Research from Cornwall Insight Australia highlights that the energy transition in New South Wales (NSW) over the next decade will need to gather pace significantly.
The below graph shows that renewables have contributed an average of ~10% of total generation in NSW in the last four years. Over that same period, coal generators (exiting the market by 2035) provided on average ~77% of total generation in the state.
This indicates a noticeable gap between power generation over the last four years and those generators that are earmarked for retirement before 2035 and renewables.
Lumi Adisa, Lead Consultant – Market Analysis and Business Development at Cornwall Insight Australia, said:
“It is startling that over the next 10-15 years, ~77% of the current generation sent-out in NSW would have to come from elsewhere. It is particularly poignant that this gap will have to be bridged by technologies whose generation has grown by just ~7% in the last four years.
“The Central-West REZ represents a significant move to help bridge this gap. NSW is also looking to improve its import capacity with ~3GW of interconnector expansions in various stages of regulatory approvals. Other innovative models for network reinforcements within the state are also being planned in preparation for new generation seeking to connect.
“NSW will undoubtedly continue pushing the envelope as it prepares for a shift in the pace of renewable/storage development needed to close this gap. It is however left to be seen if regulation can keep up.
“While the urgency needed in the renewable energy transition is most evident in NSW, the state is not alone; Victoria and Queensland are also preparing for significant coal exits in the coming years.”