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Sunny forecast for renewables as new decade dawns

The 2010s saw the renewable energy industry come of age, but the next decade promises to be even better, writes Clean Energy Council chief executive Kane Thornton.

As we enter a new decade, it’s worth reflecting on just how far the Australian renewable energy industry has come. In 2010, just 8.7% of Australia’s total electricity generation came from renewables, with hydro responsible for almost two-thirds of this. By 2019, renewable energy’s share of total electricity generation had increased to 21.3%, and almost 60% of this came from wind and solar PV.

The second half of the decade has seen massive growth as the industry ramped up to meet the Renewable Energy Target with more than a year to spare and smashed through the 2 million solar homes benchmark on the way.

In some ways, however, the industry has been a victim of its own success as our ageing grid and antiquated energy market failed to keep pace with the speed of the transition, causing headaches for developers and regulators.

While the past decade has seen the best of the renewable energy industry, it has also borne witness to the worst of Australian politics. The inability to settle on a bipartisan national energy policy has served as the backdrop for the bloodiest period in Australian political history and continues to elude us more than 10 years later.

As the past decade has shown, trying to predict what the industry will look like in 10 years’ time is a fool’s game. But it is possible to look ahead to the coming year to identify some of the key focus areas for the industry in 2020.

Grid reform is critical

Acceptance that clean energy is the future of Australia’s electricity system will grow in 2020 as market and grid reform focuses on overcoming the challenges of integrating more renewables into the network. The critical focus areas will be alleviating connection delays, resolving concerns around marginal loss factors and reducing ambiguity around generator performance standards and system strength requirements, all of which created a lot of havoc for renewable energy developers in 2019.

Climate change will shape energy discussions

This summer has seen the real-world impacts of climate change really hit home. Catastrophic bushfires, record heatwaves and the crippling effects of the drought have pushed climate change to the forefront of public debate. The increasing focus on climate change will drive discussions about building the resilience of the energy system and ensuring that our future energy infrastructure is able to leverage increasingly smart and distributed clean energy technology and cope with extreme weather conditions.

Year of the battery

The demand for grid-scale batteries will grow strongly in 2020 as network operators and project proponents look to address curtailment, mitigate the effects of the solar-induced duck curve and consider how to monetise their ability to provide important grid services. Household battery uptake will also continue to build steadily in 2020, while the interest around pumped hydro will build as work continues on Snowy 2.0 and Tasmania’s Battery of the Nation.

Rooftop solar to take on greater responsibility

Rooftop solar will continue to grow at a record pace in 2020, and the deployment of sophisticated technologies will give solar households more opportunity to directly participate in the electricity market while supporting the energy system.

The increasing integration of distributed energy resources such as household batteries and electric vehicles will begin the shift towards a more dynamic electricity system. New developments in solar and battery technology will also see the quality of solar PV panels and batteries increase in 2020 as higher standards result in lower-quality products being gradually phased out.

Emerging export market a sign of things to come

Australia’s burgeoning renewable energy export market will make significant gains in 2020 as work progresses on the National Hydrogen Strategy and business cases and feasibility studies are developed for large “lighthouse projects” such as the Sun Cable project in the Northern Territory and the Asia Renewable Energy Hub in Western Australia. As these projects get closer to fruition, it wouldn’t surprise me to see more big project announcements in 2020.

Corporates lead when government won't

The corporate power purchase agreement market will go from strength to strength in 2020. In the continued absence of political leadership, businesses will take matters into their own hands. Corporate Australia recognises that action on climate change is a significant risk factor for business and that renewable energy is the best way to mitigate the risk of volatile and high power prices.

This year promises to be another extraordinary year for renewable energy and energy storage in Australia. And as technology improves, costs continue to fall and coal-fired power plants retire, the momentum will only build as the decade progresses. While the past decade saw the renewable energy industry announce itself as the future of energy in Australia, the next 10 years will see that future realised.