Latest news with #CentreforIndependentStudies
Sky News AU
5 days ago
- Business
- Sky News AU
Energy expert says gas price drop from Queensland exploration 'not guaranteed' as Anthony Albanese government looks to unlock east coast gas reserve
The development of an east coast gas reserve could be on Anthony Albanese government's agenda as a looming investigation is revealed, as an energy expert has warned a fresh move to explore gas opportunities in Queensland may not necessarily benefit the domestic supply. The Queensland government this week announced nine new areas, totalling about 16,000 square kilometres, will be available for gas exploration. Queensland Premier David Crisafulli claimed opening up the state for gas supply will put downward pressure on power prices. The state's Minister for Natural Resources David Last said only two of tenders will be left for domestic supply demands at this stage, leaving about 15,000 square kilometres of the total tendered area without domestic mandates and available for export. However, an energy expert has said though the state government's move may drive gas prices down, it is 'not guaranteed". Centre for Independent Studies director of energy research Aidan Morrison said it was 'critical' to determine whether more or less gas ends up being contracted for export than what the newly earmarked areas produced. 'If they develop more gas in Queensland, but sign contracts to export even more gas than what they can produce and use the domestic market to top up what they develop... that pushes up domestic prices, which flow through to electricity costs,' Mr Morrison told "However, there could be substantial downward pressure on prices even if some of the gas is exported, particularly if this export meets Santos' current shortfall in their own production. It all depends on the balance - ensuring more gas is produced than is contracted for export." It comes as Resources Minister Madeline King outlined a review of Australian domestic gas supplies that would soon get underway at a conference in Brisbane earlier this week. 'I will say publicly what I have said privately to industry – the review we are about the undertake is an opportunity to achieve important reforms in the national gas system,' Ms King said in her speech. Energy sector sources have now signalled they are getting ready for the federal government to launch a viability study into developing a gas reservation on the east coast, according to AFR. A spokesperson for the Resources Minister told the masthead 'the role of market bodies to ensure more gas is made available for Australians' will be looked at as part of the federal government's gas review. 'Queensland and Western Australia are our two biggest gas exporters and they both have state-based gas reservation schemes,' the spokesperson told AFR. 'Australia has a suite of mechanisms that ensure Australian homes and businesses have enough gas for heating, cooking and manufacturing.' Meanwhile, the federal Labor government has this week approved a bid to extend the life of Australia's largest gas plant until 2070. Environment Minister Murray Watt announced on Wednesday a proposed decision to approve pushing out Woodside's North West Shelf gas project from its original deadline of 2030.
Sky News AU
26-05-2025
- Business
- Sky News AU
‘Consequence of the rush': Energy expert attributes rising electricity bills to Labor's ‘unrealistic' renewables push, as regulator reveals transmission cost blowouts
An energy expert has attributed soaring power prices to the Albanese government's renewable energy agenda, with the Australian Energy Market Operator revealing ballooning cost blowouts to the construction of transmission lines. On Tuesday, the Australian Energy Market Operator announced that 500,000 customers nationwide could experience an eye watering 9.7 per cent rise in their power bills. The price hike was revealed in the operator's default market offer, of which serves as a price safety net that limits what energy retailers can charge customers in New South Wales, south-east Queensland and South Australia. Those residing in NSW will incur an even larger price hike than that proposed in the draft form in March and will see their power bills rise by 7.9 to 9.7 per cent, with the average bill increasing by between $155 to $228. The price increase in south-east Queensland is up by $77 or 3.7 per cent and in South Australia consumers should expect a 3.2 per cent rise amounting to a hike of $71. Aidan Morrison, the director of energy research at the Centre for Independent Studies said the trend of compounding power bills was due to the Albanese government's 'rushed' renewables energy rollout. 'I think there's two reasons now why these transmission line costs are starting to emerge, it's just way higher than they were initially ever priced, which is always unrealistic,' Mr Morrison said speaking to Sky News host Danica De Giorgio. 'There was this fantastic idea that we just provide one link into the countryside and then all the other generators would sort of link themselves into the grid. 'What's happened in reality is that link gets expanded, so we pay for the transmission lines to run right into all the generation projects that happen out in the countryside. The market operator outlined in its annual report that the cost for overhead transmission line projects had surged by up to 55 per cent, with substations also rising by as much as 35 per cent. The report concluded that if the $20 billion cost of transmission infrastructure continued to inflate then power prices would rise even further. Mr Morrison said 'the price blow out in the latest report from the market operator makes it very clear that's a consequence of trying to build everything all at once, which is exactly what's happening'. He said the 'rushed rollout of massive renewables, stipulating that everything has to be built before 2030' is causing 'huge competition for all of the materials and all of the contractors'. 'There is a price hike for all the contractors and labouring materials, so the prices go up a lot, and that's what's happening right here. 'It's a consequence of the rush, and it's an inevitable consequence." Chair of the Australian Energy Regulator Clare Savage accepted that 'there are cost pressures in the system' and the regulator was 'seeing that across each of the jurisdictions'. Speaking to Sky News Business Editor Ross Greenwood, Ms Savage accepted cost pressures relating to transmission lines were contributing to the energy price pain experienced by consumers, yet repeatedly defended the government's clean energy agenda. 'We have seen some increased costs in the transmission system from new projects like HomeLink and Project Energy Connect, and they are flowing through to bills in New South Wales in particular,' Ms Savage said. 'What I'd also say is that as we do build out this system of the future and we have greater electrification and more people use electric vehicles, we're going to see increased use of those assets, and that should lead to lower prices over time. Ms Savage reminded consumers that the default offer was used to stop retailers from setting 'unjustifiably high' prices and are 'not intended to be an efficient marker of the best price out there in the market'. 'You don't want to be on the default offer, you do want to be out there, in the markets, shopping around and getting access to the best possible prices. 'I would say though that there are probably nearly 80 per cent of customers who are currently paying more than they need to." She said that people should be shopping around for a new deal every year, and acknowledged that this was an exhausting process. 'I get tired of saying 'shop around', I can promise you, but I do think it's important and probably every year is a good idea." Roughly nine per cent of households and 18 per cent of small businesses receive default market offers.
Sky News AU
15-05-2025
- Business
- Sky News AU
‘Slow motion train wreck': Energy experts tear apart Chris Bowen's renewables agenda, label green hydrogen plan ‘hopeful hand-waving'
Leading energy and environmental experts Aidan Morrison and Graham Lloyd have torn apart the efficacy of Labor's renewable energy policy, while labelling Energy Minister Chris Bowen's green hydrogen agenda as unreliable and 'impractical'. Mr Bowen claimed on Wednesday that a 'silent majority' of Australians supported his green agenda and the Albanese government considered the results of the federal election a glowing endorsement of renewable energy. In an article published in The Australian, Mr Bowen stated there had not been much evidence to support the 'noise' against renewables and the electorate had gone to the ballot box in favour of an 'affordable plan' that was 'backed by the experts'. However, energy program director for the Centre for Independent Studies, Aidan Morrison, slammed Labor's emissions reduction plan and explained the policy faced myriad pressing obstacles. When asked if the Energy Minister's renewable energy revolution could be implemented according to Labor's 2050 timeline, Mr Morrison claimed 'there's just not a chance' and likened the green agenda to a 'slow-motion train wreck'. 'It's like we're kicking around ice on the deck of the Titanic thinking: 'Oh, that was fun to brush up against that'. We haven't taken seriously how badly things are shaping up' he said. Mr Morrison said the tell-tale signs the renewables program was failing were 'all there at the moment', including mounting electricity bills, financing dilemmas and aging coal fired power stations. 'They can't get any private investors to basically completely back renewable energy projects without them being underwritten by the capacity investment scheme', which serves as one of the government's many revenue accelerant schemes for renewable energy projects, he explained. 'That's an open-ended subsidy. We don't know what it's going to cost to force them to do things the market would otherwise not do.' The investment scheme aims for a total of 32 gigawatts (GW) of new capacity, with 23 GW being renewable energy sources, representing an eye-watering $52 billion in investment. The plan also includes nine GW of clean energy dispatchable capacity, representing $15 billion in additional investment. Mr Morrison also expressed fear of grid instability by referencing AEMO's desire to possess 'emergency backstop' powers to switch off rooftop solar systems in every state during extreme situations to avoid 'system collapse'. 'Rooftop solar is about to be curtailed this year. The market operator has told people we have to turn off their solar because there's too much rooftop solar in the system to keep it steady for an engineering system,' he said. Graham Lloyd, The Australian's environment editor, was separately pressed about green hydrogen after metal mining giant Fortescue, headed by billionaire Andrew 'Twiggy' Forrest, axed 90 green hydrogen jobs across the nation on Wednesday. Mr Lloyd said the private sector had formed a consensus the 'green hydrogen boondoggle was a bust', adding the 'government was late to the party in realising that it's throwing good money after bad'. '(Andrew Forrest) is a smart guy, he's packed up his tent and he's gone back to Western Australia to concentrate on trying to make green steel,' he said. 'The difficult part of course is delivering it and there's a lot of evidence that this is more difficult and more expensive than people had hoped, and on that score green hydrogen was going to be a key part of that and we're seeing now power authorities saying grid vulnerability is an issue and that requires a much greater use of gas.' Meanwhile, Mr Morrison described green hydrogen as 'just crazy' and claimed Mr Bowen was 'the last man standing, still putting any hope in it'. 'This whole plan is just built on hopeful hand-waving. Serious engineering has not been done to actually pin this down' he said. 'All of the AEMO hydrogen system stability things are about plans to make studies, to investigate further what the requirements will be. There's no way they can set a cost to that. "The hydrogen thing is just kind of way out there. It's such an impractical gas to be able to store and move around. It's never going to be a useful fuel and a substitute for lots of the things that fossil fuels currently do for us, particularly in heavy vehicles.' Despite Prime Minister Anthony Albanese stating: 'Green hydrogen has a role to play in Australia's future', the majority of touted hydrogen projects in Australia have not moved beyond the concept or approval stage.
Sky News AU
11-05-2025
- Politics
- Sky News AU
Energy experts warn about energy dependence after European power outages as Labor Left pushes for more demanding climate targets
Concerns have mounted in Australia about the risks of over-relying on renewable energy, following power outages across Europe that have been blamed on grid instability and a lack of baseload power. Recent blackouts in Spain, Portugal and France left more than 55 million without energy and forced the government to declare a national emergency. Spanish businesses, households, mobile networks, roads, trains, airports, schools and healthcare facilities had power shut down for hours. The traffic lights went black as traffic jams stretched out for kilometres, and pedestrians had to wave down cars to safely cross the street. Residents could not search for what went wrong online, nor send text messages or make phone calls to loved ones. As Spanish President Pedro Sanchez struggles to avoid taking responsibility for his decision to phase out nuclear energy in favour of renewables, the ramifications of the energy transition have become increasingly clear. Senior Policy Analyst at the Centre for Independent Studies Zoe Hilton said that while it was not yet certain what went wrong, it was clear what made the grid vulnerable in the first place - the high penetration of intermittent renewables. 'Only a few weeks ago, Spain reached 100 per cent wind and solar generation for the first time,' Ms Hilton told Sky News. 'As coal has been phased out over the past several years, wind and solar accounted for 43 per cent of Spain's annual generation in 2024. 'The remaining electricity supply is provided by nuclear, gas and hydro—but not enough to maintain the same level of stability enjoyed by grids without intermittent renewables.' Ms Hilton explained that electricity grids rely on dispatchable baseload power - such as coal, gas, hydro and nuclear, all of which have big spinning turbines. These spinning turbines help to maintain what is called 'grid inertia' as a byproduct of their generation, which helps to ensure the grid's stability. In contrast, dispatchable power - especially photovoltaic solar - cannot supply the kind of inertia that is needed, leaving the energy grid more vulnerable. The CIS energy expert used the analogy of a Jenga Tower. 'Replacing a dispatchable generator with intermittent renewables is like taking a block out of the Jenga tower—you can only take so many before the whole thing is vulnerable to collapse,' she said. 'Just like Spain, we're playing a game of Jenga with our electricity grid … even the tiniest nudge can send the whole thing tumbling. The developments come as the Labor Environment Action Network has demanded the Albanese government increase its climate targets for 2035. The demands call for the government to cut emissions by 70 per cent from 2005 levels, and would effectively require the grid to reach more than 90 per cent renewable energy in 10 years. Executive Director of the Institute of Public Affairs Scott Hargreaves, another energy expert, warned about the consequences of relentlessly pursuing such high dependence on renewables. 'The lesson for Australia is simple—the Spanish blackouts are the new normal under net zero,' he told Sky News. 'All over the world energy security and particularly grid stability has been overlooked in the rush to renewables.' 'The Spanish blackouts have again proved that you cannot run an advanced nation without secure and reliable energy, yet this is the future facing Australians. 'We have been testing Australia's electricity market to the point of destruction for over a decade. Well-informed observers increasingly agree that physical system failure is now looming.' Mr Hargreaves pointed to the fact that state governments have had to begin extending the lifespans of coal-fired power stations, including in Yallourn, Victoria and Eraring, NSW. 'The federal government has set a target of 82 per cent (by 2030). This target is not realistic or achievable and reality will hit well before then,' he said. Despite this, federal Labor has re-committed to its renewables efforts, as it pursues its goals of an energy grid powered by about 95 per cent renewables by 2050. So far, the government's intermediate 2035 target has not been set, as Mr Albanese awaits advice from the independent Climate Change Authority. Figures of the Labor Left, including those sponsored by Labor's Environment Action Network, continue to demand the government set higher targets, and faster. 'I'd like to see (targets) as strong as possible. I'm not going to give you a number because we need to see that advice,' Labor MP Jerome Laxale told Sky News last week. 'It's huge to be given another three years on this and to continue the renewable energy rollout is something that's really important for certainty, particularly for energy transition. 'We've done an enormous amount in three years, got renewable energy up to 40 per cent of the grid, approved 80 projects, grid scale renewable energy projects. 'There's more in the pipeline that will see renewable energy go up, which is what has popular support amongst Australians and we need to make it work.' The experts, and federal opposition, warn that doing so without sufficient baseload power would place Australia at similar risks to Spain. Liberal MP Melissa Price, whose electorate of Durack spans vast parts of WA, expressed concern about imminent energy shortfalls in the next decade. "The Australian Energy Market Operator... forecasts an energy shortfall in WA of 391 MW in 2027-28, growing to 2880 by 2033-34,' she told Sky News. "This is serious. That is why we must be clear eyed about the limitations of some proposals. 'The so-called 'green hydrogen solution' – which is being promoted heavily across the Midwest region here in WA – simply won't cut it. 'Much of the hydrogen energy proposed in WA is destined for export and will do nothing to support or stabilise our own grid." Liberal Senator Dave Sharma also told Sky News that the opposition needed to offer a 'realistic energy policy' as his party recovers from its election loss. He said that energy policy should 'not be so headstrong or ideologically blinkered that it's going to introduce volatility or price uncertainty' into the power system. Key members of the Coalition have begun steeling themselves for a fight over nuclear power, insisting its credentials will become 'even more compelling' by the 2028 election. There have been calls inside the party to dump the nuclear proposal following the election defeat, but many argue it remains the most viable option for Australia. 'We need to be very careful about making rash decisions,' Nationals leader David Littleproud said of the forthcoming debate. 'Regional Australia should have a future that isn't littered with transmission lines, solar panels and wind turbines.' He maintains the Coalition must be technologically agnostic.
Sky News AU
08-05-2025
- Business
- Sky News AU
‘Plagued' Snowy 2.0 project calls Union members to ask for pay rise
Centre for Independent Studies director of energy research Aidan Morrison has spoken on the 'painfully clear' problems facing the Snowy 2.0 Pumped Storage Power Station project. 'This type of really long duration storage … is the very last thing you're supposed to build in an energy transition,' Mr Morrison told Sky News host Chris Kenny. 'If we were at 90 per cent renewables and trying to get to 95 or 98, Snowy hydro would make sense, but we built it as the first cab off the rank, and it should be the last cab off the rank. 'It's been plagued with engineering difficulties, poor design work. 'That delay has meant that the initial agreement the union has struck has expired, and now the unions have the chance to renegotiate the whole thing. 'It doesn't look really good for consumer outcomes overall.'
