EnergyAustralia has repeated its call for a real 20 per cent Renewable Energy Target (RET) to strike the right balance between driving more investment in renewable energy and keeping costs down for consumers.
Following the Commonwealth Government’s response to the Climate Change Authority’s (CCA) review of the RET, EnergyAustralia managing director Richard McIndoe said modifying the RET could save households $840.
“EnergyAustralia supports generating 20 per cent of energy from renewables by 2020, but the RET must be a sensible design that balances delivering renewable energy projects with the costs to consumers,” Mr McIndoe said.
“In the context of dramatically falling demand and rapidly rising energy prices, we’re disappointed the Government hasn’t taken the opportunity to deliver a real 20 per cent RET.
“CCA modelling shows a real 20 per cent RET would deliver more renewable energy at 2030, but at a lower cost to customers and over a more sustainable timeframe.”
Mr McIndoe said he was concerned about the practicality of the current RET design, requiring more than 2500 wind turbines to be built in the next seven years.
“Delivering new energy generation projects into the market when they are not needed is an unnecessary additional cost burden on our customers,” he said.
“There is also a very real risk that the market will not be able to deliver enough wind projects in this time frame. Under the current RET design, this will result in customers paying a financial penalty with no new renewable capacity actually being built.
“A real 20 per cent RET would give renewable energy investors and financiers confidence that the scheme is achievable and sustainable.”
Under the current RET, generators must source 20 per cent of their electricity from renewable sources by 2020. Based on current lower energy demand forecasts, the current legislated 41,000GWh target will actually lead to around 27 per cent of energy coming from renewable sources and involve a subsidy of $53.3 billion to 2030.
Last year, EnergyAustralia commissioned modelling by ACIL Tasman into a real
20 per cent RET, which showed that based on electricity demand forecasts, the cost of the subsidy would reduce to $28.1 billion – almost halving the scheme’s total cost in 2020 for a typical household.
EnergyAustralia’s generation portfolio includes the 111MW Waterloo wind farm and a 50 per cent share in the 123MW Cathedral Rocks wind farm, both in South Australia. In 2012, Waterloo and Cathedral Rocks wind farms generated 508 GWhrs of energy – enough renewable energy for approximately 70,000 residences and small businesses.
EnergyAustralia is also seeking to develop further projects, including the $300 million Stony Gap (123MW) wind farm in South Australia and has entered into power purchase agreements with two wind farm projects in New South Wales with a total installed capacity of almost 215MW.