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Russell Marsh CEC

The Clean Energy Council (CEC) is Australia's peak body for the clean energy sector representing over 350 member companies. Wind energy development in Australia has seen 55 wind farms operating with over 1,880 MW of installed capacity. In New South Wales there are 7 wind farms operating with 187 MW of capacity providing enough electricity for 78,500 homes. The market for wind energy is supported by the Large-Scale Renewable Energy Target which mandates 41,000 GWh of renewable generation by 2020 through the creation and surrender of Renewable Energy Certificates. Power purchase agreements of 10 years or more are essential for wind farm financing as they provide long-term offtake contracts for both energy and RECs produced.

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83 views

Russell Marsh CEC

The Clean Energy Council (CEC) is Australia's peak body for the clean energy sector representing over 350 member companies. Wind energy development in Australia has seen 55 wind farms operating with over 1,880 MW of installed capacity. In New South Wales there are 7 wind farms operating with 187 MW of capacity providing enough electricity for 78,500 homes. The market for wind energy is supported by the Large-Scale Renewable Energy Target which mandates 41,000 GWh of renewable generation by 2020 through the creation and surrender of Renewable Energy Certificates. Power purchase agreements of 10 years or more are essential for wind farm financing as they provide long-term offtake contracts for both energy and RECs produced.

Uploaded by

New England Wind
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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Wind energy development

and the energy market


Russell Marsh, Policy Director
Clean Energy Council
Outline

1. The Clean Energy Council


2. Wind Energy Development in
Australia
3. Market Support for Wind Energy in
NSW
4. Power Purchase Agreements
5. Other issues
The Clean Energy Council
The CEC is the peak body representing Australia’s
clean energy sector. It represents more than 350
member companies active in developing and
deploying renewable energy and energy efficiency.
The CEC’s members are involved in the full suite of
clean energy technologies including wind, hydro,
wave and tidal, solar pv , solar thermal, solar hot
water, bio energy, geothermal and cogeneration.
Wind Energy in NSW
• 7 wind farms currently operating
• Total installed capacity of 187 MW
• 116 wind turbines
• Provide enough electricity to power
78,500 homes
• A further 4,204 MW are under
development
Wind Energy in Australia
• 55 wind farms operating
• Total installed capacity is 1,880 MW
• 1056 wind turbines
• Around 10,000 MW wind expected
to be needed to meet 20%
renewable energy target
Market Support
The Renewable Energy Target
• Mandatory Renewable Energy Target (MRET) introduced in 2001: target of
9,500 GWh of renewable electricity generation by 2010
• Renewable Energy Target (RET) implemented in August 2009: target of
20% (45,000 GWh) renewable electricity generation by 2020
• Enhanced Renewable Energy Target legislation passed June 2010: splits
market into LRET (Large scale Renewable Energy Target) and SRES
(Small scale Renewable Energy Scheme)
• SRES: supports the deployment small-scale renewable energy
technologies. No target for amount of generation from this scheme.
Small-scale wind (up to 10kW) included)
• LRET: supports the deployment of large-scale renewable energy
technologies. Target of 41,000 GWh by 2020
Market Support
The LRET
• Market works on basis of demand and
supply
• Liable parties (retailers and large energy
users) have to surrender certain amount
of RECs every year.
• REC price a function of number of RECs
needed and number of RECs available
Market Support
REC prices
Market Support
NSW Feed-in Tariff
• Applies to wind turbines up to 10kW
• Provides 60c gross
• Commenced 1st January 2010 runs for 7
years
Power Purchase Agreements
(PPA)
• PPAs are a long-term (off-take) contract
with an electricity retailer for the output
(energy and RECs) from an electricity
generator (wind farm)
• Wind farms are capital intensive and
most financed through bank debt.
• A PPA for both the energy and RECs
produced a pre-requisite for lenders –
usually 10 year minimum
Other issues
Market risk: PPA essential
Counterparty risk: Lenders will require the
counterparty to a PPA to be investment grade
Regulatory risk: REC prices – and therefore
value of contracts heavily influenced by
government policy. Uncertainty as to future
policy drives prices down.

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