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Angus Taylor knows whats going on!

This is Angus Taylor Remarks at the 2021 Australian Energy Week Conference

https://www.minister.industry.gov.au/ministers/taylor/speeches/remarks-2021-australian-energy-week-conference

We have seen record investment in solar and wind – 6.3GW in 2019 and 7GW in 2020. Over $15 billion has been invested in new renewable generation in the last two years alone.

This is excellent news, but there are challenges ahead.

The speed and scale at which variable renewables are coming online is causing disruption on level that we have never seen before.

Intermittent generation is causing increasing volatility in the wholesale electricity market.

This is making the grid more difficult to manage, creating volatile prices, and undermining the retention of less flexible dispatchable capacity.

Our system is already under strain, with out of market costs and market interventions increasing.

We need balance. We need to ensure that renewables are complemented by sufficient reliable generation.

This is not about ideology, just a simple, pragmatic focus on the solutions required to ensure consumers have continued access to affordable and reliable power.

We only have to look at the recent past in South Australia to see the very real impact prolonged blackouts can have.

Likewise, the sharp rise in prices following Hazelwood’s closure in 2017, shows what can happen when we lose balance in the system.

In Victoria, like in South Australia, the consequences were very real – for families, businesses and communities.

It is essential we retain balance.

Coal provides 66 per cent of our electricity supply. Closures without replacement are not just difficult to manage, this is a fundamental challenge to ensuring families and businesses have affordable and reliable supply of electricity to underpin our way of life.

Gas will inevitably provide part of the answer, with prices falling dramatically in the last 18 months, and new generators now typically built to be hydrogen ready.

Pumped hydro with deep storage, transmission between states, and batteries can all play a role.

Ultimately we need balance between these technologies and between intermittency and dispatchability.

However, there is a challenge with investment in new dispatchable capacity that contributes to the energy market – not just system services.

It has been over a decade since a new dispatchable generator was built in NSW, and nine years since a large dispatchable generator was built in Victoria.

The Morrison Government is acting decisively to fill dispatchability gaps in the market where necessary.

Through the 2021-22 Budget, our continued commitment to securing affordable, reliable power for consumers is clear.

Snowy Hydro is building a new 660 MW gas generator at Kurri Kurri in the Hunter Valley to bridge both the price and reliability gaps following the closure of Liddell.

We are supporting AIP’s Port Kembla gas generator to complete early works as it progresses to final investment decision with $30 million in funding.

And we are establishing a $24.9 million program to ensure new gas generators are hydrogen ready. This includes $5 million for Energy Australia’s 316MW Tallawarra B gas power station in NSW.

All of this builds on a range of government actions.