Wind industry rush to Australia

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While wind project development in Australia has so far been dominated by two domestic utility developers -- Hydro Tasmania and Pacific Hydro -- keen competition is now being provided by a rush of independents from the UK, Spain, Germany, Japan, the US, New Zealand and India, who all want in thanks to the Mandated Renewable Energy Target (MRET).

The UK's Babcock & Brown and Wind Prospect have made the most significant development progress, focusing on South Australia. Stage 1 of Babcock & Brown's Lake Bonney project (80.5 MW) is under construction, while Stage 2 (128 MW) is approved, as is Wind Prospect's 60 MW Yabmana wind farm, while its 55 MW Woakwine Range project is in planning.

The power of the MRET magnate will only result in foreign investment, however, if it is secured and strengthened, says Renewable Energy Systems (RES), another UK-based developer which has just announced its move into Australia. "The outcome of the MRET review is the single most critical factor which will determine whether the company does in fact enter the Australian market," says RES, which has completed more than 700 MW of wind projects worldwide with a further 6000 MW in the pipeline. "Without enhancements to the current legislation, the economic feasibility of most wind energy projects will not be sufficient to warrant the necessary deployment of human and financial resources to Australia," it says.

An increase in the MRET to at least 5% by 2010, an extension of it to 2030, and consumer price indexing of the penalty for not meeting the mandate is needed before RES will "be able to effect a market penetration of approximately 10-15% of the wind energy projects that materialise within Australia." Investment by RES would then equate to approximately A$450 million.

Recognising the size of the development rush, Denmark's two main turbine manufacturers, Vestas and NEG Micon, are already establishing manufacturing facilities in the country and have fast become the dominant suppliers in the market.

NEG Micon's facility will be in Victoria, where it has an agreement to supply all the turbines for Pacific Hydro's 180 MW Portland Wind Energy Project. It is also the supplier to the Challicum Hills 52 MW project, also in Victoria, and so far the largest to go ahead in Australia, and the 34 MW Starfish Hill plant being built in South Australia.

Vestas, meanwhile, is setting up a nacelle assembly facility in Wynyard, Tasmania, from where it will supply turbines for Hydro Tasmania's wind projects amounting to just over 538 MW approved or in planning. It has already supplied turbines for the first 10.5 MW stage of the utility's 130 MW Woolnorth project, also in Tasmania. Vestas hopes to establish a blade manufacturing facility, but this will only proceed with significant strengthening of the MRET legislation, says the company.

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