Decarbonization of Australia’s Energy System: Integrated Modelling of the Transformation of Electricity, Transportation, and Industrial Sectors

To achieve the Paris Agreement’s long-term temperature goal, current energy systems must be transformed. Australia represents an interesting case for energy system transformation modelling: with a power system dominated by fossil fuels and, specifically, with a heavy coal component, there is at the same time a vast potential for expansion and use of renewables. We used the multi-sectoral Australian Energy Modelling System (AUSeMOSYS) to perform an integrated analysis of implications for the electricity, transport, and selected industry sectors to the mid-century. The state-level resolution allows representation of regional discrepancies in renewable supply and the quantification of inter-regional grid extensions necessary for the physical integration of variable renewables. We investigated the impacts of different CO₂ budgets and selected key factors on energy system transformation. Results indicate that coal-fired generation has to be phased out completely by 2030 and a fully renewable electricity supply achieved in the 2030s according to the cost-optimal pathway implied by the 1.5 °C Paris Agreement-compatible carbon budget. Wind and solar PV can play a dominant role in decarbonizing Australia’s energy system with continuous growth of demand due to the strong electrification of linked energy sectors.