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AEMO chief rejects claims of renewables bias in energy model

AEMO chief rejects claims of renewables bias in energy model

­National electricity grid has rejected claims it favours renewables over fossil fuel generation and warns the nation faces risks if it moves too swiftly away from coal power without adequate clean ­energy investment in its place.

A minister and five Coalition backbenchers criticised the Australian Energy Market Operator yesterday for having an “ideological worldview” that favours ­renewables.

But chief executive Audrey Zibelman struck back at concerns raised by Malcolm Turnbull’s key energy bureaucrats and said modelling provided in its recent 20-year integrated system plan forecast was based on engineering and economics rather than ideology.

“There’s no bias in the model,” Ms Zibelman said yesterday. “It’s a cost-base engineering optimisation model. The implication that somehow the modelling is biased one way or the other is simply not true.’’

Government backbenchers Tony Pasin, John Williams, Ken O’Dowd, Craig Kelly and George Christensen criticised a report ­released last month by the AEMO into the electricity sector, saying it did not focus on lowering ­prices.

The Australian has spoken to a federal minister who is furious with the AEMO report, commissioned by the Council of Australian Governments, into energy and transmission requirements for the country.

However, Ms Zibelman said the process would stand up to rigorous dissection by stakeholders.

“What we’re going to do next is allow people to kick the tyres, understand the cost and be as transparent as we can and use that as an opportunity to make the modelling as robust as possible,” she said. “It’s not a price model, it’s not an outcome-based model. It’s really based on engineering and economic analysis.”

The report warned Australia would need to spend up to $27 billion replacing retiring coal plants in the next two decades with fossil fuels set to be ousted from the country’s national electricity market. In its place would be a mix of solar, wind, storage and gas along with new ­investment in electricity transmission.

The AEMO boss said the conclusions drawn in the report mirrored similar international studies conducted for other power grids.

“Third-party analysts who look at these things worldwide are drawing the same conclusions. It’s just the fact of the matter in Australia that we have an abundance of resources capabilities,’’ Ms Zibelman said. “The assumption that we are somehow biased is simply ­incorrect.’’

Balancing the national electricity market’s reliance on coal — which accounts for 76 per cent of Australia’s power generation — with the shift to clean energy must be carefully managed with the bulk of existing coal generation due to be shuttered in the next two decades, Ms Zibelman conceded.

AEMO said in its report that ­investment to replace coal would be driven by utility-scale renewables along with pumped hydro and flexible gas-powered generation.

“We want to make sure that investments are there in advance of the coal retirements so we don’t have the type of suddenness that we had with the Northern and ­Hazelwood plants,” she said.

“Some of these assets take a very long time to build. Having a plan and then executing on it is going to be very critical.”

The Australian

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