Edge News

 

Our team is dedicated to being across the energy industry. We analyse any changes within the market and evaluate the impact to our clients. Here you will find a range of articles ranging from major industry events through to our detailed views on energy market movements.

 

22 Jun Finkel Review – Impact on LGCs and investment

The recently released Finkel Review is a review into the future of the National Electricity Market conducted by Dr Alan Finkel. The Finkel Review’s proposed removal of the Large Scale Renewable Target (LRET) scheme by 2020 has created uncertainty for renewable energy generators and electricity consumers. Summary From 2020 Large Generation Certificates (LGC) demand will no longer be a driver for new investment into renewable energy. The scheme is likely to be replaced by an alternative scheme being either the Energy Intensity Scheme (EIS) or the Clean Energy Target (CET). The current LRET scheme allocates certificates to renewable energy generators in a ratio of 1 LGC to 1 MWh of electricity. Electricity retailers are obliged...

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21 Jun PM Confirms Gas Export Restrictions

Gas Export Controls The Prime Minister has this week announced he will take immediate action as part of his commitment to ensure a reliable and affordable energy supply for consumers. Prime Minister Malcolm Turnbull, unveiled the Australian Domestic Gas Security Mechanism in April which allows the government to implement export controls and pass legislation as required to secure supply and put downward pressure on prices. Mr Turnbull this week confirmed that gas export restrictions would be put in place from 1 January 2018. The introduction of the LNG export market to Australia has created a complex situation where domestic gas consumers are paying more for gas than international buyers of the same product. The...

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06 Jun Queensland Power Plan to Decrease Wholesale Electricity Prices

A statement released yesterday by the Queensland Government outlines its plan to put downward pressure on energy prices, generate jobs, and invest in renewables infrastructure. The Queensland Premier, Treasurer, and Energy Minister jointly promoted the “Powering Queensland Plan” which will see the government invest $1.16 billion to ensure affordable, secure and sustainable energy supply for homes and businesses. The plan shows several ways the government will put downward pressure on electricity prices. In the longer term, this includes: Reverse Auction of 400 MW of renewable energy including 100 MW of energy storage Improve project facilitation, planning, and network connections Implement an action plan on gas including purchasing gas fields Deliver a plan...

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02 Jun QCA final determination on regulated retail electricity prices FY2017 – FY 2018

On the 31st May the QCA released its final determination on regulated retail electricity prices for financial year 2017-2018 for regional Queensland. Concerned that the price increases were too high, the Palaszczuk Government has intervened, directing the government-owned corporation Energy Queensland to reduce network charges. In order to do so, Energy Queensland has been directed to remove the costs associated with the Solar Bonus Scheme.  Energy Minister Mark Bailey made it clear in a statement that this change will not impact payments under the state’s solar bonus scheme, as the cost of the scheme will be met by the government instead of consumers over the next three years.  This reduction...

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25 May AEMO considers options for better load management in VIC and SA

The Australia Energy Market Operator (AEMO) continues to estimate there could be a lack of reserve in both Victoria and South Australia for the 2017/18 summer. The latest projections show reserve shortfalls above 800 MW for Victoria and up to 330 MW for South Australia. The reserve shortfalls have been present for long enough that AEMO no longer believes there will be a sufficient market response unless they intervene. AEMO has used provisions under the Reliability and Emergency Reserve Trader (RERT) rules to ask for expressions of interest for additional generation to be brought on-line, or for a reduction in demand. AEMO is looking for a RERT Panel which can provide short...

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18 May CEOs concerned about energy price rises

The CEO Business Prospects Survey conducted by The Australian Industry Group (AI Group) has identified a concern among CEOs about a rise in energy prices in 2017. The annual survey received responses from 285 CEOs representing all major non-primary private-sector industries Australia-wide. The industries were grouped into mining services, manufacturing, construction, and services. Edge was particularly interested in the results as our core business is supporting clients from these industries in managing their energy costs and portfolios. Many respondents are cautiously optimistic about business conditions in 2017 but maintain an almost neutral position when it comes to business investment and employment. There are several positive factors that contribute to this optimism including;...

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18 May ARENA launches new investment plan

The Australian Renewable Energy Agency (ARENA) has this month launched its new Investment Plan outlining the priorities which will guide funding from their Advanced Renewables Program. Funding is expected to reach $800 million over the next few years. The Investment Plan is part of ARENA’s commitment to demonstrate how renewable energy can contribute to a reliable, secure, and affordable energy system for Australians.  ARENA will address these and other challenges as Australia moves towards a low emission economy. “We are looking for new ways to adapt our electricity grid to increase productivity, make the grid more flexible and better integrate renewable energy so it can be stored and shared when and where...

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18 May Planning Assessment Commission (PAC) to determine Springvale Mine future

The NSW Government Planning Assessment Commission (PAC) met yesterday to discuss licence conditions for EnergyAustralia and Centennial Coal’s Springvale Water Treatment Project. The Water Treatment Project was proposed to meet conditions as part of a 2015 approval for the expansion of Springvale Mine. The approval condition requires the mine to reduce its release water salinity from 1,200 microSiemens per centimetre (µS/cm) to 1,000 µS/cm by June 2017, and 500 µS/cm by 2019. Failure to meet the condition could result in a loss of licence for the Springvale Mine. This closure would mean there is no coal available for EnergyAustralia’s Mount Piper Power Station which could result in a shut down. The proposed...

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17 May Have forward prices peaked?

Following the closure of Hazelwood Power Station in March 2017, forward prices quoted on the Australian Stock Exchange (ASX) increased across all regions and time periods. However more recently, forward prices were starting to soften until threat of industrial action at Loy Yang A and associated mine caused concern over energy security and availability of supply. The proposed industrial action was called off by the Fair Work Commission and the reduced prices have continued. The price changes are particularly pronounced in Victoria, though the northern states of New South Wales and Queensland have also been affected. There has been issues at the Loy Yang A plant, with three of the four...

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10 May Budget 2017: Morrison reveals Energy for the Future package

Scott Morrison last night delivered his 2017-18 federal budget which included a commitment from the government to deliver affordable and reliable energy through its energy security plan. He reiterated a number of prior announcements including; Snowy Mountains Scheme 2.0, expansion of pumped hydro storage schemes in Tasmania, and a $110m equity investment in a solar thermal project in Port Augusta, South Australia. The Federal Government announced it’s in negotiations with New South Wales and Victorian State Governments to buy Snowy Hydro outright. The government currently owns 13% and experts are quoting a price around $6 billion to purchase the remaining share. Unfortunately, there was no certainty given to any future policies around carbon...

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