Re-imagining NEM’s future

If you had to list 10 key questions about east coast electricity supply, what would they be?

Recently I chaired a panel charged with advising on such questions and the best available people to address them at the NEM Future Forum to be staged in Sydney on 24-25 June.

The other members of the panel were Kate Farrer, managing director of Qenergy, Charles Popple, executive advisor on industry development at AusNet Services and professor Chris Greig, head of the University of Queensland Energy Initiative.

The convenors of the forum are Quest Events and the event is the second of their series of “energy outlook” conferences for 2015 – the first was the recent Australian Domestic Gas Outlook forum that attracted 200 registrants.

The product of the interaction between the NEM Future Forum panel and Quest is an agenda of 18 keynote speakers and four panel discussions involving a further seven well-known stakeholders.

The conference will be co-chaired by Robert Pritchard, executive director of the Energy Policy Institute of Australia, and I.

One of the highlights of the event will be a presentation by video from the UK by professor Dieter Helm of Oxford University, one of the most highly-regarded academic analysts of energy issues in the world. His topic will be the changing generation and energy demand landscape – an issue for all the developed and major developing nations, not just Australia – and the technologies that could drive further change.

The inevitability of change is the central theme running through this conference.

As I said on Twitter overnight, “Shift happens, especially in the NEM” – and it is the extent of the transition now under way (in terms of technologies, time and impacts on consumers, legislators, regulators and investors) that is the forum’s focus.

And those 10 questions?

In my paraphrase, they are:

  1. Is the wholesale energy market “broken,” as is now so frequently asserted?
  2. What new approaches, in terms of policy, regulation and supplier management, are needed to cope with evolving consumer behavior?
  3. What is the retailers’ role in this “prosumer” era?
  4. How far can co-operative federalism be pursued to make the NEM a better place?
  5. Can privatization deliver more efficient and cost-effective supply?
  6. What are the implications for the NEM, viewing it as a chain from generation through networks to retail operations, of national efforts to reduce our carbon footprint?
  7. To what extent will renewable and distributed generation change the way the supply chain operates?
  8. Can coal continue to be the mainstay of east coast power supply and how?
  9. What are the limitations of wind power? Can it compete with fossil fuels?
  10. Is there a place for nuclear power?

Now, I don’t doubt that my fellow panelists would phrase these questions differently or that the audience will come up with a raft of varients and others not explicitly canvassed in the agenda.

The latter is one of the great merits of ensuring the program has plenty of room for audience participation.

For this occasion, the set-piece panel discussions are quite heavily oriented towards the green issues of public debate, viz: the challenges of integrating renewables further in to the NEM, the consequences along the supply chain of the growth of solar PVs, the outlook for battery storage and what I would describe as the real meaning of energy security – delivering reliable electricity at affordable prices.

I rather like an observation made by Kate Farrer, who is a speaker, too, in one of several scoping comments included in the program brochure (which you can find at www.questevents.com.au).

“Australian energy markets, and indeed those globally, are undergoing an extra-ordinary period of transformation driven by the need for greater sustainability and increased customer-centricity,” she says. “The future is less and less about the past.”

Overall, as one of the other speakers, AGL Energy’s Tim Nelson, observes, this is a discussion that needs to embrace economic efficiency, social equity, decarbonization and a digital and technological transformation.

As this perspective suggests, re-imagining the future of the NEM is a complex conversation.

It needs to take place against a very big canvas for which simplistic designs are not sufficient – no matter what some may say.

I am hopeful next month’s forum will tackle the issues with a bit more than a broad brush.

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