The NSW Electricity Strategy is the NSW Government’s plan for a reliable, affordable and sustainable electricity future. Meeting these objectives involves a three-layered approach:

First, the NSW Government will support the market to deliver reliable electricity at the lowest price, while protecting the environment. Firmed renewables are now the most cost-competitive form of new generation and cost less than the current wholesale electricity price. The economics of today’s technologies create the opportunity for market forces to deliver on the NSW Government’s three objectives for the electricity system. This Strategy supports the market by reducing barriers to entry for new generation, through an Energy Security Safeguard that ensures the rollout of cost
effective energy savings measures and through a framework that ensures the construction of new generation to replace existing power stations.

These measures are expected to reduce household bills by $40 per year, leverage $8 billion of private investment, mostly in regional NSW; maintain the electricity system’s reliability over the long-term; and improve environmental outcomes. This Strategy is estimated to result in 1,200 new jobs, most of which are expected to be in regional NSW.

Second, the NSW Government will set an Energy Security Target to ensure that the State has sufficient generation capacity to cope with unexpected generator outages during periods of peak demand, such as during heat waves.

As electricity generators age, they become less reliable. For example, the Liddell power station had 31 planned and unplanned outages in 2018.

For this reason, the NSW Government will aim to have sufficient capacity to cope with the two largest generating units in the State being out during a one in ten year heatwave. This target will ensure that the State has a resilient electricity system.

The target will work as follows: if a capacity shortfall is forecast and there is a real risk that the private sector will not address that shortfall, the NSW Government will take action to address this.

Third, the NSW Government will ensure the State has sufficient powers to deal with an electricity
emergency, if one arises.

This document provides a summary of the Strategy. It does so in five parts: Part 1 explains how the electricity system works; Part 2 explains the trends and challenges that are shaping the electricity system; Part 3 sets out the work that is already underway to address the system’s challenges; Part 4 sets out the Strategy; and Part 5 explains how the Strategy will meet the challenges posed in the years ahead.

Read the full report here.

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