According to power and utility leader EY Global Advisory, Australia may reach solar grid parity by 2020 – a point where it costs less to produce renewable energy than fossil fuels. This would make Australia one of the first nations to reach this stable grid party point, according to EY’s Serge Colle.
Solar Grid Parity – An Overview
The 2020 parity target was forecast by the EY team by modelling solar panel and battery storage installation uptake in Australia – which will result in a reduction in renewable costs. The rapid expansion of commercial solar is also helping grow Australia towards solar grid parity.
Serge Colle, head of EY Global’s power and utility section, told the Sydney Morning Herald “For those in the industry that still believe that [the renewable technologies] we see now will never be technically and economically equal to traditional energy solutions they should reconsider their thinking.”
The information is supported by a study from the Australian National University (ANU), which forecasts that new-build large-scale renewable energy generators will cost as low as $50 AUD per megawatt hour within the next 10 years.
The report, titled “Meeting Australia’s Paris greenhouse commitment at zero net cost” and written by Andrew Blakers, Matt Stocks and Bin Lu last month, posits that Australia’s current renewable energy install rate of 3GW / year, if continued until 2030, will mean that we will then meet the Paris greenhouse emissions reduction target. At that point, half of Australia’s electricity consumption would be generated by renewable energy.
The report also takes into account the need for baseline power and the sometimes unreliable nature of renewables (i.e. the sun’s not always out and the wind’s not always blowing), saying:
“The cost of renewables includes the cost of hourly balancing of the grid to retain the same reliability as at present. Hourly balancing comprises pumped hydro energy storage, stronger interstate high voltage power lines and the cost of PV and wind spillage on windy, sunny days when the energy stores are full.”
It’ll be interesting to see how Australia goes with its Renewable Energy Target and also meeting the Paris emissions reduction target given how quickly renewables have been growing in the country, especially in the last 12-18 months. 2018 is shaping up to be a massive year for wind and solar energy in Australia – strap yourselves in.