Electricity generator and retailer Synergy, owned by the Government of Western Australia, is considering paying for renewable energy projects in other states in order to meet renewable energy targets.
According to The West Australian, the company is looking at paying for wind farms and solar plants in eastern states to help meet the Renewable Energy Target, which requires electricity providers to get 20 per cent of their power supplies from large-scale renewable sources by 2020.
Synergy chairman Lyndon Rowe said requirements for electricity utilities to source mandated levels of renewable energy were imposing significant costs on a market that was already chronically over-supplied, and that the company could therefore help pay for renewable projects in other states rather than locally, as it could be cheaper.
He said: “I would have thought the community would want us, in the interests of keeping any subsidies to Synergy to as low as possible, to meet the large-scale renewable energy target in the most efficient way we can.
“There is a wide expression of interest (process) and we will review all of those in the context of what makes commercial sense for us.
“But does that mean we could end up purchasing over east? Yeah.
“The reason you’ve got a (large renewable energy) target at the moment is because the large-scale renewables are not commercial on their own. By definition what you’re doing is adding costs to the system.
“If you increase that target, what you will be doing is adding further costs to the system and we will have to respond to that in some way.”
“The responsible way to determine the best pathway forward”
WA Energy Minister Mike Nahan has backed the move, saying that Synergy was running a national EOI process “in order to identify the best commercial opportunities”.
“Synergy will also consider supply of electricity together with LGCs from renewable energy generators connected to the South West Interconnected System,” Dr Nahan said.
“The EOI called for interested parties to ensure Synergy can obtain a deep understanding of which options will achieve the best the value for Synergy and the WA taxpayer.
Dr Nahan said the EOI was “non-binding, and any contracting or investment decision would be subject to further analysis, discussions and approvals”.
He also highlighted that Synergy had invested in various renewable projects within this state, including Collgar wind farm, Greenough solar farm, Mumbida wind farm and Emu Downs wind farm.
Move is a “bastardisation of the Renewable Energy Target”
The move, however, has been criticised by WA Greens energy spokesperson Robin Chapple, who said: “The idea of our tax dollars going towards renewable projects interstate is a bastardisation of the Renewable Energy Target.
“Why would we pay for clean energy projects that we won’t ever receive electricity from?
“The fact that this has even been floated just shows how short-term this government is in its thinking.
“Here is an industry that could create new jobs, lower the price of electricity and greatly improve our environment.
“The excuse that our system is over capacity is ridiculous.”
He said that by retiring the state’s fossil-fuel generators could help bring in new renewable capacity and therefore work towards the 2020 target.
Mr Chapple added: “As a state we should, and could, be doing a lot more around renewables. Frankly, the costs of this technology are dropping so fast, and our natural resources are so good, that it is only a matter of time for WA.
“I am dumbfounded by Mr Rowe’s comments, and I sincerely hope that these ideas are not borne out.”