The energy transition is moving ahead at pace. 

Key technologies such as smart inverters and batteries are enabling a fundamental shift in what is possible.  Even as recently as the development of the 2020 Integrated Systems Plan, we were not certain that these technologies could be grid forming or provide system services.  We now have the technology and over the next few years these systems, along with the right operational architecture and market reforms, will be tested and demonstrated at scale to ensure they can do just that.

A modern electricity grid powered by diverse renewable energy and storage can provide reliable, clean and affordable power by carefully balancing supply and demand. Operating the grid within technical parameters (described by frequency, voltage, fault current levels) ensures the system remains stable. Adding storage such as grid scale batteries and pumped hydro, and increasing interconnection between states, will enhance the security and reliability of power supply.  CSIRO, AEMO and the Finkel Review have all found that there are no technical barriers to Australia achieving secure, reliable power from a high proportion of renewables. Countries such as Denmark rely on renewable energy without compromising reliability.

This is not to say there are still not many challenges.  The NEM Engineering Framework has identified 300 questions/issues to be resolved. As well as the obvious enhancements to the transmission network, the distribution networks, regulatory frameworks and market models will need to adapt. Demand management will be a critical aspect of the transition. Significant increases in the number of electric vehicles and energy efficient buildings will only exacerbate these challenges, but also provide opportunities.

The complexity of the task is exacerbated by the fact that for a period we will have parallel paths: maintaining and augmenting the capabilities of the current system while designing and implementing the future system. This is analogous to upgrading your car as it drives along the road.  Different stages of the transition will throw up challenges that require choices in balancing supply and demand.

The supply of necessary skills, particularly engineering skills, is both critical and concerning. While the skills ‘picture’ is complex and does not seem to follow classic supply and demand behaviour, there is no doubt that finding enough suitably experienced engineers is going to be difficult.  We need to put an energy workforce plan in place that accounts for cycles and enables the energy transition.

At the same time, the requirements on engineers are growing.  Engineers are now expected to be technical experts, work in complex multi-disciplinary teams, be digitally savvy, have good interpersonal skills and apply systems thinking, as well as develop trust from the community to build social licence and apply principles of sustainability to all their work. While this is a challenge, it also presents a chance to encourage young people into a dynamic career focused on community benefit.

A decade ago, the idea of a grid led by wind and solar backed up by storage did not seem real. The Australian Energy Market Operator expects the share of renewables to be around 80 per cent by 2030.  Mainstream politics is embracing it. Labor’s emissions targets assume an 82 per cent share of renewables in the grid by 2030, and the federal Coalition is forecasting 69 per cent.  Thee change has been remarkable, and we have no reason to think it won’t continue over the next decade.