ESB scraps proposal of mandatory storage for all new wind & solar

Australia’s Energy Security Board has effectively rejected the Conservative push for wind and solar to conform to outdated standards of “baseload” energy supply, and instead focused its thinking on reliability to fit around the cheapest form of power generation – wind and solar.

While original versions of the National Energy Guarantee threatened to impose a cumbersome, complex and ultimately costly contracting requirement on both reliability and emissions – that path has now been more or less abandoned.

The emissions component is abandoned because the Coalition effectively has no target that is greater than business as usual, and proposed physical contracts will be replaced by financial ones similar to those that already exist in the market, if they are needed at all.

The reliability component has been made redundant because the ESB has recognised that there is no pressing problem on reliability – now or in the near future.

And any issues that do arise – such as from the sudden departure of several coal-fired generators – is best managed centrally (by the market operator) and mechanisms outside the NEG.

The focus now is clearly on embracing new technologies, rather than penalising them, and forming rules and mechanisms that recognise their speed and flexibility.

Still, the ESB does note that while some wind and solar farms are adding storage, it wants more dispatchable options over time, particularly when those ageing coal plants come out of the system.

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Giles Parkinson