Hey Reader, in today's edition:

Preparing for a fully renewable system
Measuring public support for the transition
2035 target looms

Record investment in the NEM

The annual State of the energy market report shows more than 5GW of new solar, wind, battery and gas capacity entered the National Electricity Market (NEM) in 2024 - the largest annual new entry of capacity since the NEM began in 1998.

On 6 November 2024, renewable sources supplied 75.6% of total generation during the half-hour interval ending at 1 pm, marking the highest share on record. New records were also set for rooftop solar output (up 13% to 23GW) and home batteries installed (up 62%). In the future, the power system will at times be fully supplied by renewable energy, according to the report compiled by the Australian Energy Regulator (AER).

AER Chair Clare Savage said the profile of energy generation had changed significantly over the past decade and technological developments and consumer preferences continued to lead us away from a supply-side orientated system to one that needs to support two-way flows of electricity, and away from centralised generation to distributed generation.

Challenges for governments, energy businesses, market bodies and regulators included:

ensuring enough generation and firming capacity is being built to offset the closure of coal-fired plants
ensuring new generation capacity is located efficiently so it can be connected to the grid and delivered to customers at lowest cost
ensuring new transmission network investment to support the transition is efficient and timely
managing the safety and technical security of the grid as the generation mix changes
efficiently integrating consumer energy resources into the system in the long-term interests of consumers
ensuring all consumers benefit from the transition
optimising the role of gas in the transition to firm renewables.

Between 2014 and 2024, more than 6.6GW of coal- and gas-powered generation left the NEM. During the same decade, large-scale wind and solar and rooftop solar capacity joining the network was equivalent to 16 times Australia’s largest coal-fired power station Loy Yang.

“We are working with the states and territories to rebuild the energy grid and deliver a better, fairer energy system that Australians deserve … The Coalition must heed this warning from the experts: you can’t keep the lights on with denial and division. Australia has the best wind and sun to power our future. After a decade of ideological energy policy that only delivered delay denial and dysfunction, we’ve provided the certainty to get investment flowing, to secure the jobs we need now and into the future.”

Chris Bowen

Minister for Climate Change and Energy

AER said gas plants would be an important provider of inertia and frequency stability as coal plants retired, with gas-powered generation demand expected to stabilise over the next decade and then rise from around 2033 - particularly during winter months.

The report also captured increased volatility in the wholesale market amid an evolving system, with complex relationships between weather conditions, shifting energy demand, outages of ageing coal assets, and the more diverse mix of generation assets.

From July to September 2024, for example, periods of higher wind generation drove a record number of negative prices (when the 30-minute wholesale price of electricity falls below zero per megawatt hour), while separate periods of low generation and outages contributed to high price events (when the 30-minute wholesale price of electricity exceeds $5,000MWh).

Solutions index launched into the wild

A Clean Energy Solutions Index, designed to guide investment and collective efforts to strengthen public support and optimism about the transition, was launched at Parliament House by climate advocate Eytan Lenko and social trends expert Rebecca Huntley.

Philanthropic organisation Boundless Earth, founded to deliver on Australian tech leader Mike Cannon-Brookes’ $1.5 billion climate pledge, has been working with data-driven consultancy 89 Degrees East to develop the index and a future interactive dashboard.

The inaugural report provides a picture of where Australians stand on solar panels, electric vehicles, future manufacturing and gas-free infrastructure. Importantly, the index doesn't just measure support, it reveals the underlying reasons why people back these critical solutions and the barriers that prevent deeper acceptance, Lenko said.

Expert view

“What we’re looking for is deep support and we’ve come up with a unique measure for that. What it is is that people not only personally support the solution, believe there will be a national benefit, so it’s going to be good for Australia, but critically, there’s two other metrics that we need to look at. One of them is “I perceive people in my local community also support it’ – that kind of social validation, the idea that people like me who live close to me, who have my experiences in life, they too have this level of enthusiasm and – and ‘willingness to advocate’, so I’m not only for the country, think my neighbours want it, I’m prepared to talk about it in enthusiastic terms. Closing that perception gap is critical across all the solutions, as well as the transition itself … when I tell people how far we’ve come in focus groups you see an uplift of optimism and you see a sense of let’s keep going.

We can see there’s more work that needs to be done around the transition away from gas, and electric vehicles, then closing these gaps and making sure there’s momentum across all the solutions - essential if we’re going to succeed.”

Dr Rebecca Huntley
Research Director, 89 Degrees East

Catch Up

Capital

Australian gas giant Santos (ASX: STO) reported a slump in first-half profit after sales fell 5% to US$2.58 billion and announced a new due diligence deadline of September 19 for a consortium led by Abu Dhabi’s ADNOC, which lobbed a takeover bid for Santos in June. (AFR) (News) (The West)

“Santos and the XRG Consortium are finalising the SIA (Scheme Implementation Agreement), which will include customary protections for Santos shareholders in the event there is a longer than expected period before completion of the Potential Transaction. On 24 August 2025, the XRG Consortium again confirmed it has not found anything in due diligence that would lead it to withdraw its Indicative Proposal. The Consortium has requested an extension of the exclusivity period to conclude due diligence and to allow the Consortium to obtain all necessary approvals to enter into a binding transaction.”

Santos said in a statement

Venture capital company Pacific Channel launched Fund V to invest in New Zealand-based clean energy developer Kākāriki which has a national portfolio of seven wind, solar and energy storage projects in development in regional areas forecast to have high industrial energy demand. Phase 1 of the Kākāriki portfolio includes 4GW of wind and solar generation and 2.3GW of storage capacity, with land access, planning, grid connection activities, and partnerships with Māori already underway. The scale of the portfolio is designed to help catalyse a six-fold increase in renewable energy generation in the country.

“Fund V will provide the seed capital to get these seven well-advanced projects investment ready, with plans to invest in up to 18 more as part of the broader pipeline. This unlocks the large-scale capital required to deliver long-term economic, environmental, and community benefits.

Generating six times current levels will not only secure affordable energy for homes and businesses, it also creates opportunities to electrify transport, industry and buildings, grow exports through surplus embodied energy products and attract new energy-intensive industries.”

Richard Pinfold

Pacific Channel Partner

Projects

Australia’s biggest battery raced through its commissioning process and is now operational, ready to deliver on its expanded “solar soaker” contracts within a few weeks. The Collie battery in Western Australia is sized at 560MW/2,240MWh over its two stages - more than 17 times as much storage as the original Tesla big battery at Hornsdale in South Australia. By 2027 it will be overtaken by the 700MW/2,800 MWh Eraring battery. (Renew Economy)

Policy

Climate Change and Energy Minister Chris Bowen told the ABC the government was open to using a range to set Australia’s emissions reduction target. (AFR)

“Target ranges are used by several of Australia’s international counterparts when they set climate goals...Those countries that set a range, the bottom end is what we think might be the achievable end, and the top end might be the ambitious end.

“I’m not critical of those countries that have done it, no. It’s an option.”

Chris Bowen

Minister for Climate Change and Energy

Llew O’Brien, a Queensland LNP MP, conceded climate change “is real”, but argued net zero was “economic sabotage” as parliament debated Nationals MP Barnaby Joyce’s Repeal Net Zero Bill.

Independent MP Zali Steggall described it as a “clown show”, saying Joyce was “showing how irrelevant the Coalition want to be by wanting to repeal net zero while the vast majority of Australians are concerned about the security risks and the safety risks” of climate change.

Steggall introduced the Climate Change (National Framework for Adaptation) Bill to push for independent national risk assessment around climate risk to show how communities and industries will be affected, to compel the government to have an adaptation roadmap, and to publish a declassified version of an Office of National Intelligence report into climate-triggered security threats.

“We know that for every $1 we invest in resilience, we save $11 in disaster recovery. It is essential if we want sustainable and good fiscal management and a strong economy that we invest in recovery and resilience … currently local governments and communities are left holding the bag when disasters strike - $38 billion a year is lost on disasters by the Australian people and that is scheduled to double by 2060. Yet the treasurer when he hosted his productivity roundtable declined to include climate resilience or risk as part of that conversation.”

Independent MP Zali Steggall told reporters

Steggall called for Labor to set a strong emissions reduction target - a “minimum of 75%” - and invest in resilience and adaptation.

The Greens moved to establish a Senate inquiry into Labor’s “secrecy” on the assessment behind the pending 2035 target. “A target that does not hit net zero by 2035 and include a plan to phase out coal and gas and end native forest logging will not keep people or the planet safe,” Deputy Leader Senator Mehreen Faruqi said.

The tightrope the government must walk with the emissions reduction target spans “a wide gulf”, ANU Professor Frank Jotzo writes in The Conversation.

"The main question is not precisely what 2035 target the government sets. Rather, it’s whether the government follows through – with stronger and extra policies – and if business will get on board.

Frank Jotzo

Director, Centre for Climate and Energy Policy, ANU

Regulation

Gas exporters must supply a reasonable share of gas to the domestic market before being granted permission to export, the Australian Workers Union (AWU) said in its submission to the federal Gas Market Review.

“Because of a series of weak and stupid decisions by Australian governments during the late 2000s and early 2010s foreign gas giants operating here have been gifted the sweetest deal out of anywhere in the world. They've been able to pump our gas out of the ground and simply flog it to the highest foreign bidder without restriction. These multinationals should be kissing the boots of every Australian taxpayer for the run they've had over the last ten years. But it's time for a fairer deal.”

Paul Farrow

AWU National Secretary

The submission targets the Santos-operated “practice” at the GLNG of purchasing up to 126PJ of third-party gas annually – equivalent to more than a quarter of East Coast demand – to meet export commitments. The AWU's proposal includes several key mechanisms:

A requirement for LNG exporters to supply a fair portion of domestic demand
Rules deducting third-party gas purchases from LNG exporters’ local supply commitments - ensuring they don’t rob Peter to pay Paul
A ‘baseline-credit’ system, allowing producers who exceed their domestic supply obligation to trade credits with those that fall behind
Powers for government to set prices for industrial users if market dynamics threaten manufacturing viability.

Under this proposal, GLNG would have to develop its underused reserves for the domestic market, buy credits to cover its domestic supply shortfall, or divert export production to the local market - covering its export contract with gas from the international market.

A “paradigm shift” in forecasting of long-term load and distributed energy resources is required to manage transforming grids, according to the authors of a new report from the Energy Systems Integration Group. They point out traditional methods, which allocate load and DER growth based on proportional scaling of energy consumption, peak demand, or customer count, often fail to capture emerging geospatial adoption patterns.

Climate

Reframing doom-laden environmental news with hopeful, solutions-focused stories could be key to tackling the climate crisis, according to an award-winning paper by Charles Darwin University (CDU) researchers.

“This is a roadmap for reframing climate and biodiversity reporting, about shifting the narrative from despair to empowerment. If we want audiences to act, we need to tell stories that show change is possible.”

Dr Awni Etaywe

CDU Lecturer in Linguistics

People

Joanna Shulman will join the Environmental Defenders Office as CEO on September 1.

Research

For those doing research on electricity markets, a special issue of the Australian Journal of Agricultural and Resource Economics beckons. “The call for papers was inspired by the amazing work of the NEM Review's Academic Advisory Panel,” NEM Review Chair Tim Nelson said in a LinkedIn post.

Random

Climate change is pushing winemakers to blend wines from different years. (BBC)

What's On

August 26
NEM Review Draft Report - Long Term Incentives

This is the third in a series of online forums with the Panel undertaking the National Electricity Market wholesale market settings review.

August 26-27
Australian Renewable Heat Conference

Climate Change Authority Chair Matt Kean will speak at this event in Sydney, featuring case studies of industrial heat decarbonisation projects from Teys Australia, Graincorp, AstraZeneca, Sugar Australia, Suntory Oceania and Kilcoy Global Foods.

August 26-28
2025 New Zealand Wind Energy Summit

NZ Minister of Energy Simon Watts, Secretary-General of the World Wind Energy Association Stefan Gsänger, Global Wind Energy Council CEO Ben Backwell, Commerce Commission Chair Dr John Small, and Transpower Executive General Manager - Future Grid John Clarke headline this event in Wellington, NZ.

September 1-3
Farming Forever National Summit

Farmers for Climate Action CEO Natalie Collard, Rewiring Aeteroa CEO Mike Casey, NSW EnergyCo Chair Paul Binsted, ANU Director of the Institute for Climate, Energy & Disaster Solutions Professor Mark Howden and NAB Chief Climate Officer Jacqui Fox will speak at this Farmers for Climate Action event in Canberra.

September 2
Bias in action

ANU Institute for Infrastructure in Society Director Sara Bice, CEO of The Energy Charter Sabiene Heindl, Director of Partnerships and Engagement at Energy Estate Rosie King, and Head of Communications and Stakeholder Engagement at Ark Energy Melissa Pisani will speak at this renewable energy engagement webinar.

September 2-4
14th World Chambers Congress

OECD Secretary-General Mathias Cormann, CEFC Chair Steven Skala and Yurringa Energy CEO Arron Wood are among the speakers at this Melbourne event.

September 3
The case for an Australian clean commodities trading initiative

UNSW Professor of International Political Economy Elizabeth Thurbon and Australian country head of GAW Capital Oliver Yates will speak at this Curtin Institute for Energy Transition webinar.

September 3-4
NT Resources Week

SunCable CEO Ryan Willemsen-Bell, Northern Australia Infrastructure Facility Chair Tracey Hayes, Arafura Rare Earths CEO Darryl Cuzzubbo, Director of the Gas & Energy Transition Research Centre at UQ Professor David Close, and CSIRO Hydrogen Industry Mission Lead Dr Patrick G. Hartley will speak at this Darwin event, which includes a Clean Energy and Decarbonisation stream.

September 10
The NEM Review: Your questions answered

In this follow-up webinar, Tim Nelson and the NEM Review panel reconvene with The Energy’s Advisory Board Chair Simon Corbell to answer your questions about the draft report.

September 16
The Price of Power: The Future of Australia's Energy Sector

Bluescope Chief Executive, Climate Change and Sustainability Deborah Caudle, Alinta Energy CEO Jeff Dimery, AGL CEO Damien Nicks and Australian Energy Council CEO Louisa Kinnear will speak at this American Chamber of Commerce event in Melbourne, with R. Blair Thomas, CEO of US energy investment firm EIG speaking via Zoom.

September 23
AEMO's Annual Results

Australian Energy Market Operator CEO Daniel Westerman and Executive General Manager for Finance and Governance Vanessa Hannan will outline progress against strategic priorities and initiatives, financial results for FY25 and priorities for FY26.

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The Energy

Breaking capacity records

Record investment in the NEM