Post: Australia’s NEM requires 49GW/646GWh of dispatchable storage by 2050

Australia’s NEM requires 49GW/646GWh of dispatchable storage by 2050

The Australian Energy Market Operator (AEMO) has set out an updated 30-year roadmap for the transition of the National Electricity Market (NEM).

The 2024 Integrated System Plan (ISP), published on 26 June, confirms that the most cost-effective way to supply electricity to Australian homes and businesses is through renewable energy. This energy will be connected via transmission and distribution systems, supported by storage solutions, and backed up by gas-powered generation as the country transitions to a net zero economy. It has projected that grid-scale wind and solar in Australia will see a six-fold increase to 127GW, whereas distributed solar PV will increase four-fold to 86GW by the middle of this century.

The Optimal Development Path, designed to meet Federal and state government emissions reduction policies at the lowest cost, requires an annualised capital investment of $122B by 2050 and focuses on the new grid-scale generation, firming, storage, and transmission needed in the NEM.

In addition to the shift from coal to firm renewables and low-emission sources, the NEM will “triple its capacity to meet future demand and facilitate a two-way flow of electricity across the networks”, the report read. This would help connect new renewable energy generation with consumption to soar to 313TWh by 2050. Firming capacity, including energy storage, will need to quadruple by 2050 under AEMO’s ‘Step Change’ scenario, which is considered the most likely among forecasted projections.

At present, AEMO said, 3.7GW/10.8GWh of energy storage has progressed sufficiently to be anticipated to be added to the NEM to be included in its assumptions for the ISP in all scenarios. But it said 49GW/646GWh of dispatchable energy storage will be needed by the mid-century point, along with 15GW of flexible gas generation. If consumer batteries are efficiently coordinated, they could help reduce costs for all consumers by offsetting the need for an additional $4.1B in grid-scale investments.

The 2024 ISP includes updates to transmission projects first outlined in the 2022 ISP, with seven additional projects advancing to “actionable” status, facilitating more coordinated and effective community consultations earlier in the process. Investing in these transmission projects will ultimately lower costs for consumers. The $16B investment in these projects is expected to save consumers an additional $18.5B in avoided costs and deliver emissions reductions valued at $3.3B.

GridBeyond Sales Director Lisa Balk said:

“Australia is already experiencing a complex, rapid and irreversible energy transformation and taking full advantage of the flexibility that can be harnessed from demand side assets will be crucial is keeping the costs of the transition as low as possible, while ensuring reliability of the grid in an increasingly renewables dominate energy mix.

“At GridBeyond we use machine learning and AI-powered technologies, driven by data science, that enable I&C businesses and battery storage operators to participate in a wide range of programmes for enhanced energy automation, insights and benchmarks, savings, revenues and sustainability.”

Australia | Utility-scale energy storage

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