ACT News

ACT wind farm auction: 18 companies compete to supply electricity into national grid

The ACT Government has received an overwhelming response to its wind auction, with 18 wind companies vying for a 20-year deal deal to supply wind energy.

The bidding companies described Canberra as the only game in town with a dearth of funding for renewable energy elsewhere.

Environment Minister Simon Corbell said the 18 projects had a capacity of 1000 megawatts in all. An expert panel would assess the bids, and recommend at least two, perhaps more, to make up the 200 megawatts that will be funded with a 20-year feed-in tariff. The funded wind farms would feed in about 560,000 megawatt hours of electicity a year.

He would not discuss the geographic spread. Nor would he discuss the prices, beyond saying they reflected very competitive bidding.

Wind is expected to be close to half the price of solar. The Royalla solar array, opened this month, is earning $186 for each megawatt hour of electricity it feeds into the grid; wind is expected to come in at less than $100.

Mr Corbell said the wind farms, operational in 2016, would generate enough electricity to supply 24 per cent of the ACT's electricity in 2020. 

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Among those to submit bids is Spanish-owned Union Fenosa, which has been sitting on approvals for its wind farm at Crookwell for many months waiting for the security of a feed-in tariff. Project development manager Shaq Mohajerani said the ACT Government's commitment to renewable energy was throwing a lifeline to the industry for a little longer, although was too small in itself to sustain the industry long term.

"For large-scale industries it's really the only thing happening at the moment and I would imagine the ACT alone is holding up the industry for a little while," he said.

The 49-turbine, 92-megawatt Crookwell 2 wind farm, 30 kilometres north of Goulburn, had development approval, grid connection approval, and access. As for the price, Mr Mohajerani said it was a matter of pitching low enough to be in the running but high enough to ensure financial backing.

"There's no point having the cheapest project and not being able to finance and build it," he said.

Infigen submitted a bid for its 41-turbine Capital Wind Farm 2 project near Bungendore on the eastern side of Lake George.

"With the amount of uncertainty that's now been introduced into the country due to the review of the RET [the federal renewable energy target] this is the only show in town," general manager of development David Griffin said. "It's extremely important to the whole wind industry ... It's the only thing we can pursue."

Mr Griffin predicted a good result for the Government. "It's the Government that's running the process that's the largest winner. These are experienced industry players so they know what they can afford to bid, but it does drive a lot of competitive tension so it's a good outcome for the public."

The wind farm would be an extension of Capital Wind Farm 1 and Woodlawn, which together have 90 turbines.

Canberra company Windlab submitted a bid, but director Nathan Steggel would not say whether the proposal was for a wind farm in the ACT's borders or further afield, and did not want to discuss details of his bid.

Mr Corbell said the 18 bids would be assessed by a panel chaired by Ross Bunyon, with a decision expected before the end of the year. Bidders would be assessed not only on their technical capacity to deliver, but also on their financial assumptions, so the credibility and robustness of their bids would be carefully tested.

The lowest prices would not necessarily win – as they hadn't for solar – with significant weight given to economic benefit to the ACT (worth 20 per cent of the bid assessment). While projects could come from anywhere on the eastern seaboard, those from outside the region would need to score highly on economic benefit to the Canberra region. Community engagement is another 20 per cent of the assessment, and Mr Corbell said relationships with the local communities in which the turbines would be built were critical.

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