AEMO approves more grid connections as project log-jam grows

afr.com:

The Australian Energy Market Operator says it has approved more project capacity to connect to the grid this year than last, as governments rush to reach ambitious renewable energy targets by the end of the decade.

While regulators have been accused of not keeping pace with the rate of the transition in the energy sector, AEMO said 6.8 gigawatts of new capacity was approved in 2022-23 – a 63 per cent increase on 2021-22.

Large-scale projects, such as solar farms, take time to connect to the grid. 

But the market operator acknowledged there were barriers for energy projects trying to connect to the grid.

“Common issues currently reported to be impacting construction timelines include the need to refinance projects, long lead times for equipment and the need to change original equipment manufacturers,” AEMO said in its latest quarterly update.

New applicants to join the NEM have to work through myriad approvals during the connections process, which includes application, pre-registration, registration, commissioning and model validation.

AEMO said 30 gigawatts of new capacity was progressing through the connection process in the second quarter of this year, 5GW more was approved in the same quarter last year.

In the current quarter, AEMO also received an additional 16 new applications, totalling 3.9GW to commence the connection process.

It said in Q2 this year, there was 10.3GW of projects at various stage of construction or pre-registration, compared to 6.5GW in Q2 last year.

The AEMO update also revealed wholesale power prices had increased 31 per cent in Q2, despite a glut of wind and solar power during the day.

While electricity prices have not returned to the records of last year – which forced thetemporary suspension