'Power giants to hit out at renewables'

Australian
8 September 2011, Page: 2

THE electricity industry was planning a "massive assault" to undermine government policies to promote billions of dollars worth of investment in wind farms and other renewable energy technologies, Greens senator Christine Milne has warned. Senator Milne's comments to a renewable energy conference in Brisbane this week coincide with a fresh call by Origin Energy for the government to reconsider the timing of its target of 20% renewable energy by 2020. Meeting the mandatory renewable energy target is expected to drive a frenzy of investment in renewable energy between 2015 and 2020 but Origin Energy boss Grant King said it was unlikely to meet a key aim of promoting a range of technologies.

This was because development of geothermal energy had been slower than expected and wind turbines continued to enjoy a cost advantage over large-scale solar. New curbs of wind farm developments in Victoria and possibly NSW could make solar more attractive but they would raise the cost of meeting the 2020 renewable energy target, Mr King said. Calling on the renewable energy sector to speak out, Senator Milne said an electricity industry backlash threatened many of the so-called "complimentary measures" negotiated by the Greens to secure their support for the federal government's carbon tax that will be introduced into federal parliament next week.

This includes the $10 billion Clean Energy Finance Corporation, which is designed to kick start investment in alternative energy projects. Mr King told The Australian his firm did not object to the renewable energy target but said policy interventions needed to be well designed. "It's worth at least asking the question; is it the best thing to hit 20% by 2020?" Mr King said. "If all of the mandatory renewable energy target is going to be met by wind it is debatable whether the scheme is meeting one of its original objectives, which was to encourage a variety of technologies". Origin Energy covers the full spectrum of electricity generation with big investments planned for coal seam gas and wind power.

Mr King has upset many in the sector by likening community concerns of coal seam gas to those that have led to a crackdown on planning policies covering wind farm developments. He said some environmental groups that had campaigned heavily against other forms of energy development had "overlooked the concern" regarding wind and "not supported that concern in the same way as they had on other projects". Mr King has previously suggested the 2020 target be pushed out to 2025. But he said it was unlikely that any change would be considered while the carbon tax was making its way through federal parliament. Wind power is currently the lowest cost option for electricity companies to meet their obligations under the mandatory renewable energy target.