Why should renewables be billed for grid costs, when coal gets free ride on emissions? | RenewEconomy

Why should renewables be billed for grid costs, when coal gets free ride on emissions?

Vestas senior vice president “outraged” by claims that renewables developers should foot the bill for grid upgrade costs as more wind and solar comes online.


Who should pay for the cost of upgrading the world’s increasingly outdated electricity grids to accommodate the new world order of distributed, variable renewable energy?

It’s a major bone of contention in Australia at the moment that has pitted the renewable energy industry, and quite possibly the market operator, against the Australian Energy Market Commission.

But it’s not a problem exclusive to Australia. Just this week, the senior vice president of the world’s biggest turbine manufacturer, Danish giant Vestas, expressed “outrage” at the idea that renewables developers should be expected to foot the bill.

Speaking at a conference session at European Utility Week, Vetsas’ Morten Dyrholm, hit back at claims from fellow panelist Dominique Jamme – head of French energy regulator CRE – that costs required to upgrade grids weren’t being factored into claims wind and solar were now viable without government support.

“At 60, 70 and 80 per cent [renewables penetration], you have the issue of sustaining stability of the system. As you put in more renewables, you are adding cost,” Jamme said. “Who is going to pay for the [energy] storage?”

As Greentech Media reports, however, Dyrholm was having none of it.

“I can’t help but feel a little bit outraged when people say, ‘But system cost,'” Dyrholm said. “It should be the other guys, the fossil guys [that pay]. Their societal cost is enormous; [think about] the amount of subsidies, the socialised costs [of fossil fuels] that we’ve allowed to happen for generations.”

“And now we have finally become unsubsidised, and we have to support system costs? In the meantime, we let the young kids do the hard work for us. They go on the streets. They go and fight for change, and we sit here as an industry and talk about ‘system cost’?

“We should be as outraged as them, and we should be united [as an industry] in asking for change. We have a special obligation in our industry, and I am not just saying that to sell more turbines. I’m saying that on behalf of my kids. We need to be more outraged when we see examples of something not working just because of the regulations in place.”

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  1. Phil NSW 9 months ago

    Did the coal industry pay for the grid as it exists today or did Government? When we figure out the answer to that question we could always say renewables should get the same treatment.

  2. Chris Drongers 9 months ago

    Exactly. In the fight between the AEMC’s version of a market for grid access and AEMO/renewables developers argument for ‘grid as a service ‘ there is very little discussion about who is going to pay to build up the grid. And little evidence that grid build up is being expedited with any sence of urgency.
    COAG on 22/11 is going to be a cacophony of competing urgent agendas.

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