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Abbott’s hatred of wind farms scares off NZ’s biggest power company

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The ongoing investment uncertainty plaguing Australia’s renewable energy market has driven away another major industry player, with the chief of New Zealand’s biggest power company, Meridian Energy, saying he sees no opportunity in Australia for the foreseeable future, due to “political risk”.

“We’ve been disappointed by the approach that’s been taken by the Abbott government to the review of the Renewable Energy Target (RET) and its attitude to renewables overall, particularly Mr Abbott’s very clear personal antipathy to windfarms,” said Meridian chief Mark Binns on Wednesday.

Meridian Energy's White Hill wind farm

Meridian Energy’s White Hill wind farm

Abbott’s “antipathy” for wind, as Binns puts it, is by now very well established. After describing them as “visually awful” in a Sydney radio interview, the PM went on to say that his party had carefully designed the current RET to “capital R-E-D-U-C-E, the number of these things that we are going to get in the future.”

“What we are managing to do through this admittedly imperfect deal with the Senate is to reduce the growth rate of this particular sector as much as the current Senate would allow us to do,” Abbott said.

The comments, described as an international “embarrassment” by Opposition climate spokesman Mark Butler, have obviously found their mark.

“A new (RET) target was agreed after 18 months of political posturing which, together with the delay, has done significant damage to investor confidence,” said Binns. “The government’s commitment and longevity of the scheme is less than convincing.”

Binns’ comments followed Meridian’s announcement that it had taken $NZ38 million ($A34.10 million) in writedowns on the value of its Australian wind assets, mainly from to its 70MW Mt Millar windfarm in South Australia.

Meridian also co-developed the country’s biggest wind farm, the 420MW Macarthur project in Vitoria, along with AGL Energy. It has numerous other projects in the pipeline in Australia.

Binns said the Australian market was “not one where you would regard the political risk as low in making a major further investment.” And he’s not alone in his thinking.

Just last week, the CEO of AGL Energy said the company was not ready to “pull the trigger” on any large-scale renewable investments – solar or wind – because of the lack of clarity on the renewable energy target, which was recently scaled back to 33,000GWh from 41,000GWh, after 18 months of protracted political dispute.

“A lot more needs to be done to provide the clarity we need to pull the trigger on large-scale renewable energy investments,” AGL chief Andrew Vesey told an analysts briefing. “We are ready to act if good opportunities come around … but we are not close to pulling the trigger.”

As we reported here, Vesey particularly pointed to the big differences between the Coalition and Labor on emissions targets, and how that impacted on various policies, and suggested this was unlikely to be resolved until after the Paris climate change conference.  

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  • lin

    “Abbott destroys even more Australian jobs”
    Not a headline you will see in the Murdoch Faux News outlets.
    Abbott’s wrecking crew are the opposite of good government, and our language lacks adjectives strong enough to describe the depths of their awfulness.

  • john

    This outlines the meaning of sovereign risk.
    Job done.

  • Isuzu

    The Fool, like a bull in a china shop has no idea of the damage he is doing… Fortunately I didnt vote for him and can only gloat at his continued display stupidity and incompetence, supported of course by his fellow drongos

  • wjohnallen

    Abbot must be feeling lucky, lucky, lucky. Had the TPPA been signed by NZ and Aus, Meridian may have sued the Aus government for loss of profits arising from their changing to the RET.

  • Colin Nicholson

    I wish he had given specifics on what planned windfarms are now non-starters so you can write to the communities involved pointing out how much local dosh they have now lost. How do we find this out?