ABSTRACT

Gas-powered generation (GPG) will become increasingly critical for keeping the lights on in the east-coast electricity system (the National Electricity Market, NEM). However, energy transition planners still too often assume that GPG, and its gas supply, can continue being perfectly responsive to fluctuating electricity system demand. Multiple perspectives and historical experience suggest this is a poorly founded assumption. We illustrate the risks to NEM resilience, and the planning challenges for the gas sector, by implementing a deep-dive re-model of Australian Energy Market Operator’s (AEMO) 2024 Integrated System Plan (ISP-2024) Step Change scenario. Using AEMO’s own weather scenarios, the volatility in GPG demand will increase to levels far exceeding anything experienced historically in either the electricity or domestic gas supply systems. We also develop our own estimates of renewable energy zone (REZ)-level variable renewable energy (VRE) resource potential, back-cast over an 80-year historical record. This indicates that AEMO’s reliance on only 13 years of weather data is insufficient to capture the full range of possible winter wind production in southern states. This represents a substantial increase in the rate of gas supply (to GPG) that might be required, unanticipated by AEMO’s modelling approach. Infrastructure planning to support the coming energy transition, will need to pay far greater attention to the inherent uncertainty in estimates of future GPG demand.