Leading international group Wood Mackenzie has criticised the Australian Renewable Energy Target (RET) for distorting the energy markets.
The Study by the group said that the RET created artificial incentives to move toward renewable energy without managing the impact on the grid of the intermittency of renewables.
Saul Kavonic, an analyst for Wood Mackenzie said: “This rapid renewables build-up has occurred before the necessary market design changes and ancillary investment has been made to deal with renewables intermittency, and now policymakers and the (Australian Energy Market Operator) are playing catch-up to restore stability.”
Kavonic also criticised Elon Musk’s solar battery in South Australia: “The Tesla battery is only a small drop into the ocean and will only provide at most a few per cent of South Australia’s peak loads and only for a little over an hour.
“So you need to build something much larger than that to actually deal with the peak loads or you need to change the market design so it incentivises the gas back-up to be there.”
This study from Wood Mackenzie comes after Fortescue Metals Group chief executive Nev Power described the RET as: “past its use-by date”.