Australian Financial Review
Saturday 28/10/2006, Page: 6
The Victorian government gave the go-ahead on Friday for a proposed $600 million wind farm to be built by power giant AGL Energy, warning it would not be commercially viable under the state opposition's energy policies.
For the second time in a week, the government has launched a major renewable energy project it claims will depend on the Victorian renewable energy target (VRET), a $2 billion program that will require retailers to buy 10 per cent of their power from renewable sources within a decade.
But the state opposition, which wants to scrap the target and replace it with a fund paid for by coal royalties if it wins the election, has dismissed the targets as an expensive taxpayers' subsidy immaterial to providers' willingness to supply renewable energy.
The opposition, which welcomed the AGL announcement, has previously also criticised wind farms as heavily subsidised and divisive for many communities when inappropriately sited, such as in popular coastal regions.
The 183-turbine Macarthur Wind Farm in western Victoria near Port Fairy will be the southern hemisphere's largest, with a total capacity of about 329 megawatts, enough to power almost 190,000 homes a year, equivalent to the number of houses in a big regional city like Geelong, according to the government.
Planning Minister Rob Hulls, who earlier this year threatened to sue the federal government over its refusal to approve another wind farm in the state because of the danger posed to rare orangebellied parrots, warned the latest project would be jeopardised by opposition plans to scrap VRET.
Mr Hulls, who believes voter concerns about greenhouse gas and climate change will be a major issue in the November 25 poll, said nine out of 10 residents living in the vicinity of the wind farm were in favour, a turnaround from other recent proposals that sparked bitter opposition from communities that claimed the farms were an eyesore that reduced property values.
"The Liberal Party is opposed to renewable energy. Instead it wants to encourage clean coal with a policy that would not start until after 2011," he said.
Earlier this past week, Victoria and the federal government pledged $125 million to a huge experimental solar power plant in north-western Victoria. But Solar Systems, owner of the technology, warned that the project might have to be scrapped if there was a change of government at the November 25 election.
AGL managing director Paul Anthony said he was "delighted with the government's positive disposition towards renewable generation".
Liberal spokesman Denis Napthine said it was a "nonsense argument" that AGL was building the wind farm because of the VRET, which the government announced in July.
"Talks for this wind farm started four or five years ago.
VRET was not on the agenda. All parties were confident about size, efficiencies and viability on its own merits. In the meantime, there has been a lot of community meetings and discussions. This is a project that meets our requirements of having broad community support and is in an area that is suitable for wind farms," Mr Napthine said.
Last month, Pacific Hydro warned it would scrap hundreds of millions of dollars of wind power projects in Victoria because of the opposition's pledge to drop plans for the renewable energy scheme.
Garry Weaven, executive director of Industry Funds Services, owner of PacHydro, said its Portland development faced scrapping and the policy made contracts for wind farms difficult to find. He said getting purchase contracts from energy retailers was difficult for the Portland project because of the reduction of the federal government's scheme.
Key Points: The new wind farm will have a total capacity of about 329 megawatts. This is enough electricity to power 190.000 homes.
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