Australia’s Victoria State awards 254 MW of solar in RE auction

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From pv magazine Australia

The long-awaited results of Victoria’s inaugural reverse auction have been announced, overshadowing last year’s projected output.

The Victoria government has pledged to sign contracts for six new wind and solar farms, which will be built under the Victoria Renewable Energy Target (VRET) of 40% by 2025.

Australia’s largest renewable energy auction to date is reported to have received a huge response, with low prices and high-quality bids. Consequently, the government has approved 928 MW of capacity, thus smashing the originally announced goal of 650 MW of utility-scale wind and solar projects to be developed in the state. 

Premier Daniel Andrews and Minister for Energy Lily D’Ambrosio visited the Ararat Wind Farm on Tuesday to announce the six successful projects that will produce enough electricity to power 646,273 households.

The list of the winning projects goes as follows:

  • Berrybank Wind Farm west of Geelong, 180 MW, Union Fenosa Wind
  • Carwarp Solar Farm south of Mildura, 121.6 MW, Canadian Solar
  • Cohuna Solar Farm north-west of Echuca, 34.2 MW, Leeson Group/Enel Green Power
  • Dundonnell Wind Farm north-east of Warrnambool, 336 MW, Tilt Renewables
  • Mortlake South Wind Farm south of Mortlake, 157.5 MW, Acciona
  • Winton Solar Farm near Benalla, 98.8 MW, Fotowatio Renewable Ventures

Together, these projects will generate $1.1 billion of economic investment in regional Victoria and create more than 900 jobs, including 270 apprenticeships and traineeships, the government said in a statement.

In addition, the projects are expected to drive a 16% reduction in Victoria’s electricity sector greenhouse gas emissions by 2034/35.

“It’s simple – greater supply of renewable energy means lower power prices and more jobs for Victorian families,” Premier Daniel Andrews said in a statement. “We’re making Victoria the capital of renewable energy and supporting the thousands of jobs it creates.”

While no further auction details have been released, it is known the projects will be guaranteed the minimum income based on a contract for differences signed with the state government.

This will insulate the project owners from any massive drop in wholesale electricity prices that could harm their bottom lines.

For end consumers, the construction of the auctioned project will ultimately translate into lower energy bills.

“The Victorian reverse auction scheme is a well-designed policy that will ultimately save consumers money on their bills while providing much-needed certainty for the investors in the three wind farms and three large-scale solar plants announced today,“ said Kane Thorthon, Clean Energy Council (CEC) Chief Executive.

“Reducing power bills and emissions while securing the reliability of the power supply is achievable, and states like Victoria are showing it can be done with a mix of policies that are ambitious but achievable.”

Victoria Home Battery Scheme 

The auction results came out the same day the Victorian government announced a $40 million scheme to subsidize the installation of battery storage in 10,000 homes.

The home battery program is announced as part of Labor’s massive $1.24 billion Solar Home initiative, which will deliver half-priced solar panels to 650,000 Victorian households and solar hot water systems to 60,000 homes with no upfront cost.

If re-elected in the November state elections, the Andrews government will provide subsidies of up to $4,838, depending on the size of the battery.

This will save households with an average 11 kwH battery around $650 a year on their electricity bills in addition to savings they are already making with solar panels, the government said in a statement.

The subsidy levels will reduce over time, as the cost of home battery system reduces, tapering down to $3,714 by 2026.

Overall, the program will be open for households with income up to $180,000 that already have solar panels.

“The Victorian Renewable Energy Target (VRET) is providing long-term certainty for investors that is resulting in the lowest cost renewable energy projects. Combined with the recent announcement to support rooftop solar and today’s commitment to 10,000 home battery systems, it is clear the Victorian Government is taking a leadership role on energy policy,” Thornton commented.

The battery scheme pledge comes just days after the South Australia government released details of its $100 million Home Battery Scheme, which will subsidize the cost of buying a home energy storage system for up to 40,000 South Australian households. The scheme is scheduled to kick off in October with subsidies of up to $6,000 on offer.