Recent debates around electricity prices and renewable energy policy have ignored the crucial factors of rapidly dropping solar technology costs, and the critical risks involved in continuing with 'business as usual'. Going solar is the first economic assessment of future electricity price shocks if fossil fuels continue to dominate. The report takes a close look at Australia’s electricity price security and singles out rising gas prices and more frequent droughts as key risks. Prices for gas-fired electricity are now linked to volatile international fuel prices. Water scarcity reduces supply from water-cooled coal plants, pushing up wholesale electricity prices. Without stable policies to support renewable energy, we risk future bill shocks of up to $250 a year for the average household, plus supply interruptions.
Embracing the shift to renewable energy – a line powerfully supported by trends in the USA and China – can reduce vulnerability to electricity price shocks and energy insecurity. Rising popularity and rapidly falling costs put rooftop solar at the leading edge of this change, threatening traditional electricity business models.