A dose of reality for Australian energy cost estimates

The cheapest avenue forward for Australia in a low carbon world – renewables.
The cheapest avenue forward for Australia in a low carbon world – renewables.

The Australian government’s main economic advisor has significantly revised its cost estimates for leading energy technologies in an update that should introduce a dose of reality to the energy debate in this country.

The Bureau of Resource and Energy Economics quietly released an update of its Australian Energy Technology Assessment in December. The first report came out in July, 2012.

In the latest report – concluded after “consultation” with various industry sectors – the cost of solar technologies has been revised downwards (in some cases by up to 30 per cent), in particular solar thermal with storage, while the costs of clean energy rival technologies such as carbon capture and storage and nuclear have been revised upwards.

Indeed, the report recognizes that onshore wind energy is already cheaper than new build fossil fuels.  BREE likes to frame the future by suggesting wind and solar will be cheaper on average than fossil fuels by the mid-2030s – but its graphs  are clear – by 2020, the lowest cost wind and solar installations (which are already being achieved overseas) will be cheaper than the lowest cost coal and gas (even without pricing carbon).

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