Renewable power has become so cheap it can now generate electricity cheaper than coal-fired power plants,which still generate about 70 per cent of Australia’s electricity,and both major parties are banking on a massive expansion of renewables in their climate policies.
Labor said its “Powering Australia” plan would increase renewable generation to 82 per cent of the energy mix by 2030,while the federal government has a slightly lower forecast of 69 per cent.
Modelling of Labor’s plan by energy analyst RepuTex said by 2030 Labor will deliver a $16 per megawatt-hour reduction on wholesale prices,which comprise about 35 per cent of the average power bill. It found that Labor’s policy would drive a drop in network charges,which comprise about 50 per cent of the average bill,to lower the retail price of electricity to $69 per megawatt-hour,which wouldsave the average household $378 a year.
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Electricity networks are expensive to build,maintain and operate and Labor has committed under itsRewiring the Nation plan to a $20 billion fund that will supply low-interest loans to network companies,which is expected to generate $58 billion in private investment.
But experts questioned RepuTex’s optimistic assumption that government-issued loans would be enough to slash bills.
Victoria Energy Policy Centre director Bruce Mountain said he was “sceptical of any claim that more transmission equals lower prices”.