The heads of Australia’s major energy companies have highlighted the importance of affordability for a successful energy transition.
The Australian Energy Council has released its first-ever CEO survey- Delivering Australia’s Energy Transition Affordably- which provides insights and perspectives from those involved in the transition to a net zero energy system.
According to the survey. CEOs remain committed to supporting net zero, but highlight the challenges in meeting the country’s energy and emissions ambitions. Replacing emissions-intensive energy generation systems is not costless, and CEOs want more open dialogue about the costs involved in energy transition.
Australian Energy Council’s CEO, Louisa Kinnear, said: “Industry has an important role in supporting customers through the energy transition and we don’t shy away from the need to invest in and advocate for initiatives that help to improve energy affordability for all customers.
“We are keen to work collaboratively with federal and state governments to ensure that the policy and market settings give us the best chance at ensuring affordable and reliable energy supply is accessible by all.”
The participating CEOs said ensuring the affordability of Australia’s power supply was one of the key issues on energy transition, along with the impact of price and supply shocks on vulnerable customers.
The CEOs noted that prices have never been under more pressure, given the large-scale investment needed to replace and decarbonise generation assets.
“Network cost is only going to go up, and go up by increasing levels. And the Australian consumer is not really wise to that yet because they haven’t seen the worst of it,” a gentailer CEO noted.
“… the cost of this transition is really going to affect the people who can afford it the least, so people that are already struggling to pay their power bills are going to get slammed with more cost from more of the transmission and distribution costs that are yet to come, and the higher cost of electricity with storage that’s got to be factored in,” according to a retail CEO.
The AEC’s Kinnear said the report underscores the importance of affordability and the careful management of energy transition.
“Yes, renewable energy, once it is built and operational, is one of the lowest-cost sources of energy, but we still need to account for the costs of constructing new supply and adapting our existing energy system to accommodate and firm up low-emissions intermittent sources.
“In the long run, this approach will still be cheaper than continuing to invest in existing or new coal-fired power generation,” she said.
