The AEMC report said the biggest driver of price falls over the next three years would come from cheaper power sources from wind and solar projects. These weather-dependent generators are set to be supported with on-call dispatchable power from large-scale batteries and gas.
“New generators,mainly renewables,continue to expand capacity and drive significant falls in wholesale prices. We are also seeing positive early evidence of how energy storage,like batteries,is helping to lower prices,” the report said.
Across the national electricity grid there are 2671 megawatts of new solar power generation committed to come online until 2024,and 1393 megawatts of new wind power. The intermittent supply from these power generation sources will be backed up by 904 megawatts of additional gas-fired capacity and 470 megawatts of large-scale batteries.
AEMC chairwoman Anna Collyer said the findings showed that “integrating renewables in a smart way makes it possible to have both lower emissions and lower costs for consumers”.
“We can now see far enough into the future to be confident that power prices paid by consumers will continue to trend downwards over the next three years,despite the staged exit of Liddell power station in 2022 and 2023,one of the biggest coal-fired generators in the national electricity market,” Ms Collyer said.
“We have just under 2500 megawatts (of mostly coal power) expected to exit the grid over the next three years,there are almost 5500 megawatts of committed new large-scale generation and storage projects coming online over the same time period.”