More big batteries and electric cars will underpin a quicker transition from high-emission coal-fired power generation under plans revealed by AGL Energy.
With the country’s electricity consumption expected to double by 2050, AGL plans to add 12 gigawatts of new wind, solar and energy storage by 2035 to meet long-term demand for cheaper, clean power.
For households, now reeling under steeply rising electricity costs, increased consumption is expected to come from the replacement and upgrade of five key assets in the home.
“Electric vehicle charging, solar, batteries, heating and cooling, and hot water are likely to account for over 70 per cent of future household energy load,” AGL chief customer officer Jo Egan told a recent investor briefing.
The “value pool” and potentially flexible load across these five big assets in the home will become a market worth more than $8 billion a year across the entire value chain by 2035, she said.
‘The path to net zero’
Electric vehicle charging alone is expected to consume 2000 kilowatts per year, with 80 per cent of that to happen at home.
“It is clear electrification of transport is a key requirement on the path to net zero,” Ms Egan said.
“And as policy continues to evolve to enable this, the uptake of electric vehicles is likely to accelerate quickly.”
As the country’s biggest generator and retailer, AGL plans to tap into nationwide electrification.
Rooftop solar is expected to almost double by 2030. Business electrification is also tipped to quicken.
A mind-boggling 30 terawatts of additional electricity demand is likely nationwide by 2030 as industrial processes electrify, according to the Australian Energy Market Operator.
A faster decision is in the pipeline for AGL Energy’s 500MW big battery at the site of the old Liddell coal power station, where an industrial precinct will be developed.
The plant in the NSW Upper Hunter closed in April after underpinning the grid and local community for almost 52 years.
The final investment decision on the Liddell battery has been brought forward to the end of this year, with the first 250W stage expected to get funding from the Australian Renewable Energy Agency.
There are also hydrogen partnerships in place at all of the planned industrial hubs, including Fortescue Future Industries, chief operating officer Markus Brokhof said.
Meanwhile a pilot project with Japanese partners aims to convert coal from the AGL Loy Yang mine in the Latrobe Valley to liquid hydrogen and ship it to Japan.
‘A transition fuel’
AGL’s Torrens Island energy precinct near Adelaide is in the final stages of bringing online a 250-megawatt bank of batteries, alongside a recently built fast-start gas plant to cover short periods of peak demand.
“Despite the fact that natural gas demand is declining over time on the back of electrification, gas continues to be a transition fuel in AGL’s portfolio,” Mr Brokhof told investors.
A 50MW battery at Broken Hill will also switch on in the next three months, shareholders were told at the investor day on Friday.
A 500MW project next to Australia’s largest aluminium smelter Tomago – the biggest customer and another top emitter – and two smaller installations in NSW and Queensland are also on the drawing board.
As well as building its own assets, AGL plans to take more off-take agreements from new developments like the deal struck on Thursday with the biggest wind project in NSW.
The power purchase agreement with Rye Park wind project north of Yass will take almost half the project’s output, with the rest powering the Cadia gold and copper mine near Orange.
The company also has plans for expansion in Western Australia to meet industrial and commercial demand.
-AAP
