The end of year report dump continued this week, with a tweaked GenCost model and the NEM review getting everyone but Queensland to endorse its final recommendations.
Policy
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The CSIRO’s annual GenCost report was tweaked to include a System Levelised Cost of Energy estimate, and again found the lowest cost path to net zero in the electricity system is based almost entirely on wind, solar and storage.
The biggest recent cost increases have been in coal and gas-fired generation, reflecting a large upwards revision in gas turbine and steam turbine costs with waiting lists for the equipment blowing out into the 2030s.
Battery costs (battery and balance of plant in total) have decreased significantly by 11-16% depending on the duration, large scale solar has had the first cost rise in three years, and onshore wind costs show signs of stabilising after recording the largest increase in 2022-23.
Meanwhile, almost $5 billion was added to the Cheaper Home Batteries program, which is expected to see around 40GWh of capacity installed by 2030, doubling the election estimate of 1 million batteries and increasing the expected capacity by almost four times. With the initial allocation of $2.3 billion set to be used up in the first year, the settings will also be tweaked to stop supersized systems from exhausting the extra funding too soon.
CSIRO released a report on R&D priorities in response to the fast-moving critical minerals agenda. Among the recommendations for the next 2-7 years: Targeted pilot projects to support the most commercially viable downstream processing industries; co-investment or voucher schemes to improve industry access to existing common-user piloting facilities and laboratories; and supporting the production of high-value materials by subsidising facilities and equipment to validate product purity, which is critical to compete in premium markets.
The Queensland Government launched a Supercharger Solar for Renters scheme, offering rebates of up to $3,500 to eligible landlords who install rooftop PV systems on their rental properties.
Capital
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The finalised National Electricity Market (NEM) review report confirmed the Panel’s recommendation for an Electricity Services Entry Mechanism (ESEM) to support the next phase of investment in the grid and underplayed the power of consumer energy resources/distributed energy resources. In its final communique for the year the Energy & Climate Change Ministerial Council said Queensland did not provide in-principle agreement, "but acknowledged the good work of the panel so far and recognised sovereignty of jurisdictions to address the challenges they face".
Australia's largest aluminium smelter, Rio Tinto’s (ASX: RIO) Tomago smelter near Newcastle, will get discounted renewable energy to ensure it keeps running beyond 2028 but the cost to taxpayers is unclear. Tomago Aluminium CEO Jérôme Dozol had said the price of both renewable and coal-fired power into the future would render the smelter “unviable”. Industry Minister Tim Ayres said a long-term power purchase agreement (PPA) was being finalised and would not confirm what projects might be fast-tracked to achieve the deal. "Suffice to say there are costs and benefits that accrue to NSW and the Commonwealth and Tomago,” he said. (AAP) (ABC) (9News)
Regulation
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Consumers will have to wait until November 2028 to request access to real-time meter data at no cost following a final determination from the Australian Energy Market Commission. An initial directions paper proposed delaying the onset of the obligation until 2040, however this was cut to January 2028 in response to industry and advocacy group feedback. The rule maker has pushed this out to November 2028 in its final rule, citing the need for more time for the Australian Energy Market Operator (AEMO) to develop procedures and industry to develop and test technology and functionality.
The Australian Energy Regulator (AER) began proceedings in the Federal Court against Transgrid following an investigation into the October 2024 power outages in Broken Hill and surrounding areas, when a severe weather event led to the failure of the transmission line that supplies area, alleging a breach of the National Electricity Rules with one of two back-up generators unavailable due to maintenance and the other experienced multiple outages. The AER is seeking pecuniary penalties, declarations and costs.
 Projects
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Aula Energy has announced it has reached financial close for its Carmody’s Hill wind project in South Australia, the second project to announce FID in two days, and the first for the NEM in 2025. Construction on the 256MW wind farm is expected to begin in early 2026. (Renew Economy)
Southerly Ten, the developer of Gippsland offshore wind proposal, Star of the South, has made some forward steps, lodging its Environmental Impact Statement for approval under the Environment Protection and Biodiversity Conservation (EPBC) Act. It has also purchased 120 hectares of farmland on Gippsland’s coast near Reeves Beach, where underground cables will come to shore. Victorian offshore wind has had a tough time recently, with three proponents walking away, and in September the auction for state government procurement was postponed.
The Net Zero Economy Authority (NZEA) released an interactive investment map of over 800 renewable energy and net-zero research projects backed by federal support including the Capacity Investment Scheme (CIS), Australian Renewable Energy Agency (ARENA), Clean Energy Finance Corporation (CEFC), Northern Australia Infrastructure Facility (NAIF), and the Regional Hydrogen Hubs Program. Developed in partnership with RenewMap, the tool consolidates information about the energy transformation and also includes contextual data on transmission lines, renewable energy zones and fossil fuel-fired power plants.
Climate
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Whitehaven Coal’s (ASX: WHC) growth trajectory is contrary to Australia’s climate legislation and emissions targets, exposing shareholders and the community to climate, regulatory and financial risks, according to a report by CarbonBridge and Climate Energy Finance. The benefits of the existing diesel Fuel Tax Credit Scheme (FTCS) may outweigh the company’s Safeguard Mechanism obligations, the report finds, creating a “perverse disincentive” for Whitehaven to mitigate its direct emissions.
Research
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Standing offers have increased across all jurisdictions over the past 12 months by between 1% and 10% depending on where you live, according to Vinnies’ December tariff tracker observations. Taking a long-term price perspective, comparing 2009 to now, price-increases range from 98% to 138%. It’s a similar story for gas with recent gas pricing increases between 2% and 9% and gas price changes since 2009 ranging from 134% to 208%.
Global coal use has "plateaued", the International Energy Agency said in its closely watched annual coal report on Wednesday, but 2025 will see it hit record highs and 2026 should be similarly large thanks to the Trump administration's policies. Beyond 2026, the report predicted a 5% decline in the global trade for coal through to 2030. (AFR)
People
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Woodside Energy (ASX:WDS) CEO Meg O’Neill is on gardening leave after resigning to take up the position of CEO at British oil major BP, effective 1 April 2026. Woodside’s Executive Vice President and Chief Operating Officer Australia Liz Westcott is acting CEO, effective immediately. BP’s Murray Auchincloss steps down as CEO and board director, with Carol Howle to serve as interim CEO.
Jo Glynn and David Stevens were appointed to the board of Queensland Government owned CS Energy.
Anna Collyer was reappointed as chair of the Australian Energy Market Commission for a further five-year term.
The Energy Week is taking a break and will be back with more summaries to help you cut through the noise on January 24.
