Renewable energy: winter killer, or the path to 60% cheaper power for Aussies?
Liberal backbencher Craig Kelly has claimed renewable energy is driving electricity costs through the roof and will kill people this winter, contrary to recent industry reports projecting that a Clean Energy Target could reduce electricity prices by as much as 60%.
In comments labelled “appalling” by Shadow Energy Minister Mark Butler, Kelly told ABC radio that, "people will die."
"We've seen reports only recently that one-in-four Australian households this winter will be frightened to turn the heater on because of the price of electricity,” he continued.
After the July 1 price hikes, some Aussie households saw electricity prices rise by as much as 34.48%, or $800 a year. And perhaps suggesting that Kelly’s comments weren’t entirely off the mark, a recent Mozo survey revealed that 42% of Aussies were likely to cut back on their energy use in the face of these skyrocketing prices.
Just 13% of Aussies considered switching energy plans as an option for lowering bills, despite the fact that doing so could save them more than $1,000 per year - far more than they would save by skimping on heating this winter.
Kelly blamed rising prices on a growing investment in renewable energy, saying, "there are $3 billion this year being paid in subsidies for renewable energy, that pushes up the price of electricity to the consumer.”
His comments are in direct opposition to a recent report released by leading energy and emissions advisory firm Reputex, which predicted that over the next decade, a Clean Energy Target (CET) as suggested by the Finkel review would likely slash the price of wholesale electricity from around $100/mWh, to between $40-60/mWh.
These lower prices, the report says, would be driven by high volumes of renewable energy supply as energy producers continue to invest in clean energy such as solar and wind.
And unfortunately for Kelly, that investment is only likely to grow, according to another industry leader, Bloomberg New Energy Finance. The 2017 New Energy Outlook from BNEF sees $7.4 trillion being invested in new renewable energy plants by 2040, making up a massive 72% of the $10.2 trillion expected to be spent on new power generation worldwide.
As a result, solar power would see a 14-fold increase in capacity and a 66% drop in price, while wind power gets a fourfold capacity boost and 47% reduction in cost. By 2040, the report said, “a dollar will buy 2.3 times as much solar energy than it does today.”
Seb Henbest, lead author of the report said, “this year’s report suggests that the greening of the world’s electricity system is unstoppable, thanks to rapidly falling costs for solar and wind power, and a growing role for batteries, including those in electric vehicles, in balancing supply and demand.”
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