A hurdle in the solar vs gas race.
SPECIAL REPORT by TIM BRAND
Putting solar panels on the roof, making electricity for our own use and selling some into the public grid, is on most people’s mind these days.
The NT Government is right behind the idea – or so says its Renewables Minister, Dale Wakefield in a media release last week: It is making “a significant step forward” by working towards new Generator Performance Standards (GPS) to “provide certainty to investors to ensure the greatest amount of energy is dispatched from renewable power stations”.
The facts don’t match the spin.
Recently, and by recently I mean two years ago, the PowerWater Corporation (PWC) undertook a review of the electricity standards applicable in the Northern Territory.
This was a review they had total control of. It was open to public submissions but written by, reviewed by and ruled-over by itself and its subsidiaries.
And yet this review, which should have taken one year, took two. The Utility Commission, as the regulatory body overseeing PWC, even admonished itself for the delay.
So what was the reason for reviewing the standards of electricity generation? After all, PWC does not generate electricity in Alice Springs. That is the job of the other NT Government owned electricity company, Territory Generation.
Their apparent reasoning was simple: To restrict how electricity generation is done in the Territory.
Why? And what was wrong with the standards?
The prevailing standards were a legacy from the days when gas and diesel generators ruled the Territory. Pressure was finally building from the new technologies, like solar and batteries and from customers, and even from the national electricity grid.
So bravely onward into the late twentieth century went PWC.
All the usual consultants and community members, and government officials, fell headlong into reviewing the old standard and creating the “new” standard. All the while PWC had a firm grip on the writing of “their standard”.
There were some wins along the way. The first draft offered a standard that solar PV and batteries could comply with, but gas and diesel could not.
When this was pointed out, two standards were developed – one for PV and batteries, and one for gas and diesel, the latter privileged with much reduced requirements.
For example, solar and batteries are required to respond to voltage, frequency and reactive current changes at a rate that diesel and gas generators cannot.
When the Utility Commission passed judgement on these PWC drafted standards, even they felt compelled to comment on how unfair it was for PV and batteries to be held to this very high standard.
Also, even after a two-year process, PWC still needed to provide a huge amount of information to potential investors, including the taxpayer, to achieve this standard.
This is particularly true for the lack of information provided by PWC around forecast accuracy to understand the appropriate level of compliance, which investors need to read this new standard.
Going even further, recent national press articles have criticised the standard as being anti competitive in its lack of transparency.
Simply put, the required PV standard is so demanding that no corporation would consider the risks and uncertainties supportive of their investment. So no one could invest in the Territory electricity generation sector.
Well, almost no one. We all know about Sun Cable’s massive solar farm proposal in Tenant Creek to feed electricity to Singapore. Would this standard stop the second largest private investment in the Territory ever?
Probably not, but it will likely mean that we – the NT – do not benefit from this power, likely to be very low-cost.
One way for Sun Cable to save money is to avoid connecting to our (PWC) grid.
Community solar PV might still work, if we accept that whilst it may never be allowed to make a profit, it may be benefiting our community.
But wait, there is still gas, you say. Correct – although, even under this new standard, gas and diesel generation will increase electricity prices somewhat more than 100% PV.
The cost for electricity generation would double, assuming that gas prices only increase at 3%pa. History would suggest it could be more.
So, singlehandedly PWC has slowed the Territory economy, stopped infrastructure investment by private companies, increased the amount of public money required to be spent and put the skids under any ability for the Territory to attract the type of investment it needs.
Coupled with fracking this would make the Territory and the desert completely unlivable.