Big talk, little action: Energy future out west is at crossroads between gas and renewables

There has been a lot of talk and optimism about WA becoming a renewable energy superpower.

Big, bold announcements – like the closure of state-owned coal generation in Collie by the end of the decade – have given the impression that a wave of new renewable energy projects, underpinned by significant state investment, are in the works. 

Unfortunately, the reality is very different. Almost two years on, no large-scale renewable energy has been added to the SWIS and, worryingly, there are very few sanctioned projects in the pipeline. 

As a result, WA’s main grid is looking down the barrel of a clean energy supply problem, as we fall behind the rest of the country on renewable energy penetration and behind on emissions reduction.

In fact, WA’s overall emissions are still rising, which is not a surprise given we’re the only state without a 2030 emissions target. With only 10% of Australia’s population, WA is projected to account for almost 20% of Australia’s total emissions in 2024.

While the government blames rising emissions on growth in export industries, the domestic economy isn’t decarbonising either due to the lack of new large-scale renewable energy generation. 

This problem became clear 12 months ago when the Clean Energy Council showed that WA’s pipeline of new large-scale renewable energy projects has slowed to a trickle.  Only 3% of nationally ‘committed’ projects will be connected to the WA grid and that number falls to less than 1% if only the more ‘probable’ projects are included – well below WA’s fair share. 

Currently, the only renewables recording significant growth on the South West Interconnected System (SWIS) are domestic rooftop solar. These systems have been growing at a rate of almost a MW a day and the Australian Energy Market Operator (AEMO) forecasts this to ‘to reach an estimated 4,716 MW of installed capacity’ over the next decade – more than three times the combined size of WA’s coal-fired power stations. 

A large and stable grid cannot exist on the back of domestic investment in rooftop solar alone; it must be augmented by a significant investment in wind and battery storage. While WA is seeing some substantial investment in large-scale batteries, there are currently only  a handful of new wind projects under construction in WA. At the start of 2024, the 76MW Flat Rocks project is the only SWIS-connected wind farm under construction. 

The concern is that the flat line of large-scale renewable energy generation that began in 2020 will continue.

To understand what is holding WA back , Fraser Maywood was commissioned to interview a representative sample of renewable energy project proponents, electricity generators, and retailers to identify obstacles to getting new renewable energy on stream in a timely manner.

A strong majority of survey respondents identified serious barriers impacting the new large-scale renewable energy projects from conception through to construction. Fundamental to this was the lack of a coherent government-led plan to enact the vision outlined in the government’s SWIS demand assessment. 

Overwhelmingly the view held by industry was that the WA energy transition plan is “not sufficiently coherent, transparent and well communicated”. As one respondent said: “The plan seems to be organic and made-up on the go. The end goal is defined as aspirational however the pathways, the costs, who bears the cost is unclear.” Another respondent stated: “The vision is there but the plan is missing. State coal closure announced but it is clear that Synergy will be short of energy.”

Another key finding of the survey was that the WA Government’s “funding of critical renewable energy infrastructure is unclear and causing uncertainty amongst renewable energy investors.”

One key example of this is the proposed ‘user pays upfront’ model for critical infrastructure, including in proposed renewable energy hubs. In this model the WA Government has suggested that proponents and consumers should pay $100,000 per megawatt upfront for backbone transmission. Whilst connection costs are borne by the user, the idea of users paying for deep network augment was not supported by most industry respondents surveyed nor does this plan have parallels in other comparable jurisdictions. 

The recently announced WA renewable energy hubs in the Energy Policy WA SWIS demand assessment report were also seen by industry as insufficiently defined to develop investor confidence. Feedback was that when other governments announce renewable energy zones  they come with an implicit set of expectations around co-investment and other government support. This uncertainty, combined with long connection times and other delays, is impacting on the delivery of renewable energy in WA, especially on the SWIS.

As a result, new large-scale renewable energy projects are happening too slowly to meet the WA Government’s target of 80% renewable energy on the SWIS by 2030 and well short of the 50GW of renewables by 2042 in the SWIS demand assessment report.

The implication is that without significant and timely investment, coal generation will be kept in service longer or be replaced by more gas generation. AEMO are so concerned that there are insufficient renewables planned to replace Synergy’s scheduled coal retirements that they expect the use of gas for electricity generation in WA to ‘more than double’ by 2032. 

This outcome is obviously inconsistent with reducing emissions and the transition to net zero. 

Electricity generation is generally accepted the easiest sector to decarbonise. In WA where the state government owns both the network operator, Western Power, and the major generator-retailer, Synergy, and has impressive wind, sun, and land resources it should be even easier! 

A decarbonised electricity grid forms the basis for other industry sectors like transport and heavy industry to decarbonise via electrification. It also signals to the private sector that the government is serious about decarbonisation and is prepared to match industry funding to reach national and international goals.  

WA is at an energy crossroads as the Collie coal closures looms and an insufficient pipeline of renewable energy projects to meet national decarbonisation goals becomes apparent.  More ambitious choices and investments need to be made, otherwise WA’s path to net zero will increasingly be empty rhetoric.   

Dr Brad Pettitt is a Greens member of Parliament in the WA Upper House. Before this, he was Mayor of the City of Fremantle and Dean of the School of Sustainability at Murdoch University.

Fraser Maywood is a West Australian renewable energy expert who runs Maywood Advisory. He is also the Chair of Sustainable Energy Now, a WA renewable energy advocacy and research group.