A reality check on power supply

Whatever the long-term potential of a net-zero carbon economy, coal generation and total emissions across the National Electricity Market have risen for the first time since 2017, data from the Australian Energy Market Operator for the first quarter this year shows. The long-term overall trend remains downward. But analysis of the data shows black coal generation in NSW has risen quarter on quarter for the first time since 2018, and brown coal generation in Victoria has gone up for the first time since 2021. Gas use has fallen due to higher prices.

The situation should remind authorities to be more careful about what they aim for in manipulating consumer behaviour. While coal remains the only affordable baseload power source in most states, demand on the electricity grid has increased as more drivers switch to electric vehicles and households replace gas appliances with electric alternatives, at the behest of governments.

The uptick in coal generation and emissions occurred alongside a slight increase in renewable energy generation, but a decrease in gas-fired generation. State authorities, including in Victoria and NSW, have discouraged gas exploration and production for too long. But as Rachel Baxendale reports, the ACCC’s latest outlook, to be released on Friday, warns the two largest states face gas shortages this winter unless extra supplies can be shipped from Queensland. The decreasing reliability of ageing coal-fired power stations, coupled with predicted gas shortages, puts Victoria, in particular, in a vulnerable position. The federal and state governments are set to face hard, costly decisions to keep the lights on.