Victoria’s 650MW renewable energy auction is powering ahead, with over 15 wind and solar proposals received, it has emerged.
The heavily oversubscribed auction run by the Victorian state government saw bidders offering a total of 3.5GW of new wind and solar capacity, Inframation understands.
The Andrews government, which is facing a state election later this year, is currently poring over the competitive field of bidders with the successful parties to be announced later this year.
Victoria’s Minister for Energy and Environment and Climate Change Lily D’Ambrosio confirmed that the number of bids received was ‘overwhelming’.
The 650 megawatts of renewable energy will be enough to power 389,000 households and will attract up to AUD 1.3bn (USD 1bn) of investment to the state.
The government has mandated that 100MW of power will come from solar power with the remainder likely to be mainly wind farms.
The 15-plus bids were handed in on 14 February with the Victoria’s renewable energy auction crippled by several delays before it finally kicked off in November.
The Victorian government is offering a “hybrid payment mechanism” over 15 years. This involves bids for an annual “base payment” per megawatt of nameplate capacity plus a contract for difference (CfD).
The CfD is based on a fixed contract or “strike” price per megawatt hour of AUD 53.06 (USD 41.2) for a fixed solar plant; AUD 56.85 for a solar plant that tracks the sun; and AUD 56.52 for wind farms.
Minister D’Ambrosio had some harsh words for the Federal government’s proposed National Energy Guarantee (NEG), which is due to be discussed by all Australian state and territories when they meet this Friday at the Council of Australian Governments (COAG) meeting.
“The Turnbull Government’s National Energy Guarantee is supposed to provide industry with certainty – and we’re yet to see anything like that,” Victoria’s Minister for Energy Lily D’Ambrosio told Inframation.
The NEG, if approved by all seven Australian states and territories, is set to banish Federal subsidies for renewable energy projects and be technology neutral.
“The response to our Renewable Energy Auction Scheme has been overwhelming, and it’s proof that when you provide the market with policy certainty – the market is ready to respond,” D’Ambrosio added.
She said Victoria is “getting on and providing industry the policy stability they need to deliver a secure, sustainable and affordable energy system”.