Australia to Spend $5.2 Billion on Renewable-Power Grid Upgrade

Dec 20, 2022 by Bloomberg
image is BloomburgMedia_RN7K6DT1UM0W01_30-12-2022_15-00-08_638079552000000000.jpg

Wind turbines at the Waubra Wind Farm operated by Acciona SA in Waubra, Victoria, Australia, on Friday, March 26, 2022. The sudden speed of the shift to clean power is forcing Australia, a global champion of coal and gas, to confront one of the energy industry's biggest challenges — how to transition millions of fossil fuel workers to new roles in wind and solar. Photographer: Carla Gottgens/Bloomberg

The Australian federal and New South Wales state governments will spend A$7.8 billion ($5.2 billion) on new electricity transmission to support more renewable power, as they rush to fill a looming energy shortage left by closing coal-fired plants.

The funding will plug eight new renewable energy zones into the power grid across New South Wales, the governments said in a joint statement Wednesday. It will also connect the federal government’s pumped-hydro project, Snowy 2.0, designed to provide back up power during lulls when wind and sun fail to meet demand.  

Australia is undergoing one of the fastest transitions to a renewable-dominated grid in the world, forced by the closure of most coal-fired plants by the middle of next decade. The situation in New South Wales is particularly urgent as one of its key power providers, Liddell, is due to shut next year. 

Read more: Australia Court Blocks Giant Coal Mine on Human Rights Grounds

The nation still relies on coal for nearly 60% of its power, but the government wants renewables to supply 82% of total generation by 2030. New transmission lines are key to meeting this target, and the government went to the May election promising to spend A$20 billion “rewiring” the country.

Of the A$7.8 billion, A$4.7 billion will come from the federal government and A$3.1 billion from the center-right New South Wales government. 

Prime Minister Anthony Albanese said in the statement the funding would “help transform Australia into a renewable energy superpower.”

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©2022 Bloomberg L.P.

By James Fernyhough

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