The state of Tasmania is on track to become the first in Australia to be powered 100% by renewable energy, just as an analyst at Bloomberg New Energy Finance (BNEF) declares new wind and solar with battery storage less expensive than coal- and gas-fired generating stations.
“The new A$300-million Cattle Hill wind farm in Central Tasmania is currently under construction to reduce power bills to some of the lowest in the country,” Sky News reports. “Renewable energy already supplies 90% of the state’s energy needs, with the state government seeking to make it entirely self-sufficient by 2022.”
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With coal prices rising and renewables costs falling, BNEF Global Head of Special Projects Kobad Bhavnagri said the crossover—to the advantage of renewables—came faster than expected.
“This is something that we only projected would occur in the mid 2020s. But the change in economics, particularly the increase in domestic coal pricing, has meant that this tipping point is already upon us today,” he told RenewEconomy, in a post republished by the Institute for Energy Economics and Financial Analysis. He added that it’s less expensive today “to build bulk dispatchable capacity from a wind farm, coupled with a battery, than it is to build a new coal-fired power station—or gas. The cost of building new peaking generation in Australia now favours batteries. For short durations, for an hour or so, a battery is cheaper than building an open-cycle gas turbine or a gas reciprocating engine.”
RenewEconomy cites an Australian Energy Market Operator report showing coal prices above $100 per megawatt-hour more than half the time in the last three-month reporting period, but says the reality still hasn’t sunk in with decision-makers—even in the face of a global climate emergency. While the phenomenon “has not been well understood or well publicized,” Bhavnagri said, “the era of cheap coal in Australia has really come to an end. And that is true even for the existing generation assets.”
