In this Market Update, we introduce our latest market study “An Energy Trilemma: A cost curve for emissions reductions & energy storage in the Australian electricity sector “, providing quantitative analysis of the cost of emissions reductions, and energy storage technologies, in the Australian electricity sector.
The study presents our updated marginal abatement cost (MAC) curve for the electricity sector in 2020 and 2030, along with analysis of the “full cost” for renewables to supply reliable power, including storage, referred to as the levelised cost of “firm” energy (LCOFE).
The study was supported by extensive consultation with over 45 industry participants, including generators, industrial consumers, project developers and investors, providing input on technology readiness, costs and barriers to investment.
Key findings include:
- Demand reduction via the take-up of solar PV has the lowest marginal cost of emissions reductions in the electricity sector, in line with an anticipated drop in capital costs, and continued availability of financing.
- “Clean coal” such as Carbon Capture and Storage (CCS) and High Efficiency, Low Emissions” (HELE) coal is not forecast to be commercially mature until at least 2025. Subsequently, clean coal is projected to have a limited impact in support of Australia’s
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