An executive with Australian utility Origin Energy is declaring the end of baseload power, noting that wind and solar farms are now less expensive than generating electricity from coal.
“I have been in this game for so long,” and “the one thing I have seen is just the cost of renewables really change the game,” Greg Jarvis, the company’s head of energy trading and operations, told RenewEconomy’s Energy Insiders podcast earlier this week. “It is amazing what we have been seeing. Renewables are cheaper than the marginal cost of black coal at the moment. They are very cheap.”
Jarvis calculated the cost of solar in the mid-A$40s per megawatt-hour (4¢ per kilowatt-hour), and wind in the low $50s, “around half the average price of wholesale electricity in most states this year,” RenewEconomy notes, in a summary republished by the Institute for Energy Economics and Financial Analysis. “And with the falling cost of storage, this is likely to enable ‘firm’ renewables to emerge as a serious contender to existing fossil fuel plants.”
In “sharp contrast” to current Australian government thinking, Jarvis said his company had moved beyond relying on 24/7 baseload power from non-renewable fuels. “Oh, a long time ago,” he said. “The idea of base-load power stations is well and truly gone.”