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Fri Feb 8, 2013, 06:11 AM

 

Renewables now cheaper than coal and gas in Australia

A new analysis from research firm Bloomberg New Energy Finance has concluded that electricity from unsubsidised renewable energy is already cheaper than electricity from new-build coal and gas-fired power stations in Australia.

The modeling from the BNEF team in Sydney found that new wind farms could supply electricity at a cost of $80/MWh –compared with $143/MWh for new build coal, and $116/MWh for new build gas-fired generation.

These figures include the cost of carbon emissions, but BNEF said even without a carbon price, wind energy remained 14 per cent cheaper than new coal and 18 per cent cheaper than new gas.

“The perception that fossil fuels are cheap and renewables are expensive is now out of date”, said Michael Liebreich, chief executive of Bloomberg New Energy Finance.

“The fact that wind power is now cheaper than coal and gas in a country with some of the world’s best fossil fuel resources shows that clean energy is a game changer which promises to turn the economics of power systems on its head,” he said.

But before people, such as the conservative parties, reach for the smelling salts and wonder why renewables need support mechanisms such as the renewable energy target, BNEF said this was because new build renewables had to compete with existing plant, and the large-scale RET was essential to enable the construction of new wind and solar farms.

The study also found that Australia’s largest banks and found that lenders are unlikely to finance new coal without a substantial risk premium due to the reputational damage of emissions-intensive investments – if they are to finance coal at all.

It also said new gas-fired generation is expensive as the massive expansion of Australia’s liquefied natural gas (LNG) export market forces local prices upwards. The carbon price adds further costs to new coal- and gas-fired plant and is forecast to increase substantially over the lifetime of a new facility.

BNEF’s analysts also conclude that by 2020, large-scale solar PV will also be cheaper than coal and gas, when carbon prices are factored in.

In fact, it could be sooner than that, as we reported yesterday, companies such as Ratch Australia, which owns coal, gas and wind projects, said the cost of new build solar PV was already around $120-$150/MWh and falling. So much so that it is considering replacing its ageing coal-fired Collinsville power station with solar PV. The solar thermal industry predicts their technologies to fall to $120/MWh by 2020 at the latest.

Continue reading here: http://reneweconomy.com.au/2013/renewables-now-cheaper-than-coal-and-gas-in-australia-62268

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Reply Renewables now cheaper than coal and gas in Australia (Original post)
MichaelMcGuire Feb 2013 OP
Esse Quam Videri Feb 2013 #1
groundloop Feb 2013 #2
1-Old-Man Feb 2013 #5
Blanks Feb 2013 #3
The Straight Story Feb 2013 #4

Response to MichaelMcGuire (Original post)

Fri Feb 8, 2013, 07:00 AM

1. Very good news

Thanks for posting

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Response to MichaelMcGuire (Original post)

Fri Feb 8, 2013, 07:25 AM

2. Unfortunately fossil fuel will remain cheaper in the US thanks to subsidies

Taxpayers in the US will continue to prop up fossil fuels to the point that wind and solar can't compete. I'm hopeful that this news from Australia can help open our eyes to renewable energy, but I'm not holding my breath.

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Response to groundloop (Reply #2)

Tue Feb 12, 2013, 11:10 AM

5. When I looked at the numbers only wind could compete with CC natural gas

and the price of natural gas isn't going to change for the next 100 years - and once a well is drilled there is nearly no labor to continued extraction which means not only is the future cost predicable but its also farther out of the potential realm of power of future labor unions.

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Response to MichaelMcGuire (Original post)

Fri Feb 8, 2013, 07:43 AM

3. Alternative energies are cheaper than 'new build' coal plants...

If solar power is built into new homes and the panels calculated in as building materials (rather than retrofitted) it further drives down the cost of solar.

Of course it helps if you know in advance that you're going to use solar power because the house can be properly oriented to the sun to maximize solar gain and other energy saving mechanisms put in place instead of retrofitted.

We should start moving toward energy self-sufficient homes until we no longer need large coal (and gas) fired electric plants at all.

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Response to MichaelMcGuire (Original post)

Tue Feb 12, 2013, 10:41 AM

4. kick (nt)

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