Northern Australia is home to a number of plans to create a new clean energy export industry. The 10 GW Sun Cable solar project slated for the Northern Territory and the 15-26 GW solar and wind Asian Renewable Energy Hub (AERH) in Western Australia's Pilbara region are leading the way.
While seemingly impossibly sized, the projects are seeing support from influential energy industry analysts.
“The two mega-projects would elevate Australia to a renewable energy export superpower,” said Ernst & Young’s (EY) infrastructure advisory director Jomo Owusu, when releasing the consultancy’s 2020 Renewable Country Attractiveness.
The EY analysis noted that such projects could allow Australia to remain an energy exporter, as coal and gas exports recede.
Renewable energy analyst Michael Liebreich, the cofounder of what is now BloombergNEF, says that he too is “very impressed by the Australian developments … it’s all about industrial processes, it might be hydrogen, it might be desalination. I would love to see them linking up with ammonia and fertilizer production as it’s easily storable and transportable. Most of the process in renewables in Australia has been on the supply side, notwithstanding the efforts of the federal government, which has just been confused and misguided. The more difficult question is demand and that’s what I like about the plans for the Pilbara.”
Liebreich explains that in locations where there is available low-cost land and a strong wind and solar resource, the cheap electricity produced at good capacity factors will cause a migration of energy intensive industries, or the production of hydrogen – the latter only when transportation challenges can be addressed.
“Wherever you can have both very cheap wind and solar – and when you connect those two then you don’t have the 22% capacity factor of solar, but you can get to 60% – then there really is an economic strategic advantage,” says Liebreich.
Crunching the numbers, Liebreich says that while sub-$0.015/kWh may not be achievable from solar in Australia today, something approaching $0.03-0.04/kWh could be possible. Adding a battery storage component, at $0.05/kWh for “the biggest batteries in the world,” then energy intensive industries could be attracted. “When these costs can be achieved then there is strong argument that all energy intensity industry will be migrating to these sorts of areas.”
Liebreich suggests that outside of Australia, some parts of the United States, some parts of China, India, Chile, and Spain, or “almost all of North Africa and the Gulf,” could support such “renewable superpower” conditions.
“They [GW-scale renewable projects] are very significant because it was not that long ago that 10 MW was the size of solar projects – maybe a little over a decade ago. When you get to 2 GW that is a lot of power.”
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: firstname.lastname@example.org.