Wind, solar eat further into coal supply on NEM, as Coalition pushes for more coal supply on NEM

Australia’s Coalition government has renewed its push to bring new coal-fired power capacity onto the national grid, even as the latest energy sector emissions audit reveals that solar and wind power – for the first time ever – are cutting into black coal power supply.

In quotes published in The Australian on Monday, acting energy minister Matt Canavan said that the nation’s “fragile electricity system” needed additional supplies of reliable baseload generation, to help meet summer demand and drive down power prices.

“The last week has shown our electricity network needs more reliable power,” Canavan reportedly said, without explaining how it had shown that.

“It’s great that we did get through that period but it does also indicate the need for further investment because we shouldn’t be running a system this tight.”

The comments – which ignore the recent failings of some of the nation’s major coal and gas generators – come ahead of expressions of interest, due for submission this week in response to the federal government’s plan to underwrite new “firm” generation on the NEM.

As we reported here, the Morrison government fast-tracked the process in October, unveiling a range of different proposals that paved the way for existing coal-fired generators to participate in the scheme.

According the The Oz, industry will submit plans on Wednesday, including a proposal by coal baron Trevor St Baker to develop Australia’s first high efficiency, low ­emissions coal plants in Victoria and NSW as part of an ambitious $6 billion plan.

St Baker’s plan, the paper says is to build a 1300MW, $4 billion coal-fired plant in Victoria’s Latrobe Valley at the site of the recently shuttered Hazelwood power station (see Tweet above for Vic energy minister’s thoughts on that), and a $2 billion 660MW HELE coal plant in NSW – either at AGL’s Liddell site or at the site of St Baker’s own Vales Point A.

“What this shows is all those naysayers saying nobody wants to invest in coal are wrong,” Canavan said.

But what it really shows is the Coalition’s dogged determination to back new coal power proposals in the face of sensible economics, ballooning climate risk and the current energy market reality.

That reality, according to the The Australia Institute Climate & Energy Program’s first National Energy Emissions Audit of 2019, helped deliver the biggest year-on-year growth in the share of renewable generation on the NEM in 2018.

And this record share of renewables is, for the first time, “displacing emissions intensive black coal electricity generation in the NEM, not just expensive gas generation,” the report says.

Meanwhile, Australia’s more than 2 million solar households – which when factored in to the equation take the share of NEM renewable generation to 21.4 per cent – are proving invaluable in the hot summer months.

According to the report, rooftop solar helped to curb energy supply by nearly 10 per cent in Victoria and South Australia during the first major heatwave of the summer, in the first week of January.

“When places like Adelaide are facing six times as many extreme heat days over 40°C in our children’s lifetimes, having reliable rooftop solar supply to help households beat the heat will be crucial,” said energy analyst and report author Hugh Saddler.

“If the government truly wants more reliable energy and lower electricity prices, they need to address their wilful blindness to solar and wind energy.

“The latest addition to the NEM, Crowlands wind farm is thanks to the underwriting support of a consortium of local governments, universities and cultural institutions.

“These projects are the kind of public leadership we need in the energy sector, unlike the Morrison Government rushing to fund coal fired power stations before the next election bypassing due process, public concern, value-for-money or climate impact,” Saddler said.

The report also notes that electricity sector emissions have decreased 20 per cent since their 2008 peak, largely due to the transition from fossil fuel generation to renewables.