Australia: Research shows fully renewable system possible

03. April 2013 | Markets & Trends, Global PV markets, Research & Development | By:  Jonathan Gifford

New research from the University of New South Wales (UNSW) in Australia has drawn the conclusion that a “fully renewable” electricity system could not only be possible but cost effective. Key to the research, is that the study factors in a carbon price between AUD50 – AUD100/ton, which would make even the most efficient coal-fired plants cost uncompetitive.

A solar thermal plant in Oz.

CSP with thermal storage is thought to be an important technology for Australia in the research.

While increasing levels of renewable energy in electricity grids in many parts of the world are causing utilities to protest the potential higher costs, researchers from Australia have created a model that they believe demonstrates that not only is a 100% renewable energy system possible, but that it would cost less than a fossil fuel powered system.

The research has modeled electricity demand and production in the Australian National Electricity Market, which covers the majority of Australia’s population. Researchers performed thousands of computer simulations using actual hourly demand data and matching it with solar and wind production data from 2010.

The result was that an optimal 100% renewable system was possible and most cost effective than a conventional system driven by modern and efficient coal and gas-fired power stations.

The UNSW research team factored in a carbon price of between AUD50 – AUD100/ton, which made the fossil fuel generators uncompetitive with the renewable sources. Currently Australia’s carbon price is AUD23/ton, and is set to increase to AUD24.15 and AUD25.40 in subsequent years. It came into effect in July 2012.

"This carbon price range is considerably less than (Australian federal government) Treasury estimates for measures that would achieve far less in terms of cutting greenhouse gas emissions," said researcher Mark Diesendorf, in a statement announcing the results.

The UNSW team’s model showed that wind would dominate the production landscape, making up 46 – 59% of production, followed by photovoltaics and CSP with 15 -20% each. Existing hydro and biofuel fired gas turbines would make small but vital contributions, filling the gap between the wind and solar production.

Existing energy technologies were used for the modeling and conservative technology costs to 2030 as calculated by Australia’s, generally conservative, Bureau of Resources and Energy Economics.

Advocates of photovoltaics would presumably find these figures for the cost reduction of PV be too conservative and that solar PV will play a larger role than the UNSW predicts. Certainly last July, the Australian Energy Technology Assessment (AETA) Report and Model predicted that photovoltaics will have the lowest LCOE of all evaluated technologies by the mid-2030s.

Diesendorf said that the comparison between a "next generation" fossil fuel system and a fully renewable one was done to show what the relative cost of each technology would be. He said the fossil fuel powered system would have unacceptable C02 emissions, reduced by only 19% on today’s emissions. He noted the renewable system has zero emissions and uses far less water.

"Despite the fact that most of the electricity generation in our scenarios comes from the fluctuating sources of wind and solar photovoltaic, the least cost renewable energy systems as a whole were just as reliable as conventional systems," said Diesendorf.

"There is no need for any inflexible base-load power stations. We can balance fluctuating renewable energy sources with flexible power stations, such as hydro, gas turbines and concentrated solar thermal power with thermal storage," he said.

The UNSW results add to a growing body of evidence showing that Australia is on the edge of a major shift in electricity generation economics. In February of this year, Bloomberg New Energy Finance (BNEF) found that both photovoltaics and wind are approaching competitiveness with new-build fossil-fuel fired power plants int eh country, with the current carbon price factored in. Even without the carbon price, both technologies are set to surpass new coal and gas capacity by 2020.

"Even baseload gas may struggle to compete with renewables," said BNEF's Kobad Bhavnagri. "Australia is unlikely to require new baseload capacity until after 2020, and by this time wind and large-scale photovoltaics should be significantly cheaper than burning expensive, export-priced gas."


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