Grid renewal generates billion-dollar shock as costs of energy transition become clear

Australian consumers have been told to brace for big hikes in their power bills after a watchdog revealed the true costs of overhauling the grid to deal with the renewable energy transition. Key points: Experts say tens of billions of dollars in extra spending will be needed on poles and wires An economic watchdog has ruled in support of $1 billion in extra spending by WA's network utility Across Australia, network providers are tipped to seek big increases in funding to handle the renewable energy surge In a decision heralded as a landmark, Western Australia's economic regulator this month said the state's major electricity network provider should be allowed to spend $9 billion over the next five years – $1 billion more than it requested. Economic Regulation Authority chairman Steve Edwell said the draft decision reflected the urgent need for upgrades to Western Power's network to ensure it could handle the surge of renewable energy flooding onto the system. Biggest shifts at the small scale Under its draft determination, the ERA said Western Power's five-year spending plans to 2027 would be allowed to rise significantly compared with the past five years. Precedent 'doesn't go far enough' Matt Rennie, a partner at Brisbane-based renewable energy consultancy Rennie Partners, said he agreed with the need for increased spending on networks but doubted the ERA's decision went far enough.