Victoria backs clean energy

 

Wind farm at Codrington, SW Victoria

While Australia's federal government is backing a "gas-led" recovery, despite gas's much higher costs than renewables, State governments are for the most part backing renewables, including "Liberal" (=right-wing) ones.  Victoria's government is Labor.

From Melbourne's The Age newspaper.

Clean energy projects will receive a Victorian government funding boost in the hope of driving the state's battered economy out of the coronavirus downturn and avoiding a slump in wind and solar investment.

Victorian Energy Minister Lily D'Ambrosio is preparing to brief 300 investors on Wednesday about the launch of a formal process to test interest in building 600 megawatts of renewable energy capacity statewide, which she said would drive down prices and create new jobs at a critical time.

It comes amid calls around the world for "green recoveries" – economic rescue packages targeting investments in clean energy that would tackle global warming as well as stimulate growth. Under the Victorian program, the government would award contracts to buy power from project developers at a fixed price, giving them the revenue certainty to secure debt and proceed with projects in a volatile market.

"It's a shot in the arm for the industry," said Kane Thornton of the Clean Energy Council, a group representing renewable energy firms.

"These sorts of auctions provide a lot of confidence and ultimately bring forward projects that wouldn't otherwise get off the ground because of uncertainty around the energy market."

The government tender process is the second under the Victorian Renewable Energy Target, which aims to lift renewable energy's share of the state's grid to 40 per cent by 2025.

The first tender, launched in 2017, had a target of 650 megawatts but was swamped by bidders and ended up delivering six wind and solar projects totalling 927 megawatts of renewable energy, the government said.

"We know Victorians are doing it tough and affordable reliable power is more important than ever," Ms D'Ambrosio said. "This will help to deliver that as well as creating jobs and stimulating the economy."

This is a clever way to expand fixed investment, because it involves no capital spending by the government.  However, the NW of the state is where solar resources are best, and stronger high-voltage grid connections are required to allow solar farms to expand.  This might well involve State government expenditure.