Wind and solar energy are not the source of Australian electricity prices

- Oct 27, 2017-

According  to the Australian Broadcasting Corporation, Australian Prime Minister  Malcolm? Twumb and the Australian Competition and Consumer Commission  Chairman Rohde Sims has recently refuted the rumors of rising  electricity prices caused by renewable energy. They say the impact of renewable energy on electricity prices is minimal.

Reported  that over the past few decades, Australians frequently by the  parliament and some of the community's minority voice guidance, many  people think that the transition to renewable energy-oriented society  will make Australia lose its competitiveness, weaken its industry and  even lead to price increases. In fact, economic research shows that renewable energy is more cheap energy.


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Sims  said in an interview, it is easy to overlook is that over the past  decade, rising electricity costs are 41% of the grid maintenance costs. He also mentioned that the retailer's additional charges were up to 24%, while green energy projects accounted for only 16%.

In  this regard, the Sydney University of Science and Technology Research  Center, chief researcher Dr. Shen Xueleng in an interview with the  People's Network, said the high price is the result of a variety of  factors. From the price structure, the main reason is the continuous increase in the price of transmission and distribution. And  relatively speaking, the price of electricity, whether renewable energy  or natural gas power generation, the role is relatively small. Renewable energy in the past will really push up the price, but for now and in the future, this role will gradually disappear. While natural gas prices become a hot spot in the near future, their role in pushing up electricity is overestimated. Although  the current price of natural gas is relatively high, but most of  Australia's natural gas is sold through long-term contracts, and the  contract price is much lower than the spot price. However, in the long term, natural gas power generation will become the decisive factor in the formation of electricity prices. Therefore, the establishment of a transparent price of natural gas market is very critical.


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In recent years, Australia's natural gas prices have quadrupled. More  paradoxically, as one of the world's most abundant natural gas  reserves, its domestic prices are much higher than the export price. A  survey by the Australian Competition and Consumption Commission shows  that natural gas exports in the east coast of 2018 are likely to have a  severe shortage due to continued growth in natural gas exports, followed  by a sharp rise in electricity prices. The  Australian government has recently implemented the Australian domestic  gas safety mechanism, which can limit the export of liquefied natural  gas to meet domestic demand. If the price of natural gas in Australia can be slowed down, the electricity bill may fall.

In addition, the debate on energy structure in Australia has not seen any improvement. Some  industry insiders believe that, compared with the coal industry, clean  energy failed to get enough government subsidies, at a disadvantage. But people have overlooked the coal industry to get a lot of subsidies  after the secondary impact, such as the health costs of residents and  so on.

Based on this controversy, Shi Xupeng that renewable energy development in Australia, the bottleneck has two aspects. First, decentralized renewable energy, such as residential roof photovoltaic power generation. The history of subsidies has played a significant role. At present, the proportion of Australian residents' roof PV is the highest in the world. This future subsidies will gradually be reduced, and even disappear. Second, centralized large-scale renewable energy power generation, such as wind farms. He  also made recommendations in this area, "the development of this area,  the current point of view, mainly rely on the Government to develop  renewable energy targets to promote the future with the reduction of  renewable energy costs to promote its development factors, The need to change from policy to electricity market design, so that  renewable energy can be consumed by the electricity market.Carbon tax or  other forms of carbon prices, but also conducive to the development of  renewable energy.

In the final analysis, the level of power generation is the price competition in this price to win the key. In particular, the cost of installation into consideration, the advantages of wind and solar energy is more prominent. Renewable energy power plants from production to build only 1 to 3  years, while the thermal power plant will need 4 to 7 years, and the  higher cost.

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Finally, Shi Xunpeng also mentioned that the long-term momentum of renewable energy development is to lower prices. "This  can be achieved through two aspects, one through technological research  and development breakthrough, so that the price of key equipment to  decline.Fourth, through economies of scale and technological progress,  making renewable energy equipment manufacturing prices decline. At  the same time, the advanced technology and research and development of  such countries in Australia are very important, and the second point  will be to achieve such a huge market and manufacturing capacity in  China, which is one of the areas where China and Australia can  cooperate. "Shi said.

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