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.
— Simon Corbell MLA (@SimonCorbell) May 26, 2016
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.