Wind and solar technologies will be the cheapest ways to generate energy, it found, while small and large nuclear plants and coal and gas backed by carbon capture remain the most unaffordable solutions.
The CSIRO and the Australian Energy Market Operator (AEMO) released the findings in their GenCost draft report on Wednesday that analyses the cost of electricity generation.
It comes weeks after the Clean Energy Finance Corporation warned Australia needed to ramp up investments in renewable energy to meet its 2030 environmental target, and after the federal coalition formally abandoned plans to reach net zero by 2050.
The draft GenCost 2025-26 report analyses the capital costs of building and running energy projects and what emissions they could produce.
The report was designed to help the industry plan investments, CSIRO energy director Dietmar Tourbier said, and reveal the cost competitiveness of each technology.
"Under any scenario, there is a cost associated with the build of Australia's future electricity system," Dr Tourbier said.
"Through updating and publishing its data, its modelling and its cost projections every year, GenCost reflects the best available data in the most transparent way."
Solar and onshore wind technologies would be the cheapest forms of energy in 2030 and 2050, the report found, followed by gas, coal and offshore wind.
Small modular nuclear reactors would demand the highest capital costs, it found, followed by the use of black coal with carbon capture and large-scale nuclear reactors.
Investing in mature renewable energy projects would deliver the most cost-effective results, CSIRO chief energy economist and report co-author Paul Graham said, and in the shortest times.
"The fact is we don't have enough time now to build anything other than renewables just because of the development lead times," he told AAP.
"But even if we had time, it doesn't look like (new) gas or coal could actually compete at that average system cost."
The price of gas projects had also risen by 32 per cent in the past year due to demand for turbines, the report found, while the price of large-scale batteries toppled by 15 per cent, and onshore wind costs fell by five per cent.
Large-scale solar costs rose for the first time in three years – up by nine per cent.
The report also found it would "not be efficient to eliminate all emissions from the electricity sector" in a bid to reach net zero, as it would require more storage and more expensive fuels such as hydrogen.
Renewable energy projects could significantly cut emissions from the sector, Mr Graham said, before looking for cuts in other industries.
"You don't want to over-decarbonise your electricity sector if it's cheaper to do the abatement somewhere else but you don't want do under-abatement," he said.
"We've got to find this sweet spot."
