Updated
Renewable energy will provide one third of the
national electricity market's needs within two years, according to new
research from Green Energy Markets (GEM).
Key points:
- A record 18,917 rooftop solar PV systems were installed in May
- On current projections, renewable energy could supply 33pc of market needs by 2020 and 40pc by 2030
- The total pipeline of renewable projects if approved and built could supply 85pc on needs by 2030
The consultancy firm's forecast uses the latest data from the Australian Energy Market Operator and is based on solar and wind farms already under construction or contracted plus rooftop solar maintaining stable installation levels.
"This represents almost a doubling in renewables share compared to 2015 when it met 17.3 per cent of annual electricity consumption," GEM director Tristan Edis said.
Mr Edis said the National Energy Guarantee (NEG) was unlikely to make any difference to power station investment or emissions unless the emission target was strengthened.
"Even if contracting and construction commitments to solar farms and wind farms halted from today, ongoing installations of rooftop solar should see renewables share reaching 39 per cent by 2030," he said.
But senior Nationals have drafted a discussion paper for Prime Minister Malcolm Turnbull proposing that the Government provide incentives for businesses to invest in refurbishing existing base load power stations — an approach that was discussed at a party meeting earlier this week and that could see the life of some existing coal-fired power stations extended.
Nationals backbencher Barnaby Joyce warned rural voters may not support the NEG because they struggle to pay their power bills.
"We are not having people in the middle of winter being kicked back into the 20th century, back into the 19th century because they're going to have to go back to wood stoves," Mr Joyce said.
"I was with people on the weekend and that's precisely what's happening."
Record month for PV
GEM's forecast comes on top of another record month for small-scale rooftop photo-voltaic (PV) installation.Almost 19,000 rooftop PV systems were installed across Australia in May.
Mr Edis said new units in May alone would add up to bill savings of about $233 million over 10 years.
The 131 megawatts (MW) of rooftop solar PV registered in May was also new monthly record.
Mr Edis said his belief that solar PV sales would tail off next year was in danger of being badly wrong.
"[It] will be interesting to see what happens once the drop in wholesale electricity prices starts flowing through to end consumers, he said.
"Although because solar module prices now look set to plummet in the second half of the year it might just overwhelm the effect of declining electricity prices."
Renewable accounted for 19.9 per cent of the electricity generated in Australia's main grids in May.
On GEM figures, renewable energy avoided 2.4 million tonnes of CO2 pollution over the month, or the equivalent of taking 9.2 million cars off the road.
The NEG is designed to be a "technology-neutral" scheme which imposes a requirement on electricity retailers to reduce carbon emissions while guaranteeing reliability.
Embed: CO2 reduction of renewable energy as measured in cars off the road
Large-scale renewable pipeline growing
Mr Edis said his forecast for renewables accounting for about 40 per cent of generation by 2030 substantially exceeded the emission reduction ambition within the NEG.Modelling for the Energy Security Board estimated the emission target would be achieved with 36 per cent renewables' share.
"Given the Snowy 2.0 pumped hydro expansion is envisaged to resolve foreseeable reliability challenges, the NEG appears to do little to support investment in new generating capacity," Mr Edis said.However, even those figures may be conservative, with the pipeline of renewable projects waiting for approval capable of supplying 85 per cent of the NEM's demand by 2030.
"Since the political uncertainty over the Renewable Energy Target was resolved, project developers have been incredibly busy identifying and gaining development approval for new wind and solar farms around the country," Mr Edis said.
Former prime minister Tony Abbott has already said he would consider crossing the floor to vote against the NEG policy.
Mr Joyce would not be drawn on whether he would do the same, but he vowed to "fight" until his concerns about cutting power prices were addressed.
The Government needs all states to agree to its final energy plan, before any legislation is put to a vote in parliament.
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