A new report by the Australian Energy Market Commission (AEMC) says the impact sparked by the planned closures of several of the nation’s fossil-fuel generators, including the 1.68 GW Liddell Power Station which is set to shutter in 2023, will be largely offset by decreasing wholesale electricity and environmental costs as more renewable energy comes online across Australia.
The AEMC’s 2021 annual residential electricity price trends report, which examines the direction household electricity prices will take over the next three years, forecasts an average national drop in annual bills of 6%, or $77, by 2024 as cheaper renewable energy flows to consumers.
AEMC chair Anna Collyer said the report shows that, based on current trends, prices per kilowatt hour are likely to be under 26c p/kWh by June 2024, the first time since 2016/17.
“This illustrates how integrating renewables in a smart way makes it possible to have both lower emissions and lower costs for consumers,” she said. “What we are seeing is the impact of new generation already commissioned as well as new capacity committed across the NEM.”
The predicted declines come in spite of the impending exit of several fossil-fuel generators from the National Electricity Market (NEM), including the staged exit of AGL’s Liddell Power Station in 2022 and 2023, one of the biggest coal-fired generators in the NEM.
AGL will close the plant in the New South Wales Hunter Valley in April 2023, having already lodged plans to establish a giant 500 MW battery at the site.
Collyer said prices are expected to fall slightly this financial year, increase by about $20 a year in FY2022/23 when Liddell exits the system, and then fall again as that lost capacity is replaced by a combination of solar, wind, gas and battery energy storage.
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