Wind and solar, and not nuclear, the key to cheaper energy, CSIRO report finds
New CSIRO modeling has found that a mix of solar farms, onshore wind turbines, energy storage assets and gas is the cheapest option for the future of Australia’s electricity grid, but adding nuclear energy, carbon capture or offshore wind projects will increase energy prices.
The Commonwealth science agency’s latest cost projections confirm that an energy system dominated by backed-up renewables is the lowest-cost way to replace the country’s fleet of decommissioned coal-fired power stations while meeting growing electricity demand and reducing net emissions to zero over the next 25 years.
CSIRO found that combining onshore renewable energy sources with battery, hydropower and gas support is the cheapest transition away from coal-fired power plants.Credit: Getty Images
The draft CSIRO report, due to be published on Wednesday, comes amid renewed political debate over the cost of Australia’s energy transition, with the Coalition fighting to scrap the Albanian government’s clean energy targets and arguing taxpayer funds should be made available for technologies such as carbon capture and storage and nuclear power.
Today’s average wholesale electricity cost (the amount retailers pay for electricity before selling it to customers) is around $129 per megawatt-hour on the east coast. CSIRO estimates Labour’s target of an electricity grid 82 per cent powered by renewable energy by 2030 could see wholesale electricity prices rise to $81 per megawatt-hour, or $91 per megawatt-hour including the cost of transmission lines.
But experts and industry leaders warn that the rollout currently lags behind the pace needed for the government to meet this target, and an urgent increase in investment and project approvals is needed to achieve this target.
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By 2050, wholesale electricity is expected to cost between $115 and $124 per megawatt-hour, making it cheaper than today, the CSIRO said. The agency said it would be between $135 and $148 per megawatt-hour when the cost of transmission lines is taken into account.
But adding “first-of-its-kind” technologies such as carbon capture and storage offshore wind farms, alongside solar and onshore wind farms to deliver net-zero emissions by 2050, would further increase projected average electricity costs, he added. The CSIRO said nuclear remained the “consistently highest cost” option.
“Solar PV combination [photovoltaic]In all cases studied, onshore wind, storage, and natural gas or hydrogen were the lowest-cost technology mix; “The addition of carbon capture and storage, offshore wind and nuclear was leading to higher average electricity costs,” he said. Generation Cost Report prepared jointly by CSIRO and the Australian Energy Market Operator.
