unlocking australia's renewable energy future

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Unlocking Australia’s renewable energy future Tony Meehan, Executive Manager, Regulation NEM Future Forum 2017, 31 October 2017 #NEMFF17

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Page 1: Unlocking Australia's Renewable Energy Future

Unlocking Australia’s renewable energy future Tony Meehan, Executive Manager, Regulation

NEM Future Forum 2017, 31 October 2017

#NEMFF17

Page 2: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 2

Backbone of Australia’s Electricity System TransGrid is the operator and manager

of the NSW transmission network

NSW is the largest region in the

National Electricity Market

NSW

Centre of the NEM connecting QLD and VIC

32% of Australia’s population

34% of energy consumed in the NEM

Page 3: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 3

Disruption at the source of energy

NEM existing generation capacity mix

Coal 49%

CCGT 5%

OCGT 14%

Gas other 5%

Solar* 0.58%

Wind 9%

Water 17%

Biomass 1%

Other 0.30%

Coal CCGT OCGT Gas other Solar* Wind Water Biomass Other

Page 4: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 4

Dramatic change as generation retires

Source: AEC

Page 5: Unlocking Australia's Renewable Energy Future

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3

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Unlocking Australia's renewable energy future | October 2017

Reducing emissions

Transmission networks are integral to

reducing emissions in the electricity

sector by transporting energy between

areas with abundant renewable resources

and areas where electricity is used.

Affordability

Transmission networks deliver

affordability for consumers as the

platform on which the competitive

wholesale electricity market operates.

Energy security

Transmission networks maintain energy

security through core expertise in power

system security and stability, and a

thorough understanding of the planning

and operation of the power system.

5

Role of transmission in the future energy system

Page 6: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 6

Significant impact for consumers

Price impact of expanding renewables, and coal-plant closures

Source: Professor Ross Garnaut 550MW Topaz Solar Farm in California

Page 7: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 7

Cost of renewable generation is going down

PV module prices and learning curve

calculation The cost of wind turbine continues to fall

Source: Bloomberg New Energy Finance, Paul Maycock, company filings Source: Bloomberg New Energy Finance Note:

Data by contract signing date

Page 8: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 8

Predicted future generation in the NEM

Source: ENA Roadmap 2017

Page 9: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 9

The transition to large-scale renewable sources of

energy will be enabled by transmission A trajectory towards

100% renewable

generation is feasible,

and the technical

challenges associated

with this transformation

can be met in a way that

is affordable for

consumers.

Connection of large-scale renewable generation in areas with abundant renewable resources could be enabled by

extension of the transmission network to those areas.

Page 10: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 10

A strategic approach is required

A strategic approach to identifying renewable zones at lowest cost, considering the best renewable

resources and compatible land use.

Criteria for consideration:

Solar PV resource

Wind resource

Site elevation

Site slope

Parcel size

Land tenure

Land use

Land cover

Protected areas

Prohibited areas

Page 11: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 11

Study of new energy zones – solar resources

A significant amount of solar resource exists

within the study area.

In order to provide efficient and effective

renewable zones, solar generation should

be located near to the wind resource.

Approximately 40GW of solar has been

identified between Yass and Balranald and

another 20GW between Balranald and

Casterton.

Page 12: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 12

Developing an integrated grid plan

Source: TransGrid’s Transmission

Annual Planning Report 2017

Finkel recommendation 5.1

“By mid-2018, the Australian Energy Market

Operator, supported by transmission

network service providers and relevant

stakeholders, should develop an integrated

grid plan to facilitate the efficient

development and connection of renewable

energy zones across the National Electricity

Market.”

- Independent Review into the Future Security of the

National Electricity Market

Page 13: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 13

A successful transition

Connection of large-scale renewable

generation

Sharing of geographically diverse

resources

New ancillary services to manage system

stability

Regulatory framework to evolve to

support the system

Page 14: Unlocking Australia's Renewable Energy Future

Unlocking Australia's renewable energy future | October 2017 14 /