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Client Update: Renewed energy in renewable energy

25 September 2012

In brief: The NSW Government has released a draft renewable energy action plan, which, as it establishes the parameters for all new renewable energy investments in NSW up until 2020, has implications for all stakeholders in the NSW energy market. Partner Andrew Mansour (view CV) and Senior Associate Joel Sturgeon report on the draft plan which intends to increase the use of energy generated from renewable sources in NSW by reducing investment barriers, building community support, attracting and growing renewable energy expertise, and improving energy efficiency.

Reducing investment barriers

In addition to the $10 billion in financing to be provided by the Commonwealth's Clean Energy Finance Corporation by 2020, Bloomberg estimates that, between 2011 and 2018, $18 billion will be invested in wind energy projects, $16 billion in photovoltaics and $400 million in solar thermal across Australia. In order to maximise the State's share of these funds, the draft NSW Renewable Energy Action Plan (the plan) proposes:

  • Introducing a Renewable Energy Advocate: It is intended that a dedicated Renewable Energy Advocate will be appointed by the State to act as a single point of contact for industry to:
    • attract, facilitate and expand renewable energy investment in NSW;
    • resolve barriers to investment across Government and work with the Department of Planning and Infrastructure on project facilitation;
    • identify Crown land that can be used for potential renewable energy projects;
    • leverage specific Commonwealth programs;
    • work with the banking and investment community to facilitate investment in NSW renewable energy projects;
    • work with industry bodies and NSW international offices and allies to identify opportunities created by overseas developments; and
    • work with relevant domestic and international innovation councils and research bodies to advance the sector.
  • Streamlining the planning approval process: The NSW Government is currently reviewing its planning processes in a bid to establish a more strategic and streamlined approval system for renewable energy projects.
  • Creating a more supportive regulatory environment: The plan contemplates a review of the current regulatory environment, with the aim of identifying and removing unnecessary regulatory barriers.
  • Promoting investment opportunities in NSW: The plan foreshadows the establishment of an online information portal to provide potential investors with information regarding finance assistance, suitable Crown land, resource mapping, grid and network demand, and planning and community consultation requirements.
  • Establishing a fair price for solar-generated energy: It is intended that the Independent Pricing and Regulatory Tribunal (IPART) will set a benchmark price range each year in relation to solar-generated energy.

Building community support

Notwithstanding the plan's intended purpose of streamlining the current planning approval process, it is also intended that communities will have a greater say in developing new planning guidelines for wind energy projects, increased and early engagement on renewable projects generally, and enhanced opportunities for direct community ownership. In light of the ongoing tension that exists between many communities and proponents of coal seam gas and wind farm developments, the interface between a simplified planning approval process and increased community engagement may be a challenge for the new framework.

Growing renewable energy expertise

The formation of the Commonwealth's Clean Energy Finance Corporation and Australian Renewable Energy Agency resulted in a number of renewable energy hubs being established across Australia. For example, Newcastle now hosts the CSIRO Energy headquarters, CSIRO Energy Transformed Flagship, Australian Solar Institute, Australian Research Council Centre of Excellence in Geotechnical Science and Engineering, Newcastle University Institute of Energy and Resources and the Smart Grid Smart City Project. The NSW Government aims to expand the number of such hubs in NSW by encouraging the concentration of renewable energy expertise in appropriate locations, increasing scholarships in relevant fields, and building links between academic and industrial research through tied funding.

Improved energy efficiency

Activities that reduce or better manage energy usage can generate significant savings for governments as they delay the need to invest in increased generation and network infrastructure. In addition, such measures put downward pressure on energy prices and reduce greenhouse gas emissions. To this end, the NSW Government intends to contain electricity costs through improved energy efficiency by:

  • Establishing new programs aimed at improving energy efficiency: In particular, increasing funding to subsidised energy audits, technical support and training and market-based mechanisms (eg NSW Energy Savings Scheme).
  • Harmonising energy efficiency schemes: The NSW and Victorian governments intend to harmonise their energy efficiency schemes in order to simplify cross-border dealings.
  • Improving standards of energy efficiency: The NSW Government is currently driving change in the commercial property market by targeting government-owned or tenanted office buildings of more than 1,000m2 to achieve and maintain a 4.5 star energy and water rating. It is also requiring very large users of electricity to prepare Energy Saving Action Plans to facilitate reductions in their energy consumption.
  • Increasing customer knowledge: It is intended that initiatives such as the Home Power Savings Program, Energy Efficiency for Small Business Program and Energy Efficiency Community Awareness Program will be expanded.

Have your say

In view of the significance of the plan for future investments in renewable energy projects in NSW, it is important that all stakeholders have a say in its final form. To this end, submissions can be submitted at the have your say website until 26 October 2012.

For further information, please contact:

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