Consumers are unlikely to benefit from lower maintenance spending by networks as higher-cost coal-fired power plants make way for new energy sources.
The renewable energy transition was expected to slow the growth in electricity maintenance spending and there would be some years where maintenance on electricity generators falls, according to Oxford Economics Australia forecaster Nicholas Fearnley.
“Renewable generators require much less maintenance than fossil fuel generators per megawatt hour, and so maintenance spending will naturally fall as coal power plants are replaced by wind and solar,” Dr. Fearnley said.
While not necessarily bad news for maintenance jobs, as renewable energy expands its footprint, savings are not expected to flow through to power bills.
Instead, reduced spending will be largely offset by growing maintenance spending on transmission networks as they are expanded to unlock new renewable energy zones.
Some regulators have already increased the allowed capital expenditure for electricity distribution and transmission companies.
“We think these decisions will be repeated by other state regulators in upcoming pricing reviews and so signals higher maintenance spending for network owners,” Dr Fearnley said.
Electricity generation maintenance spending is expected to fall from $978 million in 2023/24 to $964 million in 2024/25, and drop to $644 million by 2033/34.
AAP