Canberra moves to auctions to speed renewables uptake

By Peter Roberts

The federal government has moved to accelerate Australia’s shift towards renewable electricity, replacing the Renewable Energy Target with a series of auctions to drive investment.

Climate Change and Energy Minister Chris Bowen revealed the shift to six monthly auctions to secure 32GW of new wind, solar PV and energy storage capacity to meet its 82 per cent renewable energy target for 2030.

Auctions are already being used in NSW and the ACT and are seen as a better mechanism than a target to speed investment and the closure of Australia’s ageing fossil fuel power stations.

Speaking on Sunrise this morning Bowen said auctions were the government’s longer term plan.

Bowen said: “Coal fired power stations are increasingly unreliable.

“They’re closing at various rates and we need to get more energy on quicker to replace them before they go out. Not after they go out, but before they go out.

“And so what we’re announcing today is really a big policy to improve the reliability and security of our energy grid, as well as reducing emissions.”

Bowen said the government could not announce the prices to be paid for the new renewables generation and storage capacity – this would be decided by the market in the auction process.

“We want to get the best deal for tax payers. So, we’re saying to renewable energy investors, come and bid into this auction.

“Now, yesterday, Penny Sharpe, the NSW Minister, and I announced the results of the first NSW auction under the pilot scheme.

“And that’s delivering more than a gigawatt of power in a very competitive race, and that’s more than the previous government delivered in their entire nine years just in one auction.

“So, we’re really getting on with the job.”

The government will seek 9GW of new disptchable capacity and 23GW of new wind and solar generation in the tenders, with a first auction in April 2024, to be followed by an auction every six months through to 2027.

Bowen said: “The more renewables you have into the system, the cheaper energy will be, because the sun doesn’t send a bill and the wind also doesn’t send an invoice.

“At the moment, we’re hovering around 40 percent renewable energy. As it increases closer to 82, the renewable price will be setting the price more and more.

“Wholesale prices now are way down on what they were last year. I know people don’t pay wholesale prices, but they do feed through to retail prices over the next year or so.”

Picture: Chris Bowen