January 31, 2020
Australia

Start-up delays take puff out of wind projects

Perry Williams, Senior Business Writer | The Australian Business Review | Friday, January 31, 2020 | www.theaustralian.com.au

Some of Australia’s biggest wind farms face delays in bringing their full capacity into the national power market, pushing out further wholesale price relief amid a slowdown in renewable projects connecting to the grid.

The only four wind farms that began operations last year were still progressing through the ­“energising” and commissioning phases of start-up, in a slower process than many in the market ­expected, consultancy ITK Services said.

That means a large volume of energy will be delivered to market later than anticipated and commissioning timelines for future wind projects might be wrong, based on the time lag hitting the sector now.

“Both impacts are likely to cause wholesale prices to be higher than they would otherwise be,” ITK analyst Ben Willacy said.

The Murra Warra wind farm in northwestern Victoria and the Lincoln Gap facility near Port ­Augusta in South Australia have been in the commissioning phase for nine months and eight months respectively.

Victoria’s Lal Lal wind farm near Ballarat and Queensland’s giant Coopers Gap wind unit were operating at less than half their notional capacity seven months after energising, ITK said, referencing new figures released by a separate consultancy, Global-ROAM.

The delays are likely to be a mix of longer construction timelines than seen in the previous boom-like conditions in the past few years.

It may also reflect a clampdown by the grid operator to ­ensure new renewable projects do not lead to further congestion ­issues after rapid growth in new wind and solar projects in areas not always close to existing transmission.

“The reasons for the slow time frames will likely be a mix of both systemic and assets specific ­issues,” Mr Willacy said.

“But it’s enough to suggest the beginnings of a trend, especially considering these four wind farms are the only ones in the national electricity market to have started operations in 2019.”

And with 2700MW of wind ­capacity under construction, sliding timelines could result in a price spike.

Ultimately, ITK said it expected big wind farms like Victoria’s Stockyard Hill and the Bulgana Green Energy Hub in South Australia may have to wait until 2021 to send their “full complement” of energy into the power grid.

“Given average construction time frames, we expect all 2700MW to be energised in 2020, but it looks increasingly unlikely that they (the wind farms) will be fully commissioned this year,” ITK said.

The slowing pace of renewable projects has sparked concern among some big-name investors, including the influential QIC, which cited figures saying just 151MW of new generation was committed in the current financial year, from two projects, compared to 4300MW across 46 plants in the 2019 financial year.

However, federal Energy Minister Angus Taylor also noted that 6300MW of new renewables ­capacity was added in 2019, which marked a 24 per cent jump on the previous record set the prior year.

Australia requires at least 30,000MW of solar and wind to replace coal generation by 2040, and 47,000MW should more ­aggressive pollution cuts be required in response to the climate change crisis, Australian Energy Market Operator data shows.


URL to article:  https://www.wind-watch.org/news/2020/01/31/start-up-delays-take-puff-out-of-wind-projects/