THE federal government and the power industry have massively overestimated the cost of renewable energy, according to new University of Melbourne research, commissioned by the the government's own Garnaut climate change review.

Forecasts prepared last year for the Department of Resources, Energy and Tourism as it helped plan the future electricity network suggest solar and wind power are far more costly than they actually are.

In some cases, rooftop solar panels are already cheaper than the prices they were predicted to fall to in the year 2030.

''If you make the international comparisons to the US Department of Energy and the IEA [International Energy Agency], Australia is really relying on information that's very out of date,'' said Patrick Hearps, a University of Melbourne research fellow.

''If you're looking at how we should be planning energy over the next 10 or 20 years, and you are using the data provided to the government, you are not going to be looking at large-scale renewables. You are going to be looking at gas as an interim measure.''