to deliver $28bn in net market benefits, returning 2.2 times their cost of $12.7bn, which represents just 7 per cent of the total generation, storage and network investment in the NEM.”

Energy Minister Chris Bowen said the federal government was “all in”.

“We need to upgrade the transmission grid and inject more cheap and reliable firmed renewables to keep the lights on and manage this fundamental change across the economy,” Mr Bowen said.

“This transformation won’t happen overnight or without challenge. The government is very alive to the issues in our system.”

The ISP comes amid warnings from energy operators that some customers will pay $300 more on electricity bills.

AGL is expected to hike Queenslanders’ bills by about 18 per cent, while in South Australia the rise will be 8.4 per cent per year.

This is despite assurances by the government during the election that it would cut power bills by $275 by 2025.

Mr Westerman said this could be countered in the leadup to 2050 by investing more in renewable projects.

Climate Council senior researcher Tim Baxter welcomed the report, saying it was critical Australia transitioned smoothly and accelerated away from fossil fuels.

“The adoption and transition of renewables will bring immense opportunity in terms of creating jobs, lowering emissions and ensuring security to power supply,” Mr Baxter said.

“It’s great to see this report supporting further ramping up of the rollout of wind and solar backed by storage.”