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Grid concerns and “unhelpful” government killing confidence in clean energy

Investor confidence in Australia’s clean energy sector has been significantly undermined by “unhelpful and unpredictable government intervention” by the federal Coalition, according to the Clean Energy Council. 

Investor confidence in Australia’s clean energy sector has been significantly undermined by “unhelpful and unpredictable government intervention” by the federal Coalition, according to the Clean Energy Council.

The CEC’s latest “Clean Energy Outlook – Confidence Index” report finds that investor confidence has plummeted over the past year and is now at its lowest level since 2019, thanks to interventions such as support for fossil fuels and rejection of renewable projects.

“This is the time to be opening the doors to new investment in utility-scale clean energy projects, boosting jobs and regional development and ensuring that sufficient new generation is in place before old fossil-fuel generators retire or are priced out of the market,” CEC CEO Kane Thornton said.

“Instead, we’ve seen governments backing two gas plants in New South Wales, the surprising decisions from the Federal Government not to support the Kaban Green Power Hub and then reject the world-leading Asian Renewable Energy Hub hydrogen project, on top of moves to change the funding remit of the Australian Renewable Energy Agency.

“It’s a concerning series of events and not a particularly... more [truncated due to possible copyright]  

Investor confidence in Australia’s clean energy sector has been significantly undermined by “unhelpful and unpredictable government intervention” by the federal Coalition, according to the Clean Energy Council. 

The CEC’s latest “Clean Energy Outlook – Confidence Index” report finds that investor confidence has plummeted over the past year and is now at its lowest level since 2019, thanks to interventions such as support for fossil fuels and rejection of renewable projects.

“This is the time to be opening the doors to new investment in utility-scale clean energy projects, boosting jobs and regional development and ensuring that sufficient new generation is in place before old fossil-fuel generators retire or are priced out of the market,” CEC CEO Kane Thornton said. 

“Instead, we’ve seen governments backing two gas plants in New South Wales, the surprising decisions from the Federal Government not to support the Kaban Green Power Hub and then reject the world-leading Asian Renewable Energy Hub hydrogen project, on top of moves to change the funding remit of the Australian Renewable Energy Agency. 

“It’s a concerning series of events and not a particularly welcoming environment if you’re an investor in clean energy.”

The latest index finds that overall investor confidence in Australia’s renewable energy and energy storage sectors fell to 6.3 (out of 10), the lowest level since it fell to 6.1 in December 2019. It coincides with new analysis that shows no new investment in wind projects in calendar 2021.

Investors, many of them international companies with plenty of money to spend, are clearly frustrated by both political interference and regulatory measures, particularly the difficulties over new connections.

“Regulatory change, political interference, and grid connection (the latter being the most critical), mean investment will dry up,” one investor was quoted as saying.

“We have capital ready to deploy and projects ready, but the grid remains the single biggest barrier to investment,” said another.

“The regulatory environment is too complex and unsupportive,” another observed. “The market is broken, cannot make 20-year investment decisions without assuming too much risk.”

Ironically, given the federal Coalition’s apathy towards climate policies and renewables, the state ranked the highest is led by a conservative government.

NSW, which tops the list with a confidence ranking of 7.2, which has outlined a detailed plan to replace its ageing coal fired generators with wind and solar and storage. The worst state or territory is the Northern Territory, where major grid problems have stalled connections of new solar farms.

Australia’s ageing transmission infrastructure is another concern for investors, and Thornton urged authorities to act on the recommendations of the Integrated System Plan, a 20-year blueprint to a high renewables grid prepared by the Australian Energy Market Operator.

“Build the transmission infrastructure, and the renewable energy investors will come, benefitting the entire Australian economy, keeping the lights on, supporting low emissions technologies and delivering low-cost energy to consumers,” Thornton said.

“Without transmission investment, congestion will increase, creating greater risks for generators and further stalling investment.”

Grid connections, including delays in commissioning and grid congestion, is another major issue. Some of the country’s biggest projects have been stalled despite being mechanically complete for nearly a year.

Another issue is the question of future market design. The Energy Security Board is currently mulling a range of different proposals as part of a potential rewrite of the National Electricity Market rules, which are now considered out of date and no longer fit for purpose.

However, the biggest concern centres around one key proposal – a “physical retail reliability obligation” that is seen as an effective subsidy to coal generators which will do little or nothing to improve reliability in the grid.


Source: https://reneweconomy.com.au...

JUL 7 2021
https://www.windaction.org/posts/52571-grid-concerns-and-unhelpful-government-killing-confidence-in-clean-energy
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