Energy market analysts Cornwall Insight has forecast that Australia’s National Electricity Market (NEM) will add 150 GW of solar PV, wind and energy storage capacity over the next two decades to fill the gap left by the ongoing exit of coal-fired power.
According to the United Kingdom-headquartered group’s NEM Benchmark Power Curve report, the total installed capacity for solar, wind, and energy storage technologies is expected to rise from 52 GW in 2025 to 208 GW by 2043, representing a 300% increase.
Cornwall predicts that solar technologies, including rooftop and utility-scale solar, will lead the increase, with the group expecting 78 GW of PV to be added in the NEM over the next two decades. Wind energy is expected to reach 39 GW, with energy storage capacity forecast to reach 40 GW.
Cornwall Senior Modeller Thomas Fitzsimons said the projected increase in solar, wind and storage capacity across the NEM will see the larger states “follow South Australia’s lead as pioneering, high-renewable penetration systems.”
“Our forecasts show the NEM will go through a significant transformation over the next two decades, as both state and federal governments work towards their renewable energy targets,” he said.
Despite the positive predictions, Fitzsimons warned that there are still a number of hurdles, including concerns around workforce shortages and “other bottlenecks”, that need to be overcome if the clean energy transition is to go smoothly.
Fitzsimmons said these concerns have led Cornwall to project a longer operating life for Australia’s coal-fired power plants than that outlined by the Australian Energy Market Operator (AEMO) which has forecast that the last of the NEM’s coal generation units will be shut down by 2038.
Cornwall however said coal-fired power could be extended beyond this date with question marks over whether the necessary renewable infrastructure will be built quickly enough to replace lost capacity.
“Labour constraints limit the rollout of the new technologies and the unglamourous but essential network reinforcement projects which Australia needs,” Fitzsimmons said.
“We have to be realistic. That said, with robust government policies and well-structured investment frameworks to broaden the technologies on offer in the NEM, the path to a greener future will become clearer and more attainable.”
The projected 150 GW increase comes just days after AEMO revealed that more than 45 GW of new capacity is currently progressing through the connection process from application to commissioning, a 36% increase compared to Q3 2023. This capacity included 14.6 GW of battery projects, an 87% increase on the same time last year.
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