Australia stands to stymie its own renewables rollout, not through a lack of generation — but transmission — if the federal government doesn’t move faster on crucial infrastructure. 

Peter Cowling is country head for Australia and New Zealand at wind power generation giant, Vestas. He told The Fifth Estate that investing in the power grid was a great way for Australia to achieve its emissions targets on time, but came with challenges. 

“We’re in the middle of quite a rapid transition from our old thermal power system to a renewable power system in Australia,” Mr Cowling said.

“The thing that scares me, is that the amount of new grid that needs to be built to make that work is pretty substantial and it takes a long time to do — so we really need to get started.”

In 2020, wind and solar each made up nine per cent of Australia’s total electricity generation, with wind growing at a slightly slower rate than solar partly due to rapid residential uptake of rooftop PV.

Mr Cowling explained the issue with Australia’s current energy network is it was designed and built, primarily by individual state governments, to take energy from old thermal power stations to cities and then radiate outwards to feed regional areas. 

“In a lot of ways we need to reverse the power system to take the new sources of renewable energy from typically regional areas into where the power is needed,” Mr Cowling said. 

He explained that the existing lines linking cities to regional areas are not suitable for transmitting the large amounts of energy now required of them and that certain areas close to existing grid infrastructure are beginning to become crowded.

Recently, the Australian Energy Market Operator (AEMO) which is responsible for transmission planning, gave the message to generators not to connect to the grid in north west Victoria as it was too weak to support what was already there.

“We know we can transition the Australian power system to renewables really fast. We could easily roll out the projects you need to get 80-90 per cent renewable energy in Australia over the next 10 years,” Mr Cowling said.

“The challenge that I am concerned about is whether we’ll have the grid infrastructure that’s needed to deliver that. And the difference is pretty profound.”

The role of government

A significant opportunity exists for the government to invest in the critical transmission infrastructure that will enable a greater proportion of renewable energy in the grid, and for the country to decarbonise faster.

However, building new transmission infrastructure is costly and approval is subject to lengthy, economic assessments, making it a less feasible option for private companies.

“The grid is a shared asset because you need the whole network to support projects, so it’s a tough one as to how you expand it when you’re just an individual developer,” Mr Cowling said. 

“Private development works really well for generation but takes a lot longer for transmission assets. So, it’s a great opportunity for the government to step in and do some real sort of nation building infrastructure work.” 

According to a 2020 Grattan report, in the past consumers have been forced to swallow the cost of private electricity companies conducting their own infrastructure upgrades – mostly in distribution networks – but also in transmission.

In 2018, AEMO released its “Integrated System Plan (ISP) identifying potential transmission projects, including foremost to expand the system’s capacity between Queensland, New South Wales and Victoria and potentially later creating a second interconnector between Victoria and Tasmania.

The Labor party’s $20 billion “Rewiring the Nation” policy, released in 2020 proposes to establish a government-owned body to partner with industry, providing low-cost government finance for the upgrades.

Meanwhile the Morrison government is supporting projects prioritised in the ISP through over $250 million to support the development of:

Project EnergyConnect:  a proposed high voltage transmission line connection between the New South Wales and South Australian power grids,  between Robertstown and Wagga Wagga, with an added connection to Victoria.

VNI West: expected to deliver up to 1800MW of additional capacity between New South Wales and Victoria, between the Snowy Mountains region and Melbourne.

Marinus Link: intended to provide an additional 1500MW of transmission capacity between Tasmania and the mainland. 

Mr Cowling said while these major projects are positive, we need more of them to get where we need to be — and the question of where the grid is required is already being written. 

“The state governments are putting a huge amount of work now into renewable energy zones, particularly in New South Wales and Victoria, that will assist in this process,” he said. 

“So the idea will be to gather together zones, and then sort of focus on the grid infrastructure to connect them up. But again, that grid will need to be built.”

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