Fantasy wind economics about to finally play out down under. Hopefully a lesson the UK can take on board.
When a policy is unsustainable its failure is inevitable: Australia’s Large-Scale Renewable Energy Target is just such a policy. STT has been spelling it out since December 2012.
It was around then, when Australia’s commercial power retailers determined that there was no bankable certainty attached to the LRET; since then, no commercial retailer has entered a Power Purchase Agreement with a wind power outfit (we don’t count the couple of PPAs signed with the ACT government) – it’s that simple commercial fact that will force the LRET’s hitherto political ‘champions’ to cut the current target, or that may even force them to abandon it altogether.
A long-term PPA (of at least 10 years in duration) is a critical ingredient in obtaining finance for the construction of new wind farm projects; in the absence of a PPA, a wind power outfit hoping to develop a project is unable to offer any…
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