In 2013 many forms of renewable generation were at or below the cost of many fossil fuel systems. This was in terms of the costs of building new generation plants, as well as ongoing operations. Many countries reached and passed grid parity for onshore wind and photovoltaic solar power generation in 2012/13. The argument that it’s too expensive simply doesn’t hold anymore. The arguments from both climate change and the energy trap suggest we should be actively speeding up our migration.
The AEMO study puts the capital cost of migration to 100% renewable energy in Australia to be around $300 billion spread over thirty years. Adding costs of finance, land acquisition, any stranded costs and R&D required, this would likely rise to $500 billion.
This means an expenditure of around $17 billion a year is required to complete the transition in thirty years. The Carbon Pricing scheme alone could account for a large percentage of this total. Combined with the removal of fuel subsidies and private investment from generation companies wishing to participate in the move to sustainable energy makes this an entirely achievable goal without requiring new taxes on individuals.
The carbon tax would, however drive many prices up for individuals and this change must be softened over the first decade of its introduction by directly compensating individuals in the places they are most affected. This would primarily be petrol, gas and electricity prices. Rather than placing the full burden on consumers, they should be compensated at point of sale while industry bears the direct burden to force change.