Infigen revenues down 18% as electricity prices slump

Australia’s largest listed renewable energy company, Infigen Energy, has reported an 18 per cent fall in Australian wind farm revenues in the fourth quarter because of sharply declining wholesale electricity prices.

Infigen Energy, in its full year production report, said revenues from its 560MW of wind turbines in Australia fell to $27.9 million from $34.2 million, even though production was about steady.

The fall in revenue was made worse by a slump in the price of LGCs – the certificates issues under the renewable energy target – which have fallen to near record levels at times due to uncertainty about the future of the RET.

The fall in wholesale electricity prices will be felt across the market by all electricity generators – be they coal, gas or renewable.

Few, if any, coal-fired generators are likely to have made a profit in the last year, because of falling demand caused by energy efficiency measures, the proliferation of solar PV, and declining manufacturing.

Gas fired generators are already finding themselves priced out of the markets – as the price of gas begins its rise to meet export parity as the giant LNG plants come on line.

Added to this is an excess in capacity, ironically caused by an overbuild of mostly fossil fuel generation over the last five years.

Infigen Energy said its Australian revenues for the year fell less than one per cent to $145 million, although production was up 4 per cent.

US revenues were also about steady at $144 million, with a 2 per cent increase in production.