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Labor will tell Australians that more renewables will make power cheaper. But there is a basic problem in this...
Solar and wind are intermittent. They do not run on demand, so the grid needs backup generation, storage, and far more transmission to hold the whole system together. That means paying for an entire second layer of infrastructure to stabilise what the first layer cannot do on its own.
International evidence shows higher renewable penetration rate is correlated with higher electricity costs. This should surprise no one, as it is the predictable result of low load factors, dispersed generation, storage needs, and major network expansion.
The scale of that buildout is immense. Chris Bowen’s target involves adding 10,000 kilometres to the national transmission network by 2030, with costs running into the tens of billions. In New South Wales alone, the 365km HumeLink project is already being badly delayed, with its cost estimate blowing out to almost $5 billion, while Snowy 2.0 has risen from an original estimate of $2 billion to well over $12 billion.
All these costs inevitably find their way to the average person, either through increased taxes or the costs being handed down to the consumer.
Modelling done last year by Moody estimated retail electricity costs could rise by 20 to 35 per cent in real terms over the next decade, even using conservative renewable investment assumptions. Similarly, Infrastructure Victoria modelling projected wholesale prices around $120 per megawatt-hour in 2030 if Victoria hits its renewable targets, more than double the current price level in 2025.
In light of all this, how does Labor's push for 82% renewables by 2030 make any sense?
The answer is it doesn't.
If Labor really wanted to reduce electricity prices, they would unshackle Australia from our Net Zero and renewable targets, and put electricity affordability and reliability front and centre of their energy policy. Until then, we can continue to expect high energy prices.