Is the era of cheap energy over?

Some say yes, but a new report estimates that solar photovoltaic and onshore wind could produce some of the lowest electricity generation costs in Australia by 2030, based on current policy settings.

The Minister for Energy and Resources, Martin Ferguson AM MP, today (31 July) welcomed the release of the Australian Energy Technology Assessment (AETA) from the independent Bureau of Resources and Energy Economics (BREE). 

“The report provides the most up-to-date cost estimates for 40 electricity generation technologies deployed in the Australian context,” Minister Ferguson said.

The AETA found that both tracking and non-tracking solar photovoltaic technology could be increasingly cost competitive along with onshore wind.

The report states that solar thermal, wave, nuclear and geothermal technology costs are also forecast to fall and be cost competitive with some coal- and gas-based technologies by 2030.

“The Australian Government is driving innovation and investment in these emerging technologies by putting a price on carbon and through the newly established $3.2 billion Australian Renewable Energy Agency (ARENA) and the $10 billion Clean Energy Finance Corporation,” Minister Ferguson said.

In terms of fossil fuel technologies, the AETA found that combined cycle gas offers the lowest levelised costs of electricity generation over the majority of the projection period, and would remain competitive with lower cost renewable technologies up to 2050.

During the ‘Tech Innovation in large-scale solar’ session at the Clean Energy Week conference held in Sydney last week, trends in hybrids such as solar-thermal as well as large-scale concentrated solar power (CSP) were identified for the future. James Harding from Ferrostaal said that currently parabolic trough solar is a mature technology which is being used around 90% of the time for CSP applications.  However, he says solar tower technology is looking like a good prospect for the future. This technology has potential for expansion because of its high temperatures and fuel generation capabilities. Savings can be achieved on infrastructures costs, as fewer pipes and smaller mirrors are required with this technology compared to parabolic trough. Other advantages include no pumping losses and higher storage capacity.

Gemasolar in Spain is claimed to be the first commercial-scale plant to apply central tower receiver and molten salt heat storage technology. It opens up the way for new thermosolar electrical generation technology.

The inclusion of a novel molten-salt heat storage system permits the production of electricity in the absence of solar radiation. The heat collected by the salts (capable of reaching temperatures above 500ºC) generates steam and produces electrical power. The surplus heat accumulated during sun hours is stored in the molten-salt tank.

In this way, Gemasolar can produce electrical power 24 hours a day for many months of the year.

Some conference speakers at Clean Energy Week still had question marks over costs and public acceptance for some energy options such as geothermal, nuclear and carbon capture and storage (CCS). Wave energy has potential but is still in its early stages.

Schneider Electric has identified the renewable energy market as a key growth opportunity and will increase its business focus in Australian commercial, residential and utility-scale solar farm markets. The company acquired solar and wind specialist Xantrex in 2008. Its increased focus in Australia is part of a broader global strategy to strengthen expertise in the renewable energy market, especially solar.

The BREE report predicts solar photovoltaic and onshore wind for the future. But according to Clean Energy Week conference speaker Alex Wonhas, Director, Energy Transformed Flagship, CSIRO, these are difficult but crucial times and “we are the pioneer”. Only cost-effective and reliable supply technologies, which are able to compete on cost without subsidies, will be competitive in the long term.