West Australian
1 July 2011, Page: 6
Carbon tax totalling $2 billion a year will be put into a renewable energy fund to drive a 17 fold increase in Australia's use of clean power, in a key Gillard Government concession to the Greens. The West Australian understands the fund will be managed by an independent commission and provide seed funding for solar, wind and other clean energy projects. But proponents of clean energy generation projects part funded by the scheme would be expected to repay the investment over time, once the project becomes commercially viable.
The renewable energy fund has been one of the Greens' key demands in climate change negotiations which are nearing conclusion ahead of an announcement within a week. In tandem with greater emphasis on renewable energy, the multi party climate change committee is believed to have agreed on offering financial incentives for the nation's dirtiest coal fired power stations to close or switch to gas. Three brown coal power stations in Victoria Hazelwood, Yallourn and Loy Yang and South Australia's Playford B power station will be the top targets for early closure or retrofitting to gas fired.
It is also understood the committee has agreed to a starting carbon price that is much closer to $20 than $30 in an acknowledgment that a "soft start" is crucial for the Government. Treasurer Wayne Swan yesterday revealed that renewable energy sources, excluding hydropower electricity, would comprise 40% of Australia's energy mix by 2050, up 1700%. This would translate to a 60% cut in emissions from the electricity sector, on current levels.
The renewable energy investment fund would operate independently of government, along the same lines as the Future Fund. Industry estimates suggest that for every $1 of government money, $2 to $4 could be leveraged from the private sector, with the cash vital to help underwrite investor risk before projects make a profit.
The Government's top climate adviser Ross Garnaut recommended between $2 billion and $3 billion revenue to be spent on renewables, while the Australian Conservation Foundation has been pushing for a stand alone $2 billion a year financing corporation that would help companies get new projects off the ground and boost energy efficiency measures.
ACF climate change campaigner Claire Manes said at least $100 billion was needed over the next decade for clean energy projects but any funding must be limited to real renewable energy sources, such as solar, wave and geothermal. The Greens have resisted allowing carbon capture and storage projects being eligible for funding under the scheme. The Clean Energy Council's Kane Thornton said use of carbon price revenue would "kick start a range of emerging early stage renewable technologies".
Thursday, 7 July 2011
Garnaut lambasts media reporting
Sydney Morning Herald
1 July 2011, Page: 2
Ross Garnaut has lashed out at "crude" and "distorted" reporting of the government's plans for a carbon tax, calling News Ltd the worst offender.
Speaking at a conference sponsored by The Australian, a News Ltd title, on his last day as the government's climate change adviser, Professor Garnaut said much of the reporting had been "about the crudest and most distorted discussion of a major public policy issue in my long experience of Australian public policy". "I know from my close friends among the senior journalists at The Australian that there is disquiet about that. And I don't think my feelings are unusual".
Singling out a front page story which he said implied electricity prices would rise by 11% as a result of renewable energy schemes, he said the true figure was close to 3%, with the schemes actually responsible for 11% of a 30% increase. "I could give you dozens of examples", he said. "Facts are ignored, the rules of logic violated, and it is rare for people professing strong opinions to go back and look at the documents on which they have commented".
Surveying an audience of 200 economists and academics at the Melbourne Institute Australian conference, he said he knew of only two who had read his climate change report in full. One was the opposition frontbencher Malcolm Turnbull. The misrepresentation of the US position on climate change had the potential to harm Australian foreign policy, Professor Garnaut said.
"When I and others have written about the Australian reform era, we have given a large place to the positive role played by a highly professional, committed Australian media", said the former Hawke government economic adviser. "Great figures such as Peter Robinson, Max Walsh [and] Max Suich transmitted the analysis that was going on in the universities and the Tariff Board and built a platform that made reform possible".
The Australian's economics editor, Michael Stutchbury, said it was wrong to compare the battles over tariff reform with those over a carbon tax.
1 July 2011, Page: 2
Ross Garnaut has lashed out at "crude" and "distorted" reporting of the government's plans for a carbon tax, calling News Ltd the worst offender.
Speaking at a conference sponsored by The Australian, a News Ltd title, on his last day as the government's climate change adviser, Professor Garnaut said much of the reporting had been "about the crudest and most distorted discussion of a major public policy issue in my long experience of Australian public policy". "I know from my close friends among the senior journalists at The Australian that there is disquiet about that. And I don't think my feelings are unusual".
Singling out a front page story which he said implied electricity prices would rise by 11% as a result of renewable energy schemes, he said the true figure was close to 3%, with the schemes actually responsible for 11% of a 30% increase. "I could give you dozens of examples", he said. "Facts are ignored, the rules of logic violated, and it is rare for people professing strong opinions to go back and look at the documents on which they have commented".
Surveying an audience of 200 economists and academics at the Melbourne Institute Australian conference, he said he knew of only two who had read his climate change report in full. One was the opposition frontbencher Malcolm Turnbull. The misrepresentation of the US position on climate change had the potential to harm Australian foreign policy, Professor Garnaut said.
"When I and others have written about the Australian reform era, we have given a large place to the positive role played by a highly professional, committed Australian media", said the former Hawke government economic adviser. "Great figures such as Peter Robinson, Max Walsh [and] Max Suich transmitted the analysis that was going on in the universities and the Tariff Board and built a platform that made reform possible".
The Australian's economics editor, Michael Stutchbury, said it was wrong to compare the battles over tariff reform with those over a carbon tax.
Energy firms lock in capital's rural land ahead of solar bonanza
Canberra Times
1 July 2011, Page: 1
Solar farm companies have secured large parcels of land in rural ACT in preparation for a large scale solar power auction. Environment and Sustainable Development Minister Simon Corbell, re announced details of an auction process yesterday for solar power businesses to bid for the rights to establish large facilities in the ACT that can produce 40 MWs of power for the national capital. Renewable energy company Elementus Energy has already secured 300ha of pastoral land in the ACT in anticipation of the auction.
Elementus Energy managing director Ashleigh Antflick said the company had signed "bankable" contracts with an undisclosed number of farmers willing to lease their land and have solar farms installed on their properties. He would not confirm the location of the sites. "We have looked towards areas in the ACT, where there is a large enough piece of land and no topographical shading", he said. "You don't want Mount Stromlo casting a long shadow on your solar panels for a few hours a day".
Mr Antflick said it would take three to five hectares of land to produce 1 MW of power and the company would lodge a large bid. Elementus Energy has already been in discussion with ActewAGL Energy about grid connection options. Mr Corbel' said he was aware of a number of renewable energy companies securing land in the ACT to deploy solar farm installations. The ACT Government has released an industry briefing paper on the auction process and plans to develop supporting legislation and an auction framework by the end of the year. Mr Corbell said he expected the sealed bid auction to take place early next year, 18 months later than the mid 2010 auction date previously set.
"This has proven to be a very complex process to work through and industry have said they need sufficient time to plan for auction", he said. "We expect strong interest and we will have up to 20 bids. There is strong industry interest in this already, this is the first time it has been done in Australia". The company offering the most affordable power will win the contract and receive a feed in tariff to support the facility. Meanwhile, a Greens bill to roll the household solar feed in tariff scheme into a medium scheme was passed in the Legislative Assembly yesterday after garnering support from the Liberals.
ACT Greens energy spokesperson Shane Rattenbury said the bill would provide a "lifeline" to the local solar industry, which was devastated by the sudden closure of the micro tariff scheme for households earlier this month. "Overnight the scheme stopped, industry had no preparation, no warning and it created a situation where within weeks we would have seen solar powers in Canberra lay staff off. This provides a smoother transition than the existing scheme would", he said.
Opposition leader Zed Seselja decided to support the Green's bill because it would make "a bad scheme work a little better". Amendments made to the bill by Mr Seselja will require Mr Corbell to report monthly on the number of applications for renewable energy generator connections and will lower the tariff rate for households which entered into a generator contract on or after June 1, 2011.
1 July 2011, Page: 1
Solar farm companies have secured large parcels of land in rural ACT in preparation for a large scale solar power auction. Environment and Sustainable Development Minister Simon Corbell, re announced details of an auction process yesterday for solar power businesses to bid for the rights to establish large facilities in the ACT that can produce 40 MWs of power for the national capital. Renewable energy company Elementus Energy has already secured 300ha of pastoral land in the ACT in anticipation of the auction.
Elementus Energy managing director Ashleigh Antflick said the company had signed "bankable" contracts with an undisclosed number of farmers willing to lease their land and have solar farms installed on their properties. He would not confirm the location of the sites. "We have looked towards areas in the ACT, where there is a large enough piece of land and no topographical shading", he said. "You don't want Mount Stromlo casting a long shadow on your solar panels for a few hours a day".
Mr Antflick said it would take three to five hectares of land to produce 1 MW of power and the company would lodge a large bid. Elementus Energy has already been in discussion with ActewAGL Energy about grid connection options. Mr Corbel' said he was aware of a number of renewable energy companies securing land in the ACT to deploy solar farm installations. The ACT Government has released an industry briefing paper on the auction process and plans to develop supporting legislation and an auction framework by the end of the year. Mr Corbell said he expected the sealed bid auction to take place early next year, 18 months later than the mid 2010 auction date previously set.
"This has proven to be a very complex process to work through and industry have said they need sufficient time to plan for auction", he said. "We expect strong interest and we will have up to 20 bids. There is strong industry interest in this already, this is the first time it has been done in Australia". The company offering the most affordable power will win the contract and receive a feed in tariff to support the facility. Meanwhile, a Greens bill to roll the household solar feed in tariff scheme into a medium scheme was passed in the Legislative Assembly yesterday after garnering support from the Liberals.
ACT Greens energy spokesperson Shane Rattenbury said the bill would provide a "lifeline" to the local solar industry, which was devastated by the sudden closure of the micro tariff scheme for households earlier this month. "Overnight the scheme stopped, industry had no preparation, no warning and it created a situation where within weeks we would have seen solar powers in Canberra lay staff off. This provides a smoother transition than the existing scheme would", he said.
Opposition leader Zed Seselja decided to support the Green's bill because it would make "a bad scheme work a little better". Amendments made to the bill by Mr Seselja will require Mr Corbell to report monthly on the number of applications for renewable energy generator connections and will lower the tariff rate for households which entered into a generator contract on or after June 1, 2011.
Wednesday, 6 July 2011
Home audits reveal a tonne of energy
Adelaide Advertiser
1 July 2011, Page: 26
ENERGY retailers in South Australia conducted 6500 residential energy audits last financial year, delivering more than 248,000 tonnes of greenhouse gas reduction. The number of audits was 30% above the target set under the State Government's Residential Energy Efficiency Scheme (REES). Energy Minister Michael O'Brien said the Essential Services Commission of South Australia REES 2010 report, released today, showed the scheme was highly successful.
"More than 74,000 households benefited in 2010 and, importantly, 77,000 tonnes of the reduction was delivered to low income households", Mr O'Brien said. "Under the scheme, licensed electricity and gas retailers with more than 5000 residential customers are required to achieve targets for the reduction of greenhouse gas emissions". Mr O'Brien said retailers must also conduct a specified number of residential energy audits in low income households to identify ways those residents could reduce their electricity and gas costs.
GM Holden Hill homeowner Roger Gilbert said he was able to save money and energy after learning he could turn off the back up power to his solar water heating during summer. Mr Gilbert said his home was already energy efficient with 10 solar panels on the roof and LED light bulbs fitted instead of incandescent bulbs. "I was on the right track all the way", he said. "You have to do everything you can like closing the curtains when the sun goes down.".. An AGL Energy spokeswoman said the provider had contacted customers after audits to check on whether they had adopted any of the energy saving recommendations.
1 July 2011, Page: 26
ENERGY retailers in South Australia conducted 6500 residential energy audits last financial year, delivering more than 248,000 tonnes of greenhouse gas reduction. The number of audits was 30% above the target set under the State Government's Residential Energy Efficiency Scheme (REES). Energy Minister Michael O'Brien said the Essential Services Commission of South Australia REES 2010 report, released today, showed the scheme was highly successful.
"More than 74,000 households benefited in 2010 and, importantly, 77,000 tonnes of the reduction was delivered to low income households", Mr O'Brien said. "Under the scheme, licensed electricity and gas retailers with more than 5000 residential customers are required to achieve targets for the reduction of greenhouse gas emissions". Mr O'Brien said retailers must also conduct a specified number of residential energy audits in low income households to identify ways those residents could reduce their electricity and gas costs.
GM Holden Hill homeowner Roger Gilbert said he was able to save money and energy after learning he could turn off the back up power to his solar water heating during summer. Mr Gilbert said his home was already energy efficient with 10 solar panels on the roof and LED light bulbs fitted instead of incandescent bulbs. "I was on the right track all the way", he said. "You have to do everything you can like closing the curtains when the sun goes down.".. An AGL Energy spokeswoman said the provider had contacted customers after audits to check on whether they had adopted any of the energy saving recommendations.
Detail soon on clean energy bid
Courier Mail
29 June 2011, Page: 46
GeoDynamics says detail about a major push in the year ahead on its flagship, zero emissions power project should be finalised next month. It also said the work program would be funded by existing cash resources, grant funding and its balance sheet, noting its current cash balance was $29.1 million. The Australian Stock Exchange had queried the Brisbane based company about any undisclosed information that could explain a drop in its stock price. After the company's statement, the stock surged to close up 7% at 15¢.
GeoDynamics said it was unaware of any such undisclosed information but that a review of its Innamincka Deeps joint venture forward work program with partner Origin Energy was advanced. The project aims to use GeoDynamics' world first technology to produce zero emissions, 24 hour electricity using underground heat sources. A 2009 well blowout delayed a final investment decision on a 25 MW commercial scale plant until 2013. The total market value of Australia's 81 listed clean energy and technology stocks has tumbled to $9.5 billion as of last month, from $10.3 billion a year earlier.
29 June 2011, Page: 46
GeoDynamics says detail about a major push in the year ahead on its flagship, zero emissions power project should be finalised next month. It also said the work program would be funded by existing cash resources, grant funding and its balance sheet, noting its current cash balance was $29.1 million. The Australian Stock Exchange had queried the Brisbane based company about any undisclosed information that could explain a drop in its stock price. After the company's statement, the stock surged to close up 7% at 15¢.
GeoDynamics said it was unaware of any such undisclosed information but that a review of its Innamincka Deeps joint venture forward work program with partner Origin Energy was advanced. The project aims to use GeoDynamics' world first technology to produce zero emissions, 24 hour electricity using underground heat sources. A 2009 well blowout delayed a final investment decision on a 25 MW commercial scale plant until 2013. The total market value of Australia's 81 listed clean energy and technology stocks has tumbled to $9.5 billion as of last month, from $10.3 billion a year earlier.
Renewable boom is leaving us stumbling
Canberra Times
29 June 2011, Page: 19
Australians are great innovators. Think Hills Hoist, the wine cask and bionic ears. But we are also renowned for stumbling at the finishing line where it matters most. Today, there is a global race to take advantage of the boom in renewable energy and countries like China, South Korea, Germany and the US are leaving us for dead. Often using technologies that were developed here.
We're pretending not to notice as another clean energy technology manufacturer shuts up shop and heads offshore because Australia doesn't have the right support to attract the investment needed.
Early this month, an Adelaide solar cell manufacturer closed its doors and relocated to the US after deciding an Australian based operation wasn't viable. After receiving $8 million in state and federal research and development grants to develop super slim solar panels pioneered at the Australian National University in Canberra, Origin Energy Solar is heading to Idaho, taking with it the knowledge, the investment and the potential for a stack of new jobs.
Origin Energy Solar joins the likes of Stinted' Power, now in China and one of the world's largest solar manufacturers, built on the back of technology developed at the University of New South Wales. Or the solar thermal technology developed by Dr David Mills at Sydney University and now driving the fortunes of Ausra. In America.
How can we put a stop to the brain drain, the demise of our manufacturing industries and the failure to capitalise on job creation? The answer sits on the desk of our most senior government ministers. As they deliberate on the detail of a carbon price, the answer is staring them in the face.
Revenue generated from the price on carbon can be used to finance the transition to a clean energy future and there is a smart way to do it. The Australian Conservation Foundation recently issued a report, Funding the Transition to a Clean Energy Economy, which highlights the myriad ways government can catalyse private investment in clean energy. Globally, countries are using a suite of financial policy measures and instruments to support the commercialisation of clean technologies, build low carbon industries and create tens of thousands of new jobs.
The Federal Government already supports Australian export industries through the Export Finance Insurance Corporation, our film industry through tax credits and other "nationally significant" infrastructure with a variety of co investment, off take agreements, subordinated debt and other methods.
The Federal Government has before it right now a proposal to establish an equivalent independent authority to facilitate the rapid roll out and expansion of private investment in renewable energy technologies. A clean energy finance corporation is needed as part of the carbon pricing package to unlock the clean energy boom in Australia.Support for a_clean_energy finance corporation has come from the largest investors in Australia, such as the peak bodies in the super funds industry. Investors are ready to play their part.
The Government needs to get the settings right. What better way to invest our super funds than in securing a long term clean energy future for our children? The investor community can do the heavy lifting, but it's up to the Government to prepare the ground.
A clean energy finance corporation needs to be well funded, with around $2 billion from carbon permit revenue each year. And it needs to be targeted at real renewable energy deployment solar, wave and geothermal technologies that stand ready to be delivered, using resources Australia has in abundance. We shouldn't waste time on unproven, inefficient and costly technologies like so-called clean coal. Not when our endless sunshine, wind, waves and hot rocks are the envy of the world.
We should be winning this race. We have what it takes to lead the world into a 100% renewable clean energy future. Instead we've allowed other nations, who have less technological innovation and fewer natural resources, to get ahead. At this crucial moment in deciding our economic, environmental and energy future, it's time we caught up.
Simon O'Connor is the Australian Conservation Foundation's economic adviser.
29 June 2011, Page: 19
Australians are great innovators. Think Hills Hoist, the wine cask and bionic ears. But we are also renowned for stumbling at the finishing line where it matters most. Today, there is a global race to take advantage of the boom in renewable energy and countries like China, South Korea, Germany and the US are leaving us for dead. Often using technologies that were developed here.
We're pretending not to notice as another clean energy technology manufacturer shuts up shop and heads offshore because Australia doesn't have the right support to attract the investment needed.
Early this month, an Adelaide solar cell manufacturer closed its doors and relocated to the US after deciding an Australian based operation wasn't viable. After receiving $8 million in state and federal research and development grants to develop super slim solar panels pioneered at the Australian National University in Canberra, Origin Energy Solar is heading to Idaho, taking with it the knowledge, the investment and the potential for a stack of new jobs.
Origin Energy Solar joins the likes of Stinted' Power, now in China and one of the world's largest solar manufacturers, built on the back of technology developed at the University of New South Wales. Or the solar thermal technology developed by Dr David Mills at Sydney University and now driving the fortunes of Ausra. In America.
How can we put a stop to the brain drain, the demise of our manufacturing industries and the failure to capitalise on job creation? The answer sits on the desk of our most senior government ministers. As they deliberate on the detail of a carbon price, the answer is staring them in the face.
Revenue generated from the price on carbon can be used to finance the transition to a clean energy future and there is a smart way to do it. The Australian Conservation Foundation recently issued a report, Funding the Transition to a Clean Energy Economy, which highlights the myriad ways government can catalyse private investment in clean energy. Globally, countries are using a suite of financial policy measures and instruments to support the commercialisation of clean technologies, build low carbon industries and create tens of thousands of new jobs.
The Federal Government already supports Australian export industries through the Export Finance Insurance Corporation, our film industry through tax credits and other "nationally significant" infrastructure with a variety of co investment, off take agreements, subordinated debt and other methods.
The Federal Government has before it right now a proposal to establish an equivalent independent authority to facilitate the rapid roll out and expansion of private investment in renewable energy technologies. A clean energy finance corporation is needed as part of the carbon pricing package to unlock the clean energy boom in Australia.Support for a_clean_energy finance corporation has come from the largest investors in Australia, such as the peak bodies in the super funds industry. Investors are ready to play their part.
The Government needs to get the settings right. What better way to invest our super funds than in securing a long term clean energy future for our children? The investor community can do the heavy lifting, but it's up to the Government to prepare the ground.
A clean energy finance corporation needs to be well funded, with around $2 billion from carbon permit revenue each year. And it needs to be targeted at real renewable energy deployment solar, wave and geothermal technologies that stand ready to be delivered, using resources Australia has in abundance. We shouldn't waste time on unproven, inefficient and costly technologies like so-called clean coal. Not when our endless sunshine, wind, waves and hot rocks are the envy of the world.
We should be winning this race. We have what it takes to lead the world into a 100% renewable clean energy future. Instead we've allowed other nations, who have less technological innovation and fewer natural resources, to get ahead. At this crucial moment in deciding our economic, environmental and energy future, it's time we caught up.
Simon O'Connor is the Australian Conservation Foundation's economic adviser.
Tuesday, 5 July 2011
Lawyers' picnic drives up the cost of electricity
Australian
29 June 2011, Page: 14
ELECTRICITY prices have been rising across the nation; dramatically in some states. With the introduction of a carbon tax there will be more pressure on prices.
In recent years, very little if any of the upward pressure on prices has come from the cost of the energy itself. Most of the pressure on prices has come from increasing network charges: distribution plus transmission. Various renewable schemes, such as the federal renewable energy target and various state solar schemes, have also been adding to costs and hence final electricity bills.
All this is relatively recent. Up until about five years ago, network cost increases had been relatively modest since the microeconomic reforms of the 1990s. Most of the pressure on electricity prices came from the underlying cost of the energy, not the cost of delivering (network charges) or supplying (retail margins) the energy to end customers.
Networks had been effectively regulated in some form for years; in the case of NSW, since the early 1990s. We are witnessing substantial increases in network charges. Andrew Reeves, chairman of the Australian Energy Regulator, has expressed frustration over his (in)ability to effectively regulate energy networks. The AER is foreshadowing a series of rule changes that could significantly change the way electricity networks are regulated.
Several commentators (Ross Garnaut, Rod Sims, Roman Domanski, Mark Duffy and myself) have expressed reservations about not just the regulatory model but the incentives that seem to be driving the network businesses. Businesses are being accused of gold-plating; the regulator is regularly losing appeals against arcane elements of the cost of capital a main driver of network costs. Many are now suggesting that the system is broken.
So what has changed? The basic model is essentially the same as was introduced by the Independent Pricing and Regulatory Tribunal and its predecessor the Government Pricing Tribunal of NSW in the early 1990s. But the way in which the regulator and some of the businesses now engage with the model is very different from the relatively simple model that worked for nearly 15 years.
The model of regulation that was introduced in NSW in 1992-93 was based on that developed in Britain, particularly its water regulator, Ofwat, a few years prior. A few key features underpinned its success. It was designed to be light handed (and light hearted); that is, data was kept to the minimum required to form a view about a business's efficient costs and prices.
It was explicitly based on sound commercial principles, rather than a complex legal framework. Indeed, lawyers were explicitly not a part of the IPART process for many years. In the original NSW model there was no provision for merit appeal; the decision of the regulator was final. The model was highly transparent, relatively simple and low cost, for businesses, customers and the regulator. Most important, the regulatory model was based on incentives.
The regulator formed a view about the efficient costs of the business operating costs; capital costs; depreciation; and financing costs (debt and equity) and provided incentives for the businesses to out perform the regulatory allowance during the period of price control.
The key to the incentive regulation model was that the businesses had an incentive to perform better than the regulator allowed, keeping some of those benefits for a period, with customers capturing a share of those benefits in the next regulatory period. A win-win scenario. And it worked as well for the NSW regulated utilities that were government owned as it did for privatised utilities.
At the risk of over simplification, what does the present (national) regulatory model look like today (and many of these observations apply equally to the British regulation)? It is still based on building blocks, but many of the other key features have changed substantially. Regulation today is far from light handed; the data requirements on the businesses and the burden on the regulator are very much greater, more detailed and much more intrusive than nearly 20 years ago.
The amount of material submitted as part of a regulatory submission is vast. The regulator is now attempting to second guess management in many areas of the business. Has it led to the regulator having a better understanding of the businesses and a better handle on efficient costs? I doubt it.
Lawyers have found another lucrative source of revenue in economic regulation in Australia. The regulator and the regulated now use lawyers extensively at all stages of the process. Appeals (on merit) against the regulator's determinations are standard and the regulator has lost some appeals before the Australian Competition Tribunal.
These appeals are increasingly about arcane elements of the cost of capital (the angels on pinheads of regulation) that are increasingly accounting for large increases in network charges. Regulation is now far from low cost; large regulatory budgets are standard for the businesses as well as for the regulator.
But, most important, the fundamental role of incentives appears to be missing from regulation today. The regulator doesn't appear to accept that a business will drive all of its costs, including efficient financing costs, so that customers can share in those benefits. And some of the businesses, notably the government owned businesses, are not demonstrating the same governance drivers that gives the regulator confidence that the incentive model will work.
For incentive regulation to work, the owners and management of the regulated network need to actively seek out every opportunity to drive efficiency in all the costs of the businesses. Whether all of the government owned businesses in NSW and Queensland (and Western Australia) have the same drivers that we saw in the 1990s and early 2000s is starting to be questioned.
And if governance is not transparently aligned to efficiency incentives, then the Australian regulatory model is very close to broken. How to fix it? That is the billion dollar question. Hopefully, policy makers at state and national levels of government will re engage with this critical area of micro economic reform. They need to; there is substantial economic welfare at stake.
Tom Puny was foundation executive chairman of the Independent Pricing and Regulatory Tribunal and its predecessor, the Government Pricing Tribunal of NSW, from 1992 to 2004. These views are his own.
29 June 2011, Page: 14
ELECTRICITY prices have been rising across the nation; dramatically in some states. With the introduction of a carbon tax there will be more pressure on prices.
In recent years, very little if any of the upward pressure on prices has come from the cost of the energy itself. Most of the pressure on prices has come from increasing network charges: distribution plus transmission. Various renewable schemes, such as the federal renewable energy target and various state solar schemes, have also been adding to costs and hence final electricity bills.
All this is relatively recent. Up until about five years ago, network cost increases had been relatively modest since the microeconomic reforms of the 1990s. Most of the pressure on electricity prices came from the underlying cost of the energy, not the cost of delivering (network charges) or supplying (retail margins) the energy to end customers.
Networks had been effectively regulated in some form for years; in the case of NSW, since the early 1990s. We are witnessing substantial increases in network charges. Andrew Reeves, chairman of the Australian Energy Regulator, has expressed frustration over his (in)ability to effectively regulate energy networks. The AER is foreshadowing a series of rule changes that could significantly change the way electricity networks are regulated.
Several commentators (Ross Garnaut, Rod Sims, Roman Domanski, Mark Duffy and myself) have expressed reservations about not just the regulatory model but the incentives that seem to be driving the network businesses. Businesses are being accused of gold-plating; the regulator is regularly losing appeals against arcane elements of the cost of capital a main driver of network costs. Many are now suggesting that the system is broken.
So what has changed? The basic model is essentially the same as was introduced by the Independent Pricing and Regulatory Tribunal and its predecessor the Government Pricing Tribunal of NSW in the early 1990s. But the way in which the regulator and some of the businesses now engage with the model is very different from the relatively simple model that worked for nearly 15 years.
The model of regulation that was introduced in NSW in 1992-93 was based on that developed in Britain, particularly its water regulator, Ofwat, a few years prior. A few key features underpinned its success. It was designed to be light handed (and light hearted); that is, data was kept to the minimum required to form a view about a business's efficient costs and prices.
It was explicitly based on sound commercial principles, rather than a complex legal framework. Indeed, lawyers were explicitly not a part of the IPART process for many years. In the original NSW model there was no provision for merit appeal; the decision of the regulator was final. The model was highly transparent, relatively simple and low cost, for businesses, customers and the regulator. Most important, the regulatory model was based on incentives.
The regulator formed a view about the efficient costs of the business operating costs; capital costs; depreciation; and financing costs (debt and equity) and provided incentives for the businesses to out perform the regulatory allowance during the period of price control.
The key to the incentive regulation model was that the businesses had an incentive to perform better than the regulator allowed, keeping some of those benefits for a period, with customers capturing a share of those benefits in the next regulatory period. A win-win scenario. And it worked as well for the NSW regulated utilities that were government owned as it did for privatised utilities.
At the risk of over simplification, what does the present (national) regulatory model look like today (and many of these observations apply equally to the British regulation)? It is still based on building blocks, but many of the other key features have changed substantially. Regulation today is far from light handed; the data requirements on the businesses and the burden on the regulator are very much greater, more detailed and much more intrusive than nearly 20 years ago.
The amount of material submitted as part of a regulatory submission is vast. The regulator is now attempting to second guess management in many areas of the business. Has it led to the regulator having a better understanding of the businesses and a better handle on efficient costs? I doubt it.
Lawyers have found another lucrative source of revenue in economic regulation in Australia. The regulator and the regulated now use lawyers extensively at all stages of the process. Appeals (on merit) against the regulator's determinations are standard and the regulator has lost some appeals before the Australian Competition Tribunal.
These appeals are increasingly about arcane elements of the cost of capital (the angels on pinheads of regulation) that are increasingly accounting for large increases in network charges. Regulation is now far from low cost; large regulatory budgets are standard for the businesses as well as for the regulator.
But, most important, the fundamental role of incentives appears to be missing from regulation today. The regulator doesn't appear to accept that a business will drive all of its costs, including efficient financing costs, so that customers can share in those benefits. And some of the businesses, notably the government owned businesses, are not demonstrating the same governance drivers that gives the regulator confidence that the incentive model will work.
For incentive regulation to work, the owners and management of the regulated network need to actively seek out every opportunity to drive efficiency in all the costs of the businesses. Whether all of the government owned businesses in NSW and Queensland (and Western Australia) have the same drivers that we saw in the 1990s and early 2000s is starting to be questioned.
And if governance is not transparently aligned to efficiency incentives, then the Australian regulatory model is very close to broken. How to fix it? That is the billion dollar question. Hopefully, policy makers at state and national levels of government will re engage with this critical area of micro economic reform. They need to; there is substantial economic welfare at stake.
Tom Puny was foundation executive chairman of the Independent Pricing and Regulatory Tribunal and its predecessor, the Government Pricing Tribunal of NSW, from 1992 to 2004. These views are his own.
Lawmakers seek inquiry of Natural Gas industry
www.nytimes.com
June 28, 2011
WASHINGTON — Federal lawmakers called Tuesday on several agencies, including the federal Securities and Exchange Commission, the Energy Information Administration and the Government Accountability Office, to investigate whether the natural gas industry has provided an accurate picture to investors of the long-term profitability of their wells and the amount of gas these wells can produce.
"Given the rapid growth of the shale gas industry and its growing importance for our country's energy portfolio, I urge the S.E.C. to quickly investigate whether investors have been intentionally misled," wrote Representative Maurice D. Hinchey, Democrat of New York, in one of three letters sent to the commission by four federal lawmakers, all Democrats.
The calls for investigations came amid growing questions about the environmental and financial risks surrounding natural gas drilling and especially a technique known as hydraulic fracturing, or hydropowerfracking, used to release gas trapped underground in shale formations. Members of the House Committee on Natural Resources said they hoped to hold a hearing in the next several weeks to discuss natural gas drilling.
Senator Benjamin L. Cardin, Democrat of Maryland, sent a letter to the Government Accountability Office, the investigative arm of Congress, asking it to look into questions about the environmental impacts of hydropowerfracking, the accuracy of reserves estimates, and industry regulation. State lawmakers also sought more information.
In Maryland, Delegate Heather R. Mizeur, Democrat of Montgomery County, sent a letter to the state comptroller and the attorney general calling for an investigation into disclosures related to the financial and environmental risks of drilling. In New York, Assemblywoman Barbara S. Lifton, a Democrat and longtime critic of drilling, sent a letter to the New York State comptroller, Thomas P. DiNapoli, calling for a similar investigation and citing roughly $1 billion in state pension funds invested in shale gas companies.
Officials in the office of the New York attorney general, Eric T. Schneiderman, said they had sent subpoenas to five oil and gas companies ordering them to provide documents relating to the disclosure the companies made to investors about the risks of hydropowerfracking, according to sources briefed on the investigation. A spokesman from Mr. Schneiderman's office declined to provide copies of the subpoenas.
The five companies subpoenaed — Talisman, Chesapeake Energy, E. O. G. Resources, Baker Hughes and Anadarko — all declined to comment. The calls for investigations follow articles in The New York Times describing doubts reflected in internal e-mails from federal regulators and natural gas industry officials about the costs associated with shale gas and the reliability of company reserves estimates.
Oil and gas companies and energy market analysts strongly rejected the views expressed in the industry and federal e-mails published by The Times. In an open letter to his employees, the chief executive of Chesapeake Energy, Aubrey McClendon, said the company's prospects were bright. "There is no reason to believe that shale gas wells will have shorter lives than our conventional wells — some 8,000 of which are 30 years old or older," Mr. McClendon wrote. Some financial services companies also released research notes saying they believed shale gas was now profitable for many companies.
But four federal lawmakers — Mr. Hinchey; Representative Edward J. Markey, Democrat of Massachusetts; and Representatives Carolyn B. Maloney and Jerrold Nadler, both Democrats of New York — sent letters calling for the S.E.C. to reconsider recent rule changes that allow companies to avoid disclosing details about the proprietary technology used to predict future gas production and to avoid some third-party audits of those predictions. They asked the commission whether third-party reserves audits should be made mandatory.
The lawmakers also called for an investigation into industry representatives' accusations of possible illegality or reserves overbooking. A spokesman for the S.E.C. declined to comment. In a letter to Steven Chu, the secretary of energy, Ms. Maloney and Mr. Nadler asked his department to assess how inaccuracies in production projections could affect energy policy. The federal Energy Information Administration also faced questions from Mr. Markey and Mr. Hinchey about its reports related to natural gas and its use of industry-tied contractors in writing those reports.
Voicing strong support for the natural gas industry, a bipartisan group of eight federal lawmakers from gas-producing states sent a letter to President Obama on Monday asking him to promote continued natural gas development "by any means necessary, but most specifically, by unconventional shale gas recovery." "The need for the United States to move toward energy independence becomes more crucial as the crisis in the Middle East and North Africa worsens," the letter said.
June 28, 2011
WASHINGTON — Federal lawmakers called Tuesday on several agencies, including the federal Securities and Exchange Commission, the Energy Information Administration and the Government Accountability Office, to investigate whether the natural gas industry has provided an accurate picture to investors of the long-term profitability of their wells and the amount of gas these wells can produce.
"Given the rapid growth of the shale gas industry and its growing importance for our country's energy portfolio, I urge the S.E.C. to quickly investigate whether investors have been intentionally misled," wrote Representative Maurice D. Hinchey, Democrat of New York, in one of three letters sent to the commission by four federal lawmakers, all Democrats.
The calls for investigations came amid growing questions about the environmental and financial risks surrounding natural gas drilling and especially a technique known as hydraulic fracturing, or hydropowerfracking, used to release gas trapped underground in shale formations. Members of the House Committee on Natural Resources said they hoped to hold a hearing in the next several weeks to discuss natural gas drilling.
Senator Benjamin L. Cardin, Democrat of Maryland, sent a letter to the Government Accountability Office, the investigative arm of Congress, asking it to look into questions about the environmental impacts of hydropowerfracking, the accuracy of reserves estimates, and industry regulation. State lawmakers also sought more information.
In Maryland, Delegate Heather R. Mizeur, Democrat of Montgomery County, sent a letter to the state comptroller and the attorney general calling for an investigation into disclosures related to the financial and environmental risks of drilling. In New York, Assemblywoman Barbara S. Lifton, a Democrat and longtime critic of drilling, sent a letter to the New York State comptroller, Thomas P. DiNapoli, calling for a similar investigation and citing roughly $1 billion in state pension funds invested in shale gas companies.
Officials in the office of the New York attorney general, Eric T. Schneiderman, said they had sent subpoenas to five oil and gas companies ordering them to provide documents relating to the disclosure the companies made to investors about the risks of hydropowerfracking, according to sources briefed on the investigation. A spokesman from Mr. Schneiderman's office declined to provide copies of the subpoenas.
The five companies subpoenaed — Talisman, Chesapeake Energy, E. O. G. Resources, Baker Hughes and Anadarko — all declined to comment. The calls for investigations follow articles in The New York Times describing doubts reflected in internal e-mails from federal regulators and natural gas industry officials about the costs associated with shale gas and the reliability of company reserves estimates.
Oil and gas companies and energy market analysts strongly rejected the views expressed in the industry and federal e-mails published by The Times. In an open letter to his employees, the chief executive of Chesapeake Energy, Aubrey McClendon, said the company's prospects were bright. "There is no reason to believe that shale gas wells will have shorter lives than our conventional wells — some 8,000 of which are 30 years old or older," Mr. McClendon wrote. Some financial services companies also released research notes saying they believed shale gas was now profitable for many companies.
But four federal lawmakers — Mr. Hinchey; Representative Edward J. Markey, Democrat of Massachusetts; and Representatives Carolyn B. Maloney and Jerrold Nadler, both Democrats of New York — sent letters calling for the S.E.C. to reconsider recent rule changes that allow companies to avoid disclosing details about the proprietary technology used to predict future gas production and to avoid some third-party audits of those predictions. They asked the commission whether third-party reserves audits should be made mandatory.
The lawmakers also called for an investigation into industry representatives' accusations of possible illegality or reserves overbooking. A spokesman for the S.E.C. declined to comment. In a letter to Steven Chu, the secretary of energy, Ms. Maloney and Mr. Nadler asked his department to assess how inaccuracies in production projections could affect energy policy. The federal Energy Information Administration also faced questions from Mr. Markey and Mr. Hinchey about its reports related to natural gas and its use of industry-tied contractors in writing those reports.
Voicing strong support for the natural gas industry, a bipartisan group of eight federal lawmakers from gas-producing states sent a letter to President Obama on Monday asking him to promote continued natural gas development "by any means necessary, but most specifically, by unconventional shale gas recovery." "The need for the United States to move toward energy independence becomes more crucial as the crisis in the Middle East and North Africa worsens," the letter said.
Sunshine Coast lives up to its name with solar farm power boost
Courier Mail
28 June 2011, Page: 8
THE Sunshine Coast's future as a green energy producer will take a huge step forward tomorrow with the expected approval of Queensland's biggest solar farm and an application for a second facility. A 50,000 Janet facility, worth an expected 540 million, is set to be backed by Sunshine Coast Regional Council for a 20ha site on former caneland at Valdora, halfway between Yandina and Coolum.
It will feed enough power into the grid for 2500 homes and provide a cutting edge model that could be rolled out throughout the state. The local firm behind the project, Energy Parks Australia, told The Courier Mail it would also submit plans tomorrow for a 12,000 panel "solar park" on 32ha at Cootharaba, in the Noosa hinterland.
Director Jason Hague said the Sunshine Coast was well on the way to becoming Australia's most sustainable region and his company had plans for several more projects to create localised renewable energy solutions. Mr Hague said he was confident of their success as they were aligned with council's vision to achieve 20% renewable energy by the year 2020. He said new developments such as Caloundra South and Palmview presented considerable opportunities to develop solar parks that could help save residents from soaring power bills.
"We are very excited about incorporating future energy parks into greenfield sites, which will shape the future of the Coast", Mr Hague said. "There's pressure on every level to deploy green energy options and our projects provide the blueprint for the ever increasing energy needs of modern communities". The second solar farm, to be considered for approval later in the year, would be worth $9 million and be funded by a single investor, a Sunshine Coast businessman confident of green energy's future.
Mr Hague said he hoped work would begin on the Valdora property by the end of the year. He said the clean energy produced could be sold to energy providers, or retailed to individual residents or businesses. A handful of large solar farms are being established by other companies in NSW and Western Australia, but the technology is already used in Europe and Asia. Early this month, Prime Minister Julia Gillard and Premier Anna Bligh announced a jointly funded $1.2 billion gas plant at Chinchilla in the state's west.
28 June 2011, Page: 8
THE Sunshine Coast's future as a green energy producer will take a huge step forward tomorrow with the expected approval of Queensland's biggest solar farm and an application for a second facility. A 50,000 Janet facility, worth an expected 540 million, is set to be backed by Sunshine Coast Regional Council for a 20ha site on former caneland at Valdora, halfway between Yandina and Coolum.
It will feed enough power into the grid for 2500 homes and provide a cutting edge model that could be rolled out throughout the state. The local firm behind the project, Energy Parks Australia, told The Courier Mail it would also submit plans tomorrow for a 12,000 panel "solar park" on 32ha at Cootharaba, in the Noosa hinterland.
Director Jason Hague said the Sunshine Coast was well on the way to becoming Australia's most sustainable region and his company had plans for several more projects to create localised renewable energy solutions. Mr Hague said he was confident of their success as they were aligned with council's vision to achieve 20% renewable energy by the year 2020. He said new developments such as Caloundra South and Palmview presented considerable opportunities to develop solar parks that could help save residents from soaring power bills.
"We are very excited about incorporating future energy parks into greenfield sites, which will shape the future of the Coast", Mr Hague said. "There's pressure on every level to deploy green energy options and our projects provide the blueprint for the ever increasing energy needs of modern communities". The second solar farm, to be considered for approval later in the year, would be worth $9 million and be funded by a single investor, a Sunshine Coast businessman confident of green energy's future.
Mr Hague said he hoped work would begin on the Valdora property by the end of the year. He said the clean energy produced could be sold to energy providers, or retailed to individual residents or businesses. A handful of large solar farms are being established by other companies in NSW and Western Australia, but the technology is already used in Europe and Asia. Early this month, Prime Minister Julia Gillard and Premier Anna Bligh announced a jointly funded $1.2 billion gas plant at Chinchilla in the state's west.
Monday, 4 July 2011
Sensors to cut cost of checking carbon
Australian
Tuesday 28/6/2011 Page: 35
AUSTRALIAN scientists are spearheading the international development of technology to analyse greenhouse gases and climate change. The Greenhouse Gas Monitor joint research project was awarded $2.3 million last week by the Australian Space and Research Program. The project is designed to develop a mobile sensor unit to vastly boost the number of earthbound measurement stations globally that monitor CO₂. The project, which includes a team from the University of Wollongong's GeoQuest group, will use terrestrial and satellite technology to develop a data collection and feedback system.
By increasing the number of measuring sites, scientists could increase their data volume and the diversity of environmental source conditions, yielding more accurate information and improved weather and climate change forecasting. "So you would be able to prove your computer model and say more accurately where CO₂, is coming from or where it is going to, and that has big implications for things like emissions trading schemes", project researcher and Centre for Atmospheric Chemistry senior research fellow Nicholas Jones said.
The project will enhance international efforts by Japan and the US to launch satellites capable of precisely measuring atmospheric CO₂ and methane from space. To make the satellites useful, the data must be tied back to ground measurements. Current sensors capture CO₂ measurements from Total Column Carbon Observing Network stations, which cost about $1m each and weigh 600kg. The instrument follows the sun and allows scientists to measure CO₂, and methane between the ground and the top of the atmosphere.
Wollongong has one of three TCCON instruments in the southern hemisphere. The others are in Darwin and New Zealand. There are 15 worldwide. "The problem is that, to really make use of the satellite measurements, you want to calibrate them not just in 15 places, but several hundred, preferably 1000 or may be more", Dr Jones said. "What GGM is about is whether we can do the same kind of measurement from the ground but at a tenth of the cost".
He said the team had a candidate technology that could take measurements as accurately as the TCCON. The aim was to develop a mobile instrument for less than $100,000. "In the next 24 months, we are going to be looking at a couple of these technologies, developing them and comparing them with our TCCON data and if it works out we will then commercialise this instrument". The team's mobile prototype is a thumb sized crystal in a box inside a miniature heater.
Dr Jones said the mobile system would be autonomous and made up of a solar tracker to direct sunlight into the instrument, a spectrometer and computer control able to analyse data and send it back to a base station. "So there will be some kind of data archiving system, which then has to grab that data and send it off to the end user, such as the Bureau of Meteorology". The GGM partners also include University of Melbourne and Australian National University, the Bureau of Meteorology, Rosebank Engineering and Vipac Engineers and Scientists.
"We are probably one to two years ahead of the rest of the field, so we are hoping that we can get something to market before someone else does", Dr Jones said. He said the technology would also help in the scientific understanding of the carbon cycle and in climate modelling and the effects of El Nino and La Nina. "If we are able to predict those sorts of events more accurately, that has huge implications in terms of economic impact on the country", he said.
Tuesday 28/6/2011 Page: 35
AUSTRALIAN scientists are spearheading the international development of technology to analyse greenhouse gases and climate change. The Greenhouse Gas Monitor joint research project was awarded $2.3 million last week by the Australian Space and Research Program. The project is designed to develop a mobile sensor unit to vastly boost the number of earthbound measurement stations globally that monitor CO₂. The project, which includes a team from the University of Wollongong's GeoQuest group, will use terrestrial and satellite technology to develop a data collection and feedback system.By increasing the number of measuring sites, scientists could increase their data volume and the diversity of environmental source conditions, yielding more accurate information and improved weather and climate change forecasting. "So you would be able to prove your computer model and say more accurately where CO₂, is coming from or where it is going to, and that has big implications for things like emissions trading schemes", project researcher and Centre for Atmospheric Chemistry senior research fellow Nicholas Jones said.
The project will enhance international efforts by Japan and the US to launch satellites capable of precisely measuring atmospheric CO₂ and methane from space. To make the satellites useful, the data must be tied back to ground measurements. Current sensors capture CO₂ measurements from Total Column Carbon Observing Network stations, which cost about $1m each and weigh 600kg. The instrument follows the sun and allows scientists to measure CO₂, and methane between the ground and the top of the atmosphere.
Wollongong has one of three TCCON instruments in the southern hemisphere. The others are in Darwin and New Zealand. There are 15 worldwide. "The problem is that, to really make use of the satellite measurements, you want to calibrate them not just in 15 places, but several hundred, preferably 1000 or may be more", Dr Jones said. "What GGM is about is whether we can do the same kind of measurement from the ground but at a tenth of the cost".
He said the team had a candidate technology that could take measurements as accurately as the TCCON. The aim was to develop a mobile instrument for less than $100,000. "In the next 24 months, we are going to be looking at a couple of these technologies, developing them and comparing them with our TCCON data and if it works out we will then commercialise this instrument". The team's mobile prototype is a thumb sized crystal in a box inside a miniature heater.
Dr Jones said the mobile system would be autonomous and made up of a solar tracker to direct sunlight into the instrument, a spectrometer and computer control able to analyse data and send it back to a base station. "So there will be some kind of data archiving system, which then has to grab that data and send it off to the end user, such as the Bureau of Meteorology". The GGM partners also include University of Melbourne and Australian National University, the Bureau of Meteorology, Rosebank Engineering and Vipac Engineers and Scientists.
"We are probably one to two years ahead of the rest of the field, so we are hoping that we can get something to market before someone else does", Dr Jones said. He said the technology would also help in the scientific understanding of the carbon cycle and in climate modelling and the effects of El Nino and La Nina. "If we are able to predict those sorts of events more accurately, that has huge implications in terms of economic impact on the country", he said.
How wind power can save farms
Age
28 June 2011, Page: 14
WHAT about a Senate inquiry into the health effects of not building wind farms? Rural Danish communities are dying for the same reasons as rural Australian ones are: farmers are abandoning uneconomic farms; without employment, young families and working age adults are relocating to the cities; and without the population to support them, medical infrastructure has collapsed and schools, banks and village businesses are closing.
Danish government policies expedite approval selling excess energy from their community owned wind farm, many social problems are resolved. A recent documentary featured wind power in Denmark, a world leader in this.
Replying to a question about the consequences of locating a wind farm close to his village, a resident put it succinctly: "Compared to bankruptcy, depression, substance abuse, domestic violence, family breakdowns, loss of community and suicide? - negligible"
Tim Hughes, Kensington
28 June 2011, Page: 14
WHAT about a Senate inquiry into the health effects of not building wind farms? Rural Danish communities are dying for the same reasons as rural Australian ones are: farmers are abandoning uneconomic farms; without employment, young families and working age adults are relocating to the cities; and without the population to support them, medical infrastructure has collapsed and schools, banks and village businesses are closing.
Danish government policies expedite approval selling excess energy from their community owned wind farm, many social problems are resolved. A recent documentary featured wind power in Denmark, a world leader in this.
Replying to a question about the consequences of locating a wind farm close to his village, a resident put it succinctly: "Compared to bankruptcy, depression, substance abuse, domestic violence, family breakdowns, loss of community and suicide? - negligible"
Tim Hughes, Kensington
AGL to land $38m
Adelaide Advertiser
28 June 2011, Page: 55
AGL Energy will earn a development fee of $38 million from the sale of its Oaklands Hill wind farm, which is now under construction in western Victoria. The development fee would be implemented on the completion of the project, with $30 million likely to be recognised this financial year and the balance in 2011-12, AGL Energy said in a statement yesterday.
28 June 2011, Page: 55
AGL Energy will earn a development fee of $38 million from the sale of its Oaklands Hill wind farm, which is now under construction in western Victoria. The development fee would be implemented on the completion of the project, with $30 million likely to be recognised this financial year and the balance in 2011-12, AGL Energy said in a statement yesterday.
Independent inquiry reveals why we're paying more for power
Sunday Tasmanian
26 June 2011, Page: 1
HOUSEHOLDS are paying to keep the Tamar Valley power station viable, an independent review of Tasmania's electricity prices has concluded. The Independent Review of the Tasmanian Electricity Sector's Issues Paper shows the gas fired station has been propped up by households and small businesses through recent power price increases. The report indicates these two groups, as non contestable customers, are bearing the burden to keep the Aurora Energy station up and running despite it being only a back up option for all electricity users.
The report said: "Prices for noncontestable customers, through the regulatory framework, have been increased to preserve the viability of the TVPS. Essentially non contestable customers appear to be funding the 'insurance premium' being the difference between the market related value of the TVPS and its full cost yet the facility provides risk mitigation for all electrical users".
Opposition energy spokesman Matt Groom said households were paying because in June 2010 the Labor Green Government had changed the rules for the economic regulator, which meant prices were based on long range marginal costs (LRMC) and not market costs. "The Green Labor government is forcing households and small businesses to subsidise Aurora Energy by artificially jacking up power prices to a higher level than they should be", he said yesterday.
A table in the Issues Paper shows long range marginal costs estimates can be up to 12.4% greater than market cost estimates. Mr Groom said LRMC estimates pushed the costs for households up while protecting companies that could buy bulk power from interstate firms in the contestable market. "The Labor Green government has rigged the role of the economic regulator to artificially jack up power prices in order to stop Aurora Energy from going broke", he said.
Mr Groom said the report confirmed the Liberals' long held belief that small business and households are paying more for power than they should. The paper shows that if the energy market was opened up to competition, households and small businesses could be paying less for power, he said. Energy Minister Bryan Green said the Government would properly consider the review's findings after all deliberations by its panel of experts. He did not comment about the TVPS or the LRMC estimates.
"We will not be distracted by the antics of the Liberals and their political commentary on the review as the panel continues its important work", he said. "As expected, a wide range of issues has been raised with the panel during the public consultation. The Liberals are being opportunist and simplistic in relation to the complex issue of power pricing. "The Liberals have no evidence to support their claim that going to full retail contestability will mean lower electricity prices in Tasmania.
"They are gambling with future power prices because they don't know whether consumers will benefit. The Government is not prepared to take that gamble. "The Government needs to be sure the benefits of full retail contestability outweigh the costs and is taking a responsible approach by referring the matter to the expert panel to consider as part of its review. "Long range marginal cost (LRMC) is no more than recovering the costs of power generation".
26 June 2011, Page: 1
HOUSEHOLDS are paying to keep the Tamar Valley power station viable, an independent review of Tasmania's electricity prices has concluded. The Independent Review of the Tasmanian Electricity Sector's Issues Paper shows the gas fired station has been propped up by households and small businesses through recent power price increases. The report indicates these two groups, as non contestable customers, are bearing the burden to keep the Aurora Energy station up and running despite it being only a back up option for all electricity users.
The report said: "Prices for noncontestable customers, through the regulatory framework, have been increased to preserve the viability of the TVPS. Essentially non contestable customers appear to be funding the 'insurance premium' being the difference between the market related value of the TVPS and its full cost yet the facility provides risk mitigation for all electrical users".
Opposition energy spokesman Matt Groom said households were paying because in June 2010 the Labor Green Government had changed the rules for the economic regulator, which meant prices were based on long range marginal costs (LRMC) and not market costs. "The Green Labor government is forcing households and small businesses to subsidise Aurora Energy by artificially jacking up power prices to a higher level than they should be", he said yesterday.
A table in the Issues Paper shows long range marginal costs estimates can be up to 12.4% greater than market cost estimates. Mr Groom said LRMC estimates pushed the costs for households up while protecting companies that could buy bulk power from interstate firms in the contestable market. "The Labor Green government has rigged the role of the economic regulator to artificially jack up power prices in order to stop Aurora Energy from going broke", he said.
Mr Groom said the report confirmed the Liberals' long held belief that small business and households are paying more for power than they should. The paper shows that if the energy market was opened up to competition, households and small businesses could be paying less for power, he said. Energy Minister Bryan Green said the Government would properly consider the review's findings after all deliberations by its panel of experts. He did not comment about the TVPS or the LRMC estimates.
"We will not be distracted by the antics of the Liberals and their political commentary on the review as the panel continues its important work", he said. "As expected, a wide range of issues has been raised with the panel during the public consultation. The Liberals are being opportunist and simplistic in relation to the complex issue of power pricing. "The Liberals have no evidence to support their claim that going to full retail contestability will mean lower electricity prices in Tasmania.
"They are gambling with future power prices because they don't know whether consumers will benefit. The Government is not prepared to take that gamble. "The Government needs to be sure the benefits of full retail contestability outweigh the costs and is taking a responsible approach by referring the matter to the expert panel to consider as part of its review. "Long range marginal cost (LRMC) is no more than recovering the costs of power generation".
Friday, 1 July 2011
Solar subsidy phase-out
Adelaide Advertiser
24 June 2011, Page: 23
Australians have been queueing up to get on to the bandwagon but the experience of going solar is starting to turn sour for many as waiting times blow out to up to six months. Many are now caught in a logjam of thousands trying to flick the switch on green power as quickly as possible before federal and state solar subsidies are phased out. Solar subsidies, which helped the industry find its feet under the Howard Government years, are on the way out, creating a number of network connection, resource and supply issues for the industry.
From making a decision to buy the solar panels, to installing them, and to actually connecting them to the grid is taking anywhere between two and six months, irrespective of size or value of the installation. This is largely because of the demand caused by the phasing out of the existing state solar feed in tariff scheme and the federal solar certificates scheme. Adrian Ferraretto, from the SA Solar Panel Industry Group, said consumers could be forced to wait up to six months to have panels installed.
Under an amended state solar feed in tariff scheme passed yesterday, every household that generates solar power and feeds excess power back to the grid gets 44¢ from the energy retailer until 2028, with this scheme closing for new entrants on September 30. New entrants signing up before September 30, 2013, will get only 16¢ (plus 6¢ from their retailer) until September 30, 2016.
South Australia was the first state to introduce a feed in tariff scheme in July 2008 and it will run until 2028. But all states are now phasing them out because of the cost burden shared by all power customers in every state with a scheme. Anyone deciding to install a solar panel system today would first need to pick a solar retailer and they are a dime a dozen.
Choosing an accredited supplier with a good track record is best because the boom in the industry has left the door open to a number of dodgy installers. This is especially important, given that the installation contract comes with a 30 year warranty for the panels, a five year warranty for the electricity inverter and a five year warranty for the workmanship.
In the case of Solar Shop, customers contact the call centre first and are asked to choose between having a detailed phone conversation, visiting a branch, and having a renewable energy advisor come in for a free house consult. Most decide on a house consult, which follows two weeks later. The visit includes site/roof assessment and finding out what the customer wants reduction in electricity bills, excess power generation to take advantage of solar feed in tariffs, or both.
A north facing roof is ideal for installations. The advisor provides a quote based on the needs, pricing, available subsidies, discounts and any financing facilities the customer wants to use. Customers can then take up to 14 days to decide on the quote, following which a contract is signed and a 10% deposit paid to the solar panel retailer.
The installer co ordinates with ETSA to get permission to connect to the electricity grid, which then needs to be approved by the customer's energy retailer. It is sent back to ETSA for a date at which an import-export meter can be installed, which allows electricity generated to be put into the electricity grid and the house to draw any electricity it needs. A shortage of import-export meters saw waiting times for connection to the grid balloon by up to four months in May.
However, a spokesman said an increase in installer resources, coupled with a reliable new supply of meters, had allowed some bookings to be brought forward. Customers calling ETSA today would get a booking for a meter in the second half of August. That means panels can be sitting on a customer's roof for at least two months before they are connected to the grid. Once the meter is installed, customers can be paid for all the electricity they generate. Currently about 41,888 households have solar installations and there are more than 26,789 households waiting to be connected.
24 June 2011, Page: 23
Australians have been queueing up to get on to the bandwagon but the experience of going solar is starting to turn sour for many as waiting times blow out to up to six months. Many are now caught in a logjam of thousands trying to flick the switch on green power as quickly as possible before federal and state solar subsidies are phased out. Solar subsidies, which helped the industry find its feet under the Howard Government years, are on the way out, creating a number of network connection, resource and supply issues for the industry.
From making a decision to buy the solar panels, to installing them, and to actually connecting them to the grid is taking anywhere between two and six months, irrespective of size or value of the installation. This is largely because of the demand caused by the phasing out of the existing state solar feed in tariff scheme and the federal solar certificates scheme. Adrian Ferraretto, from the SA Solar Panel Industry Group, said consumers could be forced to wait up to six months to have panels installed.
Under an amended state solar feed in tariff scheme passed yesterday, every household that generates solar power and feeds excess power back to the grid gets 44¢ from the energy retailer until 2028, with this scheme closing for new entrants on September 30. New entrants signing up before September 30, 2013, will get only 16¢ (plus 6¢ from their retailer) until September 30, 2016.
South Australia was the first state to introduce a feed in tariff scheme in July 2008 and it will run until 2028. But all states are now phasing them out because of the cost burden shared by all power customers in every state with a scheme. Anyone deciding to install a solar panel system today would first need to pick a solar retailer and they are a dime a dozen.
Choosing an accredited supplier with a good track record is best because the boom in the industry has left the door open to a number of dodgy installers. This is especially important, given that the installation contract comes with a 30 year warranty for the panels, a five year warranty for the electricity inverter and a five year warranty for the workmanship.
In the case of Solar Shop, customers contact the call centre first and are asked to choose between having a detailed phone conversation, visiting a branch, and having a renewable energy advisor come in for a free house consult. Most decide on a house consult, which follows two weeks later. The visit includes site/roof assessment and finding out what the customer wants reduction in electricity bills, excess power generation to take advantage of solar feed in tariffs, or both.
A north facing roof is ideal for installations. The advisor provides a quote based on the needs, pricing, available subsidies, discounts and any financing facilities the customer wants to use. Customers can then take up to 14 days to decide on the quote, following which a contract is signed and a 10% deposit paid to the solar panel retailer.
The installer co ordinates with ETSA to get permission to connect to the electricity grid, which then needs to be approved by the customer's energy retailer. It is sent back to ETSA for a date at which an import-export meter can be installed, which allows electricity generated to be put into the electricity grid and the house to draw any electricity it needs. A shortage of import-export meters saw waiting times for connection to the grid balloon by up to four months in May.
However, a spokesman said an increase in installer resources, coupled with a reliable new supply of meters, had allowed some bookings to be brought forward. Customers calling ETSA today would get a booking for a meter in the second half of August. That means panels can be sitting on a customer's roof for at least two months before they are connected to the grid. Once the meter is installed, customers can be paid for all the electricity they generate. Currently about 41,888 households have solar installations and there are more than 26,789 households waiting to be connected.
SA solar: Bruised but not beaten
www.cleanenergycouncil.org.au
24 Jun 2011
Last night's decision by the South Australian parliament to extend the solar feed-in tariff at a lower level for two years is a much-needed reprieve for the local industry, according to the Clean Energy Council's Chief Executive Matthew Warren today. Although the transition package is modest and less than what the industry believes is appropriate, it will nevertheless help to reduce the rate of jobs losses that would have otherwise occurred.
"This is important for South Australian consumers and the industry. There's no doubt the industry is disappointed with the severity of the changes, but we are appreciative the Government was open to significantly improving its original legislation," Mr Warren said.
"Without these amendments there would have been a huge spike in demand for solar after the proposed increase in the feed-in tariff, followed by a big slump when it ended later in this year. "This wouldn't serve consumers or be conducive to industry best practice in South Australia. There are more than 1000 well-trained workers in the industry, which is a significant part of the local economy.
"However, there should be no misunderstanding about the serious impact this legislation will have on the economic viability of many solar installer companies. Much of the South Australian solar industry is made up of small businesses. "While some will find ways to adjust to the lower levels of support, many will not."
The Clean Energy Council is hopeful the door remains open to improve the package at a later date. It offered alternative models, which would have both significantly reduced the overall cost to South Australian households, and more effectively smoothed out the process of rolling back the feed-in tariff.
Nevertheless, the medium term outlook for the solar industry remains positive, with the costs of solar technology continuing to fall rapidly. "Grid parity" (where the cost of energy produced by solar panels is equal to what consumers pay for electricity) is likely to be achieved in three-to-five years. Solar PV is a great investment for households concerned about rising electricity prices and wanting to help cut pollution and consumers should be confident that the local industry will deliver quality products and services.
24 Jun 2011
Last night's decision by the South Australian parliament to extend the solar feed-in tariff at a lower level for two years is a much-needed reprieve for the local industry, according to the Clean Energy Council's Chief Executive Matthew Warren today. Although the transition package is modest and less than what the industry believes is appropriate, it will nevertheless help to reduce the rate of jobs losses that would have otherwise occurred."This is important for South Australian consumers and the industry. There's no doubt the industry is disappointed with the severity of the changes, but we are appreciative the Government was open to significantly improving its original legislation," Mr Warren said.
"Without these amendments there would have been a huge spike in demand for solar after the proposed increase in the feed-in tariff, followed by a big slump when it ended later in this year. "This wouldn't serve consumers or be conducive to industry best practice in South Australia. There are more than 1000 well-trained workers in the industry, which is a significant part of the local economy.
"However, there should be no misunderstanding about the serious impact this legislation will have on the economic viability of many solar installer companies. Much of the South Australian solar industry is made up of small businesses. "While some will find ways to adjust to the lower levels of support, many will not."
The Clean Energy Council is hopeful the door remains open to improve the package at a later date. It offered alternative models, which would have both significantly reduced the overall cost to South Australian households, and more effectively smoothed out the process of rolling back the feed-in tariff.
Nevertheless, the medium term outlook for the solar industry remains positive, with the costs of solar technology continuing to fall rapidly. "Grid parity" (where the cost of energy produced by solar panels is equal to what consumers pay for electricity) is likely to be achieved in three-to-five years. Solar PV is a great investment for households concerned about rising electricity prices and wanting to help cut pollution and consumers should be confident that the local industry will deliver quality products and services.
Wind farm inquiry balanced and reasonable: industry
www.cleanenergycouncil.org.au
23 Jun 2011
The renewable energy industry has welcomed today's report of the Senate Inquiry into the Social and Economic Impact of Rural Wind Farms, saying it provided no reason to stop the roll out of this important clean energy technology. Clean Energy Council Policy Director Russell Marsh said the report raised some issues to consider, but it was critical the industry got on with the job of building clean energy in Australia.
"The Senate inquiry process was a way for the silent majority of wind farm supporters to have their voices heard," he said. "While we acknowledge that any change will have its critics, the vast majority of submissions to the inquiry were positive about wind farms in rural communities. Around 80% of the submissions were positive and there were more than 1100 submissions from the Hepburn community alone.
"Several findings within the report recognised the contribution of wind power to jobs in regional areas, as well as its contribution to the incomes of farmers. It reflects opinion polls that consistently show approximately 80% of Australians support wind power. "Our only regret is that there were not more opportunities for residents supportive of wind power to appear before the Senate committee."
Mr Marsh said the inquiry found nothing to suggest that wind farms directly cause health problems and suggested that symptoms could potentially be related to other factors such as stress.
"It did make a recommendation that Commonwealth Government studies into noise and health should be conducted, and the industry welcomes this. We also support the continuing review into the science of wind turbines and health by the National Health and Medical Research Council. "The Clean Energy Council would like to thank the Committee for examining this issue so thoroughly and providing a forum where all stakeholders were able to have a voice."
23 Jun 2011
The renewable energy industry has welcomed today's report of the Senate Inquiry into the Social and Economic Impact of Rural Wind Farms, saying it provided no reason to stop the roll out of this important clean energy technology. Clean Energy Council Policy Director Russell Marsh said the report raised some issues to consider, but it was critical the industry got on with the job of building clean energy in Australia."The Senate inquiry process was a way for the silent majority of wind farm supporters to have their voices heard," he said. "While we acknowledge that any change will have its critics, the vast majority of submissions to the inquiry were positive about wind farms in rural communities. Around 80% of the submissions were positive and there were more than 1100 submissions from the Hepburn community alone.
"Several findings within the report recognised the contribution of wind power to jobs in regional areas, as well as its contribution to the incomes of farmers. It reflects opinion polls that consistently show approximately 80% of Australians support wind power. "Our only regret is that there were not more opportunities for residents supportive of wind power to appear before the Senate committee."
Mr Marsh said the inquiry found nothing to suggest that wind farms directly cause health problems and suggested that symptoms could potentially be related to other factors such as stress.
"It did make a recommendation that Commonwealth Government studies into noise and health should be conducted, and the industry welcomes this. We also support the continuing review into the science of wind turbines and health by the National Health and Medical Research Council. "The Clean Energy Council would like to thank the Committee for examining this issue so thoroughly and providing a forum where all stakeholders were able to have a voice."
Thursday, 30 June 2011
Solar panels top safety record: industry
www.cleanenergycouncil.org.au
23 Jun 2011
Incorrectly installed solar panels pose a very low risk to households, and the safest thing to do is leave the system alone, according to the Clean Energy Council. The advice follows the statement by NSW Premier Barry O'Farrell who today flagged the result of new inspections in western Sydney reporting an unacceptable level of systems with an incorrectly installed system.
The peak body's Chief Executive Matthew Warren today reassured consumers about the safety of solar power technology which is providing clean energy to more than 300,000 households around Australia. An independent assessment by the industry's expert advisory panel confirmed the risk from any incorrect installation of the switch is very low.
"The solar PV industry has an excellent safety record. There are now more than 300,000 solar systems in Australia some of them operating for more than a decade, and only three minor incidents have been reported during this time", Mr Warren said.
The main issue identified in the recent audits was an incorrectly wired circuit breaker. This issue had been identified by governments and industry late last year and remedial action by the solar industry was already well underway. "We would like to remind solar households that the safest thing to do is to leave your system alone. In the unlikely event that there is a fault with your system, it is only triggered by incorrectly switching it on and off".
Mr Warren urged anyone with concerns about their solar panels to contact the company who supplied their system. By law solar panels have to be installed by a licensed electrician who has been specially trained to install household solar, with all systems inspected at least once by an independent authority before they are switched on. "There is a rigorous compliance system for solar panels that has been in place in Australia since it was introduced by the Howard Government in 2001", said Mr Warren.
23 Jun 2011
Incorrectly installed solar panels pose a very low risk to households, and the safest thing to do is leave the system alone, according to the Clean Energy Council. The advice follows the statement by NSW Premier Barry O'Farrell who today flagged the result of new inspections in western Sydney reporting an unacceptable level of systems with an incorrectly installed system.The peak body's Chief Executive Matthew Warren today reassured consumers about the safety of solar power technology which is providing clean energy to more than 300,000 households around Australia. An independent assessment by the industry's expert advisory panel confirmed the risk from any incorrect installation of the switch is very low.
"The solar PV industry has an excellent safety record. There are now more than 300,000 solar systems in Australia some of them operating for more than a decade, and only three minor incidents have been reported during this time", Mr Warren said.
The main issue identified in the recent audits was an incorrectly wired circuit breaker. This issue had been identified by governments and industry late last year and remedial action by the solar industry was already well underway. "We would like to remind solar households that the safest thing to do is to leave your system alone. In the unlikely event that there is a fault with your system, it is only triggered by incorrectly switching it on and off".
Mr Warren urged anyone with concerns about their solar panels to contact the company who supplied their system. By law solar panels have to be installed by a licensed electrician who has been specially trained to install household solar, with all systems inspected at least once by an independent authority before they are switched on. "There is a rigorous compliance system for solar panels that has been in place in Australia since it was introduced by the Howard Government in 2001", said Mr Warren.
Don't short change solar - Industry
Clean Energy Council
22 Jun 2011
The SA Government should be congratulated on today's news that it has reached its 20% Renewable Energy Target, but has been warned not to short change the solar industry in Parliament tomorrow.
The Clean Energy Council, the peak body of more than 500 renewable energy companies, urged the Rann Government to consider South Australian consumers and the local solar industry when it debates the final detail of changes to the feed in tariff in SA Parliament tomorrow.
The solar industry this afternoon urgently called on the SA Government to avoid an unnecessarily severe transition package as part of the scaling down of the feed in tariff. The Clean Energy Council's Policy Manager Tim Sonnreich feared the Government had its priorities wrong, by giving more on households which already have solar, at the expense of those who would benefit from installing it in the future.
"The industry has identified potential savings of well over $100 million and is asking for just a fraction of this to be added to the transition package. This would minimise potential job losses and protect consumers. "There is a better way to resolve this, which costs households less but helps them more to access the benefits of solar PV. Mr Sonnreich said.
"We're very close to getting a package that the industry can support which will ease the pressure on South Australian taxpayers. But we're not there yet. "We concede the Government is making progress in its bid to support the industry, but time is almost up to get this right". The Clean Energy Council is working with the Government to ensure the industry can continue to operate in a way that is efficient and safe for consumers.
22 Jun 2011
The SA Government should be congratulated on today's news that it has reached its 20% Renewable Energy Target, but has been warned not to short change the solar industry in Parliament tomorrow.The Clean Energy Council, the peak body of more than 500 renewable energy companies, urged the Rann Government to consider South Australian consumers and the local solar industry when it debates the final detail of changes to the feed in tariff in SA Parliament tomorrow.
The solar industry this afternoon urgently called on the SA Government to avoid an unnecessarily severe transition package as part of the scaling down of the feed in tariff. The Clean Energy Council's Policy Manager Tim Sonnreich feared the Government had its priorities wrong, by giving more on households which already have solar, at the expense of those who would benefit from installing it in the future.
"The industry has identified potential savings of well over $100 million and is asking for just a fraction of this to be added to the transition package. This would minimise potential job losses and protect consumers. "There is a better way to resolve this, which costs households less but helps them more to access the benefits of solar PV. Mr Sonnreich said.
"We're very close to getting a package that the industry can support which will ease the pressure on South Australian taxpayers. But we're not there yet. "We concede the Government is making progress in its bid to support the industry, but time is almost up to get this right". The Clean Energy Council is working with the Government to ensure the industry can continue to operate in a way that is efficient and safe for consumers.
UK Met Office launch eco T-shirt range
www.rapanuiclothing.com
June 2011
UK: The Met Office has teamed up with Rapanui, an eco fashion company, to create a range of weather related T shirts just in time for summer. The Met Office eco clothing collection is made from organic cotton in an ethical, wind powered factory and features a range of weather related designs inspired by the imagery, science and history of the Met Office.
Mart Drake Knight co founder of Rapanui said: "The Met Office is the international authority on climate change research, as well as being our national weather service that provides weather forecasts that we can trust and rely on".
"At Rapanui we think that it's not that people don't care about climate and the environment, it's just that they don't know where to start when it comes to organic, ethical or low carbon alternatives. Our brand is about making eco fashion cool and accessible. We were delighted when we were invited to design these Met Office t shirts. I think as well as being a nod to the Met Office's heritage and expertise, we managed to add a bit of 'Britishness' and humour to capture the spirit of 'the weather' as a subject".
The collaboration was designed to bring new audiences to the Met Office. Luke Green from the Met Office said: "Weather fascinates everybody and these t shirts provide a fun way of reaching new audiences about the work the Met Office does. The collaboration with Rapanui to design and produce these t shirts is hopefully the first step in developing new partnerships to promote our brand".
T shirts are available online via the Rapanui website.
June 2011
UK: The Met Office has teamed up with Rapanui, an eco fashion company, to create a range of weather related T shirts just in time for summer. The Met Office eco clothing collection is made from organic cotton in an ethical, wind powered factory and features a range of weather related designs inspired by the imagery, science and history of the Met Office.Mart Drake Knight co founder of Rapanui said: "The Met Office is the international authority on climate change research, as well as being our national weather service that provides weather forecasts that we can trust and rely on".
"At Rapanui we think that it's not that people don't care about climate and the environment, it's just that they don't know where to start when it comes to organic, ethical or low carbon alternatives. Our brand is about making eco fashion cool and accessible. We were delighted when we were invited to design these Met Office t shirts. I think as well as being a nod to the Met Office's heritage and expertise, we managed to add a bit of 'Britishness' and humour to capture the spirit of 'the weather' as a subject".
The collaboration was designed to bring new audiences to the Met Office. Luke Green from the Met Office said: "Weather fascinates everybody and these t shirts provide a fun way of reaching new audiences about the work the Met Office does. The collaboration with Rapanui to design and produce these t shirts is hopefully the first step in developing new partnerships to promote our brand".
T shirts are available online via the Rapanui website.
Wednesday, 29 June 2011
Spaniards want more than Moree
Summaries - Australian Financial Review
22 June 2011, Page: 50
Javier Huergo of Fotowatio Renewable Ventures, backed by General Electric and a major partner (along with BP and Pacific Hydro) in the forthcoming Moree solar power project, says his firm envisions a future firmly ensconced in Australia's power generation mix. The firm does not do "one off" projects, he says. The Moree plant was instigated by the federal government's Solar Flagship initiative. The Renewable Energy Certificate system, a mechanism for the funding of such projects, is still in the doldrums following the blowout of various state residential solar panel schemes. The Moree plans are not finalised, with FRV being advised by Investec Bank in the matter.
22 June 2011, Page: 50
Javier Huergo of Fotowatio Renewable Ventures, backed by General Electric and a major partner (along with BP and Pacific Hydro) in the forthcoming Moree solar power project, says his firm envisions a future firmly ensconced in Australia's power generation mix. The firm does not do "one off" projects, he says. The Moree plant was instigated by the federal government's Solar Flagship initiative. The Renewable Energy Certificate system, a mechanism for the funding of such projects, is still in the doldrums following the blowout of various state residential solar panel schemes. The Moree plans are not finalised, with FRV being advised by Investec Bank in the matter.
Fracking nightmare
Hobart Mercury
23 June 2011, Page: 20
I AM astonished that the Federal Government is classifying natural gas and "clean" coal as clean energy. That is absurd: both are carbon fuels that release CO₂ on burning. Further, clean coal has yet to be made and it uses a lot of energy in becoming so, if it ever does.
Gas opens up the nightmare of coal seam gas fracking fracturing a rock layer which destroys the water table and perfectly good farmland with it, not to mention methane release, which is worse for greenhouse than CO₂ and the health risks of the chemicals used in fracking.
The Government is heading down a nightmare scenario for all, except for the short term interests of mining companies. The Government is being disingenuous. Clean energy includes sources that leave no carbon footprint, like wind, tidal, solar and thermal. These are the way to go.
John Biggs, Sandy Bay
23 June 2011, Page: 20
I AM astonished that the Federal Government is classifying natural gas and "clean" coal as clean energy. That is absurd: both are carbon fuels that release CO₂ on burning. Further, clean coal has yet to be made and it uses a lot of energy in becoming so, if it ever does.
Gas opens up the nightmare of coal seam gas fracking fracturing a rock layer which destroys the water table and perfectly good farmland with it, not to mention methane release, which is worse for greenhouse than CO₂ and the health risks of the chemicals used in fracking.
The Government is heading down a nightmare scenario for all, except for the short term interests of mining companies. The Government is being disingenuous. Clean energy includes sources that leave no carbon footprint, like wind, tidal, solar and thermal. These are the way to go.
John Biggs, Sandy Bay
Govt rejects solar tariff amendment
Canberra Times
23 June 2011, Page: 6
ACT: Sustainability Minister Simon Corbell has rejected an emergency measure to save the household solar feed in tariff scheme, saying it would only offer false hope. Greens Speaker Shane Rattenbury introduced an amendment to the Government's legislation yesterday that he said would save small businesses in danger of going bankrupt over the scheme's ending. The Government abruptly ended an incentive scheme designed to encourage householders and small businesses to install rooftop solar power, and benefit the sustainable energy market.
At the time, Mr Corbell said the cap of 15 MWs had been reached far earlier than the Government had expected, but the medium scale scheme would continue. Mr Rattenbury's proposal would have rolled the household in with the existing medium scale scheme, which has not yet reached capacity. It would also mean all connections made after September 1 would be eligible for 75% of the rate, making the scheme cost neutral to Government.
Mr Rattenbury said yesterday he was in discussions with the Government and the Opposition over his proposal. But Mr Corbell rejected the Bill last night, saying it would damage the medium scale scheme designed to harness large rooftop spaces for solar power. He said he had been forced to take an estimated 6 MW of capacity from the medium scale scheme to honour existing commitments in the small scale sector.
"If we open up the medium sector, it will be fully subscribed by the end of the year, and then we'll be exactly where we are now", he said. "In simple terms, what Mr Rattenbury is offering is false hope". Mr Rattenbury said the small scale solar sector was caught by surprise by the scheme's abrupt ending.
"Everyone was bundling along, building up their skills and all of a sudden the minister's come along and said, 'It's over.' Mr Rattenbury introduced his amendment the day after about 100 protesters rallied outside the Assembly calling for respite for the industry.
David Payne, of Environmentally Friendly Products said axing the small scale scheme would devastate the industry and cost up to 200 jobs. He said the industry was not yet prepared to jump wholesale into the medium scale sector, which had different risks and demands to smaller schemes. A Liberals spokesman said the party had not decided whether to support Mr Rattenbury's proposal. "We are prepared to negotiate to assist the industry through a transition".
23 June 2011, Page: 6
ACT: Sustainability Minister Simon Corbell has rejected an emergency measure to save the household solar feed in tariff scheme, saying it would only offer false hope. Greens Speaker Shane Rattenbury introduced an amendment to the Government's legislation yesterday that he said would save small businesses in danger of going bankrupt over the scheme's ending. The Government abruptly ended an incentive scheme designed to encourage householders and small businesses to install rooftop solar power, and benefit the sustainable energy market.
At the time, Mr Corbell said the cap of 15 MWs had been reached far earlier than the Government had expected, but the medium scale scheme would continue. Mr Rattenbury's proposal would have rolled the household in with the existing medium scale scheme, which has not yet reached capacity. It would also mean all connections made after September 1 would be eligible for 75% of the rate, making the scheme cost neutral to Government.
Mr Rattenbury said yesterday he was in discussions with the Government and the Opposition over his proposal. But Mr Corbell rejected the Bill last night, saying it would damage the medium scale scheme designed to harness large rooftop spaces for solar power. He said he had been forced to take an estimated 6 MW of capacity from the medium scale scheme to honour existing commitments in the small scale sector.
"If we open up the medium sector, it will be fully subscribed by the end of the year, and then we'll be exactly where we are now", he said. "In simple terms, what Mr Rattenbury is offering is false hope". Mr Rattenbury said the small scale solar sector was caught by surprise by the scheme's abrupt ending.
"Everyone was bundling along, building up their skills and all of a sudden the minister's come along and said, 'It's over.' Mr Rattenbury introduced his amendment the day after about 100 protesters rallied outside the Assembly calling for respite for the industry.
David Payne, of Environmentally Friendly Products said axing the small scale scheme would devastate the industry and cost up to 200 jobs. He said the industry was not yet prepared to jump wholesale into the medium scale sector, which had different risks and demands to smaller schemes. A Liberals spokesman said the party had not decided whether to support Mr Rattenbury's proposal. "We are prepared to negotiate to assist the industry through a transition".
Tuesday, 28 June 2011
Solar rethink
www.climatespectator.com.au
Thu, 23 Jun 2011
The Australian Greens and key independents Rob Oakeshott and Tony Windsor have supported a push to have a national approach for the solar industry, rather than piecemeal policies from the states. The Greens and the solar industry have been pushing for a 1:1 net tariff for rooftop solar, and also measures that will encourage development of commercial and large scale installations. They'd probably like to use the policies of the ACT as a template. "What we now need is,.. a one for one, so for every kW that you generate from your renewables you should get the same price as you pay for a kW you take from the system", Senator Christine Milne said. "That way we would get the industry on a long term sustainable basis".
The politicians have also questioned the Productivity Commission assessment of solar tariffs, suggesting that like the NSW government assessment of the costs of the solar bonus scheme they have have got their figures wrong by underestimating the size of the average solar system, and over estimating the ratio of power going back into the grid. Meanwhile, the two major solar peak bodies, the Australian Solar Energy Society and the Solar Energy Industries Association, are holding a "national solar summit" at NSW Parliament House on Thursday to devise a national strategy for solar policy and push their case for a 1:1 net tariff.
Thu, 23 Jun 2011
The Australian Greens and key independents Rob Oakeshott and Tony Windsor have supported a push to have a national approach for the solar industry, rather than piecemeal policies from the states. The Greens and the solar industry have been pushing for a 1:1 net tariff for rooftop solar, and also measures that will encourage development of commercial and large scale installations. They'd probably like to use the policies of the ACT as a template. "What we now need is,.. a one for one, so for every kW that you generate from your renewables you should get the same price as you pay for a kW you take from the system", Senator Christine Milne said. "That way we would get the industry on a long term sustainable basis".
The politicians have also questioned the Productivity Commission assessment of solar tariffs, suggesting that like the NSW government assessment of the costs of the solar bonus scheme they have have got their figures wrong by underestimating the size of the average solar system, and over estimating the ratio of power going back into the grid. Meanwhile, the two major solar peak bodies, the Australian Solar Energy Society and the Solar Energy Industries Association, are holding a "national solar summit" at NSW Parliament House on Thursday to devise a national strategy for solar policy and push their case for a 1:1 net tariff.
Grid gains
www.climatespectator.com.au
Thu, 23 Jun 2011
Australia's first community owned wind farm, the two turbine Hepburn Wind, began exporting energy to the electricity grid for the first time on Wednesday. The 4 MW wind farm, located near the town of Daylesford, was initiated and funded mostly by 1700 members of the local community, and will provide more than local needs. "This is a great achievement for the Hepburn Shire Council and community. Six years ago, our community chose to be a beneficiary of the move to clean energy", Hepburn Wind chairman, Simon Holmes a Court said.
"While the political debates about carbon pricing have bogged down, the Hepburn community has built its own wind farm, which will generate enough electricity to offset most of the town". Holmes a Court said more than 45 communities have contacted Hepburn Wind's sister organisation, Embark, about adapting the Hepburn model to create similar community projects, be it in wind, solar or bioenergy. The Hepburn wind farm last week won the Victorian Premier's sustainability award.
Thu, 23 Jun 2011
Australia's first community owned wind farm, the two turbine Hepburn Wind, began exporting energy to the electricity grid for the first time on Wednesday. The 4 MW wind farm, located near the town of Daylesford, was initiated and funded mostly by 1700 members of the local community, and will provide more than local needs. "This is a great achievement for the Hepburn Shire Council and community. Six years ago, our community chose to be a beneficiary of the move to clean energy", Hepburn Wind chairman, Simon Holmes a Court said.
"While the political debates about carbon pricing have bogged down, the Hepburn community has built its own wind farm, which will generate enough electricity to offset most of the town". Holmes a Court said more than 45 communities have contacted Hepburn Wind's sister organisation, Embark, about adapting the Hepburn model to create similar community projects, be it in wind, solar or bioenergy. The Hepburn wind farm last week won the Victorian Premier's sustainability award.
Premier supports wind farms
Adelaide Advertiser
23 June 2011, Page: 33
THE Government is examining options to provide certainty for new wind farms in SA after a court disallowed an application because of its impact on visual amenity. Premier Mike Rann told Parliament yesterday the Government was concerned about future wind farm investment after the recent judgment by the Environment, Resources and Development Court. The decision blocked the proposed $175 million Acciona Energy wind farm at Allendale East.
There have also been growing protests from residents in the Mid North about wind farms on the grounds of their possible health dangers. "I note that the visual impact argument was dismissed by the court in an earlier appeal of another wind farm proposal", Mr Rann said. "A large part of our success in building an international reputation for hosting wind investment has been our commitment to making the regulatory environment as certain as possible. The Government will now be considering its options for maintaining that certainty in the light of the court's decisions".
23 June 2011, Page: 33
THE Government is examining options to provide certainty for new wind farms in SA after a court disallowed an application because of its impact on visual amenity. Premier Mike Rann told Parliament yesterday the Government was concerned about future wind farm investment after the recent judgment by the Environment, Resources and Development Court. The decision blocked the proposed $175 million Acciona Energy wind farm at Allendale East.
There have also been growing protests from residents in the Mid North about wind farms on the grounds of their possible health dangers. "I note that the visual impact argument was dismissed by the court in an earlier appeal of another wind farm proposal", Mr Rann said. "A large part of our success in building an international reputation for hosting wind investment has been our commitment to making the regulatory environment as certain as possible. The Government will now be considering its options for maintaining that certainty in the light of the court's decisions".
Bligh seeks to build on exemptions for coal seam sector
Australian
22 June 2011, Page: 6
QUEENSLAND is attempting to quarantine its boom coal seam gas industry from the Gillard government's carbon tax after successfully gaining an exemption from the mineral resources rent tax. The Bligh government is arguing for further protection for the $30 billion industry in a submission on the proposed carbon price to Climate Change Minister Greg Combet.
Queensland also wants an assistance package for coal fired electricity generators and compensation for households under the proposed carbon tax, which economist Ross Garnaut suggested should be priced at $26 a tonne of CO₂emissions. Its submission on the tax was prepared by Queensland Office of Climate Change assistant director general Greg Withers, husband of Premier Anna Bligh and a close friend of Mr Com bet.
Queensland Finance Minister Rachel Nolan said gas fired power was the most cost effective method of lowering greenhouse gas emissions, while the industry could bring up to $65bn in investment to the state. "We've sent a message to Canberra loud and clear that,., we'll be looking for compensation for Queensland households and compensation for Queensland industries, including our electricity generators and our LNG industry", she said.
22 June 2011, Page: 6
QUEENSLAND is attempting to quarantine its boom coal seam gas industry from the Gillard government's carbon tax after successfully gaining an exemption from the mineral resources rent tax. The Bligh government is arguing for further protection for the $30 billion industry in a submission on the proposed carbon price to Climate Change Minister Greg Combet.
Queensland also wants an assistance package for coal fired electricity generators and compensation for households under the proposed carbon tax, which economist Ross Garnaut suggested should be priced at $26 a tonne of CO₂emissions. Its submission on the tax was prepared by Queensland Office of Climate Change assistant director general Greg Withers, husband of Premier Anna Bligh and a close friend of Mr Com bet.
Queensland Finance Minister Rachel Nolan said gas fired power was the most cost effective method of lowering greenhouse gas emissions, while the industry could bring up to $65bn in investment to the state. "We've sent a message to Canberra loud and clear that,., we'll be looking for compensation for Queensland households and compensation for Queensland industries, including our electricity generators and our LNG industry", she said.
Monday, 27 June 2011
Leighton wins contract
West Australian
21 June 2011, Page: 41
A Leighton Holdings GE consortium has been awarded a $130 million contract to build the Mumbida wind farm south east of Geraldton. Subsidiary Leighton Holdings Contractors and global conglomerate GE expect the project, which they said would generate enough power for about 35,000 homes, to be completed by November next year.
Leighton Holdings said also it had appointed Craig van der Laan to the newly created positions of chief risk officer and group general counsel for the Leighton Holdings group.
21 June 2011, Page: 41
A Leighton Holdings GE consortium has been awarded a $130 million contract to build the Mumbida wind farm south east of Geraldton. Subsidiary Leighton Holdings Contractors and global conglomerate GE expect the project, which they said would generate enough power for about 35,000 homes, to be completed by November next year.
Leighton Holdings said also it had appointed Craig van der Laan to the newly created positions of chief risk officer and group general counsel for the Leighton Holdings group.
Giant solar energy plants to run 100,000 homes
Sydney Morning Herald
20 June 2011, Page: 4
THE two giant new solar power plants slated for Moree in western NSW and Chinchilla in Queensland will mark the first time solar power in Australia is deployed on a scale large and reliable enough to rival coal as a source of "baseload" energy. Neither plant is close to being the world's biggest, with much more powerful solar power stations in the US and Spain already under construction, but enough power to run more than 100,000 households will be generated without the use of fossil fuels.
The NSW government agreed to chip in $120 million and the federal government $306 million towards the Moree project, which will cost an estimated $923 million to build. Building from scratch means the project, which will generate up to 150 MWs of electricity, will be much more expensive than coal, even with no fuel costs.
The private consortium building the plant is led by BP Solar, Fotowatio and Pacific Hydro. It is not clear yet whether the state or federal governments can expect a return on their investments. The state government said the Moree solar farm was expected to contribute around $210 million to the NSW economy, much of it flowing through the Moree district, and would lead to at least 300 new construction jobs. It said over the 30 years the power station was expected to operate it would displace about 10.8 million tonnes of greenhouse gas that would otherwise have been released by the burning of fossil fuels.
The project will drive regional investment, create jobs and ensure NSW is well positioned to meet its future energy targets", the Energy Minister, Chris Hartcher said. "Moree is an ideal place to host the plant, with good links to the national electricity grid and a climate that will deliver strong outputs from the plant".
The NSW plant is based on large photovoltaic cells, which are similar in some ways to rooftop solar panels. The Chinchilla plant, which is slightly larger, uses solar thermal energy concentrating the sun's rays via mirrors on to a central point to generate huge amounts of heat. solar thermal energy is seen as more likely to replace baseload coal and gas plants over the longer term.
The Australian Greens leader, Bob Brown, said pressure from his party had brought the federal government to a position where it had to help fund the projects. The NSW Greens said the state government had settled for the poorer option, when compared with the Queensland plant. "It's a tribute to the lack of interest and ability of successive NSW governments that this state ended up with lots of rooftop solar panels connected together while Queensland secured the much more exciting and innovative solar thermal power station", the Greens MP John Kaye said.
20 June 2011, Page: 4
THE two giant new solar power plants slated for Moree in western NSW and Chinchilla in Queensland will mark the first time solar power in Australia is deployed on a scale large and reliable enough to rival coal as a source of "baseload" energy. Neither plant is close to being the world's biggest, with much more powerful solar power stations in the US and Spain already under construction, but enough power to run more than 100,000 households will be generated without the use of fossil fuels.
The NSW government agreed to chip in $120 million and the federal government $306 million towards the Moree project, which will cost an estimated $923 million to build. Building from scratch means the project, which will generate up to 150 MWs of electricity, will be much more expensive than coal, even with no fuel costs.
The private consortium building the plant is led by BP Solar, Fotowatio and Pacific Hydro. It is not clear yet whether the state or federal governments can expect a return on their investments. The state government said the Moree solar farm was expected to contribute around $210 million to the NSW economy, much of it flowing through the Moree district, and would lead to at least 300 new construction jobs. It said over the 30 years the power station was expected to operate it would displace about 10.8 million tonnes of greenhouse gas that would otherwise have been released by the burning of fossil fuels.
The project will drive regional investment, create jobs and ensure NSW is well positioned to meet its future energy targets", the Energy Minister, Chris Hartcher said. "Moree is an ideal place to host the plant, with good links to the national electricity grid and a climate that will deliver strong outputs from the plant".
The NSW plant is based on large photovoltaic cells, which are similar in some ways to rooftop solar panels. The Chinchilla plant, which is slightly larger, uses solar thermal energy concentrating the sun's rays via mirrors on to a central point to generate huge amounts of heat. solar thermal energy is seen as more likely to replace baseload coal and gas plants over the longer term.
The Australian Greens leader, Bob Brown, said pressure from his party had brought the federal government to a position where it had to help fund the projects. The NSW Greens said the state government had settled for the poorer option, when compared with the Queensland plant. "It's a tribute to the lack of interest and ability of successive NSW governments that this state ended up with lots of rooftop solar panels connected together while Queensland secured the much more exciting and innovative solar thermal power station", the Greens MP John Kaye said.
UBS looks at more WA wind farms
Summaries - Australian Financial Review
20 June 2011, Page: 17
UBS global head of infrastructure Paul Moy says that the investment bank would 'certainly look at doing more' wind farm projects in WA. Mr Moy's comment followed news that the UBS and Retail Employees Superannuation Trust's Collage farm in Western Australia's wheat belt would be finished prior to its anticipated completion date. Mr Moy added that he saw the level of debate over the carbon tax in Australia as healthy saying it was more active than in other parts of the world. Aside from its Australian investments the UBS international infrastructure fund has investments in Northern Star Generation, Saubermacher and Southern Water. Meanwhile a joint venture entered into last week by CDC and Njord Gas Infrastructure has brought a halt to the purchase of Exxon-Mobil's 8% stake in Gassfed's natural gas joint venture in Norway.
20 June 2011, Page: 17
UBS global head of infrastructure Paul Moy says that the investment bank would 'certainly look at doing more' wind farm projects in WA. Mr Moy's comment followed news that the UBS and Retail Employees Superannuation Trust's Collage farm in Western Australia's wheat belt would be finished prior to its anticipated completion date. Mr Moy added that he saw the level of debate over the carbon tax in Australia as healthy saying it was more active than in other parts of the world. Aside from its Australian investments the UBS international infrastructure fund has investments in Northern Star Generation, Saubermacher and Southern Water. Meanwhile a joint venture entered into last week by CDC and Njord Gas Infrastructure has brought a halt to the purchase of Exxon-Mobil's 8% stake in Gassfed's natural gas joint venture in Norway.
Sunday, 26 June 2011
Pratt's $500m in energy plants
Australian
20 June 2011, Page: 21
THE Pratt family's $3 billion Visy paper, packaging and recycling empire will spend $500 million building a raft of clean energy plants around Australia as it ramps up plans to be a worldwide leader in generating electricity from waste. Visy executive chairman Anthony Pratt said the company planned to spend an initial $100m to build a 30 MW clean energy plant on the site of the group's Tumut pulp and paper mill in southern NSW.
"I have a dream that in the not too distant future, Visy Tumut will spend around $100m to expand our clean energy generation here and take in additional waste forest wood to generate clean renewable energy and sell it into the power grid", Mr Pratt said at the official opening of Visy's $550m expansion of the Tumut mill on Saturday by NSW Premier Barry O'Farrell.
"An additional 30 MW clean energy plant here at Tumut would be another big step along the way towards my vision of making clean energy a whole new business division for Visy", Mr Pratt said. The expansion doubles the production capacity of the Tumut mill and takes total investment in the project to almost $1bn, the biggest single investment on any one site that Visy has ever undertaken.
Mr Pratt's plans for the clean energy plant at Tumut follow his commitment four years ago to invest $US1bn in paper recycling and waste-to-energy infrastructure at a Clinton Global Initiative meeting in New York. The Tumut plant will be the second such plant in Australia and the Pratt family's third in the world.
Visy is building a similar plant at its Coolaroo manufacturing and recycling plant in Melbourne. Last year, Visy's US associate, Pratt Industries, commissioned a $US60m energy plant in Georgia that converts waste from its manufacturing into gas. The next Australian clean energy plant after Tumut is expected to be at Smithfield in Sydney's west. It is expected to cost between $50m and $100m.
Visy currently generates renewable energy from waste wood and other bi products to help power the Tumut Mr Pratt said that over the past decade, 1.2 million MW of energy had been generated from renewable sources at the plant, enough to power 160,000 homes in NSW for a year. In the 2009 10 financial year, the first to incorporate the upgrade, the mill's on site renewable and cogeneration system produced 73% of total energy and 42% of power for the plant.
It also generates 190,000 to 250,000 NSW greenhouse gas abatement certificates each year through renewable energy production and energy efficient investments. "My vision for Visy Tumut is not only to keep our position as an example of world's sustainable manufacturing, but to build on it", Mr Pratt said. The mill's expansion is also expected to add an estimated 20% to Visy's total EBITDA. This year, Mr Pratt revealed he was planning to return to Australia to run Visy.
He said that after two decades in the US running Pratt Industries, he wanted to return to his homeland. He currently spends six weeks out of eight in Australia. Under the late family patriarch Richard Pratt's succession plan for Visy, his three adult children each inherited a one-third stake in the company. But Mr Pratt, who is executive chairman of Visy, has the ultimate decision making rights. His mother, Jeanne, is co chairman.
Under the succession plan, Mr Pratt also inherited ownership of Pratt Industries. His youngest sister Fiona and her partner, Raphael "While" Geminder, took control of the old Visy Packaging business now called Pact Group. Ms Geminder is also actively involved in the Visy business. Mr Pratt's elder sister Heloise and her partner, Alex Waislitz, inherited the family's investment arm, Thomey Holdings.
20 June 2011, Page: 21
THE Pratt family's $3 billion Visy paper, packaging and recycling empire will spend $500 million building a raft of clean energy plants around Australia as it ramps up plans to be a worldwide leader in generating electricity from waste. Visy executive chairman Anthony Pratt said the company planned to spend an initial $100m to build a 30 MW clean energy plant on the site of the group's Tumut pulp and paper mill in southern NSW.
"I have a dream that in the not too distant future, Visy Tumut will spend around $100m to expand our clean energy generation here and take in additional waste forest wood to generate clean renewable energy and sell it into the power grid", Mr Pratt said at the official opening of Visy's $550m expansion of the Tumut mill on Saturday by NSW Premier Barry O'Farrell.
"An additional 30 MW clean energy plant here at Tumut would be another big step along the way towards my vision of making clean energy a whole new business division for Visy", Mr Pratt said. The expansion doubles the production capacity of the Tumut mill and takes total investment in the project to almost $1bn, the biggest single investment on any one site that Visy has ever undertaken.
Mr Pratt's plans for the clean energy plant at Tumut follow his commitment four years ago to invest $US1bn in paper recycling and waste-to-energy infrastructure at a Clinton Global Initiative meeting in New York. The Tumut plant will be the second such plant in Australia and the Pratt family's third in the world.
Visy is building a similar plant at its Coolaroo manufacturing and recycling plant in Melbourne. Last year, Visy's US associate, Pratt Industries, commissioned a $US60m energy plant in Georgia that converts waste from its manufacturing into gas. The next Australian clean energy plant after Tumut is expected to be at Smithfield in Sydney's west. It is expected to cost between $50m and $100m.
Visy currently generates renewable energy from waste wood and other bi products to help power the Tumut Mr Pratt said that over the past decade, 1.2 million MW of energy had been generated from renewable sources at the plant, enough to power 160,000 homes in NSW for a year. In the 2009 10 financial year, the first to incorporate the upgrade, the mill's on site renewable and cogeneration system produced 73% of total energy and 42% of power for the plant.
It also generates 190,000 to 250,000 NSW greenhouse gas abatement certificates each year through renewable energy production and energy efficient investments. "My vision for Visy Tumut is not only to keep our position as an example of world's sustainable manufacturing, but to build on it", Mr Pratt said. The mill's expansion is also expected to add an estimated 20% to Visy's total EBITDA. This year, Mr Pratt revealed he was planning to return to Australia to run Visy.
He said that after two decades in the US running Pratt Industries, he wanted to return to his homeland. He currently spends six weeks out of eight in Australia. Under the late family patriarch Richard Pratt's succession plan for Visy, his three adult children each inherited a one-third stake in the company. But Mr Pratt, who is executive chairman of Visy, has the ultimate decision making rights. His mother, Jeanne, is co chairman.
Under the succession plan, Mr Pratt also inherited ownership of Pratt Industries. His youngest sister Fiona and her partner, Raphael "While" Geminder, took control of the old Visy Packaging business now called Pact Group. Ms Geminder is also actively involved in the Visy business. Mr Pratt's elder sister Heloise and her partner, Alex Waislitz, inherited the family's investment arm, Thomey Holdings.
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