Recent shifts in the energy industry have reflected business support for the Australian Energy Market Operator’s (AEMO) world-leading transition plan according to CEO, Daniel Westerman.
In his recent address to the Australian Financial Review’s (AFR) Energy and Climate Summit, Mr Westerman said recent developments within the energy industry – including the accelerated closure of AGL’s Loy Yang A coal power station – were consistent with the so-called ‘step change’ scenario outlined in the organisations recent 30-year Integrated System Plan (ISP).
Mr Westerman said the ISP has received global recognition from both government and industry bodies.
“All of these developments are consistent with our central scenario, the Step Change scenario, in our 30-year Integrated System Plan. The ISP is a product of extensive consultation and review with the wider energy industry and consumer groups,” Mr Westerman said.
“And this Integrated System Plan is world class – and I’m not just saying that. Over the past few weeks, governments and system operators around the world have held up Australia’s plan as a global benchmark, and a model to follow. And while I’m very proud of what we’ve collectively achieved, the work doesn’t stop here.”
AEMO’s ISP has been broadly-supported for its clarity and guidance, supported by the organisation’s world-first power system for simulating grid connections for future projects.
“In a world-first, we are enabling project developers to have open access to test their connection directly against AEMO’s power system model through a secure gateway,” Mr Westerman said.
“This will allow developers to simulate their connection, interrogate the technical outputs and iron out any bugs quickly and directly.
“Connections have been a teething issue in recent years, but now this is an area where Australia is absolutely leading the world.
“I’ve recently had feedback from two of the world’s leading energy equipment manufacturers that the structure, clarity and specificity that is now being provided is setting the benchmark for grid connections around the world.”
Mr Westerman went on to discuss the four pillars supporting Australia’s transition to a low-emissions economy, including:
- Low-cost renewable energy, taking advantage of the abundant natural resources that Australia has to offer
- Firming technology like pumped hydro, batteries, and lower emissions gas generation, to smooth out the peaks and fill in the gaps from that variable renewable energy
- New transmission to connect these new and diverse low-cost sources of generation to our towns and cities
- A grid that is capable of running, at times, entirely on renewable energy
Developing these pillars is critical to navigating a successful transition, according to Mr Westerman.
“At least five coal-fired power stations are set to close between now and 2030, and we expect the pressures on other coal-fired generators to result in further closure announcements in line with the ISP’s Step Change scenario,” Mr Westerman said.
“To replace this energy, Australia needs to install 45GW of new supply by 2030. Around 36GW should be from renewable generation like solar and wind, and 9GW from new firming capacity like pumped hydro, batteries, and gas generation, to unlock those renewables.
“AEMO has a critical job to do in connecting this new generation, and in close collaboration with the Clean Energy Council, we are implementing a swathe of improvements to the connections process.”
In recognition of AEMO’s success in achieving broad collaboration between industry and government, Australia’s Energy Ministers have committed to an expansion of the current ISP.
“I’m pleased that Energy Ministers have agreed to ‘supercharge’ it beyond its current remit, and we’ll work collaboratively with governments and other stakeholders to realise this. Because, as the ISP shows, there is a lot to do,” Mr Westerman said.
