Get all your news in one place.
100’s of premium titles.
One app.
Start reading
The Guardian - AU
The Guardian - AU
Environment
Ben Smee

Power bills set to rise 9.2% in regional Queensland as report blames delays in renewable energy projects

The power station at Tarong.
The Queensland government owns the majority of the state’s electricity generators, including the Tarong power station, and says coal plants won’t close ahead of schedule. Photograph: Auscape/Universal Images Group/Getty Images

Power prices in regional Queensland are set to jump by 9.2% next financial year because of the surging cost of coal and gas, as a new report details how customers are ultimately paying the price for delays in developing large-scale renewables projects.

The Queensland government, which owns most of the state’s power generators, has a 50% renewables target but says coal plants won’t close ahead of schedule and will “continue to play a significant role in our electricity system”.

The government has announced a $175 rebate for households, to offset the increase to power prices. Budget documents from 2021 show the state’s generators will soon be unable to pay dividends to taxpayers.

Analysis by the Queensland Conservation Council said power prices in regional areas would have decreased by 25% had two major windfarms currently under development – the Wambo and MacIntyre projects – been built more quickly.

The report, titled Coal Power is Costing Queensland, said the price hikes showed investment in these sorts of projects was needed several years ago.

“Because Queensland hasn’t invested in renewable energy at the same pace as other states over the past five years, we’ve gone from having the lowest prices in 2017 to the highest electricity prices in 2022,” the QCC’s energy strategist, Clare Silcock, said.

“Queenslanders in the south-east can shop around for a cheaper offer, but what we really need is the government to plan for and invest in more renewables to be built sooner.”

The report said Queensland had the highest dependence on coal of any state in the national energy market, and that coal-fired power was becoming increasingly unreliable.

The Callide power station in central Queensland broke down eight separate times in 2020, before an explosion and fire in one of its generators caused widespread blackouts across the state.

“Other states are already seeing renewable energy bring down prices, while Queensland cops higher prices than ever and increasingly unreliable coal-fired power stations,” Silcock said.

Stephanie Gray, the deputy director of Solar Citizens, said price increases were most pronounced in coal-dependent states like Queensland.

“Queensland wholesale prices are also through the roof because breakdowns at coal and gas units mean we’ve had unexpected shortfalls during times of high demand,” Gray said.

“To the state government’s credit they have announced a $175 … rebate for Queenslanders’ next power bill, but this is a short-term solution to a long-term issue.”

The Queensland Competition Authority released its cost determination for regional customers on Tuesday, which said price hikes – which would see a typical annual cost for households rise $119 to $1409 – were due to an increase in generation costs.

It said there was a “tighter supply-demand balance in Queensland” and that periods of high demand had been combined with reduced generation availability. That has included record heatwaves and unplanned power outages at coal and gas plants, including at Callide.

The authority said generation costs had also increased because gas and coal prices were at record highs.

“Despite recent significant growth in renewable generation, gas and coal-fired power stations continue to be the last generator dispatched and set the spot prices for about 70% of the time in Queensland,” the QCA determination said.

“This spot price setting dynamic, coupled with higher gas and coal prices, have contributed to elevated spot prices and ASX contract prices, and therefore higher wholesale energy costs.”

Queensland is expected to release a significant energy plan in the coming months, which is expected to outline the state’s path to generate 50% of its electricity from renewable energy sources by 2030, cut carbon emissions by 30% by 2030, and achieve net zero emissions by 2050.

Sign up to read this article
Read news from 100’s of titles, curated specifically for you.
Already a member? Sign in here
Related Stories
Top stories on inkl right now
Our Picks
Fourteen days free
Download the app
One app. One membership.
100+ trusted global sources.