This release addresses the recent media coverage of comments made by several parties about work Arche Energy has undertaken for two of our clients.
Key points
- Our work referenced by the Page Research Centre’s recent paper was completed in 2024.
- Our work for Coal Australia was a separate engagement completed in 2025.
- Our payments for the work we delivered to the Page Research Centre and Coal Australia were not contingent on the outcomes of the assignments.
- Arche Energy’s declarations of limitation and disclaimer are key instruments in our practice of corporate transparency.
- Our modelling assumed a 91% availability based on Aurecon’s report paid for by AEMO, 2023 Costs and Technical Parameters Review.
- Our cost of coal was based upon consumption of raw coal, which is significantly lower cost than seaborne coal.
- Our forecast does not dictate that under the “no net zero” scenario, new coal plants must be constructed, only that new generation plant must contribute to average, long-term energy prices being less than new entrant coal prices.
Work for the Page Research Centre
Our brief and methodology
In 2024, we were engaged by the Page Research Centre to provide estimates of long-term average unsubsidised power prices under four scenarios. The scenarios were:
- “No net zero”
- Technology-neutral “Low-carbon baseload”
- Current path: coal retirement replaced with renewables and firming
- Accelerated path: 100% renewables, no natural gas firming.
Under each scenario, we:
- identified a mix of power supply technologies that would be most competitive under that scenario
- calculated an estimate of the average cost of generation from that mix of technologies
- used that estimate to calculate a likely long-term (e.g. years), average, unsubsidised, wholesale power price.
We then assumed that, in an efficient market and over the long term, energy prices would trend towards the minimum price required for the most competitive technology.
Our findings — the nuance
Under the “no net zero” scenario, the most competitive technology was new coal-fired power stations fed by raw coal from adjacent, low-strip-ratio mines, known as a mine-mouth power stations. Our modelling for “no net zero” also forecast that competitive renewables projects, particularly rooftop solar, would also proceed.
Our forecast does not dictate that under the “no net zero” scenario, new coal plants must be constructed, only that new generation plant must contribute to average, long-term energy prices being less than new entrant coal prices; otherwise, they will not be competitive against the threat of new entrant coal.
In the other three scenarios, different mixes of technologies were most competitive. For example, under the “Current Path” scenario, we forecast that long-term average prices would trend towards the average cost of a mix of solar and wind, firmed with gas.
Why our coal cost estimates are different from others’
While most of Arche’s cost estimates were similar to those estimated by other parties, our estimate for the cost of coal generation was substantially lower. Here’s why:
- We used international benchmarks for capital costs from recent projects in India and China, which we adjusted for Australian conditions and Australian costs.
- We used a lower land and development cost.
- We used a cost of coal based upon low-strip-ratio raw coal that is otherwise stranded from the international market (e.g. a Surat Basin location without access to port).
We otherwise used methods and assumptions similar to those used by other parties.
Other context
We did this work in 2024. It does not account for any price changes since then. Particularly relevant are the costs of battery energy storage system (BESS) and gas turbine equipment.
We were not consulted in relation to the Page Research Centre’s November 2025 paper, Delivering a High Energy Australia, nor were we approached by the National Party prior to their recent announcements.
Work for Coal Australia
In 2025, we were engaged by Coal Australia to estimate the cost of power generated by a hypothetical new mine-mouth power station. The method we used was similar to that used in our work for the Page Research Centre, with updated benchmarks and more refined mining costs.
Commercial relationships with clients
We accept engagements regardless of the stated or assumed political agendas of clients, provided that we are paid and our independence is respected; in doing so, we do not endorse the political or policy positions of our clients.
Our payments for the work we delivered to the Page Research Centre and Coal Australia were not contingent on the outcomes of the assignments.
Arche Energy’s declarations of limitation and disclaimer are key instruments in our practice of corporate transparency. In them, we declare who pays us for our work, and the parameters, assumptions, and methodologies on which each piece of work is based. Such a declaration is part of all of our deliverables, from techno-economic reports to engineering plans and drawings.
Background to contested figures
The “availability factor” of a power generating operation, such as a solar farm or power plant, is how often it can technically produce electricity over a given period, expressed as a percentage of total time. For example, a solar farm can only produce power when there is sunlight and would expect an availability factor of around 30%.
In modelling for both of these reports, Arche Energy used an assumed availability factor for new mine-mouth coal of 91%. Commentators have opined that this figure is overstated. We took this number from the report that Aurecon delivered to AEMO as part of an engagement, 2023 Costs and Technical Parameters Review. The 91% figure is simply the midpoint of Aurecon’s estimate of 89% to 93%. As we needed to identify the most competitive version of each technology for analysis, we did not apply any economic curtailment.
In Minister Bowen’s short video statement made a few days ago, he compared our cost estimate of the cost of mining raw coal with the November 2025 price of seaborne coal, that is, coal that has been prepared and loaded onto a ship. Preparing coal for export requires washing coal, transporting it by rail to a seaport, terminal operations, and loading the coal onto ships. In our experience, these costs account for between 60% and 70% of the cost of seaborne coal.
Quotations attributable to CEO of Arche Energy Andrew Murdoch
“Decisions about our energy future are always a balance of tension between cost, reliability and emissions factors. Unfortunately, these trade-offs are constantly overshadowed in our public discourse by the over-politicisation and over simplification of energy policy. This is true of all sides of politics.”
“I urge my fellow Australians and our leaders to look beyond binary viewpoints and take the time to understand the complex physics and economics of supplying energy to the community, the impacts of energy costs on our broader economy, and the contribution of energy supply to climate change.”
“I appreciate that our estimate of the cost of power produced by a new coal power station may be uncomfortable; however, irrespective of where one sits on the political spectrum, it is in all of our best interests to be accurately informed when making decisions that will significantly impact our future as a nation.”
ENDS
Media contact
Sarah Jansen
Director of Corporate Affairs
sarah.jansen@archeenergy.com.au
+61 408 875 577