Brumby's solar hit... and miss
Victorian Premier John Brumby certainly didn’t miss with the timing of the state’s large-scale solar power plant initiative.
In the midst of a federal election campaign that has been devoid of original thought on clean energy options, Brumby has managed to steal the limelight and create the prospect that Victoria – the mainland state least endowed with solar radiation – could emerge as Australia’s centre for large scale solar development.
No wonder the Brumby team were feeling a little bit "chuffed" with themselves after announcing a 5 per cent large-scale solar energy target, supported by the country’s first large-scale feed in tariff.
It is an announcement that has been begging to be made for ages, but no one expected it just now. A cynic would suggest that Brumby’s timing was more about the upcoming state election. Best, then, to get in before anyone else. And solar plays well in focus groups; which is perhaps why this is a solar tariff, rather than a broad renewable tariff that would include geothermal, biomass and wave energy, and which would probably make more sense.
But that seems to be the way, in Australia – clean energy policy has been, and continues to be, a series of random initiatives. As one industry executive put it yesterday, “this is very good, but how the hell does it fit in with everything else.”
Brumby has set a target of 5 per cent of his state’s energy capacity to come from large-scale solar by 2020, effectively underwriting nearly 1.5GW of installed capacity and investments worth several billions of dollars, and increasing the state’s renewable energy target to 25 per cent by that year, while bringing coal down to 63 per cent from more than 90 per cent.
He has also set an interim target of 500 gigawatt hours by 2014. That equates to around 285MW of installed capacity, probably at the cost of more than $1 billion over the next four years.
That is an ambitious program. To put it in an international context, Spain overtook the US as the largest market for solar this week, with a capacity of 430MW. To put it in the local context, Australia currently has less than 1MW of installed large-scale solar. It goes without saying that this would fast track the local industry.
Victoria would effectively deliver more capacity in a shorter time frame, and with more projects, than the federal government’s much-touted Solar Flagships program (a maximum 250MW by 2015 from two projects) and would effectively leave the choice of technology and product in the hands of the market – investors and financiers – rather than a lottery decided by a government-appointed panel.
The details of how the feed-in tariff would operate, and the price, are yet to be finalised – that is a job for a working group to be chaired by ex Origin Energy and now Clinton Foundation executive Tony Wood. However, the feed-in tariff for large-scale solar will be set at a considerable discount to that of roof-top solar, simply because the technology costs are so different. Brumby estimates the additional cost on the energy bill per family at $5-$15 per year. But it is not clear how he arrived at that number.
Most in the solar industry favour the system that's being adopted in India (which plans to have 22GW of large scale solar by 2022), where the tariff is capped and the lowest bids and the cheapest technology get the funding. It may be, however, that the project will still need added incentives such as loan guarantees and tax credits to lower the cost of capital, but that will depend on the state of the credit markets and the appetite for risk. The Obama administration, for instance, has provided more than $5 billion in loan guarantees for a handful of large-scale solar energy projects and manufacturing initiatives in just the last few months.
There is no doubt this initiative will mean that many local and international solar developers will remain in the country, and that Australia will have the opportunity of ranking among the leading developers of large-scale solar in the world. This, one might argue, is its birthright, because it has the best solar resource and has been the nursery for some of the best technology.
What would make sense is for this sort of initiative to be extended to the states with the best solar radiation, where the tariffs need not be so high to support the technology; and to other technologies such as geothermal, wave and biomass, as they are in other countries.
Indeed, broad based incentives such as feed-in tariffs, loan guarantees or tax credits have been the modus operandi of many industrialised nations and are also being taken up with enthusiasm by developing countries too.
In Germany and Spain, this has helped underpin large manufacturing bases that now rank as the biggest in the world behind China and the US. And as scale has been achieved, and as costs decrease, the feed-in tariffs are also being wound back, as they were designed to be.
Meanwhile, Australia's Labor government ministers, particularly energy minister Martin Ferguson, have been dead against them. But the tide now appears to be turning.
It is difficult to imagine what else the Gillard government could unveil as part of its commitment to renewable energy, apart from renaming the renewable energy future fund that was unveiled in a hasty fashion at the May budget.
They could, of course, indulge their passion for flagship projects and extend them to other technologies, but that would be good for an individual project, not for a whole new industry.
Comments on this article
Solar Base Load power - is anything possible with money?
No amount of money could source, transport, and contain the 10 million tonnes of salt required for 10GW of solar generated, baseload power.
Similarly, we've dammed almost every river in the country. In 6 hours, we could only store a few GW hours of pumped water. Nowhere near the 180GWh we'd need to generate 10GW for 18 hours.
10GW is less than 20% of our current baseload power by the way,
Molten Salt Storage, and dam water make great "batteries", but neither are capable of being used to extend daytime solar power into 24/7 power.
Spain has a solar concentrator using Molten Salt Storage
There is one solar concentrator, currently operating, in Spain, using Molten Salt Storage. It is called Andasol 1.
Another is due to come on line soon, called Andasol 2. It is the same size.
Andasol 1 is 50MW. It boasts a peak storage capacity of 20 hours (@50MW), ie 1010MWh, but is honest enough to admit that they only expect to use on average, 7.5 hours of storage storage each day.
The ZCA 2020 report suggests building over 200, 217MW plants with 17h of molten salt storage each. The proposed salt tanks are dimensioned for 17h peak storage. The average that can be added each day (and hence able to be used at night) will be far less than this.
Spanish financial Woes caused by Nuclear program
The poor Spanish people were sold a pup. $6 Billion Euro's of Nuclear plants failed to ever deliver a single kWh of electricity and the people had to pay of this debt.
Here are the economics.
Build $6 Billion Euro's of Nuclear plants. Get $0 of electricity
equals Bad Economics.
Simple as that... Now the Spanish people suffer because of the legacy of the Nuclear disaster.
Roger Clifton fails the European Nuclear reality test
Fact: European Nuclear is in decline
Unfortunately for you, Renewables are on the upward trajectory in Europe and Nuclear is in decline. In 2009 Nuclear retired a net of 1100MWe of Nuclear power.
This trend is going to continue out until 2013 or even longer when maybe the Finish plant will come on line and stem the bleed.
Solar Base load
To all the solar base load advocates. Anything is possible with enough money. The only questions are, who is going to pay for it and is it worth doing. The answer to the first question is obviously the poor long suffering taxpayer. The answer to the second has not been answered yet but with most of the scientific research based on real world observations,and not computer models, suggesting that Catastrophic Man Made Global Warming is unlikely I would think that we would be wise to wait awhile before throwing away even more of the taxpayer's hard earned money. I also believe that all the people touting the success of Spain in this regard should probably get their research up to date. Spain's response to it's recent soverign debt crisis has caused a rethink on all of the many and varied taxpayer subsidies it provides for all of these expensive and inefficient generation processes. They are currently propsing the cancel all subsidies retrospectively. This would send most renewable energy companies broke and mean that most of the proposed solar developments will not go ahead.
Spain
Spain has a mind numbing 30MW (three-zero) of solar power tower's installed, i.e. exactly two of the type that ZCA are saying we should build
are they using molten salt storage ... errr no... its too expensive...
The main game is nukes
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Australia is being left behind in the race to convert to nuclear. Europe (exc Russia) is planning 28 GW and Russia 16 GW, of electricity that is. Already under construction are a further 4 GW plus 6 GW in Russia.
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That is quite apart from their currently operating nuclear plant, which includes 7 GWe in Spain. Is there any solar contributing reliable baseload in Spain? Spain must be relieved they got the nukes underway before the GFC hit.
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<a href="http://www.world-nuclear.org/info/reactors.html">Data from WNA</a>
Matthew Wright where are the real numbers?
Coor! A 100MW solar plant, Or in other words $1 billion for 0.22%.of Australia's electricity !!
I looked at the site you linked to, where are the real details about the molten salt storage? How long will it last after the sun goes down? How much can it deliver from that storage? Where are the numbers? How much concrete, steel and glass will it waste? I hope they are a bit more detailed than the so-called "detailed modelling" in the ZCA2020 greenwashing report.
For a detailed critique of the ZCA report check out the University of Adelaide's Brave New Climate website, before Matthew and his friends waste everybody's hard earned cash & put their feetup sipping wine off our backs with this multi-trillion dollar lunacy :
http://bravenewclimate.com/2010/07/14/zca2020
Not so bold Brumby
500 gigawatt hours of solar sounds like a big number. I wonder how many of your reader realise how tiny it really is. It is less than 1% of Victoria's annual consumption. $1 billion dollar for less than 1%.
It is only 0.22% of Australia's total electricity consumption. $1 billion for 0.22%. $455 billion for 100%.
Wait a minute! Weren't Beyond Zero going to do it for a mere $260 billion of new (largely solar) generation capacity (excluding transmission costs)? And that includes replacing all oil and gas that is currently used for transport and direct heating not just electricity. ABARE estimates that electricity is less than a quarter of final energy consumption so replacing the rest will be no small task. Yet BZ can do the whole lot for 40% less than a scaled up Brumby solution only doing the electricity.
Either Brumby is paying too much for his solar or BZ expects Australia to be using only a small fraction of the energy in 2020 than we use now.
Maybe the answer is both!
Roger Clifton is obviously not upto date on Baseload Solar
Roger could do well in updating his knowledge into the 21st century last year Europe downsized its nuclear fleet by 1100MW but Spain is building 60 SolarThermal plants...
US Sandia National Security Labs Where they do nuclear and Solar research developed Molten Salt Power Towers piloting them in the 70s and 80s and commercially providng them in the 90s
I think you should check out projects like Rice Energy and Tonopah..
Study up on this
http://www.tonopahsolar.com/Portals/11/Tonopah_Crescent_Dunes_POD_2009_1...
Replacing brown coal takes more than solar gestures.
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Bite the bullet, Brumby!
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Plan 8 GW of nuclear power stations in the Latrobe Valley. The water, land and grid infrastructure is in place and its community needs a new energy supply. Our aluminium industry can be rescued from the defeatists and new, energy-intensive industries can be developed.
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Without a clear intention to end the consumption of brown coal, any gestures about renewables are greenwash.
Bold Brumby
I think you would find that Martin Ferguson probably believe in Nuclear Power and accepts the arguments about base load power. So he sees any incentives for renewables as a waste of money and nothing more than a bit of lefty green floss.
Unfortunately this is the equiv of just two Spanish Solar plants
This is the equivalent of two spanish Baseload Solar Thermal plants (300GWh each) by 2015.
Spain is building 60 plants out to 2013. It's not so bold just a drop in the ocean. We need to multiply this 2015 commitment by 15x to make a serious industry of it on the way to decarbonising the Australian economy. Companies like Brightsource, Abengoa, ACS Cobra, Solar Reserve and Sener/Torresol Energy are ready to go. The Feed in tariff would have to be in the order of 13-22 cents per kilowatt hour to make this happen depending on whether or not RECS are included etc.
Matt
Bold Brumby
Hats off to Brumby and the Victorian Government for their solar energy initiatives. If only our federal politicians had the same get-up-and-go. Maybe this is an area where we could and should lead the world. If solar energy is going to be viable anywhere in the world you would think Australia would be a no brainer as a location. I think the world is getting sick of all the crap that is associated with fossil fuels and nuclear energy. The pollution, the toxic waste that lasts for years, the enviromental damage caused, the risk of catastrophic accidents, the wars fought over energy security, the problems caused by limited and fluctuating supply. Australia has vast resources not only in solar but also in geothermal and wave. We surely must be heading this way? Australia is at risk of being left behind. The electorate is embracing the concept more and more every day. The shift to renewables will be bigger than the information technology revolution. Those countries that make the transition early will be the winners. Let the renewables race begin!