{"id":2343,"date":"2024-03-26T17:28:33","date_gmt":"2024-03-26T06:28:33","guid":{"rendered":"https:\/\/tbhconsultancy.com\/mena\/a-key-step-in-australias-transition\/"},"modified":"2026-03-12T05:04:47","modified_gmt":"2026-03-12T01:04:47","slug":"a-key-step-in-australias-transition","status":"publish","type":"post","link":"https:\/\/tbhconsultancy.com\/mena\/a-key-step-in-australias-transition\/","title":{"rendered":"TBH: A Key Step in Australia\u2019s Transition to Renewable Energy."},"content":{"rendered":"

The growth of renewable energy sources such as wind and solar has led to dramatic declines in wholesale electricity prices across Australia’s National Electricity Market (NEM) in 2023.\u00a0<\/span>\u00a0<\/span><\/p>\n

Prices fell by 44-64% compared to 2022, driven by cheaper renewable generation displacing coal and gas-fired power.<\/span>\u00a0<\/span><\/p>\n

The <\/span>Australian Energy Regulator<\/span><\/a> in its 2023 media release attributes the price drops to favourable weather, lower fuel costs, fewer coal supply disruptions, and the expanding role of inexpensive wind and utility-scale solar. Renewables supplied a record 38.9% of average demand across the National Electricity Market (NEM) in the <\/span>September quarter<\/span><\/a> of 2023. This was the highest share for any third quarter on record<\/span>.<\/span>\u00a0<\/span><\/p>\n

Yet the proliferation of intermittent renewables like wind and solar, introduces grid reliability risks during periods of high electricity demand. Already the NEM has witnessed five high wholesale price events this past quarter despite overall mild conditions.<\/span>\u00a0<\/span><\/p>\n

Upgrading transmission corridors with new interconnectors, dynamic grid-stabilising technologies, and innovative forecasting strategies will prove critical to managing supply variability as Australia’s energy transition advances.\u00a0<\/span>\u00a0<\/span><\/p>\n

With the goal of achieving net zero emissions by 2050, Australia is currently undergoing an unprecedented energy transition. Key to the transition will be the installation of around 10,000 kilometres of transmission lines to connect Renewable Energy Zones (REZs) and dispersed solar, wind, and hydro sources to load centres \u2013 which are central hubs that distribute electricity to homes, businesses, and industries <\/span>\u2013<\/span> often located thousands of kilometres away.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

Upgrades to the energy grid are needed to adapt the system and make it safe and secure for renewable energy as existing infrastructure ages, becomes overburdened or obsolete.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

As the nation\u2019s energy landscape transforms itself to achieve national decarbonisation goals, TBH is playing an important role by providing advisory services to energy utilities facing big changes in the coming years. Jonathan Jacobs, Managing Director at TBH discusses why grid expansion is needed, and how TBH is playing an important role in \u2018Rewiring the Nation.\u2019<\/span>\u00a0<\/span><\/p>\n

Why Grid Expansion is Critical<\/b>\u00a0<\/span><\/h2>\n

To meet decarbonisation targets, Australia needs to invest in significant renewable energy infrastructure. Under the plans outlined, this means installing thousands of kilometres of new high-voltage transmission lines to connect REZs to the grid.\u00a0<\/span>\u00a0<\/span><\/p>\n

“Given the immense volume of work across great distances, the transmission task alone poses complex logistical and cost challenges. The energy story often focuses on building more solar or wind farms, but you also need to factor in how you will move that power to where it\u2019s needed,\u201d says Jacobs, emphasising the importance of a coordinated approach to planning these vital links between REZs and communities.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u201cWith <\/span>the proliferation of rooftop solar and the REZ strategy <\/span>gaining momentum,<\/span> strengthening our<\/span> grid <\/span>has become <\/span>fundamental to a successful transition.\u201d <\/span>he adds<\/span>.<\/span>\u00a0<\/span><\/p>\n

Industry estimates suggest that for every 1 megawatt of retired coal capacity, around 4 megawatts of wind or solar resources need to be deployed to ensure afternoon and evening energy requirements are matched. To exacerbate this, renewables at this scale will still struggle to deliver the stability of traditional coal-fired electricity that delivers consistent power 24\/7, rain or shine. This means that a significant amount of firming will be required such as pumped hydro, BESS, OCGT\u2019s and hydrogen electrolysers.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

\u201cSo, we are behind the eight ball \u2013 while we are making progress, r<\/span>enewable generation and storage are growing at half the rate needed to ensure the grid is 8<\/span>2%<\/span> renewable by 2030<\/span>. In addition to that, the essential conduits of this energy \u2013 transmission lines, are delayed due to extended approval periods and industry constraints\u201d.<\/span>\u00a0<\/span><\/p>\n

A <\/b>D<\/b>ifferent <\/b>A<\/b>pproach<\/b>\u00a0<\/span><\/h2>\n

TBH <\/span>has extensive experience across the entire project lifecycle from inception, through planning, procurement into delivery and closeout. We work with both clients and contractors, public and private sector and understand each party\u2019s drivers and constraints.<\/span>\u00a0<\/span><\/p>\n

However, considering each party in isolation is not the solution. The only way to achieve Australia\u2019s 2030 target will require a rethink on how projects are approved, procured, delivered, and commissioned.<\/span>\u00a0<\/span><\/p>\n

\u201cThe only way to achieve our common 2030 goal is for everyone to work together. This includes the energy sector governing bodies like AEMC, AEMO and AER, planning authorities, local communities, delivery organisations and contractors,\u201d says Jacobs. \u2018\u2019There is probably a broader piece that even requires the different states to collaborate.\u201d<\/span>\u00a0<\/span><\/p>\n

\u201cIn Australia roughly 44GW is required to be built to achieve our 2030 target. 28GW will be through large scale projects and the rest through standard sized projects \u2013 110 individual 250MW projects. Depending on who you talk to, this needs to be supported by 15GW of firming. So, there is a large mountain to climb even before you consider the $20b of investment required in grid interconnectors.\u201d<\/span>\u00a0<\/span><\/p>\n

\u201cMy personal view is that there needs to be some kind of policy decision to address four key elements \u2013 funding, planning approvals, industry capacity and grid connections and these need to be wrapped up in a program and portfolio approach to delivery.\u201d<\/span>\u00a0<\/span><\/p>\n