Labor pledges $20 billion to rebuild grid and fast-track switch to renewables | RenewEconomy

Labor pledges $20 billion to rebuild grid and fast-track switch to renewables

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Updated: Labor promises $20 billion for a Rewiring the Nation Corp to underwrite the rebuilding of the grid underlined by AEMO’s 20-year planning blueprint.

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The Australian Labor Party has outlined plans to spend $20 billion under a “Rewiring the Nation” program that will help rebuild the main electricity grid to deliver the outcomes modelled by the Australian Energy Market Operator’s 20-year blueprint for a renewables-based future.

The announcement formed one of the centre-pieces of Labor leader Anthony Albanese’s budget reply on Thursday night, and contrasts sharply with the Coalition government’s indifference to AEMO’s blueprint, known as the Integrated System Plan, which is designed to deal with what it says will be the “world’s fastest energy transition” to a renewables dominated grid.

The Coalition has promised only around $200 million to support some of the priorities identified by AEMO, but the bulk of its infrastructure funding is focused on building roads, and electric vehicles and charging networks are barely mentioned.

“We can be a renewable energy superpower,” Albanese said. “Australia’s electricity network was designed for a different century, and transmission systems themselves are operated by monopoly providers who keep taking households and businesses for a ride.

“Australians don’t just pay for their power, but for the cost of building and operating the grid and then a hefty price on top.”

Labor’s plan is to create a Rewiring the Nation Corporation (RNC) and keep it in public hands as a government-owned entity and partner with industry and provide low cost finance to deliver the ISP.

It says this will ensure the grid is rebuilt at the best price possible, and help grow traditional industries like steel and aluminium and allow growth in new sectors like hydrogen and battery production.

“The Liberals have had 22 energy policies in the last eight years and all they have to show for it are higher electricity prices and higher emissions. Australia can do so much better,” Labor said.

Shadow minister for climate change and energy Mark Butler said there is a race for renewable energy jobs and investment around the world and Australia should be leading that race.

“As more renewable energy gets built, we need the transmission network to support it. That’s why Rewiring the Nation is a no brainer. It ensures Australia’s modern energy grid will be built by Australian workers using Australian steel at the lowest possible cost.”

The plan was welcomed by the Clean Energy Council, which said it called for such a fund in its pre-Budget submission.

“Australia’s transmission network has not kept pace with the transition to a 21st-century energy system, and the lack of transmission investment is now one of the most critical challenges facing the industry,” the CEC said.

“This underinvestment is stifling new generation investment, constraining existing generation and resulting in increased energy security and reliability risks and higher power prices.

“The challenge remains as to how to deliver these projects as quickly as possible. While network service providers and private investors have demonstrated a strong willingness to own and operate new transmission infrastructure, the regulatory regime is not fit-for-purpose in providing certainty for them to make the necessary financial investments in these long-lived assets promptly.”

The Australia Institute also described Rewiring the Nation Corp as a sensible solution to funding Australia’s transmission network.

“The slow delivery of new transmission lines is a handbrake on lowering emissions in our highest polluting sector,” climate specialist Richie Merzian said in a statement.

“Rewiring the Nation Corporation builds on the successful model of public energy bodies such as the Clean Energy Finance Corporation (CEFC) and the Australian Renewable Energy Agency (ARENA), which in their first five years catalysed over $23 billion in clean energy investment.

“The energy grid is in dire need of an independent implementation agency, to take the politics out of building a modern grid, while helping to lower electricity costs and helping to create more energy jobs.”

 

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