A new report by the Climate Council think tank has found that Australia faces significant economic and environmental risks due to what it describes as its ageing, inefficient and unprepared electricity sector.
The report released today says Australia’s coal-fired power stations are some of the oldest, most inefficient and highest polluting in the world.
It says Australia, blessed with so much sun and wind, is losing the renewable energy race.
The report, titled Australia’s Electricity Sector: Ageing, Inefficient and Unprepared, is authored by Climate Councillor and energy expert and a former senior executive with power supplier origin Energy, Andrew Stock, who has spent 30 years working in the sector.
It calls for a faster transition to renewable energy and provides cost comparisons for sources of electricity generation.
Mr Stock said internationally, the energy sector accounted for the largest proportion of greenhouse gas (gHg) emissions, which are the main drivers of climate change.
Limiting temperature rise to a global average of two degrees Celsius, the internationally agreed level that may avoid dangerous climate change, requires large-scale changes in the electricity sector and a tripling of low-carbon energy by 2050.
Yet, Australia’s electricity is largely generated by ageing, inefficient coal-fired power plants and there are currently no plans, nor a national discussion on the future of the electricity sector and options to significantly reduce its emissions, he said.
Delaying the shift to a low carbon future increases the likely risks and costs of transition to a low carbon future in the electricity sector, where it typically takes a decade or more to plan, permit, finance and build major new power infrastructure.
“By the end of this decade, in less than six years, almost half our coal-fired power stations will be over 40 years old, and up for retirement or replacement,” Mr Stock said.
“It can take 10 years to plan and build power infrastructure, so we need to make the right decisions now for the future.
“The world is moving away from the high emissions of burning coal for electricity, towards other sources, including more renewable energy, which continues to drop in cost.”
Mr Stock said the least expensive zero emission option available at scale for deployment today in Australia was wind, closely followed by field scale solar PV.
These costs were falling fast as take-up globally accelerates and wind should be 20-30 per cent cheaper by 2020, while solar PV is expected to halve in cost.
He added that with Australia’s increasing gas prices, electricity generated from wind is already competitive with new gas plants, even without carbon capture and storage (CCS), and lower in cost than gas with CCS.
Chief Councillor Professor Tim Flannery said recent moves by the United States, and indications from China, to limit emissions meant Australia “cannot plan its electricity future around the technology and methods of the past”.
“We risk being energy outcasts and that is a big economic and environmental gamble that we can’t afford to lose,” he said.
The full report is here.
