Report: Energy and Resources; Powering State Growth

In June 2024, the Queensland Futures Institute’s Energy and Resources; Powering State Growth Forum outlined Queensland’s ambitious plans to integrate renewable energy, focusing on the Queensland Energy and Jobs Plan. The discussion underscored the importance of collaboration between industry and government to achieve emissions reduction targets and maintain economic prosperity during the transition.

SPEAKERS

Kieran Cusack 
Chief Executive Officer, 
Queensland Hydro

Janette Hewson
Chief Executive Officer
Queensland Resources Council

Mark Scott
Chief Executive Officer
Hastings Deering

Keiran Cusack

• The Queensland Energy and Jobs Plan will require 6 gigawatts of long-duration
  pumped hydro storage, 25 gigawatts of wind and solar resources and a transmission
  super grid.
• Queensland Hydro already has two projects underway: Borumba – which is in EIS
  phase, with exploratory works to start after approvals – and Pioneer Burdekin, the
  business case for which is to be delivered to the government shortly.
• Pumped hydro is fast, flexible and reliable, providing secure power 24/7. This
  reliability is crucial to the renewable energy transition as variable renewable sources
  like wind and solar are deployed.
• Uruguay is an excellent example to illustrate how renewable energy targets can be
  achieved, given its population of 4 million and its history of oil and gas. The country
  has successfully integrated 100% of renewable energy into the system in only 10
  months – utilising pumped hydro, wind and solar, as well as a carbon tax.
• This level of renewable penetration requires a system with deep storage, variable
  renewable sources, and an efficient grid.

• Queensland has the world’s longest and stringiest grid – which makes integration complex.
• To maximise power system availability, Powerlink has the ability to work on live substations – a globally unique operational decision shared only with Electricité de France.
• The Queensland network was originally built to support 11 generating sites (coal and hydro), but now has over 74 generators across the state. This is a significant operational challenge.
• In its role, Powerlink has adopted innovative operational strategies, such as the Wide Area Monitoring and Protection Control (WAMPAC) system, to manage the grid more effectively. This allows circuits to be run at higher utilisation through credible contingent events such as lightning storms, switching in less than 160 milliseconds in order to maintain stability if a lightning strike occurs. Powerlink is again one of the first two operators globally to utilise this innovation – the other being Southern California Edison.
• Innovations like this help manage the grid’s increasing complexity and maintain stability.
• Powerlink has done well to enable renewables – exemplified by the state’s northern grid (above Mackay) having the highest renewable share globally – higher than Denmark.
• Given this high level of renewable market share, Powerlink has had to address new challenges in operating the grid due to complexities with inverter-based systems. This has led to innovations in system strength and system operations.
• Generators are also dealing with these challenges. For example, Vestas – a leading
  turbine manufacturer – pioneered a wind farm control solution for system strength
  with a Queensland wind farm, applying it across its global fleet. This demonstrates
  Queensland’s role in pioneering solutions for system management.
• Queensland also has the highest rooftop solar PV take-up rate in the world, which
  also presents network challenges.
• Powerlink engineers are continuously solving these complex problems, ensuring grid
  stability and enabling the integration of diverse renewable resources and new loads
  like green hydrogen.

Janette Hewson

• The resource sector will play a key role in this transition. Gas is currently needed for
  manufacturing – which will continue to be important given the Future Made in Australia
  initiatives – and steelmaking coal is used in electric vehicle production. We must
  ensure public understanding of the necessity of these existing commodities, as well as
  critical minerals, to reach net zero.
• Queensland is well positioned for critical minerals due to our existing resource sector,
  a skilled and highly paid workforce, and strong ESG criteria met by the
  state. Our state has strong mining and energy sectors and stringent environmental
  regulations, which boosts confidence in our ability to benefit from these opportunities
  and become a critical minerals leader.
• To meet global demand, 230 new critical minerals mines are needed by 2030. It
  currently takes 16 years on average from exploration to production, indicating we’re
  behind in starting critical mineral operations.
• Ensuring investment confidence is a key challenge to unlocking Queensland’s
  opportunities not only in traditional mining, but also in advanced processing to add
  value along the supply chain.
• Reliable, affordable, and sustainable energy is also critical for these ventures. For
  example, existing mines are major energy users who are demanding clean energy as
  they pursue decarbonisation. This is being met through electrification on site and
  through renewable energy agreements.
• Additionally, we must streamline project approvals to reduce the 16-year wait and
  enhance investor confidence.
• The development of the resource sector is vital for Queensland’s economy,
  government revenue, and employment – directly and indirectly supporting over half a
  million Queenslanders.
• The Queensland Resources Council emphasises policy stability to maintain investor
  confidence and capitalise on opportunities. Policy certainty and stability are critical for
  long-term investments; sudden changes without consultation deter investors.
• The right policy settings are critical to ensuring Queensland capitalises on the
  opportunities in the critical minerals sector.

James Harman

• The transition to sustainable energy is challenging, but Queensland is well placed to
  contribute to the global effort.
• One key challenge is providing renewable energy to those far from the grid, which
  includes many remote areas in Queensland. Traditionally, these off-grid areas have
  relied on unreliable diesel generators.
• EDL has played a key role in delivering hybrid renewable energy alternatives to
  remote communities and mine sites.
• When these projects were first started, this resulted in about 10-15% renewable
  energy for a mine site or remote community. Cannington mine was an early example
  of this, with the conversion of a diesel-fired power station to gas, and then the
  addition of a solar farm.
• In 2020, EDL developed the Agnew microgrid in Western Australia for a Gold Fields
  mine – integrating wind, solar, battery, and thermal backup to deliver more than
  50% renewables. This was also the first mine in Australia to be powered by largescale wind.
• As technology and EDL’s solutions have developed, and come down in cost, it has
  become possible to deliver projects that are over 80% renewables – while ensuring
  the lowest cost for new mining projects anywhere in Australia.
• This is enabling a different approach to managing electricity supply and demand,
  moving from a centralised model towards decentralised energy for communities and
  customers located away from the main grid via microgrids. These can deliver 75-
  80% renewables and can be more reliable than the grid.
• Policy change is critical to continuing to support these innovative solutions.
• These solutions are case studies for microgrids which should be considered in
  policy development in order to supply remote power across Queensland.
• Broader decarbonisation policy is critical to achieve 100% renewables; while we
  can get to about 90% renewables through solar, wind, battery, and some thermal
  backup, renewable gas or fuels can enable the final 10% for remote energy
  applications in communities and mines.
• As another example of innovation helping with the global transitions, EDL is also a
  producer of renewable natural gas – biomethane – in the US, where we have up to
  seven petajoules of capacity.
• Considering the difficulty in decarbonising and electrifying industrial processes,
  having an alternate to fossil fuel gas is critical. The use of renewable natural gas is
  widespread in Europe and North America, but not in Australia – given the supportive
  policy environment in these regions. This includes the Inflation Reduction Act and
  Renewable Fuel Standard – which has resulted in 70% of the gas used in transport
  in the US being renewable, compared to zero in Australia.
• Greater policy support will be required to unlock the bioenergy sources in
  Queensland, which could supply more than half of the domestic demand for gas in
  the state.

Mark Scott

• Hastings Deering has a 92-year history in Queensland, working in construction,
  resources and energy sectors.
• As an industry, we are ready for the ramp-up in construction needed for pumped
  hydro energy storage and renewable integration. This major opportunity for the
  construction industry should focus on long-term benefits for Queensland and the
  country, not just immediate needs.
• To achieve this, these projects require planning, coordination, resourcing and the
  right funding models to achieve success.
• Certainty and planning are critical for long-term investment and infrastructure
  development. To achieve this, we must ensure a well-planned pipeline of
  opportunities and secure our supply chains.
• Collaboration across the value chain is necessary to achieve the construction goals
  and unlock the state’s potential.
• Another critical enabler of this development will be continuous investment in skills to
  overcome ongoing skill shortages.

Keiran Cusack

• Queensland Hydro have launched a new campaign focused on education and
  awareness. This was in response to low levels of knowledge about Queensland
  Hydro and how hydroelectricity works in areas outside of those directly impacted
  by development.
• Queensland Hydro is also spreading information via a website to address this gap,
  providing more information about the Pioneer Burdekin project – including how
  hydro works and how it integrates into the system.

James Harman

• The Queensland Government’s decarbonisation initiatives are significantly
  contributing to this area.
• One notable initiative is the Queensland Decarbonisation Hub, launched in
  collaboration with universities, industry, government and communities. This hub
  promotes a collaborative approach to decarbonising the state, ensuring community
  involvement in projects like wind farms, solar farms, and hydro projects.
• Another significant policy is the Low Emission Investment Partnership, aimed at
  supporting mining, particularly metallurgical coal. This partnership invites industry
  collaboration to help mines decarbonise.
• For over 20 years, EDL has been converting waste gases from underground coal
  mines in Queensland into power.
• With government support, this fund will enable major miners in Queensland to
  undertake similar initiatives and advance their decarbonisation efforts.

Keiran Cusack

• Queensland Hydro considers how to achieve nature-positive outcomes, beyond
  just the immediate benefits from hydro. For example, we are looking for
  opportunities to exceed our base offset requirements and increase the protected
  area of national parks.
• While hydro has obvious benefits for decarbonisation and the reef in particular, we
  have an obligation to further contribute to ensuring positive local impacts as much
  as we contribute to the global impacts of decarbonisation.

Keiran Cusack

• Our project is quite distinct to Snowy Two, which has 27 kilometres of tunnels
  connecting two reservoirs, given our tunnels will be about three kilometres.
• The selected site is geographically advantageous for having very short tunnels,
  providing an advantage in reduced impacts and reduced risk for the projects.
• In terms of constructability, we are bringing in a highly skilled and talented team.
  To do this, we have established partnerships with Landsverkjun Power from Iceland,
  a state-owned operator of hydro that has been building them since 1939. We have
  also formed a relationship with Verbund, the Austrian generation entity with 8,000
  megawatts of generating capacity.
• This highlights how we are bringing significant expertise to help us craft the best
  plans to mitigate risk and overcome the types of challenges seen with Snowy Two.

•  Operating a power system with high levels of renewables without storage is
  complex. Given intermittency, this will involve some level of over-capacity – resulting
  in spilled output - to meet demand and State targets.
• As such, there is a clear role for storage, including batteries, to support the system.
  Batteries are currently economical for short durations – around two to four hours –
  while long duration storage solutions need further development and support.
• A key challenge is that we need to make storage decisions now, despite the
  uncertainty around potential future technological advancements. Operating in
  this environment will see those technologies which deliver the best economic and
  technical outcomes come out on top.
• Solar energy is rapidly increasing in the market, competing with coal-fired power
  generation. By the 2030s, this solar influx will require some coal generators to shut
  down due to material oversupply during daylight hours.
• As such, enhancing our ability to shift renewable energy through space (via
  Powerlink’s networks) and through time (via long duration storage) will be critical.
• Pumped hydro is currently the most cost-effective long duration storage solution.
  However, future options might include innovative technologies such as compressed
  air, various battery technologies, and flexible loads.

James Harman

• In deploying microgrid solutions, EDL is considering four-hour duration batteries,
  given significantly decreasing costs.
• For example, a few years ago, we replaced an old diesel-fired power station at
  Jabiru in Kakadu National Park, which supplied the Ranger uranium mine and the
  town of Jabiru.
• Our energy solution delivered 50% renewable energy to Jabiru, using solar, battery
  and diesel backup.
• If we delivered the same project now, we could deliver around 70% renewables at
  the same cost due to the reduced cost of storage. The battery cost curve is on a
  downward slope – and this is supporting innovative projects such as our
  microgrid solutions.

•  Any storage – including household batteries – is beneficial for the power system.
  Household batteries can help move solar power around, which has positive impacts
  for the local grid.
• However, household batteries need coordination, which can be challenging. This
  is exacerbated given the increasing average installation size of rooftop solar in
  Queensland – which is now 9.9 kilowatts.
• With these installations, a household battery – like a Powerwall – would likely fill
  up by 10:30 AM and be depleted by 7:30 PM. There is clearly further coordination
  required to better shift this energy throughout the day – but this may not suit
  the household.
• Larger batteries in electric vehicles may also contribute in this area. However,
  coordination implies some level of control by electricity utilities and this is,
  understandably, likely to be met with resistance by households.
• So for these reasons, and given the scale of the storage needed, both household
  and utility-scale batteries and other long duration storage assets such as pumped
  hydro will be essential to meet this need, both shifting power and also providing
  services like frequency control and system strength.
• We must deliver storage – no matter the scale – at an efficient price in order to
  effectively manage Queensland’s abundant solar resources.

As we undertake decarbonisation and the energy transition, how do we ensure we don’t miss out
on the economic prosperity previously delivered by a strong resources sector?

Janette Hewson

• Queensland has long relied on energy – including coal and gas, as well as exports
  to New South Wales and overseas – for its economic prosperity. As we transition
  away from these traditional energy sources, we must retain this prosperity in the
  decarbonised future.
• Last year, $18 billion in royalties came to the Queensland Government and to
  Queenslanders – highlighting the significance of this revenue source for
  the economy.
• Queensland is fortunate to have various energy options, unlike some of our Asian
  export partners who are also aiming for net zero emissions.
• From a geopolitical perspective, we need to ensure energy security. But we must
  also consider our role beyond our state in supporting a safe, reliable and prosperous
  region and world.
• The whole world is facing net zero challenges, and each country will approach
  this in different ways. Some countries rely on our exports to keep their lights on,
  especially those with populations much larger than ours.
• Queensland will therefore likely play a role in supporting decarbonisation across
  other economies. We must consider how to best leverage this opportunity as we
  pivot our own economy

Mark Scott

• Mining operations have pioneered cutting-edge technology. For example, autonomous vehicles are being developed by companies like Caterpillar for the industry, before being considered for public roads.
• There will still be a role for diesel engines for some time, with ongoing development to improve their efficiency. However, battery electric and alternate fuel technologies are currently being developed and advanced – which may eventually support transition.
• Large mining companies globally are starting to trial and publicly announce these new
  technologies. We are likely to see the results of these technological developments in the next few years once they are proven and adopted.

•  As leaders in the energy and resources industry, we have a long history of coordination, though it hasn’t always been seamless.
• The power sector and resources sector are closely linked - historically, one doesn’t function well without the other. This interdependence provides practical evidence of the coordination required and our ability to work together.
• Given this relationship, Queensland is well placed to coordinate effectively in achieving the
  state’s emission reduction targets.

James Harman

• There’s been a long history of cooperation and collaboration between the energy and
  resources sector.
• For example, the resources sector wants reliable, sustainable and cheap energy – and is now seeking sustainable energy to achieve this given renewable solutions are now cheaper than the old thermal solutions. This is a win-win situation as we can deploy renewables to help the resources sector decarbonise.
• However, beyond the electricity needs, there is a significant amount of work required to
  decarbonise transport and deliver broader electrification of processes at mines.
• The energy demand for this electricity is going to be very large – and will require solutions to produce and manage the energy required to supply this demand.
• Collaboration between the private and public sector will be required to achieve this.

Janette Hewson

• Collaboration within industry is a critical enabler of the transition.
• However, it is also critical for government to work with industry to overcome the challenges faced by the resources and energy sectors that have been discussed.
• Given the capability of businesses to solve problems, and set and achieve targets, the more we can leverage this knowledge through collaboration with governments at a federal and state level, the better.