Tesla chair Robyn Denholm has welcomed Australian Energy Market Operator’s Integrated System Plan as a vote in favour of battery storage as a cheaper and better option to support the shift to renewables than gas, as the grid transitions away from coal.
Denholm, an Australian who was appointed as chair to the Tesla EV and energy storage powerhouse in 2018, linked to the much anticipated AEMO report in a LinkedIn comment on Thursday, with the opening line: “A very encouraging read!”
As RenewEconomy has reported, the final version of the 2020 Integrated System Plan was released to the public on Thursday with a central message that the energy transition is inevitable and accelerating, and could quite reasonably reach 94 per cent renewables by 2040.
In terms of battery storage, the new ISP revised down the cost of the technology by around 30 per cent from its draft, based on feedback from stakeholders. Peaking gas generators, meanwhile had their costs revised up by between 30 and 60 per cent.
And while the ISP notes that gas still has a cost advantage over batteries at current costs, this advantage is expected to shift to batteries by the 2030s, particularly to provide dispatchable supply during two- and four-hour periods.
“Based on the cost assumptions in the ISP, new batteries are more cost-effective than gas in the 2030s. Future climate policies may also impact the investment case for new gas,” it said.
The clear message from AEMO appears to be that batteries will be cheaper and cleaner than new gas plants. And Tesla’s Denholm wholeheartedly agrees.
“AEMOs plan highlights a critical role for firming technologies such as battery storage at all scales as lower cost renewable energy displaces ageing coal generation,” she wrote on LinkedIn.
“Australia still holds the title for ‘world’s biggest battery,’ which has proven that batteries [do] not just support grid stability but can do so at lower prices than gas and coal turbines.
“This trend is being driven not just by falling costs but also the speed of battery deployment. Investment decisions that used to take years to deliver returns with traditional generation technologies can now be implemented in months,” Denholm said.
“Australia has a unique opportunity to make a big impact in clean tech, to transition to sustainable energy that is not just better for the environment, but that makes economic sense today.”
Others, too, have seized on the message the ISP has delivered on gas.
“This report shows that the writing is on the wall for the gas industry, with solar, wind and batteries able to meet our energy needs,” said 350 Australia senior campaigner Shani Tager in a statement on Thursday.
“The Prime Minister needs to rule out subsidising the gas industry that is polluting and not needed.
“It’s time for them to kick-start an economic recovery that puts people above gas corporations, and supports industries that tackle the climate crisis while creating sustainable jobs,” Tager said.