AEMO’s Zibelman: Transition out of coal does not mean lights going out

Audrey Zibelman, the CEO of Australia’s Energy Market Operator, has contradicted claims by the federal Coalition that transitioning out of coal would mean the lights going out.

The blackout line has been a long-time favourite of the Coalition government and has come to the forefront again after the UN Intergovernmental Panel on Climate Change recommended the world end its use of coal for power generation by 2050 at the latest.

Australia, despite its officials having approved of the IPCC report, rejected the findings out of hand. Former energy minister and current treasurer Josh Frydenberg said: “If we were to take coal out of the system … the lights would go out overnight.”

Asked about this claim on ABC Radio National’s Breakfast program on Thursday, Zibelman said:

“If we have a transition , which is exactly what the Finkel Review identified, from one resource mix to another, certainly we could keep the lights on. But it requires a plan, it requires a plan that could be actionable.”

As it happens, Zibelman has a plan – the Integrated System Plan, which is a 20 year blueprint of how to manage the changes in the electricity mix over the next 20 years, broken down hour by hour and considering various scenarios, from business as usual to more ambitious plans proposed by Labor.

“Certainly what we would want – and this is exactly what the ISP says – we should maintain coal assets for as long as they are economically viable. And we should have a plan to replace them with resources that are lowest cost.”

No prizes for guessing what Zibelman means by that. There is absolutely no doubt that wind and solar provide the cheapest form of bulk energy, by a long shot.

The issue for Zibelman is to ensure that there is enough dispatchable power at the critical moments for the grid, such as in the midst of a heat wave when demand peaks and traditional generation suffers from stress, as has been seen in the last few summers.

Those resources are likely to come from battery storage, pumped hydro, demand management, and fast-start generators.

And, as it happens, all of Australia’s coal generators are expected to retire by 2050, with AGL’s Loy Yang A the last one out in 2048.

That fits in nicely with the IPCC proposed timetable. As Zibelman says: “We need a plan and (we need to) be able to execute on that plan.”