AFR National Energy Conference 2010
THE chief executive of AGL Energy, Michael Fraser, suggested yesterday at the AFR conference, Australia could adopt a staggered approach to climate change by introducing an emissions trading scheme that covered only power plants.
“Stationary energy is some 40 per cent of Australia’s carbon pollution so it may be pragmatic to start an ETS with this sector only,” Mr Fraser said at a conference in Sydney.
“This would leave other more contentious sectors, including transport, agriculture and waste, out of the scheme until later in the piece.” He also went on to say, that deregulation of the regulated prices would be a good move for the customer, generator, retailer and developing technologies.
The coal industry had a good representation at the AFR conference and it is obvious to see its place in the future energy mix for many countries especially in the pacific/asia region. Thermal coal generation would enable developed and undeveloped governments to keep pace with national growth/energy consumption and also provide a stable base load power supply. Current and developing Renewable/clean technologies can not fill this space as yet.
It was also mentioned that there is going to be a large adjustment in coal price due to the increased demand of thermal export coal by other nations including China and India and the fact that the supply contracts to some of Australia’s large coal generators are soon to expire. This will also effect the energy price.
The CCS industry was also represented by Dale Seymour who mentioned that an electricity price of around $130/MWh could make commercial CCS applications feasible.
Other points of note:
- All who spoke at the conference spoke of the uncertainty in Australian from the current Government’s lack of direction on a carbon price. All would like to see a price on carbon asap to provide some certainty in investment decisions and company strategy;
- it was interesting to hear (but no suprise) that CBA had only lent $100M last year to renewable projects. They might have to open the cheque book further if they back the right horse in the solar flagship scheme;
- There is a large step in the requirement for RECs in 2015/16, which could catch a lot of retailers and businesses out;
- nominal electricity retail prices are expected to be around $280/MWh in 2015;
- world gas prices might not rise as much as predicted due to overseas competition, which would lead to better conditions for Australian gas generation.
ACT Solar Tariff
The ACT Government has unveiled its scheme to turn Canberra into the nation’s solar power leader in a radical departure from its previous renewable energy plan.
If the new feed-in tariff proposals announced yesterday are successful, up to 25 per cent of the city’s power would be generated within a few years by solar farms dotted around the territory and by vast photovoltaic panels on shopping centre and warehouse roofs.
Environment Minster Simon Corbell said yesterday that the Government would legislate for two new categories to its existing solar feed-in tariff scheme, allowing medium-scale generation of between 30 kilowatts and 200kW and large-scale generation of more than 200kW.
The medium category will allow businesses to produce their own power using panels on their roof spaces and to feed surplus electricity back into the grid, while the large-scale category paves the way for private players to build solar farms for the territory’s first effort at large-scale renewable electricity generation.
The firm to run the first solar farm, generating about 40kW, will be chosen by auction. The company offering the lowest-priced power will win the contract and further schemes will be announced after the effectiveness of the auction model has been assessed.
Origin
Origin’s PNG hydro plan to build a multibillion-dollar, 1800MW hydro-electric project con- necting Papua New Guinea to Queensland, with the potential to power 1.8 million homes.
Under a memorandum of co-operation signed between the PNG and Queensland governments, along with Origin and PNG Energy Developments Ltd, a 250-kilometre subsea interconnector, similar to BassLink which connects Tasmania and Victoria, will be built between a hydro power project on PNG’s Purari River at Wabo and Daru in the country’s south.
Another cable would run for a similar distance under Torres Strait to Bamaga in Cape York, with a further 1000 kilometres of transmission infrastructure providing a link to Weipa and down to Townsville, where it will join the national electricity grid.
The 50:50 venture between Origin and the PNG Sustainable Development Program will be subject to a feasibility study, expected to be completed in 2012, and require regulatory, Commonwealth and native title approvals.
Mr King said the cost of the project and other details would only be known after the completion of the feasibility study. If the project gets the green light, it could be delivering 1200MW of power to Australia and 600MW to PNG as early as 2018.
But analysts expressed doubts about the project advancing, sending Origin shares down more than 1 per cent against a higher market, losing 17¢ to $15.48.
”The thing about the Purari River at Wabo is that it rains eight metres all year [there] so the river flows are constant. The annual constant river flow is four times the Murray River system. It could fill up Sydney Harbour in two days. ”In terms of its potential to be transformative, it is a Snowy Mountains Scheme.
”It is important to say that while the Snowy scheme has a higher nameplate (capacity) of about 2500 megawatts, it is still only an intermediate and peak provider of energy into the national electricity market. This will provide more energy because it is base load.”
Linc
Linc Energy Ltd. (LNC AU): The Australian clean fuel company may seek a partner to help develop its proposed commercial coal gas-to-liquids plant amid surging construction costs.
Silex
Silex Systems Ltd. (SLX AU): The Australian research and development company had its rating raised to “buy” from “hold” by analysts at Royal Bank of Scotland Group Plc.
