South Australia blown away by wind power this week

Clean Energy Council
6 Sep 2012

South Australia's blustery conditions this week had one positive: wind power provided more than half of the state's power on Wednesday, according to the Clean Energy Council. Clean Energy Council Policy Director Russell Marsh said data from the Australian Energy Market Operator (AEMO) showed that 55% of all the electricity used by South Australians yesterday was generated by the state's wind farms, which were spinning flat out all day long.

"In the early hours of Wednesday morning, there was a peak where 80% of the state's power came from the wind and South Australia exported some of its energy to Victoria. Then early on Monday morning a record was broken when just over 85% of power came from the wind.

"According to AEMO, in the 2011 12 financial year almost a quarter of the state's electricity was generated by wind farms. This has led to a corresponding drop in generation from coal and gas plants, with wind generating more energy than coal for the first time. "South Australia has proven once again that wind power can generate real power-and lots of it", he said.

Mr Marsh said the data showed that emissions from South Australia's power sector had fallen every year since 2005 06 and had reduced by more than 27% over the last five years. "All this wind is putting South Australia well ahead of the curve on Australia's 20% Renewable Energy Target, and helping to provide farmers and local businesses in regional areas with extra income. "It also means the state's residents collectively have a lower carbon price bill, while getting fully compensated by the Federal Government under the scheme".

Fast facts:

• On Wednesday 5 September, 55% of SA's power came from wind farms
• A record 85.5% of power came from the wind early on Monday 3 September
• 24.2% of the state's power came from the wind in the 2011-12 financial year. Coal use dropped by 9% over the same period
• Emissions in South Australia have dropped by 27.4% over the last five years.

Energy policy needs a jump-start

Business Spectator
Tuesday 4/5/2010 Page: 1

If there is a sense of deja-vu in the clean energy industry it is because many feel they have been here before: the year 2010 is starting to bear an unsettling resemblance to 2004. That was the year the Howard government decided not to expand the extraordinary successful renewable energy target. It was a decision that brought the industry to a crashing halt, emptied factories and drove Australian and international companies back overseas in search of greener pastures. Which they readily found.

Six years later, the industry has reconvened - a host of local and international developers, manufacturers, financiers and project managers - and is ready to party like its 1999, when the impact of the initial MRET was in full swing. It is, in the words of AGL Energy CEO Michael Fraser, the potential dawn of a new era of energy investment, with billions of dollars of investment and thousands of jobs, and a pathway to a clean energy future.

What's more, he said. It's a global phenomenon. Even Kuwait has a 5% renewable energy target. It's inconceivable that Australia would not follow. But can Australia get its act together to properly legislate its 20% target, the last leg standing of the Rudd government's climate election package? No-one's prepared to spend much until they know for sure. Senator Penny Wong made her first appearance since her three year campaign to establish a carbon price was sequestered indefinitely by a PM possibly fearful that the issues are far too complex for a twitter election campaign. She managed to talk for 20 minutes without mentioning the ETS. Indeed, her speech might have been a compilation of Energy Minister Martin Ferguson's cleanest press releases, a succession of grant initiatives that are long on promises but so far short on delivery.

But her rhetoric was eerily similar to that in the lead-up to the CPRS debacle. The opposition is divided, the government will negotiate, but only what is fair and reasonable, it is a test of the opposition's commitment to climate change, etc, etc. But its capitulation on the CPRS means the government is not in a position of strength. In an election year it needs runs on the board, and projects to announce. The opposition might not be of a mind to help.

That would be devastating for the local clean energy industry. Little wonder than the local market is taking an each-way bet on the legislation getting passed, with the price for renewable energy certificates currently at $45, halfway between the $60 peak when the Labor government first declared its 2020 target, and the $30 nadir reached when the market suddenly realised how poorly conceived the initial legislation had been.

Other nations won't wait In the light of this uncertainty, the first day of Clean Energy Council's annual conference followed the course of most such gatherings in Australia, it marvelled at the policy initiatives and the massive progress in clean energy development elsewhere in the world, which took off in 2004 just as Australia's was shutting down, rising from around $US46 billion to $US180 billion in 2008. In 2010, after a blip caused by the GFC, it will be more than $US200 billion.

The extra incentive for nations in Europe, along with China and the US, to act with such purpose is not so much concern about climate change, as the threat to energy security, and the fears of energy poverty. In Europe, governments do not want to rely on unstable neighbours to guarantee supply, and would spend some €1.8 trillion over the next two decades.

In the US, the combination of two issues - a carbon constrained world and energy security - was creating a "sweet spot" in energy policy, according to Todd Glass, an energy specialist from the US legal firm Wilson Sonsini. Although he noted that one of the perverse outcomes of the disastrous oil spill in the Gulf of Mexico could be the end of bipartisan support for the new clean energy bill. The carrot to buy enough Republicans had been Obama's concession on increased offshore oil drilling. That, though, is now a political hot potato.

In China, said Philip Hirschhorn, the head of Boston Consulting's sustainable development practice in the Asia Pacific, energy policy was being targeted to drive industrial policy, and to provide for a looming energy deficit. The scale of the development is enormous, and in just 5 years Chinese companies had displaced Japanese rivals and now accounted for 5 of the top 6 rankings in solar module manufacturing. "We all need to sit up and take notice," Hirschhorn said.

Billions slipping through our fingers

Business Spectator
Wednesday 28/4/2010 Page: 1
28 Apr 2010

It may take until the next election to judge if the decision to abandon attempts to forge a sensible climate policy and a carbon price for another three years is sound politics. But two things should already be abundantly clear: it's not good for the environment and it's very bad for business.

Exactly what's at stake for the business community was made clear earlier this year by US Republican Senator Lindsey Graham, the co-sponsor of a now stalled bipartisan attempt to forge consensus on climate policy in Congress: "Six months ago my biggest worry was that an emissions deal would make American business less competitive compared to China," he said in a now often quoted remark. "Now my concern is that every day that we delay trying to find a price for carbon is a day that China uses to dominate the green economy." There's no reason to suppose it's any different for Australian business.

A survey produced by the UN Environment Program and the think-tank AccountAbility last week estimated the low carbon economy was likely to generate revenues of several trillion dollars by 2020, and any country wanting a share of that market would need to develop the appropriate policy settings.

The survey found that nearly half of the 95 countries that make up 97% of global economic activity had actually strengthened their climate change and clean energy policies despite the failure of Copenhagen. Chief among these were China, of course, along with South Korea, Japan and a host of European nations.

But, it noted, in North America and Australia, "there is a telling mismatch between citizen concerns and price signals, and divergent views within the business community and in politics." Little wonder, then, that in compiling a list of the top ten green giants in the global economy, the US-based website Greentech Media earlier nominated the Chinese Communist Party in number one position. Positions 2 to 10 were filled with the likes of General Electric, Siemens, Nissan, Wal-Mart, Cisco, Veolia, Dow Chemical and Panasonic - all well established sprawling conglomerates.

This is the key difference between the cleantech boom and the internet boom that preceded it. As Greentech Media noted, green technology essentially involves revamping the physical infrastructure of the modern world: replacing coal-fired power plants with wind turbines, building homes from materials concocted in chemistry laboratories, and swapping out engines for electric motors. It said established companies are simply in a far better position to muster the capital, technological depth, managerial expertise and factory capacity that will all be needed to make the transition.

What they all want and demand of their governments is the policies that can facilitate that transformation. China has no such inhibitions, but other countries rely on a political accord and market-based incentives. The fact that Australian business has been so poorly served on the policy front was lamented by Origin Energy CEO Grant King earlier this month, when he correctly predicted that Australian politicians did not have the stomach for the debate and any policy initiatives would be effectively on hold for another electoral cycle.

That's bad for business because not only does it not provide any motive for transformation - an issue highlighted by the report by the Grattan Institute last week - it also means that no long term decisions on energy infrastructure can be made, and any attempts to meet Australia's renewable energy and emission reduction targets would only be achieved with quick-fix and more expensive solutions - raising costs for the public and undermining the competitiveness of Australian business.

As Business Spectator noted as far back as May last year, the Rudd government has sought to play wedge politics with its climate policy, but in the end managed to wedge itself and Australian business, who now have no tools whatsoever to drive the investment they know they need to make.

But Australian business can hardly complain. They have only been visible when industry groups and lobbyists for the heaviest emitters generated scare campaigns in their fight for increased compensation, which in itself will likely to prove futile given the likely shape of the next parliament. There has been precious little of the coordinated campaigns such as the US Climate

Action Partnership, a coalition of bodies including green groups and big business such as GE, GM, Ford, Shell and Siemens. Australia, as the world's largest emitter per capita, has the most to do and the least time to lose. But it hasn't even had the strength of purpose to deal with the easy bits yet.

SA: Save energy, save tax

Independent Weekly
Friday 18/12/2009 Page: 26

New renewable energy projects in South Australia will get big tax breaks, says the State Government. From July, next year, investors in large-scale renewable energy projects will get payroll tax rebates for the labour associated with direct, on-site construction. Rebates will be set at a maximum of $5 million for each solar project and $1 million for every wind energy project and will remain in place for the next four years.

"I expect the effect of this rebate will be to provide a payroll tax holiday for most, if not all, new wind farms over the four-year period." Premier Mike Rann said in a statement released from the Copenhagen climate change summit. "It will also provide significant relief for investors in large-scale solar energy projects."

The premier said the investment incentives would help SA reach its target of having 20% of all electricity generated from renewable energy by 2014 and 33% by 2020. "The Government recognises that these goals will not be achieved by only the attractiveness for investors of our excellent renewable energy resources alone," he said. "An important part of our success has been implementing regulatory regimes that provide efficient and certain processes for investors."

Smiling assassins: how Rudd is killing renewable energy

Crikey.com.au
Monday 23/11/2009 Page: 1
Author : Mark Diesendorf

Despite strong and consistent public support, renewable energy has been held back for decades by Australian governments. They have done this with a combination of token support on the public stage and decimation behind the scenes.

The principal feature of John Howard's tokenism was the tiny mandatory renewable energy target (MRET), a certificate system the gave a subsidy to generators of renewable energy. MRET was so keenly supported by the new clean green industries, that the 2010 MRET target was essentially reached in 2006 and then Australia's nascent wind turbine manufacturing industry went from boom to bust. Factories making wind turbine components in Wynyard, Tasmania, and Portland, Victoria, were shut down. Before the 2007 federal election, Rudd Labor promised to change all that.

Its election commitments for renewable energy included an expanded Renewable Energy Target (RET), the Renewable Energy Fund (for demonstration and dissemination), the Energy Innovation Fund (for research), the $8000 rebate for residential solar electricity, and an emissions trading scheme. Voters were also led to belief that several existing schemes - - such as the Remote Renewable Power Generation Program and Citi Investment Researches for Climate Protection - - would be continued.

Eighteen months after Rudd Labor was swept into office, partly on the strength of its promises for renewable energy, every one of these promises and reasonable expectations had either been broken, or delayed in implementation, or only funded to a negligible degree. Here, I focus on RET, which was finally passed into law in August 2009, over a year after it could have been implemented. Its official aim is a worthy if modest one: to lift renewable energy's contribution to 20% of Australia's electricity by 2020. However, the scheme is designed in a way that ensures that this goal cannot be achieved in practice.

The first design flaw, pointed out before the scheme was put before parliament, is that a large proportion of the target will be taken up by solar and electric heat pump hot water. While these technologies deserve support, it should not come from inclusion in the RET. With existing subsidies, the main barrier to solar hot water is not an economic one, but rather the requirement by many local governments that solar hot water must have planning permission.

The second major design flaw of the RET is that, under the Solar Credits Scheme, each residential solar electricity system that is installed is counted as if it contributed five systems, one real and four "phantom", to the target. Although the phantom systems will be phased out by mid-2015, by then the damage will have been done. Together with solar and heat pump hot water, the phantom solar electric systems will have taken up the vast majority of the RET and the subsidies that come with the renewable energy certificates (RECs) generated by the RET.

It is difficult to believe that these fundamental design flaws were a result of incompetence alone. One result is that there will be few if any RECs available for large-scale wind energy and bioelectricity from crop residues, the two lowest cost of the new renewable electricity technologies. Another result, already causing consternation among renewable energy businesses, is that the price of RECs will fall and so the large-scale renewable energy technologies will not be able to compete with dirty coal power. Several wind farms currently under development are now facing bankruptcy.

The remaining manufacturers of wind turbine components, such as Keppel Prince, are on the point of laying off many workers. The Condong and Broadwater bioelectricity power stations, which burn sugar cane residues, are said to be making big losses. The solutions to this situation are simple. The federal government should remove solar and heat pump hot water from the RET and should immediately stop counting phantom RECs as contributing to the target.

State governments should ban local governments from requiring planning permission for the installation of solar and heat pump hot water. Thus we can have solar hot water, residential solar electricity and large-scale wind energy and bioelectricity. However, we would still need a separate scheme to build the market for large solar energy stations. Based on European experience, the best mechanism is feed-in tariffs.

Dr Mark Diesendorf is deputy director of the Institute of Environmental Studies at UNSW and author of Climate Action: A campaign manual for greenhouse solutions.

Clean power in the wind

Weekend Australian
Saturday 6/6/2009 Page: 7

Renewable energy projects could create thousands of construction jobs, writes Keith Orchison
ONE of Australia's leading renewable energy companies says the enlarged zero emissions power generation target proposed by the federal Government will stimulate about $25 billion in infrastructure investment and create tens of thousands of jobs in the next decade, many in regional areas.

Rob Grant, chief executive of Pacific Hydro, which has plans for 600MW of projects costing $2 billion, says its own developments alone will "create thousands of jobs" in areas such as road building, concreting, steel fixing and steel fabrication. He says the jobs that can be created if the Government's RET legislation is processed quickly are those that may be now under pressure because of the global financial crisis and are "easily transferable" from sectors such as mining.

The Government proposes a new target for renewable energy of 20% of Australian power consumption by 2020 and aims to support the scheme with a $65,000 per gigawatt hour charge on energy retailers who fail to take up their quota of the target.

On the basis that national electricity demand will rise to 300,000GWh a year by 2020, and allowing for 9500GWh of supply under the Howard government's MRET scheme, plus 15,000GWh of generation by hydro-electric plants (which don't benefit from the scheme), the target for new renewable energy will be about 35,000GWh annually at the end of the next decade.

Support for the view that this, and other carbon policy plans, will lead to a surge in renewable energy development comes from the latest electricity review published by the Australian Bureau of Agricultural Resource Economics. The ABARE study reports the present policy situation saw just two windfarms completed in the past year: Pacific Hydro's $130 million addition of 58MW to its Portland operations in Victoria and Acciona Energy of Spain's $400 million project.

The 192MW Waubra development is the largest in the southern hemisphere and contains 192MW of turbines spread over 170 sq km of rural Victoria. ABARE also reports that seven more windfarms are at an advanced stage of development in South Australia, Tasmania, NSW (to feed electricity to Canberra) and Victoria. They will have a total capacity of 603MW and cost up to $1.5 billion.

Looking ahead, ABARE says there are 9.4GW of renewable energy plants on the drawing boards for Australia in various stages of feasibility study. More than 8.2GW of this capacity will be constructed in windfarms: 11 in NSW, 20 in Victoria, two each in Queensland and Western Australia and 15 in South Australia. The largest in this category is the Silverton Windfarm near Broken Hill in NSW, with a planned capacity of 1GW, proposed by German developer Epuron, and, if built, it will cost $2.2 billion. If it goes ahead, it will be one of the largest in the world and easily the biggest in the southern hemisphere.

Another big development is under consideration for Cooper's Gap in Queensland by AGL Energy and Windlab Systems. Located 65km south of Dalby, it could have a capacity of 440MW, operating as many as 250 turbines, and cost $1.2 billion.

A critical factor in the delivery of this massive increase in remote generation over the next 10 years will be the capacity to build new high-voltage transmission lines to connect the wind turbines and other renewable plants to the grids delivering power in eastern Australia and the southwest of Western Australia, where the main loads are found. It is estimated that some $4.5 billion will need to be spent on transmission, also creating hundreds more jobs.

Mark Diesendorf, deputy director of the Institute of Environmental Studies at the University of New South Wales and a prominent advocate of renewable energy, has expressed disappointment that the federal budget made no provision for new and strengthened transmission links to support windfarms and other clean energy developments.

If the federal Government upgraded the transmission lines linking South Australia to NSW and Victoria," he says, "wind energy capacity could be greatly augmented, and a commitment to a new high-voltage line to link the geothermal region in north-east South Australia to the main grid would also he valuable."

$20 billion of renewable investment ready to go

Clean Energy Council
17 December 2008

NATIONAL: The Clean Energy Council today welcomed the release of draft legislation outlining the rules for a 20 per cent renewable energy target (RET) by 2020. This has been a fundamental objective of the Council. The Council thanked the government for confirming its 2007 election promise and reaffirming its commitment towards the rapid development and deployment of the nation's renewable energy sector.

The Renewable Energy Target has the potential to unlock more than $20 billion worth of zero emission, clean energy investments and create thousands of new green job opportunities across the nation. "This policy has been a long time coming and we're relieved to see draft legislation tabled sooner rather than later," said Chief Executive Matthew Warren. "It represents an important step towards investors being able to bank new projects which deliver immediate emissions reductions ahead of the gentle ambitions of the carbon pollution reduction scheme."

Mr Warren said the draft RET legislation had introduced a number of novel policy initiatives which have not been discussed with industry. These pose a number of serious concerns about the effectiveness of the proposed legislation and its ability to provide the crucial development pathway and investor certainty for the industry.

"The task at hand now is to clarify these issues and find solutions to ensure that the government delivers on its election promises." "This draft legislation impacts on the future of the entire renewable energy industry. It is critical we get this legislation right to ensure the industry has the confidence to begin investing as soon as possible."

The 20 per cent (45,000GWh) by 2020 renewable energy target goes beyond the existing mandatory renewable energy target (MRET) originally set at 2 per cent (9,500GWh) and which has since resulted in over 6,500 gigawatt hours of new clean energy generated this year. The draft RET legislation is available for public download at www.climatechange.gov.au/renewabletarget

New modelling shows sun can shine on Australian solar power

Clean Energy Council
21 November 2008

NATIONAL: Australia is in a strong position to develop a thriving national solar industry over the next 20 years, according to a report into the renewable energy sector released today by the Clean Energy Council (CEC). The report, undertaken by Access Economics, provides a compelling economic case for the implementation of a gross national feed-in tariff in Australia.

"What this shows is that with the right policy and investment, there's a strong future for sustainable and profitable growth in Australia's renewable energy sector," said CEO of the Clean Energy Council, Matthew Warren. "Australia's share of the global solar market has fallen from seven per cent in 1992 to one per cent in 2007 - despite having the highest average solar radiation of any country in the world, Australia significantly lags behind other countries in its investment in the solar industry."

The report shows a gross national FIT would drive investment in solar PV systems by the commercial and residential sectors, assuming 3,000 MW of capacity is deployed, of up to $17.9 billion over the next 20 years (NPV at 5.7 per cent). Solar industries in other countries that have adopted a national gross feed-in tariff have developed strong industries that encourage take-up of solar through consumer earnings and cost savings.

"The report shows a gross feed-in tariff will be the trigger for strong investment - and growth - in the solar sector," Mr Warren said. "This kind of policy in Australia could help reduce residential and commercial demand for energy and help deliver electricity on hot sunny days when it is the most valuable. "As a result, the modelling suggests solar energy can defer investment in gas-peaking plans".

The Access Economics report records the sharp increase in deployment of solar panels in Australia since 2007 when the increased federal government rebate triggered increased awareness and affordability of the technology. The report also states Australia's carbon pollution reduction scheme (CPRS) and mandatory renewable energy target (MRET) may be insufficient to drive significant investment in the solar sector.

"A gross feed-in tariff is entirely complimentary to a CPRS and a 20% MRET, but it's important to note that currently, less than one per cent of the MRET comes from solar sources," said Mr Warren.

Renewable energy fund fizzles

Australian
Monday 17/11/2008 Page: 20

INVESTMENT in Australia's renewable energy sector has failed to take off, totalling just $3 billion in the eight years since the scheme was introduced. Modelling by the Energy Supply Association of Australia estimates that a $23 billion investment in renewable energy will be required to achieve the federal Government's goal of doubling the market share of renewable energy from 10 per cent to 20 per cent by 2020.

Uncertainty over interim mandatory renewable energy targets (MRET) beyond 2010, which is slated to be announced in early 2009, has been the key reason for investment in the sector stalling, according to "2020 Vision", a new report from Ernst & Young on the investment challenges and opportunities of meeting the target.

The MRET was initially set to reach 9500 gigawatts by 2010, but the federal Government has since vowed to increase the target to 45,000GW by 2020. But it has not revealed its interim targets for the increase in energy from wind, biomass, geothermal and solar sources.

Adding to the regulatory challenges confronting the industry, E&Y strategic growth markets leader Jon Dobell said increased finance costs due to the global financial crisis were also likely to impact on the viability of some 'cleantech" projects. The International Energy Agency's 2008 Outlook, which was released last week, found modern renewable technologies would grow "most rapidly, overtaking gas soon after 2010 to become the second largest source of electricity behind coal".

But it noted that shifting the energy mix to reduce carbon emissions required "much more investment in energy-related infrastructure and equipment". Mr Dobell said investment in Australia would need to step up a gear for domestic renewable targets to be met. To achieve the 2020 target of 20 per cent (market share), more than half of all new electricity generation capacity installed in Australia until then will need to be renewable, requiring about $23 billion in investment," Mr Dobell said.

"Only about $3 billion has been invested in the renewable energy sector in Australia since mandatory national targets were first introduced eight years ago so this is a huge increase." As the clock wound down on meeting the MRETs, the attractiveness of renewable energy investment in Australia's states and territories is also set to dramatically change, the 2020 report found.

Despite capturing the lion's share of renewable energy investment over the past seven years, South Australia, the traditional seat of renewable power, was "about to lose its crown" because of grid transmission capacity constraints, while the unexploited wind resource and available transmission capacity made NSW the "'next frontier" for renewable energy investment.

"A relatively lower underlying electricity price in NSW in the past due to excess baseload capacity has impeded the viability of renewable energy projects," the report says. "However, increasing coal prices, the introduction of emissions trading and increasing construction costs for new fossil fuel plants are likely to negate this in the future."

Western Australia, where the electricity market is not physically connected to the other states, was deemed the most attractive state for investment in large-scale renewable energy projects in the short term because of its "excellent" wind resources along the southwest coastline near population centres and because planned of upgrades of the electricity transmission line from Perth to Geraldton, which would support renewable energy infrastructure.

Although Queensland, Victoria, NSW and Tasmania are all physically linked through major transmission interconnectors and operate under the National Electricity Market (NEM), the report found that differences in regulation and the range of operators and distribution infrastructure limited trade between regions and created a variety of electricity prices which "can affect a state's attractiveness for renewable energy projects".

Renewable energy crown slips to WA

Adelaide Advertiser
Monday 17/11/2008 Page: 48

IT has been the nation's renewable energy sector leader for the past seven years, but South Australia is about to lose its crown, a report says. A slow-growing electricity market and a need to upgrade transmission lines will put the brakes on future growth, according to Ernst & Young's renewable energy sector report, released today.

"SA has captured the lion's share of new renewables investment during the past seven years since mandatory renewable energy targets commenced, moving from near-zero renewables in its electricity supply to 17 per cent," it says. "In many respects, it serves as the MRET success story and beacon of what's possible for the rest of Australia." Ernst & Young SA regional managing partner Mark Butcher said other states were now following the lead set by SA.

"The challenge is to attract and retain our share of renewable energy funding going forward,' he said. Mr Butcher said much of SA's renewable energy resources were remote, such as the massive geothermal energy resource more than 3km underground in the Cooper Basin which was 500km from the nearest transmission infrastructure.

"The challenge is to move the power from where it's generated to the markets," he said. Ernst & Young's Jon Dobell said SA had led the nation in wind-power generation. Western Australia will be next.

Tasmania feels the power pinch

Weekend Australian
Saturday 8/11/2008 Page: 3

IT'S not easy being green even if you have been in the renewable energy business for almost a century when you have to contend with the weather. The drought, considered the worst in Australia for 100 years, would have had a dire effect on the country's greenest state, Tasmania, if it were not for a fortuitously built link to the mainland, ironically to the country's highest greenhouse gas emitting power system.

Three years of low rainfall have severely tested the state's government-owned Hydro-Electric Corporation, which trades as Hydro Tasmania. Chairman David Crean, noting that the generator's dam storage levels had fallen below 20 per cent for the first time in 40 years, acknowledges that it is the controversial Basslink high voltage transmission line across Bass Strait that has enabled his business to "keep on the lights" and sustain employment in Tasmania's energy-intensive manufacturing industry.

In 2007 Tasmania imported more than 1,900GWh of electricity across Basslink, built by Britain's National Grid Company for $780 million and recently sold to Singapore's CitySpring Infrastructure Management for more than $1.2 billion, a significant amount in a state where annual consumption sits just under 10,000GWh. Only 618GWh flowed north last year.

Without Basslink, a development which the Greens and others opposed bitterly, "Tasmania would have faced the prospect of winter power restrictions with inevitable negative impact on the economy," chief executive Vince Hawkesworth says. Rescue has come at a substantial cost. Hydro Tasmania spent more than $100 million in 2007-08 buying power from Victoria and gas to run a small power plant at Bell Bay in the state's north.

Hydro development, says David Crean, has been crucial to Tasmania's development in the 20th century, with the corporation building up its water-driven generation resource to 50 dams and 29 power stations providing a capacity of 2615MW and an asset value of $3.4 billion before the hydro construction period came to an end in the 1990s in a nation-rocking controversy over the eventually-banned Franklin River project.

Today more than 80 per cent of Hydro Tasmania's water storage is in two dams the Great Lake, Australia's largest natural freshwater lake in the Midlands, and Lake Gordon in the south-west wilderness area.

Hydro Tasmania is by far the largest contributor to Australia's existing renewable energy generation producing more than 8000GWh a year compared with less than 4000GWh annually from the Snowy system out of a national total of almost 14,000GWh. All the hydro power together, however, adds up to barely 6 per cent of Australia's electricity supply.

Existing hydro-electric schemes are specifically excluded from the mandatory renewable energy target scheme, but the new MRET provides Hydro Tasmania with opportunities to upgrade and augment its generation and to build wind farms. The corporation is investigating adding 1000GWh annual capacity to its system at a cost of $400 million "under the right market conditions."

Moderation way to go: retailer-generator TRUenergy

Age
Monday 29/9/2008 Page: 2

THE Federal Government needs to adopt a moderate emissions reduction trajectory, and support for a renewable energy target must be maintained, says energy retailer and generator TRUEnergy. In its submission to the emissions trading green paper, TRUEnergy says incentives need to be provided to encourage renewable energy investment on top of the Government's commitment to start its carbon pollution reduction scheme in 2010.

The Government has committed to extending its mandatory renewable energy target scheme (MRET) to require that 20% of Australia's electricity supply conies from renewable energy sources by 2020. TRUEnergy managing director Richard Mclndoe told BusinessDay he would wait for Treasury to release its economic modelling next month.

But he said a trajectory similar to government adviser Professor Ross Garnaut's 10% reduction in emissions by 2020 would be appropriate. TRUEnergy has matched the Government's commitment to reduce its emissions by 60% by 2050. Mr Mclndoe said the uncertainty around an emissions trading scheme had made it difficult to get funding for low emissions investment. "For the last 18 months it has been almost impossible to get any traction with board and bankers in investing in large capital projects because we don t know what the trajectory is going to be and we don't know the price," he said.

"It is starting to compromise the viability of those new investments because if you wait too long your existing assets start to deteriorate." He said it was unreasonable to expect generators to turn around their emissions profile immediately after the Government's white paper is published at the end of the year. "A moderate trajectory would be the sensible policy because you have MRET which is bringing that new technology into the market," he said.

AGL buys into geothermal explorer Torrens

Australian
Thursday 10/7/2008 Page: 20

AGL Energy has agreed to buy a stake in geothermal exploration company Torrens Energy, potentially expanding its renewable energy portfolio to include power generated from hot rocks. AGL, Australia's largest gas and electricity supplier, will pay $2.2 million for a 9.99 per cent stake in Perth-based Torrens. The companies have also agreed to jointly develop geothermal projects close to the national electricity grid.

Under the agreement, AGL will have the right to earn 50 per cent of any geothermal resource project identified by Torrens in return for funding the drilling of a well, estimated to cost about $10 million. AGL's competitors have also been busy investing in hot rocks. Origin Energy and Woodside Petroleum have recently invested in GeoDynamics, a geothermal energy company that is testing the transformation of heat into electricity from underground rocks in the Cooper Basin in South Australia.

AGL managing director Michael Fraser said geothermal energy was an emerging renewable technology that would complement the company's existing projects in hydro and wind and could help it meet the federal Government's Mandatory Renewable Energy Target scheme (MRET), which would require energy companies to source an increasing proportion of their power from renewables.

"If successful, geothermal energy could play an important role in meeting AGL's longer-term renewable energy obligations," Mr Fraser said. AGL's renewable energy generation assets now comprise about 40 per cent of its generation portfolio. Torrens, which listed in 2007, has been granted a large geothermal tenement holding in areas close to Adelaide.

Earlier this year, it completed exploration drilling in an area north of Port Augusta and found temperatures of more than 200 degrees Celsius at about 4000m depth which it says is well within the range required for hot rock commercial power generation. AGL shares closed up 52c to $14.32 yesterday while Torrens rose 6c to 41.5c.

Retain MRET, urges union

Australian
Monday 23/6/2008 Page: 2

THE coal workers union has written to Climate Change Minister Penny Wong urging her to stick with the Government's policy for a Mandatory Renewable Energy Target against a rising tide of advice that the emissions trading regime could make it superfluous.

The MRET, which requires 20 per cent of energy to come from renewable sources by 2020, is intended as a way of boosting renewable technologies to commercial scale in the medium term, while the price imposed on carbon is still so low that they would not be otherwise competitive.

But both the Productivity Commission and the government's adviser on climate change policies, Roger Wilkins, have suggested the Government would be better off relying on the Emissions Trading Scheme alone, rather than such "market distorting" initiatives.

Now the Construction, Forestry, Mining and Energy Union (CFMEU) has written to Senator Wong urging her to ignore this advice, arguing that a low initial price on carbon would encourage energy supply from gas, but do nothing to develop technologies that were necessary to deliver the tar deeper cuts in emissions that will have to be made in the future.

If we remove the renewable target it will result in a substitution of gas for wind power and other forms of renewable energy," wrote CFMEU mining and energy division general president Tony Maher.

"While that will result in a lowering of our average emissions it does not help to prepare the economy and the energy supply industry for the medium to long term." Mr Maher said the Government might even need to be more interventionist than the present plans for the MRET assume, assigning specific targets for emerging renewable technology such as geothermal and solar thermal, which would otherwise be squeezed out by proven and cheaper renewable technologies like wind power.

Mr Maher's industry does not stand to benefit from the MRET, but is lobbying Government to set up a separate target for electricity generated with Carbon Capture and Storage technology. The Government has not responded to this suggestion. As The Australian reported recently, Mr Wilkins, who is reviewing Labor's climate change policies to complement an Emissions Trading Scheme, has questioned whether the MRET is the best way to force a shift to renewable technology.

His comments came after the Productivity Commission also questioned the wisdom of an MRET operating alongside an emissions trading regime. And the Government's climate change adviser, Ross Garnaut, has emphasised the need to phase out an MRET quickly, once an Emissions Trading Scheme is up and running. The federal Opposition wants the MRET to be replaced with a Clean Energy Target, which would include clean coal technology and gas, but the CFMEU does not support this approach.

Development extension for Vincent North Wind Farm

Yorke Peninsula Country Times - Kadina
Tuesday 15/4/2008 Page: 7

As Pacific Hydro considers its options in regard to the development of the Vincent North Wind Farm, District Council of Yorke Peninsula has granted the company a further two-year extension to the development authorisation originally approved in October 2003. Currently, the 132kV line serving Yorke Peninsula is at capacity and, until the capacity constraints are resolved and the electricity transmission infrastructure upgraded, this project and others like it are likely to remain on hold.

"While Pacific Hydro remains committed to the project, currently the company's resources are focused on their Clements Gap Wind Farm, with construction to begin shortly," Communications Manager Emily Wood said. Clements Gap will be the first wind farm to begin construction as a result of the Federal Government's commitment to increase the Mandatory Renewable Energy Target (MRET) in Australia by 20% by 2020, and will be Pacific Hydro's first wind farm in South Australia.

Located in the Barunga Ranges, Clements Gap Wind Farm will have 27 turbines; while the generators will be supplied by Indian company Suzlon Energy, all other components have been sourced from South Australian suppliers. "We are excited about this project, which has had strong support from the local community," Ms Wood said.

Winds of change

Adelaide Advertiser
Saturday 12/4/2008 Page: 18

THE amount of wind power generated in South Australia is expected to more than double by the end of next year. More than $1.1 billion worth of investment has been committed to projects either under construction or slated to start this year. Four projects are expected to be completed, or ramp up to full electricity production, during this year. Once all projects were complete, South Australia's wind power generation capacity would increase from 387 megawatts to more than 850mW.

This follows a year in which Australia lagged the world in the installation of new wind generation capacity, with just 7mW of new generating capacity installed in 2007, the Global Wind Energy Council said in its annual report, released this month. This increase, of less than 1 per cent, lagged the 27 per cent increase in installed capacity worldwide. It follows six years of growth from just 32mW of wind power in Australia in 2000, to 824mW in 2007. The largest of the new South Australian projects, the 159mW Lake Bonney Stage Two project, owned by Babcock and Brown Wind Partners, is already generating power.

It was expected to be finished in the middle of the year. That project involves 53, 80m high turbines generating a maximum of 3mW each. The first turbine at TrustPower's 88mW wind farm at Snowtown was installed in December and all 47 turbines are expected to be up and running by September. Transfield Services's Mount Millar Wind Farm, which has been operating since February, 2006, will also reach its full capacity in the second half of this year.

Pacific Hydro has started building its 27 turbine Clement's Gap project close to Port Pirie, which is also expected to be operational next year. AGL is planning to build a 34 turbine, 71mW project at Hallett Hill, 170km north of Adelaide, which will be operational late next year. Hallett Hill 1, also known as Brown Hill, is nearing completion, and will contribute 95mW. The slowdown in investment last year was due to the Federal Government's Mandatory Renewable Energy Target scheme reaching capacity.

Under the scheme, electricity generators were committed to buying 9500 gigawatt hours of power (about 2 per cent of national demand in 2001) from renewable sources per year by 2010. As the scheme filled up, the viability of some new projects, such as a 39 turbine project 30km southeast of Clare, was called into question. Tasmanian company Roaring 40s put that $180 million project, the Waterloo Wind Farm, on hold in 2006. Clean Energy Council general manager, policy, Rob Jackson, said the policies of the previous Federal Government caused the slowdown in investment.

"As early as 2004, MRET was considered to be basically full and not a lot of new generation was needed," Mr Jackson said. "Schemes to spur investment in Victoria and New South Wales had been announced, but only Victoria had a legislated target, which had led to a lot of localised new investment and activity in 2007. "And while South Australia had a 20 per cent renewable energy target, there was no specific policy in place to deliver that. "Last year on the back of that, with the uncertainty leading up to the federal election investment slowed down quite quickly.

Mr Jackson said the Federal Labor Government's policies were expected to reinvigorate the sector "driven by the Federal Government's intention to increase MRET to 45,000 gigawatt hours (by 2020) and on top of that to bring in the Emissions Trading Scheme." "There's potential for billions of dollars in new investment that will create thousands of jobs in regional Australia, particularly in the manufacturing sector. Along with the environment, many regional communities will benefit from these policies." The GWEC report indicates the tide has already started to turn.

"While there were only three new project commitments during 2007 - amounting to $740 million of investment - the 2008 outlook is rosier. Significant wind capacity is moving through the project planning stage with over 400mW of projects receiving planning approval during 2007. State Energy Minister Patrick Conlon said the success of the wind energy sector was evidenced by the recent heatwave in March, when at times more than 10 per cent of the state's power was supplied by wind turbines.

Labor renewable energy plan `will cost economy $1.5bn'

Australian
19/03/2008 Page: 8

LABOR'S plan to dramatically increase the mandatory levels of renewable energy will cost the economy $1.5 billion and drive up power bills by 6 per cent. According to new economic analysis from the gas industry, Labor's Mandatory Renewable Energy Target of 20 per cent by 2020 is unnecessary and will crowd out cheaper ways to cut greenhouse emissions, making electricity more expensive.

The analysis conducted by consultants CRA International for the Australian Petroleum Production and Exploration Association claims an emissions trading scheme due to start in 2010 could on its own deliver the same greenhouse gas cuts, but at a lower cost. This contradicts an economic analysis released last year by the renewable energy industry that claimed the MRET will stimulate growth and jobs and make electricity cheaper by creating an oversupply in the national energy market.

The Mandatory Renewable Energy Target promised by Labor during last year's federal election campaign has been criticised as populist and inefficient by the gas industry and major emitters, who argue it will quickly become redundant as emissions trading becomes fully operational. In the interim report released last month by the Government's key climate change adviser, Ross Garnaut, he warned that the MRET would drive most abatement cuts in the early years of an emissions trading scheme. He is still to report on the interaction between the two systems.

Professor Garnaut will release a discussion paper on key design principles for a trading scheme tomorrow, ahead of the Government's green paper in July and the release of draft legislation in December. Treasury modelling on the full economic cost of different levels of abatement is also expected to be released in July. Climate Minister Penny Wong is already working to fold existing state renewable energy schemes into the national target, and a working group will report to the Council of Australian Governments meeting next week.

Department of Climate Change officials have been meeting power industry representatives in a push to map out a strategy to prevent price volatility and supply instability from the big shift to renewables. APPEA chief executive Belinda Robinson agreed there was a need for a range of strategies to complement a national carbon trading scheme, including accelerated development of clean energy technologies.

She said the mandatory targets threatened to undermine the Government's commitment to ensuring the lowest-cost greenhouse abatement for the economy. Opposition environment spokesman Greg Hunt said the report endorsed the Coalition's call for a clean energy target that included gas and other technologies. We need all the low emissions measures to be on the table." he said.

$350m wind farm roaring

Launceston Examiner
Saturday 23/2/2008 Page: 1

THE future of the $350 million North-East Wind Farm at Cape Portland has finally been secured. The Labor Party's Mandatory Renewable Energy Target of 20 per cent by 2020 has given Roaring 40s the impetus to proceed with its Musselroe Project, and more projects across Tasmania are under investigation as the 12-year race to provide more environmentally sustainable power begins in earnest.

Roaring 40s Oceania construction manager David Mounter said yesterday that work should begin on the North-East project later this year, with Danish-made turbines to be shipped into the State later next year. Civil construction will begin first to prepare for the 80m towers, which are topped with blades that span 90m. Each tower is made up of 12 truckloads of material. Roaring 40s put in its development application to Dorset Council in 2004 and gained approval for up to 80 turbines, which will generate 140MW into the State's grid.

That is more than the Woolnorth project in the far North West, which generates 125MW. It will be more than enough power to provide electricity to 140,000 homes. Mr Mounter said the project would take two and a half years to finish and a peak workforce of 120 was anticipated. Mr Mounter said between $50 million and $80 million would be pumped into the Northern Tasmanian economy as a result of the project. "A few plans just need to be approved by State and federal environment regulators but we don't envisage any problems with them.," Mr Mounter said.

"We always had confidence that it would be built but we just didn't know when. The timing has been good with the federal target because our (council) permit hasn't expired." Confirmation of Roaring 40s dedication to Tasmania comes after the Labor Party promised during the federal election campaign that it would step-up the MRET after the previous Howard Government refused to extend it from the initial 2001 target of 9500 gigawatt-hours.

Kevin Rudd's plan will see that figure grow to 45,000 gigawatt-hours. The Musselroe project accounts for only 0.1 per cent of what is anticipated to be produced by 2020. No other development applications have been submitted for more wind farms across the State, but Roaring 40s staff were investigating a range of options.

"At the moment it's a case of `that's a windy hill' and `that's a windy hill'," Mr Mounter said. "Our wind data collection slowed down as the MRET scaled down and now that that is winding up again we are looking at our next reasonable option. "There would need to be a year's worth of wind monitoring, it would take a year to put together a DA, that can take a while to get approval with the comment phase and then it would take one year to get to construction, so any new farms are at least three years away." Victoria and South Australia were other states that the company would look into, Mr Mounter said.

Wind generation, the ability to connect to the electricity grid via Transend and environmental constrains would need to be taken into account for all new projects. Transend would need to upgrade its facilities at Woolnorth and Musselroe if those two wind farm projects were to expand any further. Roaring 40s also has two 50MW wind farms operating in China, with nine more under construction.

Blowing strong after Rudd promise

Australian Financial Review
Friday 8/2/2008 Page: 34

Excitement has increased in the wind energy sector since the Federal Government said it planned to raise Mandatory Renewable Energy Target levels to 20 percent of Australia's forecast electricity demand by 2020.

So far, Origin Energy and Macquarie Capital Group have said they are teaming up with Epuron for separate projects and AGL Energy has signed an agreement with Meridian Energy, while Pacific Hydro is considering a number of options including a partial float to free up capital and fast-track wind farms and other clean energy projects. Hong Kong's CLP Holdings (which owns TRUEnergy) and AGL are thought to be interested in buying a stake in Pacific Hydro, while international wind players active in Australia such as Germany's Conergy (which owns Epuron) Spain's Acciona (which was the underbidder for Pacific Hydro when IFM bought it in 2005) and New Zealand's Meridian Energy would potentially be interested.

Those who could be interested in a Pacific Hydro stake were a trade sale to take place include Macquarie Group, Babcock and Brown, Allco Finance Group, Transfield Services and the infrastructure divisions of Australia's big four retail banks. According to JPMorgan, AGL has plans for wind farms at Brown Hill (South Australia), Mallett Hill (SA) and Macarthur (Victoria); Origin Energy for Cullerin Range (New South Wales), Conroy's Gap (NSW) and Snowy Plains (NSW); and Babcock and Brown Wind for Lake Bonney II and Capital (NSW). JPMorgan analysts have also noted that wind contributed 45 percent of the renewable energy certificates created under MRET in 2007.

$135m wind farm ready to go ahead

Adelaide Advertiser
Wednesday 6/2/2008 Page: 49

SOUTH Australia will play host to a new $135 million, 57-megawatt wind farm to be developed by Melbourne based renewable energy company Pacific Hydro. The wind farm at Clements Gap - 250km north of Adelaide, close to Port Pirie - will be equipped with 27 windmills supplied by India's largest wind generator manufacturer, Suzlon Energy, under a new agreement signed yesterday. By 2009, the wind farm is expected to power 25,000 households.

The wind farm is the first for Pacific Hydro and is also the first to start construction since the Federal Government committed to increase the Mandatory Renewable Energy Target to 20 per cent by 2020. "South Australia has got an excellent wind regime, streamlined approval process, good transmission lines and there is community support for the Clements Gap project," said Pacific Hydro's chief executive Rob Grant.

SA-based Consolidated Power Projects Australia will begin civil works at the wind farm this April. With construction tipped to take 18 months, the windmills are likely to arrive at Port Adelaide late this year or early next year. Mr Grant said the encouraging policy environment was behind the company's investment decision. "Labour's policy on MRET gave us and the retailers certainty to proceed with the project," Mr Grant said. The project had received planning approval in 2005, but the lack of a supportive policy environment had held back investment decisions. "A 20 per cent renewable energy target is expected to drive more than $20 billion in new investment across Australia." Mr Grant added.