A recent report by the Centre for Independent Studies has sparked debate, revealing Australia's energy market as the world's most volatile. Senior policy analyst Jude Blik attributes this volatility to Labor's renewable energy push, which has led to a series of concerning outcomes. The report, titled 'Risky Business', highlights the transition's impact on consumer prices, retailer failures, and market competition. Wholesale energy prices in Australia have surged, with prices in Queensland reaching $34 per megawatt-hour and soaring to $96 in Victoria, a quarter-on-quarter increase of over $90. This surge is further exacerbated by a hidden cross-subsidy, where non-solar households effectively subsidize those with rooftop solar panels. Mr. Blik emphasizes the dramatic rise in extreme price events, from 18 in 2012 to over 600 in 2024, leading to increased costs and risk for retailers. This volatility undermines the certainty needed for long-term power market decisions, potentially harming investment in wind and solar projects. The report also suggests that the government's Capacity Investment Scheme and the Nelson review's recommendations may inadvertently subsidize these projects, shifting the burden to taxpayers. This controversial interpretation invites further discussion on the implications of Australia's renewable energy transition.
