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Australia

Australia

GREEN PRICING PART OF DEREGULATION, NSW monopoly broken

On the day before Australia elected a new Conservative government, the state of New South Wales (NSW) transformed its electricity industry with new legislation emphasising sustainable power generation. The legislation requires electricity distributors to meet strict environmental standards and splits NSW's monolithic generator, Pacific Power, into two. NSW is the first Australian state to have a Sustainable Energy Authority that will fund the development and commercialisation of clean energy technologies.

NSW monopoly broken

Green pricing part of deregulation

On the day before Australia elected a new Conservative government, the state of New South Wales (NSW) transformed its electricity industry with new legislation emphasising sustainable power generation. Introduced on March 1, the legislation requires electricity distributors to meet strict environmental standards, particularly on greenhouse gas emissions.

The new law amalgamates the state's 25 electricity distribution companies -- serving seven million people -- into six "energy service companies" and splits NSW's monolithic generator, Pacific Power, into Macquarie Generation and First State Power.

The six new service companies are now free to sell a wide range of services, including home insulation, solar water heating and energy management services. In addition they can offer electricity from renewable energy sources under a green pricing scheme, a service for which they can charge a premium.

This they may well have to. The new legislation requires the companies to promote clean generation technologies while meeting greenhouse gas reduction targets. Greenpeace's Keith Tarlo believes this is the first time anywhere in the world that greenhouse gas reduction targets have been written into law.

Purchase strategies

Specifically, the new energy service companies must: develop strategies of one, three and five years for buying energy from sustainable sources such as wind and solar; report annually on carbon dioxide emissions arising from electricity production; and measure their performance on emissions against the nation's 1992 National Greenhouse Response Strategy target of returning emissions to 1990 levels by 2000.

The legislation also makes New South Wales the first Australian state to have a Sustainable Energy Authority that will fund the development and commercialisation of clean energy technologies. With a budget of AUS$ 65 million over three years, the state will invest dramatically more in clean energy than the formal federal government.

The developments in New South Wales, however, will be difficult to duplicate nationally after the landslide election of a Conservative government. This is led by a coalition of political parties which in the past has been hostile to the development of sustainable energy resources.

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