Renewables keep crunching Australia’s electricity emissions – no thanks to federal policy

Large-scale renewable energy generation – and increasingly big solar – continue to drive a steady fall in Australia’s electricity sector emissions, while a thriving rooftop solar market has effectively cancelled out any increases in consumption of grid supplied power, new reports have shown.

The Australia Institute’s National Energy Emissions Audit Reports for January and February 2020 find that electricity consumption, emissions, and emissions intensity of generation remain essentially unchanged for the start of the year, with overall consumption of grid supplied electricity flat or decreasing – but gradually increasing when rooftop solar generation is included. (Fig 1)

From 2018, says the report’s author, Hugh Saddler, “rooftop solar was sufficient to meet all of the (relatively modest) growth in total electricity consumption in the (National Electricity Market), with the result that electricity supplied through the NEM grid stayed almost exactly constant.”

Meanwhile, in the large-scale sector, new wind and solar capacity had displaced, in varying proportions, black coal, brown coal and gas generation, resulting in a steady fall in emissions.

“Many new wind farms came on-line, accompanied, for the first time, by large numbers of new solar farms,” the report says – a trend illustrated in figure 2, below.The report shows that in the year to the end of December 2019, the total share of electricity supplied by coal power stations was 67 per cent, down from 74 per cent three years previously, and 82% 10 years previously, while the share of gas remained stable over the past decade.

“In parallel with these changes,” says Saddler, “uptake of small (rooftop) solar generation accelerated across all size ranges, including residential scale and also, for the first time, larger commercial and industrial-scale installations.”

But Saddler also noted the impact of constraints on transmission capacity on the NEM which, as RenewEconomy has reported extensively, has slowed the connection rate for new wind and solar, and consequently the growth of new generation, as well as the share of renewables supply on the grid.

Saddler says that “a distinct slowdown” in the growth of new renewable energy investment can be blamed on two main factors: continuing lack of clear national emissions reduction policy; and the delay in approving and undertaking new transmission investment – “itself ultimately attributable to the lack of policy direction over recent years,” he adds.

“Substantial new investment is needed to allow new wind and solar generators to connect to the NEM grid without compromising the overall security of the grid as a whole,” Saddler said in the January 2020 report.

“This situation is causing AEMO to impose long delays in granting approvals for new generators to start supplying into the NEM, and, when they do start, imposing large discounts to the generation volumes for which they are paid, in order to meet the costs of transmission losses.

“Sustaining renewables investment requires policy certainty and substantial grid planning. While a clear national policy framework would be preferable, in its absence, state-level policy is essential.”

On the state policy front, Saddler notes that Victoria is doing well, with its targets for renewables to reach 25% of total generation by 2020, 40% by 2025 and 50% by 2030 said to be “achievable” if growth in wind and solar generation continues at the same pace.

Queensland, however, would “almost certainly require more decisive action by the state government, such as the reverse auctions” to meet its target of 50% renewable generation by 2030. And New South Wales, with no formal target other than an aspirational net zero emissions by 2050, would also need to make up some ground, but the trend was upwards, Saddler said.