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Jun 26 2024

Statement on Integrated System Plan

The latest market operator assessment of what would need to happen to achieve Australia’s energy transition goals serves to highlight the sheer scope and scale of the task ahead and the significant uncertainties which still remain, according to the peak body for energy generators and retailers.

The Australian Energy Council’s interim Chief Executive, Ben Barnes, said the final Integrated System Plan (ISP) reflects what is required to reach a range of Federal and state government targets and policy settings in a relatively short timeframe.

“Producing an achievable roadmap is an extremely difficult task for the Australian Energy Market Operator (AEMO) given the targets and policies it models are either fixed or becoming more ambitious.

“As we have seen, real on-the-ground issues such as supply chain constraints and community opposition can have an impact on realising the ISP.

“AEMO has flagged a range of risks to delivering on the ISP with solutions to many not yet evident. Key amongst them is the risk that replacement generation, storage and transmission may not be available ahead of coal plants retiring.

“What happens next is what counts. It will be up to government, investors and market bodies to work collaboratively on the gaps and find solutions to ensure we can deliver the transition whilst maintaining community support.

“It is incumbent on all of industry to continually ask itself: how do we best deliver the energy transition reliably and at the least cost to consumers? The ISP provides some guidance on what would need to happen to deliver on the various Government targets, and how things might unfold, but there is more work to do.” Mr Barnes said.

“There may also be scope for future ISP iterations to include more sensitivity analysis to help identify alternatives to deal with the prospect of some projects not materialising, or policy settings changing.
“It would be useful to understand what alternatives would look like and their impacts on the cost benefit analysis in the ISP. This will also help the ISP evolve over time, which given the scale of the transition, will prove invaluable.

“Our members look forward to working with government and market bodies to find practical solutions that meet the needs of the system, energy consumers, and the broader community.”

About the Australian Energy Council

The Australian Energy Council is the peak industry body for electricity and downstream natural gas businesses operating in the competitive wholesale and retail energy markets. AEC members generate and sell energy to 10 million homes and businesses and are major investors in renewable energy generation. The AEC supports reaching net-zero by 2050 as well as a 55 per cent emissions reduction target by 2035 and is committed to delivering the energy transition for the benefit of consumers.

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