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Key Findings

Paying power generators for their available capacity – on top of the energy they sell to the grid – could lock in high emissions from coal and gas-fired power plants, deter new entrants and add substantially to already high household power bills.

Capacity Mechanism Proposal will not solve the current problems facing the National Energy Market – as it will not provide certainty around coal exits and may lock in high emissions system for longer while discouraging new entrants 

So-called “capacity mechanism” payments are not the solution to supply and cost issues affecting the National Electricity Market (NEM).

Johanna Bowyer

Johanna Bowyer is the Lead Analyst for Australian Electricity at IEEFA. Her research is focused on trends in the National Electricity Market, energy policy and decarbonisation.

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