Western Australia could secure projects worth $1 billion under a reduced renewable energy target, although there is conjecture as to whether the final terms will be business friendly enough.
Western Australia could secure projects worth $1 billion under a reduced renewable energy target, although there is conjecture as to whether the final terms will be business friendly enough.
The government and Labor have agreed on the RET – 33,000 gigawatt hours by 2020, down from an original target of 41,000GWh – but are still squabbling over how often reviews of the target should occur.
Proponents of renewable energy projects in WA have welcomed the in-principle agreement, which comes after a 14-month review of the RET, and have flagged the prospect of thousands of new construction jobs.
But some in the sector believe the government’s insistence on biennial reviews will act as a disincentive to investment.
Richard Harris, the director of clean energy developer WestGen, shares those concerns, but told Business News a new RET deal boosted the potential for a range of large-scale renewable projects, including solar farms, biomass power plants and wind farms, to be built in WA.
“These (will be) located in the South West and Mid West predominantly,” Mr Harris said.
“Collectively the projects will be worth about $1 billion and will create thousands of jobs in construction and provide long-term employment in regional areas.”
Mr Harris’s cautious optimism stands amid a number of concerns within the sector, however.
Clean Energy Council WA manager Dermot Costello said the federal government’s insistence on continually reviewing the RET could upset any uncertainty provided by agreeing to the new target.
“It won’t give the industry the certainty to unlock these projects, leading to investment and ultimately jobs, this is unacceptable,” he said.
WA Labor energy spokesman Bill Johnston said even if a federal target was agreed to, the WA government’s lack of planning meant it was unlikely investment would take place here.
“It is unlikely that there will be any large-scale renewable energy projects in WA because the government has not conducted any planning for renewable energy,” he said.
“In fact, Minister Nahan is planning to buy renewable energy certificates from east coast renewable energy producers.”
Dr Nahan shot back, saying Mr Johnston’s claim was pure speculation based on a general comment he made in parliament that WA did not need any more energy capacity at the moment.
Under the revised RET, government-owned electricity entities Synergy and Horizon Power will be subject to reduced renewable energy obligations.
Synergy currently generates about 110 megawatts of renewable energy across its portfolio and underwrites the renewable sector by buying an additional 600MW through power purchase agreements with wind farms, solar farms and home owners with rooftop solar.
Denmark Community and Mount Barker wind farm developers, former Greens politician Paul Llewellyn and Skyfarming director Andrew Woodroffe, told Business News until there was the political will to force older, fossil fuel-fired power stations to exit the market it would be difficult for more renewable energy projects to gain power purchase agreements.
“There’s an awful lot of (renewable energy) proposals out there, some of them are very well developed and everybody’s holding back,” Mr Woodroffe said.
“While there’s a great deal of uncertainty at the federal level, in WA there’s also a great deal of uncertainty at the state level on top of the excessive generation.”
Mr Llewellyn said the first step needed to be a shake-out of the market.
“We don’t want to be oversupplied with either clean energy or brown energy, so if we want to reduce greenhouse gas emissions and decarbonise our electricity sector then we need to actually make a choice,” he said.
Messrs Llewellyn and Woodroffe said planned coal-fired power station expansions by Bluewaters were unlikely to gain investment support.
They said Bluewaters and similar power stations were obsolete, old technology, that even the banks were hesitant to be seen providing funds for.
“Bluewater, I think they’re dreaming. I think any way you look at coal, even with the best friends in politics, coal just doesn’t seem to get how quickly solar (and wind) can evolve,” Mr Woodroffe said.
“The other thing they don’t really quite get is the marginal cost of wind and solar is very low, once you’ve got them in the ground you can cut the legs off anybody else.”
