NSW energy transition4 September 2020
The need for speed
Above: Renewables and retiring coal in the NSW generation mix (source: Cornwall Insight)
Research from Cornwall Insight Australia highlights that the energy transition in New South Wales over the next decade will need to gather pace significantly.
The graph shows that renewables have contributed an average of ~10% of total generation in NSW in the last four years. Over that same period, coal generators (exiting the market by 2035) provided on average ~77% of total generation in the state.
“It is startling that over the next 10-15 years, ~77% of the current generation sent-out in NSW will have to come from elsewhere”, said Lumi Adisa, lead consultant – market analysis and business development at Cornwall Insight Australia, noting that the “gap will have to be bridged by technologies whose generation has grown by just ~7% in the last four years.”
“The Central-West REZ [Renewable Energy Zone] represents a significant move to help bridge the gap. NSW is also looking to improve its import capacity with ~3GW of interconnector expansions in various stages of regulatory approvals. Other innovative models for network reinforcements within the state are also being planned in preparation for new generation seeking to connect. NSW will undoubtedly continue pushing the envelope as it prepares for a shift in the pace of renewable/ storage development needed to close this gap. It is however left to be seen if regulation can keep up.
“While the urgency needed in the transition is most evident in NSW, the state is not alone; Victoria and Queensland are also preparing for significant coal exits in the coming years.”
Shift to green hydrogen
One way to accelerate the energy transition in NSW would be a major shift to green hydrogen. In this context, Australian start-up Infinite Blue Energy (IBE) has unveiled a plan, Project NEO, to transition large users of fossil fuel based electricity in NSW to green hydrogen by 2027. The initial target for Project NEO is provision of 1 GW of baseload power delivered by a combination of PV, wind and hydrogen fuel cell technology. But the concept is scalable, says IBE, and “potentially able to provide a significant proportion of the region’s electricity requirement” without the intermittency issues normally encountered with solar and wind generation.
Project NEO will start with a feasibility study and detailed design effort over the next 18 months.
“The vision at IBE is to show the world, first and foremost, that Australia has the technology, skills and entrepreneurial mindset to be a true leader in the development of green hydrogen plants,” IBE CEO Stephen Gauld said. “We are currently in robust negotiations with major electricity users in the NSW Hunter Region that have confirmed their intentions to transition to green hydrogen baseload electricity this decade’’, with the expectation that over 1000 MW of electricity currently generated by coal and natural gas will be sourced from green hydrogen. Infinite Blue Energy also anticipates that a significant proportion of the workforce required for Project NEO will be drawn from the existing coal fired power stations in NSW, since many of the skills are similar.
Infinite Blue Energy recently reported that it had secured funding to build Australia’s first large scale green hydrogen plant. Located in Western Australia, 320 km north of Perth, the $300 million dollar Arrowsmith Hydrogen Project will produce 25 tonnes of green hydrogen a day using solar and wind generated electricity, with start of operation scheduled for 2022.
- Sebastopol PV project, NSW, is ib vogt’s first development project sale in Australia. ib vogt has announced the sale of the proposed 90 MW (AC) Sebastopol solar project to Fotowatio Renewable Ventures (FRV). ib vogt first entered the Australian solar market in 2016 when it constructed the 11.1 MWp Williamsdale project in the ACT (Australian Capital Teritory). Since then it has progressed to an advanced stage of development over 450 MWp of PV projects throughout NSW and Victoria, with Sebastopol the lead project of the portfolio. It has full planning consent, all land rights secured and grid ‘committed’ status with AEMO (Australian Energy Market Operator).