The ACT government says it will better its 90 per cent renewable energy target by 2020, and will in fact source 100 per cent of its electricity needs from renewable energy by that date.
In the same week that federal Labor was pilloried by the Coalition and most mainstream media for confirming its national target of 50 per cent renewable energy by 2030, ACT’s minister for the environment and climate change Simon Corbell said the switch to 100 per cent renewables was both achievable and affordable.
“As leaders in the renewable energy field the ACT is reaping the environmental and economic benefits of decarbonisation,” Corbell said.
“Not only are we providing clean power for the people of Canberra, we are also delivering jobs and economic benefits by securing $400 million in local investment through our reverse auction process.”
Importantly, Corbell said the ACT would retain its ranking as having the lowest electricity prices in the country, even with sourcing 100 per cent of its energy demand from renewable energy.
“We are demonstrating thru these policies that not only is a transition to a renewable energy future achievable, it is affordable and is creating jobs,” he said in an address to the Local Energy and Microgrids conference, hosted by RenewEconomy, where he announced the new target.
The irony is that the ACT is taking advantage of the stagnation in the national market caused by the fluctuating policies of the federal Coalition. That is offering the ACT opportunities to lock in low prices as developers knock down prices.
Corbell says because of that, the ACT will increase the size of its upcoming (and third) wind energy auction from 109MW to 200MW, which would be enough to lift the ACT from 90 per cent to 100 per cent by 2020.
“Adding an extra 91MW of renewables to our current auction process will allow us to take advantage of the record low prices and significant local investment we have achieved in our recent auctions,” Corbell said. Bids for that auction are due on May 13.
“The ACT government has set a significant undertaking with the vision of Canberra being an internationally recognised centre for renewable energy innovation and investment,” he said.
“Being powered by 100 per cent renewables by 2020 places Canberra at the lead, both in Australia and internationally, of cities taking effective action on climate change.”
Legislation will be introduced to change the ACT’s feed-in-tariff legislation to accommodate the extra capacity required to meet the new target.
Corbell said the total cost of the project is expected to peak at around $5.50 per household per week in 2020, before declining. But this cost is expected to be largely offset by energy savings from mandated energy efficiency measures, including the installation of free energy-saving lights.
Interestingly, the cost of the 100 per cent target is no greater than for the 90 per cent target, thanks to the declining cost of wind and solar, a fall that the ACT is taking credit for.
Indeed, the wind auctions have helped driven down the cost of wind to $77/MWh, which equates to a price in the mid-$60s/MWh because the 20-year price contract is fixed and does not rise with inflation.
“The target will demonstrate to industry, business and the community our community’s commitment to tackling greenhouse gas emissions by embracing new clean energy technology.”
Meanwhile, new data from Bloomberg New Energy Finance says that overall in Australia, investment in large-scale renewables has plunged again, with only $US69 million invested in the first quarter of 2016, although households and business invested five times that much in rooftop solar and battery storage.
Indeed, the only large-scale investment committed in the last three years has been projects from the ACT reverse auction process, and from projects assisted by the Australian Renewable Energy Agency and the Clean Energy Finance Corporation.
The national target, which was cut by the Coalition to 33,000GWh, is still likely to fall short because of the inability to lock in contracts with utilities and source long-term finance, although the market for solar is improving.
The national target equates to around 23 per cent renewable energy by 2020. The Coalition has said that this is “more than enough” and has said that Labor’s 50 per cent renewable energy target by 2030 would amount to a new “electricity tax.” The major networks and energy supply lobby groups are also fighting against it.