By Mike Foley
Australia’s energy regulator has three months to sort out back up plans to prevent blackouts, after it found that delays to key energy projects could cause power outages during a summer heatwave on the eastern seaboard.
Noting the delays to start dates for energy projects across the nation, the Australian Energy Market Operator built into its predictions an assumed six-to-12 month hold-ups for energy generation, storage and transmission line projects.
Power project delays have raised the risk of blackouts during heatwaves this summer. Credit: Glenn Campbell
“If risks of commissioning delays eventuate as they have in recent years, reliability gaps are forecast in Victoria, NSW and South Australia,” AEMO said in its annual Electricity Statement of Opportunity.
The regulator will now contract new electricity supply deals and work with big energy users to cut consumption – such as paying smelters to reduce usage if a heatwaves looms.
AEMO said without new supplies, existing project delays would drive the risk of blackouts above the regulated standard this summer, particularly if there’s a power outage at one of the ageing east coast coal plants that coincides with a run of high temperatures in the same state.
While AEMO is allowing for project delays, the Commonwealth-owned corporation Snowy Hydro is confident its fast-start gas plant at Kurri Kurri in NSW will be completed by December – making it the second new plant in NSW in the past decade after EnergyAustralia’s Tallawarra plant in the Illawarra.
Snowy’s new gas peaker would fill three times over the gap in supply needed to eliminate AEMO’s reliability warning for NSW.
AEMO chief executive Daniel Westerman said power supply reliability was improving, but warned that it is critical all these anticipated projects are delivered on time or supply shortfalls would be a growing risk.
“It is critical that expected investments in generation, storage and transmission are delivered on time and in full,” Westerman said.
“If delays occur to projects already under way or further investment does not materialise, then the outlook for reliability will deteriorate,” he said.
The total energy generation capacity of all the coal and gas plants, solar farms, wind turbines and hydroelectric dams across the grid is 60 gigawatts.
AEMO said that in the past year, 365 kilometres of transmission lines and projects totalling 5.7 gigawatts of generation had advanced to a stage where they could be completed within a year.
That figure includes 3.9 gigawatts of dispatchable capacity, such as batteries and gas plants, which can be called on at a moment’s notice to fill gaps in supply if a coal plant breaks down or if there is low wind and solar output.
The state of the electricity grid is a key political test for the Albanese government, which has committed to raise the share of renewable energy to 82 per cent by 2030 – its key measure to achieve its emissions reduction targets.
Renewable energy in the grid has grown by 25 per cent since the Albanese government came to power and on average now accounts for 40 per cent of the mix.
Officials warn the green shift is not happening fast enough to avoid the risk of blackouts and price spikes as nearly every coal-fired power plant shuts in the next decade.
Energy Minister Chris Bowen said AEMO’s report showed the success of government schemes underwriting private investment in transmission lines and renewable energy.
The Victorian government will on Thursday announce its fast-track planning process for renewable projects has approved a $250 million, 350 megawatt battery in western Victoria, which was submitted and processed within nine weeks.
“This streamlined process allows us to bring good renewable projects like battery storage systems online faster so that we can provide more Victorians with cheaper and cleaner energy,” Planning Minister Sonya Kilkenny said.
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