Energy market operator warns of blackouts as renewable projects delayed

There's a warning of future blackouts across the state thanks to delays in key transmission projects and the looming retirement of coal power plants. The Australian Energy Market Operator issuing the unusual warning today, prompting a blame game across the political divide. Let's bring in Greg Elkins, who was the former head of connections at the Energy Market Operator and current CEO of Global Power Energy. Greg, thank you so much for your time. First of all, can you break down what this warning is today and and what the report has to say? The report's looking to the future to get an understanding as to what our energy supply needs are moving forward. It's designed as a market signal to understand to investors to signal to say it's time for a new generation to come on board so that we can have adequacy of supply within the system. Amo is seeing key challenges in the next five years, particularly around Victoria and NSW. Further on to just the energy supply, we've got challenges with regard to keeping the lights on and that they're saying that we need 22 new machines in order to support the renewables that are coming online, the wind and the solar and the batteries. This issue appears to prong then the the closure of coal-fired power plants and the lack of investment in renewable transition infrastructure. One can't happen without the other though, right? Exactly right. We we need to figure out how to transition and how to provide incentives to the industry to build a new generators. At the same time, we need to overcome the regulatory framework challenge, which is how do we actually get the permission from the Australian Energy regulator to build the transmission on time so that the risk of constraints and delays for transmission or for generation is not paramount. So what needs to happen to ensure electricity supply and transition to renewables? We're reaching the limit of the low hanging fruit of the spare capacity out where we've got cheap land. Now we need to go into the other areas and start building new infrastructure and new transmission lines to be able to support the connection of additional generators and the government's also looking at extending the life of the erring coal plant. Is that a good solution? Unfortunately, we need to be able to stabilise the system at the same time as providing a rapid transition to renewables. What we've got here is the requirement to rely on the firm and continuous supply of energy from the thermal power stations, but at the same time we want to be able to transition to renewables. Unfortunately, what we're seeing is the transition to renewables are being constrained because we need to keep the coal or the thermal power stations online to maintain that stability. So what we should be focusing on is not just keeping a rearing online, but improving its flexibility so that we can reduce the reliance on the energy, but still have it rapidly available for urgent requirements, say, for example, a large heat wave or a large storm event that takes out a lot of solar. Well, let's hope the relevant authorities are listening today. Greg, thank you so much for your time. Cheers. Thank you.

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