GenCost 2024-25 Draft Report Released for Consultation
Renewables Remain Cheapest Power Source for Seventh Straight Year, GenCost report Finds
Canberra, Australia – December 9, 2024 – A new report has confirmed that renewable energy sources continue to be the most cost-effective option for new electricity generation in Australia, marking the seventh consecutive year thay have held this position.
The draft GenCost 2024-25 report, an annual assessment of Australia’s future electricity generation costs, was released today for public consultation. Published by CSIRO, Australia’s national science agency, and the Australian Energy Market Operator (AEMO), the report provides crucial data for business leaders and policymakers involved in infrastructure planning and financing.
“GenCost’s annual update delivers data-based forecasts that support informed decision-making across the energy sector,” said Dr. Dietmar Tourbier, CSIRO’s Director of Energy.
Key Findings:
Solar Power Costs Continue to Fall: Large-scale solar photovoltaic (PV) capital costs have dropped by 8% for the second consecutive year.
Battery Costs Plummet: Battery costs saw the most meaningful annual reduction, with capital costs falling by a remarkable 20%.
Wind Costs Moderate: Onshore wind generation costs increased by 2%, a slower rate compared to the 8% increase seen last year, reflecting ongoing but moderated increases in equipment and installation costs.
Gas Turbine Costs Rise: Gas turbine costs increased by 11% due to the added expense of making them hydrogen-ready, which is now an industry standard.
Nuclear Offers No Cost Advantage: Modeling of nuclear power’s long operational life revealed no unique cost advantage over other technologies.
Nuclear Power: A closer Look
Since GenCost first provided detailed costings for new-build nuclear power in Australia, three key considerations have emerged:
Longer Operational Life: Nuclear power plants have a longer operational life (60 years).
Capacity Factor: The estimated capacity factor range for Australia, which represents the average time a power plant operates at full capacity.
Development Time: The anticipated time required for planning, regulatory approvals, community engagement, and construction.
“Similar cost savings can be achieved with shorter-lived technologies, including renewables, even when accounting for the need to build them twice,” said Paul Graham, CSIRO Chief Energy Economist and gencost lead author.
The report found that global median nuclear construction times have increased from 6 years to 8.2 years over the last five years. Based on this analysis, GenCost estimates a total development lead time for nuclear in Australia of at least 15 years.
Public Consultation and Next Steps
The draft GenCost 2024-25 report is open for public consultation until February 11,2025.feedback should be submitted to AEMO. The final report will be released in the second quarter of 2025.
Download the GenCost 2024-25 consultation draft here: [Link to CSIRO website]
Renewables Reinforce Dominance as Cheapest Power Source: Expert Weighs In on GenCost Findings
NewsDirectory3.com – In a major boon for Australia’s clean energy transition,teh latest GenCost report has confirmed that renewables maintain their position as the most cost-effective source of new electricity generation for a remarkable seventh consecutive year. We spoke with Dr. Dietmar Tourbier, CSIRO’s Director of Energy, to unpack the key takeaways from this influential report.
NewsDirectory3: Dr. Tourbier,GenCost paints a clear picture of renewables leading the charge,but what are some of the most significant trends you’re observing in this year’s report?
Dr. Tourbier: This year, we’ve seen solar PV costs continue their notable decline, dropping by another 8%. Battery storage costs are also plummeting, with a staggering 20% decrease, further bolstering the economic viability of renewable energy systems.
NewsDirectory3: The report also highlights that onshore wind costs have risen moderately. What factors are driving this increase?
Dr. Tourbier: While wind costs did see a 2% increase, it’s significant to note that this is a significant slowdown compared to last year’s 8% rise. This reflects ongoing but moderated increases in equipment and installation expenses.
NewsDirectory3: Interestingly, the report suggests that nuclear power doesn’t offer a cost advantage, despite its longer operational life. can you elaborate on this finding?
Dr. Tourbier: Our modeling showed that while nuclear plants have a longer lifespan,the cost savings over time are offset by factors like lengthy development times and high upfront capital costs. Building shorter-lived renewable technologies twice can prove to be more cost-effective.
NewsDirectory3: The report emphasizes the extended led times for nuclear projects. What are the main contributors to these delays?
Dr. Tourbier: We’ve observed a global trend of escalating nuclear construction times, now averaging 8.2 years. this is driven by complex regulatory processes, community engagement requirements, and technological advancements.For Australia, we estimate a minimum development timeline of 15 years for a nuclear project.
NewsDirectory3: what are the key takeaways for policymakers and businesses looking to invest in Australia’s energy future?
Dr. Tourbier: GenCost underscores the undeniable economic advantages of renewables.
Policymakers should prioritize policies that encourage renewable energy development and grid modernization. Businesses looking for long-term stability and cost certainty should recognize the value proposition offered by clean energy technologies.