November 8, 2018 Read More →

Australian energy provider plans big switch from coal to renewables

Greentech Media:

The Australian government-owned energy provider Snowy Hydro this month announced a major switch to renewables in a series of “game-changing deals.”

The company said in a press release that it had signed eight wind and solar contracts, totaling 888 megawatts of peak power and around 2.8 terawatt-hours of energy a year, that would provider cheaper electricity to 500,000 households. The capacity is due to come online between now and 2020 and will replace the mainly coal-based energy that Snowy Hydro sources from Australia’s National Electricity Market to power pumped hydro storage and resell directly to customers at times of high demand.

Snowy Hydro — which owns energy retailers Red Energy and Lumo Energy that serve more than 1 million customers — is one of the largest energy buyers on the National Electricity Market. It purchases around 3 terawatt-hours of electricity a year to supplement the 4 terawatt-hours produced from its own generating assets. “Just like households, we are exposed to high wholesale prices,” said the company.

“The new renewable energy generation, ‘firmed’ by existing Snowy Hydro assets, is a game-changer and will push down future energy prices,” said Snowy Hydro in announcing the deal. “This will bring on significant new energy supply and therefore much-needed competition to the market, and will enable Snowy Hydro to pass on lower wholesale prices to our customers.”

As a result of the switch from the National Electricity Market to renewable power, Snowy Hydro will offer energy to customers at a flat rate of less than AUD $70 (USD $51) per megawatt-hour, for up to 15 years starting in 2020. This compares to a first-quarter 2020 electricity price of AUD $98.50 (roughly USD $72) a megawatt-hour in New South Wales and AUD $108 (roughly USD $79) per megawatt-hour in Victoria, according to ASX energy market trading data cited by The Sydney Morning Herald.

Snowy Hydro said the move to renewables was prompted by “rapid changes” in the National Electricity Market over the last 12 months, along with an ongoing drop in the price of renewable energy.

More: Australia’s Snowy Hydro makes ‘game-changing’ leap from coal to renewables

 

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