Does NSW need more baseload?

A recent paper by our Chief Economist, Tim Nelson, covered in the Australian Financial Review today, looks at what types of energy supply the New South Wales energy market needs to meet different types of demand. While people often talk about the need for baseload, Tim points out there’s likely to be enough baseload to meet the state’s needs but not enough intermediate or peaking supply.

To understand what he’s talking about it’s useful to define the three categories of demand:

  • Baseload – demand that’s there all the time, night and day, this has historically been provided by coal-fired generation in NSW
  • Intermediate – additional demand on top of baseload when commercial and industrial users are active, this is now supplemented by renewable energy like wind and solar
  • Peaking – usually occurs on very hot days when everyone’s air-conditioners get turned on at the same time, this is can be met by open cycle gas or pumped hydro

As you can see below, there’s more baseload available than is needed, but when it comes to generation in the intermediate and peaking categories, New South Wales runs short.

Because intermediate and peaking demand varies, it’s important that supply is also flexible. In the short-term that means open cycle gas turbines and longer term energy storage will come into its own with batteries and pumped hydro able to respond best to quickly changing demand.

You can read Tim’s article explaining it all in more detail on LinkedIn.

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