National Energy Market redesign to impact Central Queensland

The Central Queensland energy market faces the retirement of coal fired power and emergence of renewables.

Stanwell Tarong Power Station is making changes to stay competitive in the energy market. (PHOTO: Katherine Morris)

The way we produce and consume energy is changing and Central Queensland is set to play a significant role and face impacts from the redesign of the National Energy Market, it has been revealed.

A shortlist of options for the National Electricity Market redesign released by the Energy Security Board addressed the influx of renewables and the retirement of coal generation.

ESB independent chair, Dr Kerry Schott AO, said it was impossible to overstate the scale and pace of change in Australia’s electricity sector.

She said reforms were needed to address the transformation.

Energy Security Board Chair Dr Kerry Schott speaks during a discussion forum at the Clean Energy summit at the International Convention Centre in Sydney.

“The rapid spread of large-scale wind and solar, along with rooftop PV, across Australia means our energy system is experiencing the fastest and most substantial change in the world,” Dr Schott said.

“Our generation mix is changing fast, but the physics of our power system cannot change in the same way.

“We are preparing the advice ministers need to enable the critical decisions needed for an affordable, reliable and secure electricity system that can ultimately operate at net zero emissions.”

Retiring old coal generation will hit Central Queensland, with a number of coal-fired power stations set to be retired in coming years.

But the emergence of renewables in the region is set to take the place of coal.

The energy market redesign is focused on four critical areas: Preparing for old coal retirement by facilitating the timely entry of new generation and storage, backing up power system security by ensuring the resources like inertia, voltage and frequency control services are available, unlocking benefits for all energy consumers of recent changes including solar PV, batteries, and smart appliances, and opening the grid to cheaper large-scale renewables in both the short and longer term by putting generation and transmission together to minimise the costs of transformation.

Dr Schott said rather than a single big bang reform, the pathway developed accommodated different jurisdictional schemes and priorities, while reflecting the urgency of the situation.

“There is no doubt that policy changes are needed to the existing market design and the decisions that Ministers make mid-year, and in the future, are critical to reaching an affordable, reliable and secure electricity system that is able to operate at net zero emissions,” Dr Schott said.

“The physics of power are complicated to manage in practice as the system changes; and every state and territory has different priorities, goals and risks in terms of price, reliability and emissions.

An Energy Vault co-located with a solar farm could be the way of the future for renewables and electricity storage.

“We are taking a pragmatic approach to clearing the path for technology to make people’s lives easier while keeping the lights on at the lowest possible cost. Some measures are immediate or already underway, others are near-term but require further development, and others will happen if and when they are needed,” Dr Schott said.

“This is the best chance we have of setting up Australia’s energy system for the future.

“We can’t kick these challenges any further down the road.”

The Energy Security Board has five members:

Dr Kerry Schott AO independent Chair

David Swift independent Deputy Chair

Clare Savage Chair of the Australian Energy Regulator

Anna Collyer Chair of the Australian Energy Market Commission

Drew Clarke Chair of the Australian Energy Market Operator

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