Queenslanders go to the polls in just four weeks – and it seems that there will be more at stake for the renewable energy industry than a now postponed auction of wind and solar and storage projects. It could help decide the future of renewable energy in Australia.
That may seem a big call to make about a state that has only one 20MW solar farm (Barcaldine) to show for its 50 per cent renewable energy target, and which will likely feature the cost of electricity and the future of coal power as one of the principle points of difference.
Queensland has high electricity prices, but it has nothing to do with renewables. The Labor government has had to tell the state-owned generators to pull their heads in and moderate their business practices, in clear acknowledgement that it is the actions of fossil fuel incumbents that are pushing up prices.
But while there are some 2,000MW of wind and solar projects under construction across the state right now, they will not come into play until next year.
And by then, the shape of future investment will be well and truly set, and the fate of another 9,000MW of wind, solar and biomass and a further 6,000MW of storage potential will become clearer.
Queensland is the first of four states that will go to the polls in the next 12 months and three of them – Queensland, South Australia and Victoria – have ambitious renewable energy policies that in the absence of any federal initiative are critical to the future of renewables in Australia.
Queensland has its target of 50 per cent renewables by 2030, Victoria is aiming for 40 per cent by 2025, and South Australia – already at around 50 per cent – has staked its future on the further transition to a decarbonised grid.
The continuation of these policies is seen as crucial in the absence of any federal policy that could provide a signal to build new renewables.
The renewable energy target – which will result in 23.5 per cent of large scale renewables by 2020 (plus around 4 per cent of rooftop solar) – is nearly met, and the federal government’s new policy, the National Energy Guarantee designed by the Energy Security Board, envisages little or no additions in the following decade, and is being modelled on the assumption that no emission reductions are made beyond 2030.
Hence the dependence on the states.
The two territories also have ambitious policies – but the ACT’s 100 per cent renewable energy target is already contracted, and nothing has been heard from the Northern Territory and its 50 per cent target by 2030 since it commissioned a report earlier this year.
Tasmania, which also goes to the polls in the next year, is near enough to 100 per cent renewables, although it would like to build a Tassie 2.0 pumped hydro scheme to be the “clean energy battery” of the country.
In Western Australia, the new Labor government is slowly removing the shackles on wind and solar imposed by the previous Coalition government, while NSW – despite making positive noises – has no state-based incentives to speak of.
The federal Coalition has defended its new National Energy Guarantee on the basis that it may allow the states to go it alone, although it is not clear to what extent the new reliability obligations will make that easy.
It’s ironic, given that the federal Coalition had branded the state-based Labor targets as “reckless”, but it may not mean a lot if Labor loses power in those states.
In each of these states, the conservative parties remain implacably opposed to any further renewable investment of scale. In Victoria, the LNP voted against the VRET, and in Queensland that party has vowed to build a coal-fired generator in Townsville, even though even the main energy lobby thinks it’s a crazy idea.
Of the states, only the Victoria target is actually legislated, although that was opposed by the LNP.
Queensland has directly supported – through a series of off take agreements and some limited funding – around half of the 2,000MW of solar and wind projects now under construction in the state.
But it has yet to legislate its policy, or provide a solid framework for how the 50 per cent renewable energy target will be achieved, despite commissioning a report last year.
Its recent call for expressions of interest in a tender for 400MW of renewables, including 100MW of storage, attracted more than 110 proposals. But the formal tender will be sidelined pending the election, and if the LNP win the poll, then it won’t go ahead.
The tender underlined the pent-up interest in wind, solar and storage in the state.
The 115 proposals accounted for a total of 9000MW of renewable projects, more than 20 times the capacity sought, and 6000MW of energy storage, including battery storage and several proposals for solar thermal projects of the type built at Crescent Dunes in Nevada and to be built in Port Augusta.
The renewables projects included 2,200MW of wind energy, more than 6,400MW of solar and around 500MW of other renewable energy technologies such as biomass.
The future of the Adani coal project also looms large, although it is difficult to tell the real split between Labor and the LNP on this. The Greens are the only party against Adani, and hope to get three seats. But it is not clear they will win any.
Labor premier Annastacia Palaszczuk has a slim two party preferred lead – 52-48 per cent – over the opposition led by Tim Nicholls, according to recent polls.
But the result will be complicated by the rising popularity of One Nation (up to 30 per cent in some seats), and the return of full preferential voting, new boundaries for many existing seats, four new seats and the fact that it is a single house parliament.
The LNP energy policy page reads as a list of things it hasn’t done – it froze solar tariffs, opposed the carbon price, and has argued against renewable energy incentives. But it does want to build that new coal-fired generator in the north. (Listen to this Energy Insiders podcast to hear why that could be a huge white elephant).
“We will make sure Queensland’s energy security is not put at risk so we don’t end up like South Australia with blackouts and industry shutting up shop,” it says.
The poll date of November 25 means it will be held one day after a COAG meeting due to consider modelling from the Energy Security Board and a possible vote on whether to commission the ESB to do more work on the National Energy Guarantee.
South Australia will go to the polls in March, as does Tasmania, while Victoria heads to the polls in November, 2018.
Giles Parkinson is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the former editor of Climate Spectator.