The Coalition and One Nation's assertion that scrapping Australia's net zero emissions target would lead to lower power prices is directly contradicted by the latest CSIRO GenCost report, which analyzes the costs of electricity generation technologies. The report, released annually, concludes that generation costs are likely to rise after 2030 regardless of net zero policy, and that nuclear power remains the most expensive option available.
Key Findings on Generation Costs
According to the CSIRO's chief energy economist and lead author Paul Graham, abandoning net zero does not open a low-cost pathway for electricity. “If we abandon net zero, that does not open up some low-cost pathway [for electricity]. As coal retires, you have to replace it. If that new thing is coal, we still have the same costs [of electricity generation] as we are expecting if we replace it with renewables,” Graham said. He added that delaying coal plant closures or building new coal plants would increase greenhouse gas emissions in the electricity sector, forcing more expensive abatement elsewhere.
The report projects that wholesale electricity prices, which account for about 33% of a retail bill, will likely stay below $100 per megawatt hour (MWh) in the near term but will rise as coal plants retire and new generation is built. By 2050, wholesale costs are expected to exceed $120 per MWh in all scenarios, with the highest costs associated with nuclear power. “We consistently find that nuclear is the most expensive option for electricity generation in Australia,” Graham noted, even when basing costs on South Korea's efficient nuclear deployment.
Current Market Context and Policy Debate
Electricity prices and energy policy remain politically contentious. The Coalition has abandoned the target of reaching net zero greenhouse gas emissions by 2050, while One Nation, polling close to Labor and above the Coalition, rejects climate science and would abandon the Paris agreement entirely. The GenCost report undermines their claims that ditching net zero would lower power prices.
Wholesale prices across the National Electricity Market (covering all regions except Western Australia and the Northern Territory) peaked at $189 per MWh in 2022 but dropped to $104 in 2025, according to the report. Graham said analysis of electricity contracts suggests prices will likely stay below $100 per MWh for the coming years, but the retirement of coal plants will push prices up. The report also notes that a boom in power-hungry datacentres in the United States is driving up gas turbine costs, while batteries are increasingly replacing gas for evening peak supply in Australia.
Components of Electricity Bills
The wholesale price of electricity constitutes only about 33% of a retail bill. Transmission via high-voltage power lines and towers accounts for 7%, local distribution through poles and wires for 34%, and metering, retail charges, and government programs make up the remainder. This means that changes in wholesale prices have a limited direct impact on consumer bills.
Graham emphasized the resilience of renewable energy and battery storage: “We have been tracking electricity costs for eight years and the market still surprises us. We are still delivering cost reductions in solar and batteries when the world is really unstable. It has made Australia far more resilient than a lot of people appreciate.”
