Essay by Eric Worrall
Shock – regardless of a political promise of cheaper energy payments, seems somebody has to pay the trillions of {dollars} required to “transition” to renewables.
Electrical energy costs to soar as power transition falters
Angela Macdonald-Smithand Jenny Wiggins
Up to date Oct 10, 2022 – 6.40pm, first printed at 2.19pm…
“Subsequent yr, utilizing the present market costs, tariffs are going up a minimal 35 per cent,” Alinta Vitality chief government Jeff Dimery advised the summit in Sydney, with disagreement from Origin Vitality and EnergyAustralia.
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Mr Dimery warned Australia was “out of time” on setting up insurance policies to help funding in new firmed renewables capability to exchange the coal energy vegetation exiting at an accelerating fee, worsening upward pressures on pricing.
“What value $1 billion to accumulate goes to value me $8 billion to exchange. So let’s discuss that and nonetheless clarify to me how power costs come down, I don’t get it.”
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It makes it tougher to attain the drop in energy costs promised by Labor by 2025 within the run-up to the election in Could, though Local weather Change and Vitality Minister Chris Bowen didn’t again away from that assurance.
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“It seems that some individuals suppose [the energy transition] will probably be simple and low-cost, however I believe most individuals on this room perceive it’s exhausting and costly and prone to drive power payments [up] within the close to time period,” mentioned Andrew Richards, CEO of the Vitality Customers Affiliation of Australia.
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“If you happen to take a look at the quantum of funding required … [estimates] take a look at anyplace between $US100 and $US120 trillion of funding essential to impact transition by 2050. That’s orders of magnitude greater than the provision chain is able to doing at this time.”
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Learn extra (paywalled): https://www.afr.com/firms/power/electricity-prices-tipped-to-rise-at-least-35pc-in-2023-20221010-p5boif
May it’s no one ran the numbers, earlier than our legislators opened their mouths and dedicated to an impossibly costly power resolution?
Notice the $US100+ trillion is a almost certainly a world transition estimate, although this isn’t clear from the context.
The price of Australia transitioning is round AUD $7 trillion by my estimate, a lot of that value is battery backup. Although this estimate is simply the price of changing present demand, it doesn’t embrace the price of offering extra electrical energy for a 100% electrical car fleet.
And naturally, there’s a actual query whether or not the transition is even potential, given European photo voltaic producers seem like selecting to shut their factories slightly than face the prospect of utilizing their very own product to energy operations.
