ACT reports 15 bids, “impressive prices” for latest 200MW wind + solar auction

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ACT says receives more than 1,000MW of wind and solar proposals and “impressive” prices in latest renewable energy auction.

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The ACT government says it has received 15 proposal totalling more than 1GW of wind and solar capacity for its latest auction of 200MW of renewable energy capacity – one of the final pieces to be put in place to help the territory reach 100 per cent renewable energy by 2020.

Environment minister Simon Corbell says (tweeted) that the bids include some “impressive prices”, which is probably not surprising given the number of projects looking for contracts, and their inability to strike power purchase agreements with the major retailers and other potential off-takers.

The ACT reverse auction program has already elicited the counter’s lowest price for wind energy – an $81.50 fixed contract for 20 years for the small 18MW Coonooer Bridge wind farm in the ACT, which is now operating.

The Hornsdale wind farm in South Australia, which won capacity in two of the auctions, then offered a new record low price of $77/MWh in the second auction for 100MW of capacity. Both figures translate into a price in the $60s/MWh because they do not rise with inflation.

Corbell decided to bring forward the wind auction and double its capacity after noting that the large-scale renewable energy market remained stalled across Australia, extending a three-year investment drought that has only been broken by the ACT auctions.

Developers say there is lingering uncertainty in the market which is holding back PPAs, despite the need for at least 3,000MW of new capacity to be committed if the 33,000GWh target is to be met by 2020, and no penalty prices passed on to consumers.

Only one major project, the 175MW White Rock wind farm near Glen Innes, has been committed. It is owned by Chinese turbine maker Goldwind. Most other developers are struggling to get finance without long term contracts.

The ACT wind and solar auction round closed on Thursday. Money from the auction process will be used to support the ACT government’s plan to roll out 36MW of battery storage capacity in up to 5,000 homes and businesses in the next few years. A second tender for that technology was announced earlier this week.

 

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9 Comments
  1. Nick Thiwerspoon 4 years ago

    That’s US cents 5.3/kWh. Not bad.

  2. Ian 4 years ago

    Can’t the ACT palm off some of its projects to other states or large companies and keep the auction process going?

    • nakedChimp 4 years ago

      The other states should just run their own auctions.. can’t be that hard, can it?

      • Brian Tehan 4 years ago

        The big problem is that most of the other states aren’t running auctions. In Victoria, the problem is that the power generation is 100% private so who’s going to buy the power? Could the state government get back into the power generation game by buying wind or solar? If so, how would they sell the power into the grid? I don’t know enough about the energy market.
        Some legislation might be needed.

        • Mike Shurtleff 4 years ago

          Yes, legislation is needed in places like Victoria. The problem of having Utilities in bed with government so they can protect their monopoly on power, charging any price they like must end. The continually decreasing cost of renewable, the increasing potential for reducing power prices, will eventually catch up to them. You cannot cheat all of the people, all of the time. It’s already starting to. Yes, legislation. No more unbridled monopoly abuse!

        • Mike Shurtleff 4 years ago

          Ya know, it’s as simple as requiring them, by law, to integrate a reasonable percentage of new wind and solar or face a painful fine. Easy. Just takes the people remembering who is supposed to serve who.

        • Giles 4 years ago

          Thy are to a certain extent. Thwe Victoria government, the Melbourne City Council, the SA government, WA retailer Synergy, the NSW government are all running tenders (effectively reverse auctions) for renewable energy capacity or RECs to meet some mandate (government purchases, supply for rail line) or another. They do exist and right now are just about the only mechanism that gets stuff built.

      • Mike Dill 4 years ago

        Perhaps ACT can build out more in SA, which would be a win for both. Hornsdale needs to be expanded, and SA needs the clean power.

  3. john 4 years ago

    The industry has a problem as noted in this from the article.
    { Developers say there is lingering uncertainty in the market which is holding back PPAs, despite the need for at least 3,000MW of new capacity to be committed if the 33,000GWh target is to be met by 2020, and no penalty prices passed on to consumers. }
    So the industry has to find 3,000 MW of new capacity, so they had better get cracking or they will be paying for the short fall.
    Every state government had also get their heads together and facilitate this pretty simple goal.
    Addressing the first point about uncertainty this is know as sovereign risk, where industry can not trust the guidelines to be followed by successive government policy.
    It is way past time that top to bottom down Governments of every persuasion fixed up this problem.
    I trust that each and every government in each state and federally will have positive and substantive policies that lend themselves to industry being able to invest without the fear of Sovereign Risk.

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