Aiden Morrison, a data scientist and physicist who works for the think tank the Centre for Independent Studies, recently spoke at a forum in Wagga Wagga about how solar farms will affect the region. Photo: Shri Gayathirie Rajen.
While Australians grapple with rising electricity costs, critics argue that renewable energy is making them more expensive.
Rural communities in the Riverina are now at the heart of the debate over large-scale renewable infrastructure, economic feasibility, and uncertainties surrounding the impact on viable farmland.
Think tank the Centre for Independent Studies’ director and physicist Aiden Morrison claims Australians have been misled into believing that renewable energy is the cheapest option when the cost of implementing it has not been accounted for.
“The current push for renewables is driven by government subsidies rather than market forces,” Mr Morrison said.
“No major renewable project has reached full financial close without government underwriting.
“Essentially, taxpayer money is being used to force these developments into the system, even when they are not commercially viable. This ultimately puts upward pressure on energy prices.”
Mr Morrison said Australia had 40 per cent renewable energy — eight per cent from hydro and just over 30 per cent from wind and solar.
“To meet the 82 per cent target, we would need more than double the wind and solar deployment rate.
“However, we are already seeing significant community resistance, and many of the best sites have already been taken.
“This means future projects will require more transmission lines, be built on less suitable land, or encroach on valuable agricultural and conservation areas.”
Mr Morrison said a freedom of information (FOI) request revealed the Department of Climate Change, Energy, the Environment and Water (DCCEEW) directed the Australian Energy Market Operator to assume that the 82 per cent renewable target would be met, limiting alternative modelling scenarios.
A DCCEEW spokesperson told Region that CSIRO’s GenCost report consistently found that firm renewables were the cheapest form of new generation.
“The path to 82 per cent renewables is accelerating in Australia, with the Clean Energy Regulator reporting a record installation of 7.5 GW in renewables in 2024,” the spokesperson said.
“A grid with more renewables is central to the government’s target of reducing emissions by 43 per cent from 2005 levels by 2030. With at least 107 countries committed to net zero, either by law or through policy, the energy target is critical to Australia’s emissions reduction efforts, replacement of unreliable coal generators, and ensuring future prosperity.”
Mr Morrison also claims that GenCost does not include the full system costs of renewable energy, such as transmission, backup power, and grid integration. He suggests governments are using CSIRO’s modelling to justify renewable energy policies despite underestimating the costs of large-scale renewable rollouts.
A CSIRO spokesperson said the cost of firming renewables was included in the GenCost report.
“We call it the integration costs, and these are the additional costs of ensuring supply is reliable when using intermittent energy sources. Integration costs include investments in storage, peaking generation, transmission, and system security devices such as synchronous condensers. Modelling determines the most cost-effective combination of these investments.”
CSIRO said that while renewable energy could influence the cost of electricity, it did not directly control prices.
“Electricity prices are controlled by the balance of supply and demand,” the spokesperson said.
“If supply is tight relative to demand, then prices go up. If supply is significantly more than demand, then prices go down. In 2022, global natural gas supply constraints, triggered by sanctions on Russia due to the Ukraine war, together with unplanned coal plant outages, caused a price spike. This is still reverberating through the electricity system.”
Mr Morrison is also calling for a royal commission into the government’s handling of the renewable energy model, saying it has misled Australians about the associated costs and there has been a lack of transparency.
Region contacted the Australian Energy Regulator (AER) for clarification on the impact of renewables on electricity prices, the causes of recent price hikes, and measures to ensure affordability and stability.
“We understand it remains a challenging time for energy consumers. This year, we’ve seen cost pressures across nearly every component of the draft Default Market Offer [DMO] — not only wholesale costs but also network and retailer costs to serve customers. As part of the DMO consultation process, the AER will continue to examine costs before making our final determination.
“We’ve observed that when renewables are available, they are increasingly setting wholesale electricity prices and leading to negative price periods. During the evening peak outside of solar hours, dispatchable forms of generation such as coal, gas, hydro, and batteries are still setting the wholesale price over 90 per cent of the time.
“The other key factor is wholesale market volatility. In 2024, we saw a large number of high-price events, which have led to increasing average prices. These high-price events are often driven by a combination of high demand, coal generator and network outages, and low solar and wind output.”
Region also asked the Australian Competition and Consumer Commission what measures it took to protect consumers from unnecessary price hikes in the energy sector.
“We monitor compliance with the electricity retail code, which supports customers in comparing electricity plans,” an ACCC spokesperson said.
“We examine electricity price outcomes in the sector through our inquiry reports. Our December inquiry report examined electricity price outcomes using data collection from plans and customers in SA, VIC, NSW, and South East Queensland.
“This report highlighted that customers on older electricity plans paid higher prices than those on newer plans and the value to customers in switching their electricity plan.”
ACCC’s monitoring of compliance with the electricity retail code led to the Federal Court ordering EnergyAustralia to pay $14 million in penalties for making false, misleading or deceptive statements to hundreds of thousands of consumers about electricity prices and failing to provide mandatory information required by the code.
Original Article published by Shri Gayathirie Rajen on Region Riverina.
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