It has been argued by the renewable energy community in Australia for some months that uncertainty as to the future of Australias RET is causing projects to be cancelled. This has been evidenced in parties pulling out of projects and today, by the cancellation of the 100 MW Mildura CPV project.
Solar Systems, which is wholly owned by the company Silex, announced that it suspend plans for the Mildura project and cancel a AUD$75 million (US$70 million) funding agreement with Australian Renewable Energy Agency (ARENA). A $35 million (US$32.5 million) grant from the Victorian state government has also been terminated.
After careful consideration of project economics, we have decided to reassess plans for the Mildura 100 MW Solar Power Station, said Dr Michael Goldsworthy, CEO of Silex. Since we launched the 1.5 MW Mildura Demonstration Facility in June last year, we have captured a great deal of useful data and are now investigating alternative opportunities to build on the outstanding work already achieved at the Mildura site.
Silex had been one of the pioneers of Australias commercial solar industry. When it was operating as a PV manufacturer it supplied Australian-made modules to an installation on the roof of Parliament House. It pulled out of module manufacture in 2012.
Silex has had some success developing CPV through its Solar Systems subsidiary. The company completed a 1 MW system near Riyadh in Saudi Arabia last year.
Today’s announcement is the second blow to Australian CPV in a short period. Areva announced earlier this month that it would discontinue its attempts to commercialize Australian CPV technology. Areva had previously acquired the Sydney-based Solar Heat and Power.
The politics of the RET
The RET in Australia has been under review for some months recent reports suggested the government intended to scrap the renewable energy mechanism entirely.
Tristen Edis from Climate Spectator wrote earlier today that the leaking of the apparent desire to scrap the RET may in fact be an attempt for the government to appear to be compromising when announcing a real 20% RET reduction later this week. Edis said that such attempts would likely end in failure as some industry and business groups have spoken out in support of the RET, with modeling showing its scrapping is unlikely to reduce electricity costs.
Since the reports that the RET may be scrapped broke this morning, finance minister Matthias Cormann has said that the government plans to keep the RET in place. Regardless of this, and as is evidenced by the Mildura decision, uncertainty regarding the RET is already leaving some utility scale solar projects without a future.