Mr Campbell said a change in AEMO’s modelling since the 336 megawatt Dundonnell project was certified as compliant in 2018 had led to issues around its impact on voltage in the system. More tests are now needed, with the possibility that equipment at the plant will need to be modified.
“AEMO and ourselves are working hard to find a solution that does not require further investment,” he said, adding that the full start up could still be months away, if not longer.
Meanwhile, NSW’s planned 8000 MW New England Renewable Energy Zone was strongly welcomed by renewables developers such as Walcha Energy, which is planning 4000 MW of wind, solar and pumped hydro capacity there.
But the Australian Energy Council, which represents major electricity suppliers, voiced caution, saying more work was needed to understand whether it is needed and whether it would lower power prices as claimed.
AEC chief executive Sarah McNamara said the industry supported the national planning process overseen by AEMO and the Australian Energy Regulator that includes a rigorous cost-benefit analysis to understand the impacts on supply and consumers’ bills. She noted that AEMO’s latest blueprint for the power grid only recommended a renewables zone for New England in 2036.
“The cost savings of harvesting sun and wind energy a long way from population centres often do not outweigh the cost of transporting it long distances,” Ms McNamara said.
Still, EY utilities leader Matthew Rennie said that with about 7000 MW of coal power exiting the National Electricity Market over the next 15 years there was “no question we need investment ecosystems for renewable energy in Australia”.
He said investment in “firming” generation to complement weather-dependent renewables would follow, pointing to seven rule changes being considered for the market that would help spur fast-start, on-demand generation projects. An agreed lowering of the trigger point for the Retailer Reliability Obligation – which requires retailers to have adequate supply contracts in place or face penalties – should also sharpen the price signals for new investment.
Grattan Institute’s Tony Wood highlighted lingering uncertainties over the REZ plan, including who pays for the required transmission – whether the state government or NSW grid owner TransGrid – and whether costs are later shared across all NSW consumers or only between the generators that will use it. How quickly plants are installed is also important given that fast-tracking renewables would accelerate the closure of coal power stations.
In any case, access to transmission capacity, as facilitated by renewable energy zones, isn’t the only issue, said Tilt’s Mr Campbell.
“We are injecting into a part of the grid that has got heaps of capacity but we’ve still got challenges,” he said.
“So a REZ that provides a big transmission line is not the only challenge that we need to get over.”