The no-name policy with little chance of reducing power prices

The National Energy Guarantee is to all intents and purposes an emissions intensity scheme. Its impact will depend entirely on the required intensity.

Figure 1 Electricity Co2 emissions for 28% reduction from 2005 in electricity. Source: National Greenhouse accounts, Clean Energy Regulator, ITKe

If our COP 21 commitment is taken to mean the NDIC of a  26-28 per cent reduction in CO2 from 2005 levels then we think that only a further 1.2GW reduction in coal replaced by about 4GW of renewables is required (see Fig 1, 2 & 3) by 2030. That’s less than 400MW a year.

We think the big gentailers will backend this as much as possible. They have various incentives to do that and the proposed rules entrench their place in the system.

If our COP 21 commitment/obligation is taken to mean providing our share of emissions reductions to keep the world to less than 2°C, then that means a >50 per cent reduction in electricity emissions by 2030 and that would require a lot of new investment. However, we think the current federal government hasn’t a snowball’s chance in hell of making that kind of effort.

Read the story by David Leitch on RenewEconomy -“The no-name policy with little chance of reducing power prices.”