Electricity generation in Australia, Part 4: NSW and VIC

The last in a series of posts looking at electricity generation in Australia. Part 4 profiles electricity generation in New South Wales and Victoria.

This is the fourth and final part of a series looking at electricity generation in Australia. You can also read parts one, two and three.

This post will provide an overview of electricity generation in New South Wales and Victoria over the last five years.

New South Wales:

New South Wales201520182019Change from
2015 to 2019
Black coal80.5%78.8%76.8%-3.7%
solar PV
Natural gas7.3%3.1%4.1%-3.2%
solar PV
Oil products0.4%0.5%0.5%0.1%
Change in 
from 2015 
to 2019

New South Wales* is the most coal dependent state in Australia, with black coal providing 77% of the state’s electricity generation. New South Wales is also the least reliant on gas of the mainland states, at 4%.

Almost 19% of the state’s electricity is from renewable energy, including 6% wind, 5% hydro, 4% rooftop solar and 2% large-scale solar. Biomass provides almost 2%. Overall, the state generates 9% more electricity now than it did in 2015.

New South Wales has had the most stable electricity supply make-up over the last five years, symptomatic of a lack of support for the renewable energy industry until very recently. The biggest changes have been the 3.7% decrease in coal and the 3.5% increase in wind. 

Total renewable energy generation in New South Wales bounces around year-to-year due to the state’s relatively high proportion of hydro generation. Hydro generation is heavily influenced by rainfall, which is variable.

From 2018 to 2019, wind and solar generation increased by 3.4% – a sizeable increase not far behind Victoria and Queensland. But total renewable energy generation increased by just 1.2%. The wind and solar increase was partly cancelled out by a 2.2% decline in hydro generation, due to low rainfall.

Conversely, there has been heavy rainfall in the first half of 2020, so it is probable that hydro will drive a sizeable increase in total renewable energy this year, even if wind and solar do not increase by much. 

So when analysing the renewable energy transition in New South Wales, it is best to exclude hydro generation to get a more accurate picture of the situation. 

Big changes loom in New South Wales. The state has the oldest coal power station fleet in the country including the 48-year old Liddell power station, which will shut during 2022 and 2023. The state government has also begun a process to enable a massive increase in renewable energy projects in the years to come. Clearly the stability of recent years is coming to an end.


Victoria201520182019Change from
2015 to 2019
Brown coal85.4%75.8%70.2%-15.2%
Natural gas3.1%6.3%8.3%5.2%
solar PV
solar PV
Oil products0.2%0.4%0.4%0.2%
Change in 
from 2015 
to 2019

Victoria sources a bit over two-thirds of its electricity generation from brown coal – it is the only state in Australia that burns brown coal. Wind energy is the second largest source of electricity at 11%, with rooftop solar providing 5%, hydro 2% and biomass and large-scale solar each providing almost 2%. Gas supplies 8%.

Victoria’s electricity sector has been turbulent in recent years. Victoria is the only state in Australia where overall electricity generation has declined over the past five years, down by almost 16%. This is primarily due to the sudden closure in 2017 of Hazelwood, Australia’s oldest and most polluting coal power station, which came just months after its owners announced the closure. 

This sent shockwaves throughout the electricity sector, which was unprepared for such a sudden withdrawal of electricity supply. This led to an increase in generation from all other energy sources (except hydro) while Victoria became increasingly reliant on importing electricity at times of high electricity demand from South Australia, Tasmania and to a lesser extent New South Wales.

Ironically, the supply impacts of Hazelwood’s closure have been compounded by climate change. Increasingly extreme heat waves in recent summers have driven up electricity demand whilst causing major breakdowns in Victoria’s remaining ageing coal power stations. Witness the enforced blackouts across parts of Melbourne in January 2019, when several of the state’s coal units broke down due to the extreme heat.

Victoria has a relatively high proportion of renewable energy at 21%, with strong increases in both wind and solar generation over the last five years. Wind and solar generation will increase further in the next couple of years as Victoria is currently the renewable energy investment capital of Australia, with more new projects scheduled to connect over the next 12 months than in any other state. Unfortunately, this also means that Victoria is suffering most acutely from onerous grid connection requirements on new renewable energy projects.

While the state is on track to exceed 50% renewable energy by 2030, Victoria continues to be grossly unprepared for another coal closure. I continue to think that an early full or partial closure of the Yallourn coal power station within the next five years is far more likely than generally appreciated ……but that is a topic for another post.

Data on electricity generation used in this post was calculated from the Federal Government’s Australian Energy Statistics – Table O, released in May 2020.

* For electricity generation purposes, the ACT is included in the total for New South Wales. The ACT has relatively little electricity generation within its borders but the local government purchases renewable energy to supply 100% of the ACT’s electricity consumption.

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