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Australia

Australia

Industry bowled over with state support -- Australia back in action

While Australia's new wind capacity for 2006 totalled just 110 MW from two projects to bring cumulative capacity to 817 MW, the year will be remembered as one that saw new life breathed back into an anxious wind industry. A year ago the mood was grim, with projects put on hold and several companies abandoning Australia in favour of growth markets in Asia, Canada and New Zealand, all in the wake of the federal government's cull of its renewable support program, the Mandatory Renewable Energy Target (MRET). Today the industry is vibrant again, bounding with optimism and activity -- all thanks to state governments ignoring the federal government's negative lead on renewables. Instead they have introduced policy initiatives which have already seen over 1500 MW of wind projects approved for construction.

"Two-thousand-and-six was definitely a year spent holding one's breath, a do or die year where if there were no changes in government policy, the industry would have collapsed," says Wind Prospect's Michael Vawser. The turnaround was kick started courtesy of the Victoria state government. In September it announced its own mandatory renewable energy target, VRET, setting a target for 10% of its power to come from renewable energy by 2016, up from 4% previously. "That came at a time when sentiment in the industry was at its lowest since MRET was hatched," says Vawser.

Other states soon followed suit. In November, New South Wales confirmed its mandatory target, NRET, for 10% by 2010 and 15% by 2020. Similarly, South Australia's premier Mike Rann confirmed: "Our target is to have twenty per cent of electricity to come from renewable energy sources by 2014 -- the highest in Australia -- and we're backing it in law." Western Australia is also on the verge of confirming a similar target.

Jump started

The impact of the announcements in the wind industry has been demonstrably positive, with companies jump-started back into action. Already this year, Wind Prospect's 88 MW Snowtown wind farm in South Australia, approved for construction last year, has reached financial close and is now entering the construction phase in the hands of Trustpower, leaving Vawser even more upbeat. "Wind Prospect has now developed 299 MW of projects to reach construction/operation, more megawatts than any other developer in Oceania," he says. The company's 170 MW Barunga project in South Australia was also approved last year. Another company encouraged by the state action is Pacific Hydro, which suddenly reconfirmed the next stage of its Portland development in Victoria, committing A$165 million to it after the announcement of VRET.

Even with a new sense of optimism, the industry still has much to worry about. While some suggest that as much as 338 MW of new installed capacity can be expected for 2007, Dominique La Fontaine of the Australia wind energy association, Auswind, says a lot of uncertainty still faces the industry and suggests 163 MW is more realistic. "With no national mechanism currently in operation to encourage investment in renewable energy, the industry is focusing on the opportunities provided by state programs which are extremely welcome but unable, by themselves, to provide the levels of certainty the industry would wish to see," she says. Suzlon's Dan Kofoed Hansen agrees. "We need firm renewable policies for the federal government setting a long term perspective -- and energy and carbon price signals," he says.

Colin Liebmann of RES-Southern Cross says the processing of planning applications, availability of turbines, and grid connection negotiations are top of the list of impediments to progress in Australia. For his company, 2006 was a year of battling in the New South Wales (NSW) Land and Environment Court. "On a company level, 2006 will be remembered for the year that we spent an enormous amount of effort and money on defending approval for our Taralga wind farm, a very costly, time consuming and frustrating process which has significantly delayed progress on the project," says Liebmann.

The 130 MW project was approved by the state planning minister in January 2006 but an appeal against the approval was lodged by a small local group, Landscape Guardians. "It was appealed on several grounds which amounted to a laundry list of the usual claims against wind farms, including visual impact, noise, birds, bats, rare grass and so on," Liebmann continues. "The appeal was the first wind farm case in the NSW Land and Environment Court. Perhaps because of this, the hearings were unusually long and detailed. They were twice extended." Hearings were completed in November and last month the court approved the project. "Great news for us," says Liebmann. "There are some changed conditions but overall it was a very good judgement."

Forecasting

Meanwhile, work on grid issues continues, with technical standards and wind forecasting high on the action list. "This is going to be a significant step forward, but it will require sane input from wind farm proponents to ensure that it keeps heading in the right direction," says Pacific Hydro's Kate Summers on the subject of the wind forecasting work. She adds, though, that there is every reason for optimism. "I think that the National Electricity Market Management Company, NEMMCO, and the transmission network service providers in the National Electricity Market are getting more relaxed about wind energy," she says. "Operating experience in South Australia is showing that it's not that scary after all and in fact there are benefits. As operating data builds it will help turn the tide of resistance."

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