He noted the country has major obstacles to development, including the cheapest electricity prices in the world and lack of political support at federal level. Overall, however, Australian public support for wind power and renewable energy is high, he said.
"The market drivers for wind are support mechanisms, high electricity prices, a positive permitting environment and grid infrastructure. Wind power is being seen as a good long term hedge against rising fuel prices in many countries but government policy is required to stimulate and maintain the market."
Fears that Australia lacks interconnection capacity on the grid for the distribution of ever rising levels of wind generation in the various state power systems are ill-founded, according to O'Neill. He was backed by words from the horse's mouth. "The mechanisms are in place already and future mechanisms are coming," said Paul Ravalli of the National Electricity Market Management Company (NEMMCO).
In particular, South Australia's long skinny grid system is considered unique. "In February last year we engaged the German company DlgSILENT to carry out power system stability studies. The key results of the first stage of the studies show that for wind generation up to 800 MW and possibly up to 1200 MW under low demand conditions, the South Australia network could be managed with some reduction in the transfer capability from Victoria to South Australia. We are now looking at more detailed studies," said Ravalli.
According to the Australian wind energy association, Auswind, South Australia has 388 MW of completed wind farms with a further 1849 MW from feasibility to planning approved, out to tender or under construction. The South Australia power system has a forecast peak of 3378 MW and a minimum demand as low as 900 MW. Its network is 275 kV running the length of the state with 132 kV in parallel.
Accurate forecasting is essential to ensure system security, Ravalli said. "Most rapid changes occur in August and September and also during early afternoon. NEMMCO is investigating alternatives to security. Changes in wind production, he pointed out, are gradual, allowing time for compensatory measures to be taken by system operators. "A wind event is not going to be a sudden event but rather occur over a period of half an hour to an hour," he said. "The Victoria South Australia interconnector can handle at least 265 MW of sudden change without instability."
In 2004 the Australian federal government committed A$14 million over five years to assist the development of systems to allow accurate wind forecasting and facilitate the increasing penetration of wind energy in the national electricity market. Part of that grant is financially supporting WINDFORNEM, a three year research pro-ject up to 2009 at the Centre for Energy and Environmental Markets (CEEM), located at the University of New South Wales. The project on wind power integration is exploring the design and performance of the Australian electricity structure, while the strand on wind energy forecasting is looking into the behaviour of the atmosphere, statistical forecasting methods and strategies for wind farm control.
NEMMCO operates the National Electricity Market (NEM), the wholesale market for electricity supply in the Australian Capital Territory and the states of Queensland, New South Wales, Victoria and South Australia. Tasmania also joined the NEM when the underwater Basslink interconnector became operational in April this year.