Energy ministers sign off on capacity mechanism
Chris Bowen "Keeping the lights on mechanism"
DECEMBER 9, 2022
Australia’s energy ministers have unanimously agreed to establish a capacity investment mechanism that they anticipate will unleash at least $10 billion (USD 6.7 billion) worth of investment and at least 6 GW of renewable energy generation and storage to stabilise the grid as the nation’s ageing coal-fired power plants exit the energy market.
Australia’s federal, state and territory energy ministers have signed off on a Capacity Investment Scheme (CIS) that will incentivise new investment in renewable energy generation backed by batteries, pumped hydro and other long-duration storage technologies to support the ongoing decarbonisation of the grid.The CIS, agreed to at a meeting of energy ministers in Brisbane on Thursday and to be underwritten and guaranteed by the Commonwealth, will provide the national framework to ensure there will be a reliable supply of clean dispatchable power, regardless of conditions in the market.
With at least five of Australia’s coal-fired power stations set to close before the end of the decade, Australia needs to install 45 GW of new supply by 2030, including about 36 GW from renewable generation like solar and wind.
