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Wind auction delivers renewable energy and economic benefits

By Canfan - 6 February 2015 31

The ACT’s first wind energy reverse auction has resulted in a $50 million direct investment into the local economy and broader economic benefits in excess of $240 million, Minister for the Environment Simon Corbell announced today.

 “The auction has also delivered low renewable energy prices and enough renewable energy to provide for approximately 33% of Canberra’s electricity needs,” he said.

“The three successful wind farm projects, including one to be developed by a local Canberra company, are expected to be operational by 2017.

“Combined they will deliver almost 200 megawatts of renewable energy generation capacity for the territory, enough to power 107,000 Canberra homes, and will result in a 580,000 tonne reduction in the ACT’s carbon emissions each year, the equivalent of taking 157,000 cars off the road.

“Today’s announcement delivers the single largest step-change in emissions reductions of any jurisdiction in Australia.

“Through this auction the ACT Government has secured renewable energy at the lowest possible price.”

The pass through cost to consumers for the 200 megawatts is expected to peak at just $1.79 per household per week in 2020 before declining after.  This is part of total cost of reaching 90% renewable energy use which is estimated to peak at $4.67 per household per week in 2020 before declining after.

The successful projects are:

  • The Ararat Wind Farm, an 80.5 megawatt wind farm developed by RES Australia west of Ballarat in Victoria at a feed-in tariff price of $87.00 per megawatt hour 
  • The Coonooer Bridge Wind Farm, a 19.4 megawatt wind farm developed by Canberra company Windlab Limited west of Bendigo, Victoria, at a feed-in tariff price of $81.50 per megawatt hour
  • The Hornsdale Wind Farm, a 100 megawatt wind farm developed by Neoen south-east of Port Augusta in South Australia at a feed-in tariff price of $92.00 per megawatt hour

“The three successful projects will deliver a range of benefits for the ACT through a $50million economic stimulus package, including new jobs, a new national trades training centre, an innovation fund for small Canberra renewables businesses and a $7 million investment in new courses at the Canberra Institute of Technology and the ANU,” Corbell said.

“This is not just about sourcing renewable energy; this project will secure Canberra as the renewable energy capital, providing jobs and economic benefits for all Canberrans.

“Our location, our policies and the expertise of local small businesses and premier research institutions, make the ACT the leading jurisdiction in the nation for renewable investment.

“For example, as Windlab continues to grow in Australia and internationally, so too will Windlab’s Canberra headquarters. Windlab estimates its salaries and on-costs for ACT based staff over the next 20 years will exceed $240 million. This is from a company that was founded in Canberra only 12 years ago.

“Also, Neoen, a multinational company, will grow its investment in Canberra and will make the ACT the headquarters for its Asia-Pacific wind business.”

The auction outcome has also set a new benchmark for wind farm community engagement practices in Australia and should provide a strong incentive for new projects to engage with local communities in a more meaningful and co-operative manner, for the benefit of proponents and communities alike.

The 200 megawatt wind auction will deliver approximately 33 per cent of Canberra’s electricity supply from renewable sources by 2017. Together with the 40 megawatts of large-scale solar the territory is investing in, and the existing 44 megawatts of household solar installations, renewables will be powering 80 per cent of all Canberra’s household electricity needs.

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31 Responses to
Wind auction delivers renewable energy and economic benefits
mcs 9:28 am 13 Feb 15

dungfungus said :

When you say “pollution” what are you referring to, exactly?

Perhaps the pollution created by burning coal to produce electricity?

mcs 9:25 am 13 Feb 15

gazket said :

The ACT will be paying for South Australian’s electricity . S.A. has a electricity shortage so none of that wind power will make it here to the ACT. Over that distance you may be able to charge up your phone.

There fore we are paying for nothing. You’re an idiot Corbell

It is a national electricity market, as pointed out earlier in the discussion. Therefore, we are paying for the generation of that power, not so that we recieve the actual power generated by the windfarm itself. Here is a reasonably simple explanation of how the NEM works:

http://www.aemo.com.au/About-the-Industry/Energy-Markets/National-Electricity-Market

Whether the ACT should be paying the premium we do for the generation of wind power is another question, but it is not a case of ‘paying for nothing’ as you suggest.

It really is the simple economics of supply and demand. We are paying for x amount of power to be generated from windfarms, which forms part of the overall supply of power in the whole of the NEM, which, if the market operators are doing their job, should equal the amount of power being demanded by consumers of power. Where the actual power you ‘use’ at the end of the day is irrelevant per say.

dungfungus 7:16 am 13 Feb 15

gazket said :

The ACT will be paying for South Australian’s electricity . S.A. has a electricity shortage so none of that wind power will make it here to the ACT. Over that distance you may be able to charge up your phone.

There fore we are paying for nothing. You’re an idiot Corbell

tooltime said :

Can someone please explain to me how these wind businesses generate power about 1000km away and transport it to the ACT cheaper than say a locally built solar farm built at Braidwood or Williamsdale? Is it the cost of the land?

Don’t hold your breath waiting for an answer tooltime.

gazket 6:45 pm 12 Feb 15

To me it seems like this.

The wind farms in VIC and SA will be getting paid twice for the electricity they generate. Once by ACT residents who won’t even see the electricity and again by VIC and SA residents who will actually use the electricity.

gazket 6:21 pm 12 Feb 15

The ACT will be paying for South Australian’s electricity . S.A. has a electricity shortage so none of that wind power will make it here to the ACT. Over that distance you may be able to charge up your phone.

There fore we are paying for nothing. You’re an idiot Corbell

dungfungus 5:20 pm 12 Feb 15

dungfungus said :

watto23 said :

rommeldog56 said :

jonation said :

Hey tool time – South Australia and Victoria have better wind resources which make them more cost-effective for development than the local region. In terms of the power getting here, think of the National Electricity Market like a full bath – it doesn’t matter where you drop the the renewables in, it still displaces non-renewables.

In terms of pricing, the article states the $4.67 is the cost of achieving 90% renewables, not just the wind auction. This cost declines in real terms as it is not adjusted for inflation. Also the ACT pays the net of the FiT price and the wholesale spot price. So rises/falls in wholesale prices correspond to a fall/rise in FiT payments respectively. When carbon pricing is reintroduced, wholesale prices go up, FiT payments go down. Check out the Renew Economy article for more info…

Ok – I miss read the cost – apol’s for that.

So, if achieving the 90% renewables target will cost $242pa or about +$61 per quarter, that sounds quite reasonable. Credit where credit is due – if the ACT Gov’t can achieve that for +$61 per quarter onto everyone’s electricity bills, it isn’t so bad.

And if we add to the fact that the cost of coal and oil will only keep going up, we eventually should be able to save money. Problem is while ever coal is subsidised in Australia its harder for that to happen.
Lets ignore the climate change debate for a second, regardless of ones beliefs there, it is undeniably better to reduce the burning of coal and reduce the pollution it creates.

When you say “pollution” what are you referring to, exactly?

Have you run out of steam watto? I was expecting a detailed answer by now.

dungfungus 12:33 pm 09 Feb 15

watto23 said :

rommeldog56 said :

jonation said :

Hey tool time – South Australia and Victoria have better wind resources which make them more cost-effective for development than the local region. In terms of the power getting here, think of the National Electricity Market like a full bath – it doesn’t matter where you drop the the renewables in, it still displaces non-renewables.

In terms of pricing, the article states the $4.67 is the cost of achieving 90% renewables, not just the wind auction. This cost declines in real terms as it is not adjusted for inflation. Also the ACT pays the net of the FiT price and the wholesale spot price. So rises/falls in wholesale prices correspond to a fall/rise in FiT payments respectively. When carbon pricing is reintroduced, wholesale prices go up, FiT payments go down. Check out the Renew Economy article for more info…

Ok – I miss read the cost – apol’s for that.

So, if achieving the 90% renewables target will cost $242pa or about +$61 per quarter, that sounds quite reasonable. Credit where credit is due – if the ACT Gov’t can achieve that for +$61 per quarter onto everyone’s electricity bills, it isn’t so bad.

And if we add to the fact that the cost of coal and oil will only keep going up, we eventually should be able to save money. Problem is while ever coal is subsidised in Australia its harder for that to happen.
Lets ignore the climate change debate for a second, regardless of ones beliefs there, it is undeniably better to reduce the burning of coal and reduce the pollution it creates.

When you say “pollution” what are you referring to, exactly?

watto23 12:14 pm 09 Feb 15

rommeldog56 said :

jonation said :

Hey tool time – South Australia and Victoria have better wind resources which make them more cost-effective for development than the local region. In terms of the power getting here, think of the National Electricity Market like a full bath – it doesn’t matter where you drop the the renewables in, it still displaces non-renewables.

In terms of pricing, the article states the $4.67 is the cost of achieving 90% renewables, not just the wind auction. This cost declines in real terms as it is not adjusted for inflation. Also the ACT pays the net of the FiT price and the wholesale spot price. So rises/falls in wholesale prices correspond to a fall/rise in FiT payments respectively. When carbon pricing is reintroduced, wholesale prices go up, FiT payments go down. Check out the Renew Economy article for more info…

Ok – I miss read the cost – apol’s for that.

So, if achieving the 90% renewables target will cost $242pa or about +$61 per quarter, that sounds quite reasonable. Credit where credit is due – if the ACT Gov’t can achieve that for +$61 per quarter onto everyone’s electricity bills, it isn’t so bad.

And if we add to the fact that the cost of coal and oil will only keep going up, we eventually should be able to save money. Problem is while ever coal is subsidised in Australia its harder for that to happen.
Lets ignore the climate change debate for a second, regardless of ones beliefs there, it is undeniably better to reduce the burning of coal and reduce the pollution it creates.

rommeldog56 5:24 pm 07 Feb 15

jonation said :

Hey tool time – South Australia and Victoria have better wind resources which make them more cost-effective for development than the local region. In terms of the power getting here, think of the National Electricity Market like a full bath – it doesn’t matter where you drop the the renewables in, it still displaces non-renewables.

In terms of pricing, the article states the $4.67 is the cost of achieving 90% renewables, not just the wind auction. This cost declines in real terms as it is not adjusted for inflation. Also the ACT pays the net of the FiT price and the wholesale spot price. So rises/falls in wholesale prices correspond to a fall/rise in FiT payments respectively. When carbon pricing is reintroduced, wholesale prices go up, FiT payments go down. Check out the Renew Economy article for more info…

Ok – I miss read the cost – apol’s for that.

So, if achieving the 90% renewables target will cost $242pa or about +$61 per quarter, that sounds quite reasonable. Credit where credit is due – if the ACT Gov’t can achieve that for +$61 per quarter onto everyone’s electricity bills, it isn’t so bad.

jonation 1:51 pm 07 Feb 15

Hey tool time – South Australia and Victoria have better wind resources which make them more cost-effective for development than the local region. In terms of the power getting here, think of the National Electricity Market like a full bath – it doesn’t matter where you drop the the renewables in, it still displaces non-renewables.

In terms of pricing, the article states the $4.67 is the cost of achieving 90% renewables, not just the wind auction. This cost declines in real terms as it is not adjusted for inflation. Also the ACT pays the net of the FiT price and the wholesale spot price. So rises/falls in wholesale prices correspond to a fall/rise in FiT payments respectively. When carbon pricing is reintroduced, wholesale prices go up, FiT payments go down. Check out the Renew Economy article for more info…

dungfungus 1:24 pm 07 Feb 15

rommeldog56 said :

rommeldog56 said :

“This is part of total cost of reaching 90% renewable energy use which is estimated to peak at $4.67 per household per week in 2020 before declining after.”

I love the way all pollies spin things nowdays. Choosing to quote $4.67pw extra instead of $243pa or $60 per quarterly electricity bill extra – on top of the existing charges (which won’t remain lower too long anyway). It’s sort of insulting to voters IMHO.

Why would it decline after 2020 anyway ? How much of a decline is anticipated (ball park will do thanks) so we measure what the long term, permanent increase will be ?

It’s good to go green as far as is reasonably possible & affordable. But personally, I would much prefer to have that extra $ paid to householders in the form of substantial extra incentatives to install their own solar panels /wind turbines so they can meet their own electricity needs to a greater or lesser extent. Would save the “profit” margin/incentive paid to the commercial providers too, which is built into the charge.

Maybe that mean less revenue to ACTEW and so less “return” to the ACT Gov’t. How silly of me !

Oh….the $4.67pw, $243pa or $60 per quarter extra on our electricity bills is just for this one 200 megawatt project – not all up to achieve the 90% renewable energy target.

So, when/if the ACT does reach that 90% target – what will the price of electricity be for households and industry/retail ? I hope the ACT Gov’t will come “clean” and tell us.

Those LED lights I installed everywhere in my house are starting to look like a good investment.

chewy14 9:14 am 07 Feb 15

tooltime said :

Can someone please explain to me how these wind businesses generate power about 1000km away and transport it to the ACT cheaper than say a locally built solar farm built at Braidwood or Williamsdale? Is it the cost of the land?

They don’t, we have a national energy market, so we aren’t physically going to receive the electricity generated from them.

rommeldog56 9:21 pm 06 Feb 15

rommeldog56 said :

“This is part of total cost of reaching 90% renewable energy use which is estimated to peak at $4.67 per household per week in 2020 before declining after.”

I love the way all pollies spin things nowdays. Choosing to quote $4.67pw extra instead of $243pa or $60 per quarterly electricity bill extra – on top of the existing charges (which won’t remain lower too long anyway). It’s sort of insulting to voters IMHO.

Why would it decline after 2020 anyway ? How much of a decline is anticipated (ball park will do thanks) so we measure what the long term, permanent increase will be ?

It’s good to go green as far as is reasonably possible & affordable. But personally, I would much prefer to have that extra $ paid to householders in the form of substantial extra incentatives to install their own solar panels /wind turbines so they can meet their own electricity needs to a greater or lesser extent. Would save the “profit” margin/incentive paid to the commercial providers too, which is built into the charge.

Maybe that mean less revenue to ACTEW and so less “return” to the ACT Gov’t. How silly of me !

Oh….the $4.67pw, $243pa or $60 per quarter extra on our electricity bills is just for this one 200 megawatt project – not all up to achieve the 90% renewable energy target.

So, when/if the ACT does reach that 90% target – what will the price of electricity be for households and industry/retail ? I hope the ACT Gov’t will come “clean” and tell us.

rommeldog56 6:54 pm 06 Feb 15

“This is part of total cost of reaching 90% renewable energy use which is estimated to peak at $4.67 per household per week in 2020 before declining after.”

I love the way all pollies spin things nowdays. Choosing to quote $4.67pw extra instead of $243pa or $60 per quarterly electricity bill extra – on top of the existing charges (which won’t remain lower too long anyway). It’s sort of insulting to voters IMHO.

Why would it decline after 2020 anyway ? How much of a decline is anticipated (ball park will do thanks) so we measure what the long term, permanent increase will be ?

It’s good to go green as far as is reasonably possible & affordable. But personally, I would much prefer to have that extra $ paid to householders in the form of substantial extra incentatives to install their own solar panels /wind turbines so they can meet their own electricity needs to a greater or lesser extent. Would save the “profit” margin/incentive paid to the commercial providers too, which is built into the charge.

Maybe that mean less revenue to ACTEW and so less “return” to the ACT Gov’t. How silly of me !

tooltime 6:19 pm 06 Feb 15

Can someone please explain to me how these wind businesses generate power about 1000km away and transport it to the ACT cheaper than say a locally built solar farm built at Braidwood or Williamsdale? Is it the cost of the land?

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