17
May

NSW signs net zero deal with Denmark

NSW will partner with Denmark – a world leader in clean energy where wind and solar supplies 50 per cent of grid power – to share expertise and research on decarbonising as they seek to accelerate plans to reach net zero emissions.

Heightened concerns about electricity prices have seen a growing wave of countries accelerate their plans to transition away from fossil fuels, with some looking for an inside track in burgeoning energy sources such as hydrogen.

NSW is expected to be at the forefront of Australia’s plan to lead the global race to profit from increased demand for hydrogen, which has seen a flood of investment and government support.

NSW and Denmark will collaborate on innovation, policy and program design and trade, investment and technology transfer.

“By sharing our knowledge we can accelerate our progress towards net zero emissions by 2050 and set ourselves up to prosper in the global economy of the future,” NSW Treasurer and Minister for Energy Matt Kean said.

“Denmark is a world leader in clean energy, with wind and solar supplying 50 per cent of Denmark’s electricity. Danish companies are also at the forefront of global clean energy technology development.”

The viability of hydrogen exports was highlighted this year when Australia shipped the world’s first cargo of liquid hydrogen in a small pilot project, produced using brown coal mined in Victoria’s Latrobe Valley. The project relied on Australian carbon offset units to nullify its emissions impact.

Denmark’s ambassador to Australia said the deal would offer the European country much-needed knowledge.

“NSW and Denmark already have ambitious policies in place to decarbonise our electricity grids, but we can learn from each other’s experiences and address some of our trickiest challenges together,” Pernille Dahler Karde said.

Gas prices soar

Australia’s target of net zero emissions by 2050 is expected to reshape the country’s $2 trillion economy, but with a global energy crunch driving demand for fossil fuels, some politicians continue to publicly question the rationale for decarbonising.

The debate has intensified recently amid concerns about the impact of soaring wholesale prices on consumers and businesses. Some conservative MPs have said Australia should boost the use of fossil fuels to ease wholesale prices.

The Australian Energy Market Operator said last month that wholesale energy prices in the first three months of this year surged 141 per cent on average compared with the same period last year.

The rise has largely been driven by rising prices for coal, which is still the dominant source of Australia’s electricity generation, but the situation has been exacerbated by a series of outages and maintenance shutdowns at ageing coal-fired power stations.

Some energy retailers warned last week that companies could be sent to the wall if the national energy regulator did not raise benchmark retail power tariffs enough to reflect the huge surge in wholesale prices.

The surge in coal power outages has increased the reliance of Australia’s electricity generation sector on gas, which has seen domestic prices surge.

Consultancy EnergyQuest said Queensland gas prices had doubled in price from April to May to top more than $30 a gigajoule.

Prime Minister Scott Morrison has resisted efforts from conservative MPs to fund the development of a coal-powered power plant, preferring gas to supplement the country’s energy transition.

Climate advocates have said greater investment in renewable energy generation would reduce the need for gas, ease concerns about cost of living for households and propel Australia towards its net zero emissions by 2050 target.

Those claims are backed by the AEMO’s wholesale price data that shows the states with the highest renewable energy generation have the lowest wholesale price rises. However, zero emission generation can take years to develop and often requires expensive new transmission lines to connect plants to the grid.

 

Extracted from AFR