“The CSIRO, in its latest GenCost report, has finally admitted that a renewable-driven net zero target means higher prices for Australian families and businesses,” said Scott Hargreaves, Executive Director at the Institute of Public Affairs.
The CSIRO’s Final 2025-26 GenCost Report was released on Wednesday 15 July 2026. Following mounting pressure from the IPA and other experts, the CSIRO has, in this year’s report, included a revised methodology to estimate System Levelised Cost of Electricity (SLCOE) under different scenarios for Australia’s main electricity network, one better able to capture how increased wind and solar penetration actually drives up system costs.
IPA analysis of the CSIRO’s own data reveals:
- By 2050, achieving a net zero emissions target will be between 5 per cent and 39 per cent more expensive than abandoning net zero.
- The idea that wind and solar are the cheapest form of energy is based on flawed methodology.
- There is a trade-off between energy affordability and achieving net zero emissions by 2050.
“In 2024 the IPA identified at length the problems with the CSIRO’s application of the Levelised Cost of Electricity method, and has called for emphasis to be placed on the total system cost of electricity,” said Mr Hargreaves.
“The attempts to finesse a flawed model to recognise system costs are a step in the right direction, but the damage has been done.
“Flawed CSIRO modelling has already been weaponised by policy makers to justify an unachievable objective of 82 per cent renewable energy by 2030.
“The IPA remains of the view that attempting to transition the grid to wind and solar leads to a total system cost for electricity three to four times greater than that with existing traditional baseload supply.
“That is, the real costs of net zero are much higher than even what is admitted in this latest CSIRO report.”
Previous IPA research has found:
- The levelised cost of electricity measure fails to take into account the broader system cost of variable renewable (i.e., wind and solar) penetration of the electricity network.
- There is a trade-off between energy reliability plus affordability, and achieving the goal of net zero emissions by 2050.
- The system with the lowest total system cost is the one that we have, or at least had until recently, which is backed by existing baseload generators. The next lowest cost system is one built on new baseload power plants, whether they be coal or nuclear.
“Australia’s decision makers have deluded themselves for far too long, thinking that the CSIRO’s previous iterations of GenCost modelling were an accurate and reliable basis on which to design Australia’s energy future. And Australians have been misled on the true cost of wind and solar,” said Mr Hargreaves.
“The more wind and solar in the electricity network, the more expensive electricity becomes. The CSIRO’s sheepish admission of the flaws in their previous GenCost reports should just be the first step to urging policy makers to abandon net zero. Australians deserve better.”
To download the IPA’s research on the folly of the CSIRO’s reliance on LCOE accounting click here.
To download the IPA’s research on the system-wide cost of electricity by generation technology, click here.
