Electricity customers don’t just pay the costs of generating power. What consumers pay for is the whole energy system—including generation, storage, firming, and poles and wires.
The first of two independent reports by leading energy consultancy Frontier Economics revealed the real cost of the Albanese Government’s renewables-only plan to deliver a net-zero electricity grid by 2050. It will cost at least five times more than what Labor has told the Australian people.
These findings are consistent with work done by Net Zero Australia, which found that $1.2 to $1.5 trillion will be required by the end of the decade to implement a renewables-only transition. That cost will blow out to between $7 and $9 trillion by 2060.
While the rollout of Labor’s plan is still in its early days, its high cost is already being paid for by households and businesses. Australians now pay among the highest electricity prices in the world.
Labor promised a $275 reduction in household power bills, but families are now paying up to $1,000 more than Labor promised.
A second report from Frontier Economics shows that when a systems analysis is done, a grid using nuclear is cheaper, cleaner and more reliable than one without nuclear.
A comparison of the Albanese Government’s renewables-only approach and the Coalition’s balanced energy mix—including nuclear, renewables and gas—shows that the Coalition’s plan is 44 per cent cheaper than Labor’s plan (see figure below).
Some have criticised the report’s finding that coal-fired power stations will need to operate for longer than expected. However, the Albanese Government has already accepted that the lives of coal-fired plants will need to be extended to keep the lights on—with Energy Minister Chris Bowen supporting new powers for states to extend retiring coal plants.
With decades of specialist experience, Frontier Economics is a highly credible organisation, with deep subject-matter expertise, and is regularly trusted by government departments for consultancy work. Mr Bowen’s early attempts to discredit Frontier were spectacularly refuted when it was revealed that Mr Bowen’s own department has engaged the organisation for energy modelling over the past year.
Listen to Frontier Economics’ managing director Danny Price respond directly to criticism.
Frontier Economics’ findings corroborate a recent US Department of Energy report, which showed than including nuclear in the energy mix alongside renewables was 37% cheaper.
That report noted: “New nuclear has a critical role in decarbonization, strengthening energy security, reliability, and affordability while providing high-quality, high-paying jobs and facilitating an equitable energy transition.” (p. 5)
Frontier’s modelling also aligns with what we’re seeing in other advanced economies, where countries are expanding their nuclear programs or building plants for the first time—a proven path Australia can follow under the Coalition’s plan.
If elected, the Coalition will build 14 GW of nuclear energy by 2050 across the seven identified sites in the National Electricity Market and Western Australia to maintain a source of “always on” 24/7 baseload power (see figure above).
We need a Dutton Coalition Government to get Australia back on track to a stronger, more prosperous energy future. Read more about the Coalition’s plan for a balanced energy mix.