Public solar projects deserve their day in the sun
AUSTRALIA has started its move to a 100 per cent renewable electricity supply. It’s the Great Transition – a latter stage of the Industrial Revolution – that has previously brought us coal and oil power, freeing humanity from using muscle power alone. We have to take this step if we wish to help avoid dangerous climate change. Various studies have shown that a 90100 per cent renewable energy electricity supply is possible. The real questions now concern how we go about making it a reality, and how fast we do it. The most common view is that a 100 per cent renewable energy electricity supply will largely be powered by wind and solar, with sufficient storage (pumped hydro, batteries and so on) to deal with supply and demand variability. Wind: There is currently 3800 MW (December, 2014) of wind power installed, and projections are that wind could supply about half of our nation’s energy demand. Wind currently has the lowest LCOE (levelised cost of electricity), at about $70 to $100/ MWH. This means that $100M will get you more electricity if you put it into wind infrastructure than if you put it into other renewable energy technologies. Solar: There is currently 4,900 MW of solar PV (photo-voltaic) installed in Australia. Most of this (about 4635 MW, in December 2015) is called “small scale solar”, meaning solar PV panels that mums and dads have installed on the roof of their homes. It also includes a smaller amount that is installed on offices, shops and other commercial buildings. A minor portion (about one part in 15) of the PV panels installed in Australia are called “large scale solar”. These are similar to the PV panels that individuals have on their rooftops, but were not installed by individuals but by large corporations. There has been debate about how, and how fast, Australia can transition to a 100 per cent (or more than 95 per cent) renewable electricity supply, and about how both small scale and large scale solar fit into the mix. One of the issues with large scale solar is that it’s expensive – about half as much again as small scale. Similar PV panels are being used, but they cost more to install and get operating when both bankers and corporations and power lines, substations, network connection, roads/infrastructure and so forth are involved, compared with mums and dads “behind the existing meter”. It’s dis-economies of scale. For example, the 102 MW Nyngan Solar Farm (completed in June last year) cost a bit less than $300M, or just over $2.80/watt. Solarchoice PV price check has PV panels being installed (3 kw, average price) on a rooftop for $1.80 / watt. We are not entirely comparing apples with apples, but you get the idea.
To get large scale solar PV installed, taxpayers subsidised the corporations’ cost. Public funds typically paid about half the bill. The reason given for wanting a viable large scale solar sector in Australia is to tap into the financial resources that banks and corporations have, so that money can be sourced and used to build the renewable energy infrastructure that Australia will need. Another round of funding for large scale solar has been announced, with $100M of public funds to be spent. The current round aims to get more large scale solar projects built. It is hoped the projects would drive down the levelised cost of electricity (LCOE) to between $135/MWH and $115/MWH. There were 77 eligible bids submitted seeking funding. The Solar Energy exchange Initiative (SEXI), of which I am the co-ordinator, put in a bid. We proposed a 17 MW large scale solar PV plant – an aggregated, distributed system with an LCOE of $115/MWH and an estimated total project cost of $1.76/watt. We were rejected because we were a council organisation. Taxpayer funds going to directly benefit taxpayers and/or ratepayers is it seems not preferred under the federal government’s current funding guidelines.
Instead, for large scale solar, it seems public funds should only go to corporations (to benefit shareholders). I am yet to meet a person in the street, when the idea was explained to them, who did not see some benefit in the SEXI Proposal. The Solar Energy exchange Initiative, which covers about 60 per cent of the NSW land area, has gained official support from 27 Councils. It has official support from four Regional Organisations of Councils (ROCS). A Motion of Support passed the Upper House of the NSW Parliament in October 2013 - it was unanimous, with support right across the political spectrum. A Motion of Support for the SEXI Proposal, requesting all levels of government to consider how they could support the proposal, was passed by the Senate in March last year. At a time when passing legislation through the Senate has apparently been fractious, this was one item that was unanimous. It is difficult to imagine how we can get any higher official approval, unless we can somehow get Ban Ki-moon and Pope Francis onboard. The current Prime Minister has talked about the importance of innovation in 21st century Australia. No one would disagree. There seems to be a pervasive ideology that the only innovation possible is private sector innovation; that the public and community sectors, that make up 20-30 per cent (depending on the statistics selected) of the economy, somehow don’t count. The US has PV panel installation costs on homes roughly double that of Australia, mostly due to balance of system costs. In a large part this is due to lack of innovation in the public/administrative sector in the US. Australia innovated both its business and administrative sectors (for PV), and the US did not, or did so only slowly. The cost difference in PV installation is what “lack of innovation in administration” means. From 2013 to 2017 more than $400million in public funds will go to corporations for (large scale) solar PV installation. We don’t begrudge the private sector getting taxpayer support. But we would ask for a similar level, or at least a significant level, of taxpayer support for public and community groups as well. The Mayor of the Gold Coast was succinct. As quoted in Renew Economy (December 17, 2015) Gold Coast Mayor Mark Jamieson said: “How a local Council representing Australian taxpayers can be deemed ineligible, and [a foreign company] be given $23 million in tax payer funds is beyond belief.” We need changes to the current funding guidelines so that public and community groups are allowed to access public funds to install PV. To believe that public funds should only go to corporations, and never to go to a public service provider is not sound economics. It’s ideology. Public funds should benefit the public.
“We need changes to the current funding guidelines so that public and community groups are allowed to access public funds to install solar PV.