Canberra concedes wind and solar to be cheapest energy by 2030 by Sophie Vorrath

The Australian government’s chief forecasting body has published a dramatic revision of its energy cost estimates, and predicted that onshore wind and solar PV will deliver the cheapest forms of energy by 2030 – with solar PV dramatically cheaper than all other energy forms by 2050.

The Australian Energy Technology Assessment (AETA) prepared by the government’s Bureau of Resources and Energy Economics slashes its previous estimates of the cost of a whole range of renewables technologies,  and in some cases doubles the predicted cost of coal-fired generation in the decades to come - with or without the addition of carbon capture and storage.

Its estimates of the cost of gas generation are relatively unchanged, but in its most controversial conclusion is says that nuclear energy currently represents the cheapest form of energy – saying that its range of costs is between $50 and $100/MWh, even though the experience in the UK is that new nuclear requires tariffs of at least $200/MW to get built.

BREE’s Professor Quentin Grafton said in the report, which was prepared in conjunction with engineering group Worley Parsons, that by 2030 some renewable technologies, such as solar PV and wind, are expected to have the lowest LCOE of all of the evaluated technologies.

“The results indicate that Australia’s energy future is likely to be very different to the present,” the report concludes. “This has profound implications for electricity networks, how energy is distributed and Australia’s ability to meet its targeted greenhouse gas emissions reductions.”

These are the first government-sponsored technology cost estimates published since the Draft Energy White Paper was released last December. That paper virtually ignored solar as a contributing element to Australia’s energy grid, but it now recognizes that estimates for solar PV were wide of the mark, and its costs had fallen dramatically and would continue to do so (even though the report predicts no cost declines between 2020 and 2030).