Why using a capacity mechanism to prop up coal and gas generators is a really bad idea
Paying power generators for their available capacity – on top of the energy they sell to the grid – could lock in high emissions from coal and gas-fired power plants, deter new entrants and add substantially to already high household power bills.
So-called “capacity mechanism” payments are not the solution to supply and cost issues affecting the National Electricity Market (NEM).
The mechanism would pay generators based on availability in periods where the system is “at risk”.
Issues with the capacity payment proposal
The government wants the mechanism to prioritize renewables, new entrants and storage yet the model in its current form does not do this. It proposes to pay all forms of generation capacity – both new and existing – and includes payments to coal and gas.
Coal-fired power …
More on: reneweconomy.com.au