by More investment is urgently needed to modernise Australia’s energy grid, or the continued closure of coal power stations could lead to electricity shortages and blackouts on the east coast by 2027, according to a forecast from the Australian Energy Market Operator.
AEMO CEO Daniel Westerman said “reliability gaps” would begin to emerge from 2025, until all states and territories in the national energy market would “breach” reliability standards in 2027, without urgent investment in generation and the grid.
Westerman said the breaches could be attributed to at least five coal power stations – totalling about 13 per cent of the market’s total capacity – expected to retire.
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“Urgent and ongoing investment in renewable energy, long-duration storage and transmission is needed to reliably meet demand from Australian homes and businesses,” Westerman said.
He said short-term reliability gaps in South Australia and Victoria had been filled by “new gas, wind and battery developments”.
“The NEM (national energy market) has a strong pipeline of proposed generation and storage projects, totalling three times today’s generation capacity, with large-scale solar, wind and batteries accounting for 86 per cent,” Westerman said.
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“Investment in firming generation, such as pumped hydro, gas and long-duration batteries, is critical to complement our growing fleet of weather-dependent renewable generation to meet electricity demand without coal generation.”
AEMO was established in 2009 by the Council of Australian Governments to regulate the energy market, and is jointly owned by the federal and state governments, and industry.
Other experts said it was clear more action was needed on renewables.
“The good news is we are going to be okay for electricity supply this winter when Liddell closes,” Nexa Advisory founder and former AGL public policy head Stephanie Bashir said.
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“Over the longer term, this statement shows we are behind on building renewable generation and transmission. We need to get on with it, on a massive scale.”
Climate Energy Finance director Tim Buckley said there had clearly been significant progress on decarbonising the energy grid in the past six months.
“AEMO flags a staggering 209 gigawatts pipeline of new firmed renewables project proposals – battery, solar and wind – worth over $250 billion in total, highlighting the massive, once in a century regional employment and investment opportunities ahead for Australia from decarbonisation,” he said.
“However, with only 10 gigawatts committed, there is a clear need for sustained policy certainty, accelerated grid transmission investment, expedited Renewable Energy Zones (REZ) and a continuation of the Federal-State cooperation we have seen since the election of the Albanese government.”
