Review of the Future Security of the National Electricity Market
The Australia Institute welcomes the opportunity to make a submission to the Finkel Review. With the current state public discussion around energy issues, this review has the potential to steer Australia back towards a policy path that looks after the interests of energy consumers and the environment.
Australia’s energy future should centre on renewable energy and storage of renewable energy. Debate around energy should be on the real policy and engineering challenges of how to make this transition, rather than on whether it should happen. There is no “investment appetite” for more coal-fired generation, nor is there any for nuclear generation. Current interest in these technologies is pushed by self-interested lobby groups rather than investors and consumers.
The reality is that renewable energy is competitively priced and storage technologies are evolving rapidly. Australia’s energy problems are chiefly around peaks in demand and price, issues that renewables and storage are well placed to meet. When managed properly renewable energy can enhance the stability of electricity grids.
Gas-fired electricity is less emissions intensive than coal, as long as fugitive methane emissions from gas extraction are ignored, but is not likely to be competitive for anything other than peak generation. Because east coast gas prices are now linked to Asian prices, they will stay high regardless of expansion of Australian supplies.Importantly, gas-fired power is still emissions intensive and extraction of gas results in fugitive and migratory emissions that are poorly measured and accounted for in Australia.