A massive investment in power generation, storage and transmission will be needed over the next decade to ensure the closure of coal and gas plants does not impact homes and businesses.
That is the verdict of the Australian Energy Market Operator's latest report on electricity reliability released on Wednesday.
"In the next decade, Australia will experience our first cluster of coal-generation retirements, at least five power stations totalling 8.3 gigawatts, equal to approximately 14 per cent of the national electricity market's total capacity," AEMO CEO Daniel Westerman said.
"Without further investments, this will reduce generation supply and challenge the transmission network's capability to meet reliability standards and power system security needs."
The report forecast reliability gaps in South Australia in 2023-24 and Victoria from 2024-25 against what is know as the "interim reliability measure", and in NSW from 2025-26 against the "reliability standard".
Gaps are forecast across all states in the national electricity market before 2031-32.
For this coming summer, AEMO says there are "supply risks" across eastern Australia.
But around 800 megawatts more capacity from a range of technologies is forecast to be operational this summer than was available last summer.
Mr Westerman said should the 3.4 GW of anticipated generation and storage projects, alongside Integrated System Plan transmission projects, be delivered to their current schedules, then reliability standards would be met in all region's market until later in the decade when more large thermal generators exit.
The report noted a large number of committed power projects over the next five years, totally 7.3 GW of capacity.
These included: Energy Australia's 320 MW Tallawarra B project, Snowy Hydro's 750 MW Kurri Kurri, Genex Power's 250 MW Kidston pumped hydro energy storage project, Snowy Hydro's 2 GW Snowy 2.0 project, 1 GW of wind generation and almost 1.5 GW of utility-scale solar generation.
