Councils could lead way for big solar in Australia

Local councils could underpin a significant roll-out of utility-scale solar across Australia – providing a hedge against rising electricity prices for themselves and rate-payers.

This is the prediction of Sunshine Coast Council, which is looking to build its own 10MW solar farm to protect against rising electricity prices.

In a submission to the Renewable Energy Target Review, Sunshine Coast says that such initiatives would ultimately deliver savings to councils and the community without the need for assistance, but warns that removing the RET would likely threaten early projects, such as its own.

“By maintaining the RET and remaining committed to the program, scope exists for a significant roll out of utility-scale solar by local governments across Australia,” it says.

“By doing so, we expect to reach a point where the solar efficiencies delivered allow for projects that are viable in the commercial arena, allowing the more widespread deployment of solar commercially at a cost lower than the current electricity price and without the need for external assistance.

“This scenario would see renewables deliver a real cost saving to all Australian as this would naturally reduce electricity pricing.”

Sunshine Coast is the most advanced along the path to utility-scale solar, although numerous other councils are considering similar projects. Lismore, in NSW, is likely to build a utility-scale solar plant as part of its plans to reach 100 per cent renewable.

In its submission, Sunshine Coast said that its research had shown that there was only a marginal difference between the cost of the solar project, and the current cost of power it bought from the grid.

Over the long term, however, the solar farm would be cheaper than buying electricity from retailers and would deliver “significant savings” to the council which can then be passed back to the community.

Sunshine Coast, which wants to establish itself as a regional “clean-tech” hub, has previously said the solar farm could deliver a $9 million saving in electricity costs. And it would also inject $10 million into the local economy over the next 10 years and create up to 40 jobs during construction.

In its submission to the RET Review panel, it also says it would protect the council from electricity price shocks.

“Given that marginal electricity capacity and electricity pricing is largely set by natural gas-fired power station and that Australia is looking to develop a strong gas export market, the real risk remains that natural gas pricing could be subject of price shocks, driving the cost of electricity significantly higher.

“Renewables, particularly solar, acts as a natural hedge against” those shocks, but removing the RET would exacerbate those risks.

Sunshine Coast said the project was ideal to be implemented by other local governments, and could be adopted nationally.

But it warned that the projects – at least those in the vanguard – would be threatened if the RET was removed or reduced significantly, as many fear the government intends to do.

Failing to commit to the RET would significantly reduce competition in the market and hinder the development of renewables, and leave consumers hostage to the fortunes of the gas market.