AEMO calls for fast track on Snowy Hydro links
Coal-fired power stations will close at an accelerating pace and Australians need to get their act together and connect up massive hydro projects, the market operator warns. There’s no way back.
Connections to the electricity grid from Snowy Hydro 2.0 should be fast-tracked because of risks coal-fired power stations will close earlier than expected, the Australian Energy Market Operator warns.
Closure of coal-fired power will accelerate in the 2030s and action is needed now because it takes years to plan and build transmission lines, AEMO says in a report published on Wednesday.
Of immediate concern is the Latrobe Valley’s Yallourn Power Station — which supplies more than a fifth of Victoria’s electrical power.
It is scheduled to close by 2032 but AEMO says the grid must prepare for it to close by 2028-29.
Any precipitous loss of reliability in Victoria would affect South Australia because the states’ electricity supply and prices are closely aligned.
The AEMO report, Building power system resilience with pumped hydro energy storage, examines the impact of the $4.5 billion Snowy Hydro 2.0 project, the proposed Battery of the Nation hydro in Tasmania, interstate transmission links and the growth of renewable energy.
“The National Electricity Market has to manage the increasing variability of both supply and demand from changing weather patterns, consumer behaviours, growing variable renewable generation and declining reliability of existing generators,” AEMO managing director Audrey Zibelman said.
“AEMO’s in-depth analysis confirms the important role of energy storage to build power system resilience, improve reliability and to put downward pressure on wholesale costs.
“By 2030, wind and solar generators, including consumer rooftop systems, are expected to represent approximately 50 per cent of the market’s installed generation and storage capacity, generating over 40 per cent of energy consumed.
“It is critical we advance the required transmission infrastructure to support the integration of these new resources to ultimately deliver secure, reliable and affordable energy for Australians.”
The report found the huge size of the Snowy Hydro 2.0 storage meant it could take advantage of cheap seasonal renewable electricity — such as excess solar in spring and autumn — to deliver least cost extended reliability.
Smaller hydro projects and batteries would be valuable in shorter term management of the grid.
The proposed transmission line from Snowy to Melbourne, the Keranglink, would loop through western Victoria.
Energy Networks Australia welcomed the AEMO report.
The logical response to growing levels of renewable generation was to create a more connected system, Energy Networks Australia acting chief executive officer Tamatha Smith said.
“Transmission is our electricity superhighway and more strategically placed transmission means more power can reach more customers with greater reliability,” she said.
“Coordinated investments in transmission and interconnections between states will ensure electricity from new generation can be shared across the National Electricity Market.
“This will support better reliability and system security as coal-fired power stations retire and put downward pressure on wholesale prices, which means lower bills for customers.”