AEMO slams Murdoch media campaign that claims renewables are not low cost

Aug 11, 2023
Aerial view of three wind turbines in the early morning fog at sunrise.

The Australian Energy Market Operator has made a rare foray into the mainstream media debate around the green energy transition, saying claims that its cost assessment of renewables does not include transmission and storage are “wrong.”

Conservative media, led by the Murdoch press but also including others, has been seeking to suggest that AEMO’s 30-year planning blueprint, the Integrated System Plan, and the GenCost report prepared by AEMO and the CSIRO, do not take into account system costs.

A series of articles published in recent weeks has attacked the GenCost and ISP reports, and appears to be part of a broad campaign against renewables, new transmission links, and in favour of small modular reactor technologies, which don’t exist on a commercial scale in the western world.

The campaign has already drawn a response from CSIRO economist Paul Graham, but after one Murdoch media columnist sought to seize upon this as proof that renewables were not low cost, it appears to have been too much for AEMO.

“Recent media commentary that AEMO’s Integrated System Plan (ISP) does not include transmission and storage, as well as generation costs associated with providing electricity to Australian customers is wrong,” the organisation wrote in a media statement on Monday.

“The ISP is a ‘whole of system plan’ based on rigorous economic modelling and engineering analysis. It models:

  • the cost of generation, including capital and operating costs;
  • fuel prices, including gas and coal price forecasts;
  • the cost of different types and duration of storage – including batteries and pumped hydro storage systems; and
  • the cost of transmission investments.

“The plan looks at the generation mix into the future, and includes transmission and storage needed to keep the lights on.”

AEMO says that the latest ISP, released in 2022, involved 32 forums and webinars, 198 written submissions, involvement of more than 1,500 stakeholders and “continuous dialogue on every aspect” or the report.

“The ISP demonstrates that new renewables with new transmission, firmed with hydro, batteries and gas – is the lowest cost way to supply electricity to Australian homes and businesses as coal fired generation retires,” it writes.

It also notes that while the ISP does not model technologies that are not allowable under existing laws, and so does not include nuclear, the GenCost report does model all available forms of generation including nuclear.

“This shows that nuclear generation is higher cost and has a longer lead time than renewables backed by storage and transmission.”

This assessment on nuclear is backed up by every major energy company in Australia, and by two former chief scientists – Alan Finkel and Robin Batterham – both supporters of nuclear technology who say it has no role to play in Australia’s green energy transition, at least not for the next two decades.

But the federal Coalition is hanging its hat on nuclear, and ramping up its opposition to – and campaign against – renewables.

It is doing this through parliament via Opposition leader Peter Dutton, and through intense campaigning from former National leaders Barnaby Joyce, using platforms such as the Bush Summit that is supported by the Murdoch media and Gina Rinehart.

The opposition to renewables is gathering pace on social media too, with a series of tik-tok and You-Tube videos containing outright lies about wind power, for instance, saying that turbines cannot turn without being powered by coal fired generators.

Green energy developers report that their dealings with landowners are now tarnished by this misinformation campaign, frustrating attempts to have sensible conversations about the opportunities in green energy.

RenewEconomy is also experiencing a huge influx of comments and emails and interaction on social media shouting down renewables.

Some of it absolutely bat-shit crazy, such as those suggesting we look at websites (with up to one million followers) that believe the world is controlled by intergalactic lizards and that the push to wind and solar is part of some sinister plot to control everyone’s minds. No, really.

Others are just gullible, believing any sort of nonsense spread about wind farms and solar panels. This You-Tube video that claims that wind turbine blades can not possibly be turned by wind power alone is a major drawcard.

One Facebook page at the centre of opposition to a major wind farm in north Queensland, which has drawn the interest of Murdoch media, says it is not anti-renewables.

But it provides a prominent link to a Facebook page that publishes stories such as “Why electric cars are an expensive scam” and “solar, a risky waste of time and money”, and the anti-science rhetoric of climate science deniers such as One Nation’s Malcolm Roberts and the LNP’s Gerard Rennick.

All of this nonsense could, and should be ignored, but it springs up in day to day conversations, often amplified by so called “serious” journalists in the conservative media. And it is causing problems for the renewables industry.

Paul Graham, the senior energy economist at CSIRO, wrote a letter to The Australian last week seeking to explain how the GenCost calculations were made. It is published on the CSIRO’s website.

It followed an article that claimed the opposite. Graham pointed out that its cost estimates focuses on calculating the cost of moving from the expected 50% variable renewable share in 2030 to either 60%, 70%, 80% or 90% renewables.

“All existing generation, storage and transmission capacity up to 2030 is treated as sunk costs since they are not relevant to new-build costs in that year,” Graham writes.

But he adds that AEMO’s ISP does take into account all added costs. And the ISP is quite clear that wind, solar and storage is the cheapest option.

The Australian double dipped, producing another article from the same commentator that claimed that Graham had provided proof that CSIRO was confirming that its costings did not take into account transmission and storage. Graham says this is nonsense.

“If you are building a new wind and solar farm now, it will take advantage of infrastructure that already exists, Graham told RenewEconomy. As it would for new coal and gas. “There’s no point building or costing it again. It’s already there.”

In the letter to The Australian, Graham said caution was needed when interpreting alternative studies that find higher costs for renewable integration.

“These tend to be based on renewables operating in ways inconsistent with least cost system design which must make use of all available technologies and only deploy renewables where they contribute to lower system costs.”


First published in Renew Economy August 8, 2023

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