Last month the CSIRO and Australian Energy Market Operator (AEMO) released a joint cost report on the state of coal versus renewable costs, as reported by the Sydney Morning Herald. Here are the findings from that report.
Renewable vs Coal Costs
The report found:
- New solar and wind farms are cheaper than new coal-fired power.
- If nuclear power is added to Australia’s energy mix, it will be the most expensive form of energy.
- Gas is the cheapest form of power compared with other new technologies.
More Batteries Needed to Keep Up With Solar and Wind
As the amount of renewable generation grows in Australia, more batteries will be needed to support this. A stable renewable and battery infrastructure would encourage consumers to rely less on the grid at peak times.
CSIRO chief energy economist Paul Graham said renewables are lowering energy prices across Australia, however, more money into storage technologies is essential because solar and wind still present risks during high demand periods. Batteries added into the energy infrastructure will make the entire process even cheaper.
Our data confirms that while existing fossil fuel power plants are competitive due to their sunk capital costs, solar and wind generation technologies are currently the lowest-cost ways to generate electricity for Australia, compared to any other new-build technology.
– Paul Graham, CSIRO
Planning for Demand Management
The CSIRO has also stated in the report that demand management strategies will become increasingly important as more renewables and storage are added into the mix.