It is now clearly recognised, away from the imaginary world of the fossil fuel lobby, that the cheapest form of new generation in Australia – and most other places in the world – is wind and solar, and certainly not coal and gas (or nuclear). Recently, Bloomberg New Energy Finance predicted that the cost of new wind and solar would soon beat the cost of refurbished coal plants. Now BNEF predicts that solar will beat the cost of existing, fully depreciated and unrefurbished coal plants by 2032. And wind will follow soon after. The baseload system that is often touted around “cheap coal” is a bit misleading, because it has always depended on more expensive gas to top up the system demand and meet system peaks. The gas sets the price of generation, and this can be increased by market bidding behaviour. The new system has cheap renewables meeting demand much of the time, but storage – delivered through batteries and pumped hydro, and other dispatchable generation, as well as demand management and increased efficiency, will fill in the gaps, but at a much cheaper cost than gas.
Renew Economy 19th July 2017 read more »