Aurecon, which has advised on the 5 megawatt/3.3MWh battery energy storage project to be located in Alice Springs which Territory Generation sanctioned in June, surveyed more than 100 Australian energy sector and government executives asking: "If you were Australia's Chief Scientist, Dr Alan Finkel, how would you shape Australia's energy future?"
Unsurprisingly, the message from respondents was overwhelmingly that "the future of energy is up for design".
Aurecon's resulting report, The future of energy: Do Australians want the impossible from their energy system?, said skyrocketing power prices, closing coal plants and a lack of anything resembling a possibility of bipartisan policy meant the country's energy sector was "fraught with uncertainty".
While 62% of respondents chose a combination of reliability improvements, cost and emissions reductions which could not be technically delivered, while 62% believe industry needed to significantly improve reliability, while 52% said industry must exceed the government's current emissions reduction pledge.
A substantial 56% of respondents believed government has a role in targeted interventions to ensure energy reliability, price and energy objectives, while 31% believed government should act as a "fail-safe" mechanism if the market fails to deliver them.
While the upstream industry favours less intervention, only 7% of Aurecon's respondents agreed that government should completely step away from the energy market.
"The promise of the NEG is that by relying on the existing market mechanism, an invisible hand will almost magically lead us to the lowest cost outcome," Aurecon managing director, energy, resource and manufacturing Dr Alex Wonhas said.
"There is plenty of evidence to suggest that while the energy market is very good at guiding short-term decisions in the presence of low uncertainty and good information, eg the dispatch of generators, markets in general are not as well equipped to guide longer-term decisions, such as network investments.
"This means that Dr Finkel's approach for better long-term planning of our energy system will be as important as ever for the success of the NEG.
"Without the right network footprint, future renewable power stations are likely to be less efficient and more difficult to reliably integrate into our energy system. The market on its own will not fix this.
"In short, we need an honest and technically informed political debate that brokers a realistic compromise."
A balanced approach that combines the NEG's market based approach with better integrated plan for Australia's energy future was also needed, he said, which would make the NEG a vital component of a functioning energy system that delivers affordable, reliable and lower emissions energy for Australia.
Telling results
Since Dr Finkel issued his blueprint to help guide Australia towards those objectives, the COAG Energy Council has committed to 49 of his 50 recommendations, with the Clean Energy Target replaced by the NEG.
With the energy sector crippled after at least a decade of political tug-of-war, Aurecon's report concluded that a national "fact-based" dialogue was needed to reach a societal consensus for how to trade-off between cost, affordability and emission goals.
From this, state and federal and state governments can, with the utopian bipartisan approach, refine and adjust policy and market settings to reach those goals.
Once the direction is set and implemented, "we must stop meddling".
"A sector that requires multi-decadal investment decision does not cope with frequent major changes in direction," the report concluded, echoing the upstream sector's sentiment in that regard.
The consequences of not doing so would put Australia "far worse off", with higher costs, more interruptions and less emissions reductions.
"The cost, reliability and emissions compromise is unlikely to be the compromise that the majority would like to see," the report said.
"There is no alternative to fixing the system now."
