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Australia's AEMO calls for focus on renewables zones in 20yr network plan

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Australia's AEMO calls for focus on renewables zones in 20yr network plan


July 19 (Solar) – It would not be economic for the transmission network to reach all currently proposed renewables projects across the National Electricity Market (NEM), the Australian Energy Market Operator (AEMO) says in a new report, saying it would be better to prioritise a number of renewable energy zones (REZs).

AEMO has now published its Integrated System Plan (ISP), whose goal is to project the overall transmission system requirements for the NEM over a period of 20 years. An important point in the plan is the retirement of existing coal-fired power plants and their replacement, which, according to the ISP scenarios, would involve the addition of between 14 GW and 48 GW of new renewables, connecting to the NEM by 2040.

Coal-fired generators producing roughly 70 TWh annually are expected to retire by 2040. This is close to a third of total NEM consumption, AEMO calculates.

Under its Neutral ISP planning scenario, the lowest cost replacement option for the retiring capacity and energy, based on forecasted costs, will be a portfolio combining 28 GW of solar, 10.5 GW of wind, 17 GW and 90 GWh of energy storage, and 500 MW of flexible gas plant capacity, as well as transmission investment. Such a portfolio can produce 90 TWh net of energy per year, thus more than offsetting the loss of coal power.

The significant expansion of renewable capacity will require NEM transmission network investments. AEMO said many of the current grid connection applications are at the periphery of the transmission network, where the renewable resources is good but the network is weak.

The ISP includes a list of 34 potential zones of good renewable resources across the NEM. Several of these have high quality renewable resource and, at the same time, are located in areas where the transmission network is strong and there is network capacity available. The overall costs of renewables integration in the NEM would be reduced by prioritising such zones, AEMO stresses. These “immediately optimal REZ development areas” are:

New South Wales – Central Tablelands (wind and solar) and Southern Tablelands (wind);

Queensland – Darling Downs and Fitzroy (wind and solar);

South Australia – Northern SA (solar) and Mid-North (wind);

Tasmania – North-West Tasmania (wind);

Victoria – Moyne (wind);

DISTRIBUTED ENERGY

The ISP confirms that the supply mix and demand requirements in the NEM are changing radically and this is in large part due to a surge in solar installations in the residential, industrial, and commercial sectors. Rooftop photovoltaic (PV) installations, increased interest in local storage and energy efficiency improvements are resulting in a flattening demand for power on the grid.

“In contrast to the history of this sector, overall economic and population growth, and associated growth in demand for power, does not result in increased requirements for supply from the power system,” AEMO said.

Distributed energy resources (DER) will be responsible for a growing portion of supply, all ISP scenarios confirm. In the High DER scenario, the projected need for utility-scale investment and intra-regional transmission development to provide access to the incremental REZs is reduced, but still there is a need for increased national transmission capacity to take advantage of diversity and better utilise dispatchable resources.

The use of more electric vehicles (EVs) will have just a small impact on overall grid-based demand.


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