Recent news brings into question how much longer the current government’s alleged affinity for coal will remain a feasible position.
The Clean Energy Council has criticised the government’s recent consultation paper on Underwriting New Generation Investments on a number of fronts. Among these criticisms is a diversion from the ACCC’s recommendations, claiming the programme is not technology neutral; the paper suggests the program could be extended to upgrades of existing generators, likely to favour coal.
Coal, it argues, should not be supported by this program due to its lack of cost-competitiveness, questions over reliability and incompatibility within the energy system. It has been shown that extending a coal plant beyond its commercial life is unlikely to be the lowest cost solution. This was demonstrated by comparing the extension of the Liddel Power Station with a combination of renewables, battery storage and gas peaking plants. Furthermore, generation failures are more common towards the end of a plant’s lifespan, they are inflexible compared to other sources and are incompatible with longer-term policies incorporating Australia’s emission reduction targets.
Indeed, a recent report discussed by RenewEconomy has showed that even CCS, the last beacon of hope for coal supporters hoping to rectify the emissions concerns involved with coal, is unlikely to provide a solution. Consultancy firm Lazard reveals that energy from an integrated gasification combined-cycle plant with 90% carbon capture cost around 231USD/MWh. This far exceeds both wind and solar – the Australian Renewable Energy Agency recently quoted utility-scale solar to cost “somewhere in the $50s” in 2018.
This amid the latest headline from Bloomberg New Energy Finance that unsubsidised wind and solar now beat coal as the cheapest form of bulk generation in all major economies except Japan, is making coal look increasingly less viable as a form of generation that should be supported by policy.
Australia now has over 10GW of solar installed, enough to meet more than 5.5% of our energy demand. In rooftop solar alone, Australia is on track to install over 1GW this year, many of which are businesses and organisations looking to reduce their energy costs.
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