Listen now (36 mins) | You might have heard that renewables are the cheapest new electricity generation technology. But is this claim true? Physicist and businessman Aidan Morrison looked into the assumptions and analysis in the various reports that produce such claims from organisations like the CSIRO and AEMO.
Im in two minds about this. The levelised costs in 2030 in the Gencost are correct based on the assumptions of where we would be at in 2030. However, its also clear that the LCOE of firmed renewables at 90% is making some big assumptions on the transmission and storage needed for the road ahead. Things that are HUGE challenges for the growth of renewables.
However, the back end of this podcast descends into very similar speculation and ideology that we see about renewable energy, which I didnt enjoy nearly as much. Suggesting nuclear would be much better, without any data is a joke. The Gencost report suggests LCOE anywhere from 2.64 to 4.5x most for nuclear SMR than onshore wind. How much transmission and storage can you get for that difference? A lot more than snowy 2.0 & transmission lines! Not to mention that there is a time cost to us delaying action to reduce emissions.
But its because of that time-cost that we do need to properly account for things like transmission and storage costs, because as long as they are ignored, they will continue to be large challenges in the actual uptake of renewable energy.
Lastly, on the household electrification, Id just note that Aidan misses some key things about electrification - the refrigeration cycle allows a much lower total energy use, bringing the equation on emissions between gas & electric heating much closer. Sure, the maximised benefits of electrification are only predicated on a renewable energy grid, but also you need to consider the inefficiency of gas networks and even just having 2 networks to maintain in general!
There is a confusion here of average cost with marginal cost. The MARGINAL cost of wind and solar are near zero at certain times of day/wind conditions. IF this this zero marginal cost output can be economically used for charging batteries, transmission long distances to places where the marginal cost of producing power is not zero, or running CCS, THEN these sources will eventually make use of CO2 emitting fossil fuels uneconomic. They will have become the cheapest sources of average cost energy. That hope lies behind the subsidies for wind and solar power.