Page 2698 - Week 08 - Tuesday, 15 August 2017

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The first successful auction project to begin generation was the Royalla Solar Farm, located south of Canberra on the Monaro Highway, which began generation in August 2014. The last successful auction project to begin generation will be the third stage of the Hornsdale Wind Farm in South Australia that will begin feed-in tariff supported generation in October 2019.

When all the renewable energy generators supported under the act are generating, around 2.3 million megawatt hours of clean, renewable electricity will be generated by them each year, which is enough to supply around three-quarters of the ACT’s forecast 2020 electricity supply. The remaining renewable electricity supply needed to reach the 100 per cent by 2020 renewable electricity target will come from the ACT’s share of the national renewable energy target, its voluntary GreenPower purchases as well as its rooftop solar generation.

The act requires that a review be undertaken into it after every five years of operation. Its first five years of operation finished in December 2016. The review was required to cover the progress of the construction of successful projects, the act’s effectiveness in achieving its objectives and the feed-in tariff costs that are passed on by the successful auction projects to the ACT’s electricity consumers. The review of the act included a number of key findings and highlighted the overall success of the act and the ACT government’s reverse auction program in general.

In summary, the review of the act found that it has been successful in stimulating competitively priced wind and solar projects that proceeded to commercial operation; that ACT auction processes were well regarded and understood by the renewable energy industry and that this had assisted in delivering competitive auction outcomes; the construction of all the generators awarded feed-in tariff entitlements under the act was on track; the auctions held under the act established and enhanced the ACT’s reputation as a hub for renewable energy; the act was achieving all of its objectives; and the net cost of the ACT’s large feed-in tariff scheme compared favourably with the support cost of the commonwealth’s renewable energy target scheme.

Importantly, the review validated the government’s use of the reverse auction mechanism to support large-scale renewable electricity generation. It also found that after 2025 the ACT’s large feed-in tariff scheme should have no net cost to ACT electricity consumers and, in fact, the supported wind and solar generators will eventually be making net payments back to ActewAGL distribution, which manages the feed-in tariff payments. This forecast needs to be treated with some caution because it is based on a number of assumptions, one of which is that Australia will reintroduce national carbon pricing in 2022. However, the prediction is a major endorsement of the design of the large feed-in tariff scheme and shows that, in the long run, ACT electricity users should not be penalised because of the territory’s ambitious renewable electricity target.

The next generation renewables auction opened for proposals on 1 April 2016 and closed on 25 May 2016. Fifteen proposals were received from 14 proponents. The total capacity of all the submitted proposals was 1,078 megawatts, around six times

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