Article by Stephen Anthony, courtesy of The Daily Telegraph
12.02.2026
Australia’s energy debate can feel like the fate of Sisyphus: An endless push uphill, only to slide back again. Despite years of policy effort, electricity prices remain high, reliability is strained and the promised benefits of a rapid transition to 100 per cent renewables remain uncertain.
Many engineers and physicists warn the task is far harder than commonly acknowledged.
No major country has attempted such a fast transition without firm backup, interconnections to neighbours or proven large-scale substitutes for coal and gas. Some argue it may not be achievable within a reasonable time frame without serious economic and social costs.
The main problem is replacing “dispatchable” power – coal and gas plants that can run anytime – with wind and solar. Old coal plants were built near users, ran all day and provided inertia, strength and voltage control naturally. Australia’s east coast grid was designed for this reliability. Closing them early wastes value and raises costs.
A wind/solar grid needs 3–4 times more nameplate capacity to provide (or approach) firming.
The systems are spatially intensive. They uses huge land areas (about 2 hectares per MW for solar, more overall), long power lines (with losses), and backup systems.
These include batteries, gas plants for peaks, pumped hydro, diesel, and expensive “synchronous condensers” – big spinning machines that copy inertia. They help during calm or cloudy periods. All this adds big costs.
South Australia is often called a renewable success, with over 70% from wind and solar. But it has Australia’s highest household prices. The grid faces shortages in bad weather and sudden changes. It needed hundreds of millions for synchronous condensers, costs passed to bills.
This is the paradox: The more renewables generation is built, the more backup we seem to need. Estimates suggest Australia needs wind capacity to rise from about 14GW to 68GW, solar from 20GW to 66GW, and storage to increase seven times to 52GW.
All to replace just to replace 23GW of existing coal generation.
No Australian government over the past 25 years has fully compared costs of the full renewables transition versus just keeping/upgrading coal plants (with pollution controls) or heating those steam turbines with alternative technologies.
Policymakers may not grasp physics and engineering limits, or perhaps ideology or vested interests motivates them more than facts. But ignoring practical realities hurts working people and those in need.
The extra cost of the renewables- led transition could reach hundreds of billions – or even $1 trillion. That means lower living standards on average and fewer tax dollars to fund schools and hospitals. We need a fair, physics-based look at all options: Clean coal/gas, small nuclear reactors, hydro, batteries, wind/solar and long-term thermal storage. Treat the transition as an engineering task with three constraints – cut emissions, keep grid stable, ensure enough power – and aim for the lowest total cost.
Maybe one day lithium batteries may back up the renewables. But remember there are around 15 to 30 tonnes of CO2 released per tonne of lithium processed, so there is no free lunch here either.
We are undertaking a 100% renewables transition without our best tools: Those reliable old steam turbines. Ignoring physics won’t make electricity affordable or secure, lower-emission energy more probable. It won’t keep costs low. No shortcuts exist. We must face up to real challenges.
Stephen Anthony is a director of Macroeconomics Advisory, an adjunct professor at the University of Canberra, and chaired the Independent Pricing Committee into the NDIS.
