The conversation at the All-Energy 2016 conference was unequivocal about the need to transition our energy market.
As NSW Renewable Energy Advocate Amy Kean said: “It’s not a matter of ‘if’ anymore, it’s just ‘when’ and ‘how’.
Presenting on progressive strategies for renewable energy at a state level, Kean said: “It’s so obvious this industry is thumping! Having worked in it for about 18 years, I really haven’t felt the momentum that I’m feeling today.
“Renewable energy is now cost-effective against all other forms of energy. However, the market is no longer fit for purpose.”
The conference heard that the ACT and the states were making impressive progress towards their individual targets:
- ACT 100 per cent renewable by 2020
- South Australia 50 per cent by 2025
- Victoria 25 per cent by 2020 and 40 per cent by 2025
- Queensland 50 per cent by 2030
Jon Sibley, director energy and waste policy from the ACT Government’s Environment and Planning Directorate said the ACT had the contracts in place to deliver 100 per cent renewable electricity by 2020.
“We are pretty small, we are a population of 400,000, but we are leading the world on ambitious renewable energy targets and also low emissions policies like low-emissions transport, hydrogen vehicles etcetera,” he said.
The ACT’s energy policies are delivering deep emissions cuts in a relatively short period of time.
“We are showing this can be done; it gives confidence in the market,” he said. “This is resulting in 100 per cent renewables in the ACT for only $5 per household per week extra.
“We have driven down prices nationally through these contracts for both wind and solar and we have set a new benchmark for community engagement.
“Many of my neighbours who live in NSW say they are paying more for their electricity bills than what we are in ACT as we shift to renewable energy.
“It can be done, technically it’s feasible and economically at low cost.”
Sibley pointed out that not all the renewable energy was sourced from within the ACT. They are using a reverse auction scheme that is now unfolding in Victoria and being considered for Queensland.
“It’s essentially contracting renewable energy from outside the state and within the state,” Sibley said. “What we are doing is providing the incentives for more renewables to go into the [National Electricity Market]. So more states and territories will follow and the grid will become a much higher proportion of renewable energy.”
This is driving national policy and is expected to be a hot topic on the agenda at COAG (Council of Australian Governments) meeting on Friday.
Renewables taking off in NSW
Kean shared NSW’s progress on delivering its Renewable Energy Action Plan, which has been underway for about three years.
NSW now has about 14 per cent renewables including Snowy Hydro.
“Now excluding Snowy Hydro that has actually tripled in the past six years, which is phenomenal,” she said. “Wind energy has obviously been a huge success story.”
The state wind farms have increased generation from 187 megawatts in 2010 to 660 in 2015.
“We have tripled our generation in the past two years thanks to the ACT government and we are building a number of projects at the moment.”
NSW leads the country with three large-scale solar projects. Five more projects – in Parkes, Manildra, Griffiths, Dubbo and Glen Innes, recently received Australian Renewable Energy Agency grants and will hopefully be built over the next year or so.
“When I started three years ago we had no large-scale solar projects so to think that utility solar would grow this quickly – no one predicted it and no one predicted the cost,” Kean said.
Fifteen per cent, or 350,000, households in NSW now have solar and that has flowed through to the commercial sector with about 10,000 businesses installing solar on their roofs.
“In many cases if you are using energy at home during the day it’s cheaper for solar,” Kean said. “I don’t think businesses get that but again that’s going to continue to drive the next chance of growth, which is going to continue to drive the industry.”
Renewables are also booming in regional areas, particularly Lismore.
“Most people think it’s in the inner city but regional NSW is far more interested in solar,” Kean said.
Overall, public support for renewables is at 91 per cent, according to the Office of Environment and Heritage.
“There is no other industry that has that level of support,” Kean said. “That is what this industry has in its favour and we need to leverage that more than we do.”
Kean said NSW absolutely had the capacity to reach its renewable energy target.
“We have 8000 megawatts in our planning system that is shovel ready,” she said. It is simply a matter of unlocking barriers.
To support the ARENA funding applications, NSW offered a power purchase agreement of 50 megawatts by its energy retailer. In addition, the Sydney Metro NorthWest infrastructure project has a development application requirement to offset 100 per cent of its operating emissions and renewable energy from NSW was chosen for that purpose.
“Renewables are now cost-effective, which allows us to do all these exciting and innovative commercial initiatives and we hope that we will have many more infrastructure projects,” Kean said.
NSW has committed an advanced energy strategy and has just released a framework for community consultation for wind farms and hopes to release the final framework shortly.
Jobs, community consultation and diversity in Victoria
Scott Hamilton, executive director of renewable energy, Department of Environment, Land, Water and Planning Victoria, said the Ararat Wind Farm was a good example of partners working together. Extensive environmental studies and community consultation informed the design.
“There’s a general acceptance we need to transition to a clean energy economy; we need to create an environment where investment is occurring, jobs are happening and the community gets benefits,” he said.
Like NSW, about 14 per cent of Victoria’s electricity comes from renewable sources.
By 2025 it’s anticipated that up to 5400 megawatts of new large-scale renewable energy capacity will be built, contributing to 4000 additional jobs and about a 12 per cent reduction in electricity sector greenhouse emissions by 2034-35.
An auctions scheme will be introduced with project developers competing to be the lowest cost provider. However, successful bidders will be granted long-term contracts, providing certainty for investors.
There is great potential for large-scale solar to become a mainstream source of energy over the next decade due to rapid technology advances and decreasing costs.
However, diversity is also important.
“We want to see a number of different technologies,” Hamilton said. “We need to bring the other ones forward.”
Communities driving renewables
Community action on renewables is providing tangible results. The Northern Rivers region of NSW has created Australia’s first community owned renewable energy retailing and installation business, Enova Energy.
Alison Crook, chair of Enova Energy, presented a keynote address on community energy.
“We came into being as a result of frustration over the lack of government leadership on climate change and in opposition of government support for coal seam gas in a region of outstanding natural beauty relying on agriculture and tourism,” Crook said.
There was a strong demand to demonstrate what could be achieved with renewables but a gap in the market.
“The big companies didn’t want to or need to work with small players,” Crook said. “So a community retailer was required to purchase and sell back community-generated energy.”
The Total Environment Centre and the NSW Office of Environment and Heritage provided a small grant and a feasibility study was conducted to see if a community retailer was viable.
Enova Energy was set up from the outset as a social enterprise with the twin objectives of assisting the community to reduce carbon emissions and providing community benefits.
The team developed a business plan, obtained a retail license and lodged a prospectus. They held 30-plus community events and secured 1100 investors (75 per cent from the region), eventually raising $4 million.
“We are very pleased to see that the other 25 per cent came from every other state and territory in Australia because there was strong interest in the model and what could be done,” Crook said.
The systems were set up earlier this year and the first customers came aboard in June – now ahead of target at 900.
Basically Enova is a retail and solutions advisory company providing:
- Competitive pricing
- Generous solar feed-in tariff
- 100 per cent Green Power and other energy plans
- Tariff assessments, education and advice on reducing energy bills
- Advice, installation and maintenance for solar and battery storage
“To encourage the development of community-scale renewable we are willing to pay a premium on wholesale market prices for renewable energy and we encourage our customers to purchase this through using our gross margin to subsidise the cost,” Crook said.
Importantly, 50 per cent of profits (after tax) from the retail arm will flow back to the not-for-profit arm for investment in social benefit projects. Enova is currently working on a solar project with a social housing provider and the OEH.
Enova’s renewable development initiative invites customers to contribute 13 per cent of each bill to a fund to develop community generation. So far 33 per cent of customers have agreed and Enova has entered into memorandum of understandings for three projects:
- SolarShare in Canberra
- Byron Shire Council and Community-Owned Renewable Energy Mullumbimby
- Community Energy 4 Goulburn
Discussions are underway with more groups in NSW, Queensland and Victoria.
Crook said Enova Energy had demonstrated the success of the concept and saw itself as a model for other communities.
“Our aim is very much to demonstrate the success at the community level in lowering acquisition costs and churn, which we think it will do,” she said. “We can make strides at facilitating generation, but providing a premium product for wholesale prices and grow the partnerships and obtain the funds for a wide range of social benefit projects.”
The plan is to replicate.
“Our licence allows us to sell across the NEM and our back-office systems are scalable. Our vision is one of communities empowering themselves across Australia.”