Business Case on the Nexus Between Energy Security and Emissions Reduction

In 2023, CNSWJO received funding from the Department of Regional NSW through its Business Case and Strategy Development Fund to develop a Business Case on the Nexus Between Energy Security and Emissions Reduction.

This important piece of work came about through discussions with member councils who expressed their concerns that their LGAs were being negatively impacted by capacity constraints and energy reliability issues in the electricity network in the area. The Central NSW region is an important contributor to the NSW economy, with prominent agriculture and mining industries, and a population of more than 180,000 people, but energy security and reliability issues are impacting residents and businesses and constraining future growth.

The Business Case found that of the region’s 30 distribution zone substations, one-third and their surrounding areas are currently experiencing:

  • Network constraints – where electricity demand exceeds the rated infrastructure capacity
  • Reliability issues – where supply interruptions in minutes are highest in the region.

Further, the traditional grid is not set up to accommodate Distributed Energy Resources (DER), like rooftop solar and battery storage. Investment in the electricity grid is not progressing quickly enough to enable DER integration without creating power quality issues or curtailing exports.

Several stakeholders noted angst and uncertainty directed at the roadmap to achieve net zero. People are concerned about the lack of community benefit from large-scale infrastructure, land use, noise and visual amenity. As a result, some communities have begun organising to oppose the development of renewable energy infrastructure.

Until firm renewable energy sources can meet demand, the market is relying on increasingly high-cost fossil fuel generation. These higher prices and volatility are being passed on to consumers through higher electricity tariffs and to large businesses in the form of volatile electricity market spot prices.

Through consultation with stakeholders during the development of the Business Case, multiple solutions were proposed and explored. The preferred option addresses not only current and future energy security concerns, but also supports emission reduction objectives and achieving state and national net zero targets. The preferred option recommends the development of the following infrastructure solutions:

A ‘business-as-usual’ approach to energy security and reliability in the region is simply not viable. Residents and businesses are bearing the burden of capacity constrained energy infrastructure and outages, constraining their growth and impacting the quality of their electricity supply. The preferred option will alleviate the issues identified and can be scaled to meet regional growth ambitions, improving energy security and supporting the achievement of local, state and national net zero targets. It is an imperative that action is taken and investment made to support the residents and local businesses of Central NSW.

The Business Case and its appendices are found in the links below: