It was interesting to hear in Peter Dutton’s budget reply speech that: “At the very centre of Labor’s cost-of-living crisis is, of course, the skyrocketing cost of energy.”
Which according to Dutton is, “due to Anthony Albanese and Chris Bowen’s reckless renewables-only policy trainwreck.”
So Dutton has said he will halt programs aimed at supporting the roll out of renewables. Instead of this he explained, “the only way to drive down power prices quickly is to ramp-up domestic gas production. Tonight, I announce our National Gas Plan.”
According to Dutton his plan, “will drive down new wholesale domestic gas prices from around $14 per gigajoule to under $10 per gigajoule”.
So how does that $10 per gigajoule energy compare to the reckless renewables scenario?
Luckily for us, the CSIRO provides a handy calculator that allows you to adjust the fuel cost for various different fossil fuel generators, and it then works out what that would mean for their cost to convert that fuel into electricity. The results are shown in the chart below.
Now in doing so we also need to account for the fact that this gas will have to be transported from Queensland to the southern states via pipeline (a pipeline that Dutton has said taxpayers will need to help fund to upgrade). That is likely to add another $2 per gigajoule to the cost, to make it $12 per gigajoule.
If we punch $12 per gigajoule into the CSIRO calculator it gives us a cost for a megawatt-hour of electricity from a gas turbine in the year 2030 of between $109 to $184.
The cost for large scale solar PV meanwhile (which doesn’t have to pay for fuel) is between $37 per megawatt-hour at the lowest end to $63 per megawatt-hour at the upper end. For wind the cost is between $52 to $88 per megawatt-hour.
Has anyone told Peter Dutton about this?
Maybe we can blame the same people who forgot to tell Peter Dutton that nuclear power is incredibly expensive and would drive up household power bills by around an average of $665 per year.
