The Clean Energy Council (CEC) has welcomed the commitment from the Federal Opposition to establish a ‘Rewiring the Nation’ initiative that will inject $20 billion to accelerate investment in Australia’s electricity network and unlock the next wave of renewable energy investment.
The CEC’s pre-Budget submission included a call to establish a future transmission fund and deliver the 2020 Integrated System Plan (ISP) developed by the Australian Energy Market Operator (AEMO). The ISP identifies the highest priority transmission projects with a clear business case to benefit electricity customers concerning the price, security and reliability of the energy system.
The CEC states that Australia’s transmission network has not kept pace with the transition to a 21st-century energy system, and the lack of transmission investment is now one of the most critical challenges facing the industry.
“This underinvestment is stifling new generation investment, constraining existing generation and resulting in increased energy security and reliability risks and higher power prices,” it said.
“The challenge remains as to how to deliver these projects as quickly as possible. While network service providers and private investors have demonstrated a strong willingness to own and operate new transmission infrastructure, the regulatory regime is not fit-for-purpose in providing certainty for them to make the necessary financial investments in these long-lived assets promptly.”
The CEC states that for over a decade the clean energy industry has called for reform, particularly to the Regulatory Investment Test for Transmission (RIT-T), to speed up transmission build for the benefit of consumers.
“The recent rule change to integrate the ISP into the first stage of the RIT-T is a step forward, but more is still required,” it said.
“This has been demonstrated by the more direct and recent initiatives from governments to accelerate and underpin transmission investments, including through the Federal Government’s Grid Reliability Fund.”
The CEC noted that there is still a need for a more significant role for the Commonwealth Government to accelerate these strategic transmission projects to unlock the next wave of renewable energy investment, drive down power prices and deliver an economic and jobs boost.
“We welcome the ALP’s commitment to accelerating this investment and look forward to further consultation to ensure the program leverages the massive capacity and capabilities of the private sector and unlocks Australia’s enormous renewable energy potential,” the CEC concluded.
