03/12/2018 – News / Energy / Power / Coal / Renewables / Australia
Growth in Australia’s renewables sector hinges on decommissioning coal-fired power plants, finds new report
Australia has not been able to decommission its coal-fired power plants at the pace originally envisaged, which has turned out to be the country’s biggest stumbling block in fast-tracking renewable energy development, according to GlobalData – a leading data and analytics company.
The research firm’s latest report reveals that the coal-rich nation has been decommissioning its coal-fired power plants at a slower pace while still encouraging the development of renewable power plants, leading to surplus generation. Consequently, the country has been forced to slow down the pace of renewable energy development.
Chiradeep Chatterjee, Power Industry Analyst at GlobalData, said: “Australia has vast unused renewable potential and aims to generate 23.5 per cent of its energy – equivalent to 33 TWh – from renewable sources by 2020, in accordance with the extended Mandatory Renewable Energy Target.”
Coal’s dominance in the energy mix
As of 2017, coal dominated the Australian power mix, with a share of 37.7 per cent of the total installed capacity, followed by gas with 28.7 per cent.
Australia has substantial coal reserves, which account for the dominance of this fuel in the power generation mix. The country’s coal reserves, which have higher thermal efficiency due to lower sulphur content, represent around 14 per cent of the world’s black coal resources. Additionally, the country has 29 per cent of the world’s uranium resources and almost 1.9 per cent of its gas resources.
Targeting over 20% renewables by 2020
Australia still has to move away from coal as its renewable energy target mandates generating more than 20% of its supply from renewable energy sources by 2020.
The most pressing challenge in this direction is that coal-fired power plants have not been phased out at the pace originally planned in the energy policy, leading to surplus generation capacity and low wholesale prices. This could possibly slow down the fast growth of renewable technologies.
“The government will therefore have to create a policy environment that will expedite the decommissioning of coal-fired power plants, thus setting the way for a smooth development of renewables,” Chatterjee concluded.
To access the full report, visit: https://www.globaldata.com/store/report/gdpe2111icr--australia-power-market-outlook-to-2030-update-2018-market-trends-regulations-and-competitive-landscape/
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