Clean Energy Australia Report 2014 Table of Contents

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Clean Energy Australia Report 2014 Table of Contents CLEAN ENERGY AUSTRALIA REPORT 2014 TABLE OF CONTENTS 02 Introduction 04 Executive summary 06 Snapshot 10 2014 in review 16 Industry outlook 2015–2020 18 Employment 20 Investment 22 Electricity prices 24 Demand for electricity 26 Energy efficiency 28 Energy storage 30 Summary of clean energy generation 33 Bioenergy 35 Geothermal 37 Hydro 39 Marine 41 Solar power 47 Large-scale solar power 51 Solar water heating 55 Wind power 61 Appendices Front cover and this page: Royalla Solar Farm, Australian Capital Territory. Image courtesy FRV Services Australia 2 INTRODUCTION While the future for renewable energy in Australia is extremely bright, the industry always knew there would be a few clouds along the way. Image: Snowtown 2 Wind Farm, South Australia Kane Thornton Chief Executive, Clean Energy Council 3 Last year was a tough one for most Household solar fared better than the Globally, the installation of renewable forms of renewable energy, from large-scale sector last year. Increased energy in the last decade has large-scale technologies such as consumer engagement and awareness surpassed all expectations. Costs for bioenergy, wind and solar to emerging about electricity prices and the benefits most technologies have come down technologies like geothermal. of solar technology meant more than significantly, and supporting policies 230,000 households and businesses have continued to spread throughout An expert panel for the Federal installed either solar power or solar the world. However, Australia went Government’s review of the national hot water. sharply backwards on large-scale Renewable Energy Target (RET) was renewable energy last year while the announced early in the year. The review And the support and innovative appetite for clean energy across the ultimately froze investment for more finance solutions provided by the rest of the world increased by 16 per than 12 months and, at the time Australian Renewable Energy Agency cent to US$310 billion.1 of writing, the future of the RET (ARENA) and the Clean Energy Finance remained unresolved. Corporation (CEFC) are helping the next It is not too late to catch up again, generation of local innovators get their given our abundant sunshine, wind, I am hopeful that a bipartisan deal will technology out of the laboratory and waves, biomass and other renewable be reached quickly, allowing many of into the power supply. energy resources – not to mention the major renewable energy projects the extraordinary capability of the that have been on ice to finally begin Despite all the stops and starts of the local industry. construction in the near future. last few years, the renewable energy sector is poised for a strong and vibrant And we will cement our position as an period out to 2020 as we deliver on our industry of the future by continuing promises and recommence building to exceed expectations in the here projects in earnest. If bipartisan support and now, as we have virtually every can be returned to the RET, billions of year I have worked in this industry. dollars in investment and thousands of jobs across the country will be unlocked. 1 Bloomberg New Energy Finance, Rebound in clean energy investment in 2014 beats expectations, 9 January 2015 4 EXECUTIVE SUMMARY The review of the Renewable Energy Target (RET), which was Energy storage continued to attract announced in February 2014 and continued beyond the end of the keen interest across the renewable year, essentially froze new investment in large-scale renewable energy energy sector. Innovation and scale in Australia last year. According to Bloomberg New Energy Finance, step changes such as the construction new investment in large-scale projects such as solar and wind farms of the US$5 billion Gigafactory by was down by 88 per cent in 2014 compared to the year before. Tesla Motors in the United States are expected to drive down the price of technology and make it more widely The RET review had a more modest Lower rainfall in hydro catchments adopted in the next few years. impact on the smaller-scale renewable contributed to a 25 per cent fall in energy market, and both commercial hydro generation, leading to a drop in The Australian Renewable Energy and domestic solar power continued the proportion of renewable energy in Agency (ARENA) supported a diverse to perform well. More than 15,000 the nation’s power supply from 14.76 group of projects investigating cutting- businesses have now installed a solar per cent in 2013 to 13.47 per cent last edge renewable technologies. These power system, collectively saving more year. Of the various renewable energy included the use of renewable energy than $64 million on their power bills technologies, hydro made the largest in off-grid situations for a variety of every year. Some consolidation of solar contribution to total Australian energy applications, such as mining at Weipa in businesses continued as the market generation (6.2 per cent), followed by North Queensland. Hybrid technologies continued to mature, and innovative wind (4.2 per cent), solar (2.1 per cent) were also a feature of ARENA’s work, financing options were a feature of the and bioenergy (1 per cent). including a project that aims to commercial solar sector last year. integrate solar and wind with diesel at Despite the uncertainty that washed Coober Pedy to provide 70 per cent of Bundaberg in Queensland was through the renewable energy sector the town’s electricity from renewables. Australia’s solar power capital at the during 2014, three large wind farms end of 2014, with the most solar power totalling 566.7 megawatts were Approximately 40 per cent of systems of any postcode in the country. completed during the year. Among South Australia’s power came from Mandurah in Western Australia was these was Trustpower’s Snowtown 2 renewable energy during 2014, and second and Hervey Bay, just over in South Australia, Australia’s second- the state government increased its 100 km away from Bundaberg, placed largest operating wind farm. These own renewable energy target to 50 third. Eight of the top 10 solar regions projects were approved and financed per cent by 2025. South Australia was of the year were from the aptly-named long before the beginning of the review completely powered by renewable Sunshine State, with the remaining two of the RET. energy between 9.30am and 6pm from Western Australia. on 30 September in 2014, providing The 20 megawatt Royalla Solar Farm a glimpse into the potential Employment across the sector developed by Fotowatio Renewable of renewable energy in Australia. contracted by nearly 1000 full-time Ventures, the nation’s largest at the positions, leaving approximately end of 2014, was officially opened 20,000 people directly employed by the in September. Support from the ACT renewable energy industry. Government was crucial to the viability of the project. 5 ABOUT THE CLEAN ENERGY COUNCIL The Clean Energy Council is the The Clean Energy Council leads and peak body for the clean energy supports the growth of the clean energy industry in Australia through: industry in Australia. • shaping policy We represent and work with hundreds • developing standards and of leading businesses operating in regulations and ensuring the solar, wind, energy efficiency, hydro, integrity of the industry bioenergy, energy storage, geothermal • promoting the industry and marine along with more than 4000 • providing a range of valuable solar installers. We are committed to services to our members, customers accelerating the transformation of and partners. Australia’s energy system to one that is smarter and cleaner. The Clean Energy Council also operates a Solar PV Retailer Code of Conduct to provide consumers with greater assurance that they are buying from a company that is committed to excellence in the quality of its products and workmanship, as well as to customer service. Image: Portland Wind Energy Project IV, Victoria 6 SNAPSHOT Renewable energy provided 13.47 per cent of Australia’s electricity in 2014, enough to provide power for the equivalent of approximately 4.5 million average homes. The proportion of electricity provided by Three new wind farms completed The carbon price was repealed in the renewable energy generation last year was construction during 2014, including second half of 2014, changing commercial lower than 2013, when strong rainfall and Trustpower’s Snowtown 2 project, the drivers in many businesses and leading to commercial strategies by hydro companies second-largest wind farm in the country. an increase in coal generation and a rise in to maximise the opportunity of the carbon Australia’s largest solar farm was also emissions from the power generation tax meant that renewables delivered 14.76 completed by Fotowatio Renewable sector in the second half of 2014.2 per cent of the country’s electricity. Ventures, at Royalla near Canberra, which was made possible by support from the With the RET under review, much of the The steadily rising contribution from both ACT Government’s reverse auction for activity in the large-scale renewable energy wind (6 per cent increase) and solar power large-scale solar power. sector in 2014 was driven by support from (29 per cent increase) in 2014 was not the Australian Renewable Energy Agency enough to offset the fall in hydro The uptake of both rooftop solar power (ARENA) or loans from the Clean Energy generation, which was down by almost a and solar hot water continued steadily. Finance Corporation (CEFC). According to a quarter compared to the year before. For Sales were well below the peaks of a few statement by the CEFC in February 2015, the first time this century, hydro provided years ago for both technologies, but the investments made by the publicly- less than half of Australia’s renewable substantial numbers of both were installed funded bank are expected to make money energy (approximately 46 per cent of the during the year.
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