The Australian Energy Market Operator (AEMO) chief executive Daniel Westerman can’t guarantee energy prices will be cheaper under the current roadmap for development of the electricity market.
During a Senate committee hearing, Westerman emphasised that while the integrated system plan was the “lowest cost pathway,” this did not ensure lower energy prices in the future.
“You’re saying you cannot guarantee that the current government policy settings – which you model – will deliver lower power prices?” Senator Matt Canavan questioned.
In response, Westerman stated, “I can’t guarantee that, no.”
“What I would say is we try to be quite clear about the communication of our message, which is that the integrated system plan, which considers these things – generation storage and major transmission upgrades – is the lowest cost pathway,” he said.
“It doesn’t refer to whether it’s cheaper or more expensive for that wholesale component.”
The latest AEMO system plan outlines a A$122 billion price tag for the core infrastructure needed to reach net-zero emissions by 2050.
This figure excludes the costs for new power poles and wiring, but it is on the lower end of independent modelling compared to the Coalition’s nuclear energy plan.
The Coalition’s proposal for seven nuclear power plants has been criticised for lacking detail.
Modelling by the Smart Energy Council estimates a cost range of A$1 billion to A$600 billion, while only contributing 3.7% of Australia’s energy mix by 2050.
The Council's analysis suggested the costs would be comparable to achieving a near 100% renewables mix by the same target year.