Australia can achieve net zero energy by 2050 with a $122 billion program of investment in renewable generation, storage and transmission, a new roadmap says.

And the roadmap contradicts claims by Opposition Leader Peter Dutton that an all-renewables transition would cost $1.3 trillion.

But the roadmap has not considered options for nuclear power (see below).

The Australian Energy Market Operator has released the 2024 edition of its Integrated Systems Plan (ISP).

Produced every two years as required by legislation, the plan serves as a roadmap to guide efforts to deliver reliable power at the lowest possible cost as the nation seeks to decarbonise its energy system.

Its release follows two years of consultation, analysis and review. This involved 2,100 stakeholders, 85 presentations and reports and consideration of 220 formal submissions.

According to AEMO, urgency to renew the plan is being driven by the closing down of coal-fired power stations.

Whilst coal currently provides around half of Australia’s electricity, ten coal-fired power stations have closed since 2012.

Going forward, AEMO expects all remaining coal-fired energy generation to close by 2038.

The centrepiece of the ISP is an optimal development path (ODP). This sets out the least cost path to achieve net zero energy by 2050 with current Commonwealth and state policies on emissions reductions.

The ODP involves a mix of replacement grid-scale generation (such as solar and wind power), which is firmed by storage and supported by additional transmission to connect new generation assets to the grid.

Using data from the 2024 edition of the GenCost report published by the CSIRO in conjunction with AEMO, AEMO estimates the capital cost of its plan at $122 billion.

All up, the plan projects that electricity consumption will almost double from 174 TWh currently to 313 TWh by 2050.

To meet this demand, the plan proposes:

• a six-fold increase in the volume of installed grid-scale wind and solar capacity from 21 GW now to 65 GW by 2030 and 127 GW by 2050.
• a four-fold increase in rooftop solar and other distributed solar from 21GW now to 36 GW by 2030 and 86 GW by 2050
• a sixteen-fold increase in storage capacity (batteries, pumped hydro, virtual power plants) from 3GW to 49 GW by 2050
• a modest increase in gas fired power generation from 11.5 GW to 15 GW by 2050
• addition of around 10,000 km of new transmission lines which the report has identified as necessary to connect new generation to the grid
• a focus on grid-scale generation in renewable energy zones to support better grid connections and reliability as well as regional expertise and employment at scale; and
• leveraging of system security services and operational approaches to ensure that the grid remains secure and reliable as more electricity is generated through intermittent sources.

(projected capacity under the most likely ‘step change’ scenario in the AEMO report)

The latest plan comes amid intense policy debate in Australia about the best way to transition the nation’s energy grid to a more sustainable future.

The current Labor Government is pinning its hopes on renewable energy generation supported by storage technology, additional transmission and ongoing gas supply.

However, the Opposition Liberal/National Coalition is pursuing a policy whereby nuclear energy would be part of the mix as well as renewables.

Last week, the Coalition unveiled seven sites on which it said it would build nuclear power if elected into Government in 2025.

However, the Coalition has not revealed any costs in relation to its plan and is unable to say how much power would be generated at the sites.

(To pursue nuclear energy, the Coalition would require the support of the Parliament to overturn a current ban on nuclear energy which is in place at the Commonwealth level.

The Coalition would also need to deal with nuclear bans which are in place across several individual states.)

In its plan, AEMO did not consider nuclear as the plan is legally required to consider only those means which are supported by existing Commonwealth and state policies.

However, it noted that the GenCost report has identified nuclear as being considerably more expensive compared with other generation sources.

At any rate, AEMO noted that the time it would take to design and build nuclear generation is likely to be too slow in order to deliver grid reliability in time for the closure of coal-fired power generation.

Further, the $122 billion price tag for capital expenditure for the roadmap in the AEMO report contradicts claims by Opposition Leader Peter Dutton that the Government’s all-renewables plan will cost $1.3 trillion.

The report also makes clear that gas is an integral part of the ISP and will continue to play a critical back-up role to deliver power during periods where renewable generation is unavailable.

In fact, the plan involves a modest increase in gas output.

This is likely to disappoint parties such as The Greens, who support an immediate ban on new coal and gas infrastructure.

Also important could be consumer energy technologies such as home batteries, rooftop solar panels and electric vehicles.

If successfully integrated into the grid, AEMO says that these technologies could contribute to meeting energy demand during peak periods and thus lowering grid requirements and costs.

By themselves, home batteries could save consumers as much as $4.1 billion in avoided costs for additional grid-scale investment.

All up, AEMO estimates that building and maintaining the energy infrastructure to deliver on net zero will support more than 60,000 energy jobs over the next 20 years.

However, the report warns of challenges and risks ahead.

These are accruing as planned projects are facing delivery challenges such as approval process delays, investment uncertainty, cost pressures, social licence issues, supply chain disruption and workforce shortages.

AEMO CEO Daniel Westerman said that the importance of action should not be underestimated.

“The ISP is a roadmap to navigate Australia’s power system through the energy transition, providing Australians with reliable electricity at the lowest cost,” Westerman said.

“Australia’s energy transition is well underway, with renewable energy accounting for 40% of electricity used in the past year,

“There is a real risk that replacement generation, storage and transmission may not be available in time when coal plants retire, and this risk must be avoided.

“This ISP is a clear call to investors, industry and governments for the urgent delivery of generation, storage and transmission to ensure Australian consumers continue to have access to reliable electricity at the lowest cost.”

Enjoying Sourceable articles? Subscribe for Free and receive daily updates of all articles which are published on our site

Want to grow your sales, reach more new clients and expand your client base across Australia’s design and construction sector?

Advertise on Sourceable and have your business seen by the thousands of architects, engineers, builders/construction contractors, subcontractors/trade contractors, property developers and building industry suppliers who read our stories across the civil, commercial and residential construction sector