The NSW Emerging Energy Program. What is it?

Published: 1 November 2018

The NSW Coalition newly released Emerging Energy Program will see most of the state’s coal-fired power stations replaced with wind, solar and electricity storage over the next 15 years.

The NSW Coalition has just released a new NSW Emerging Energy Program. Over the next 15 years, most of the state’s decrepit and dirty coal-fired power stations will be replaced with wind, solar and electricity storage. Yes, renewables.

The NSW Emerging Energy Program focuses on providing seed money to “…support the commercialisation of new large-scale projects in NSW that use emerging, dispatchable technology.” In other words, it’s a kickstart for the transition from the antiquated baseload fossil fuel powered electricity grid to dispatchable renewables.

In our current political climate, the terms renewables and coalition appearing positively in the same sentence clearly bucks a trend. However, we must remember that this is the NSW coalition and not the Federal Government.

NSW has been the target of very heavy criticism for its serious lack of movement on energy and climate policy. As a dyed in the wool coal state, NSW has been slow off the mark to begin in earnest (let alone escalate) the integration of renewables into the grid.

With such a sluggish start, the inevitable national and global march to renewable technologies means that NSW is in for one heck of a big (and rapid) transition. NSW is way behind its sister states and “…is the only state in the National Electricity Market without a specific or aspirational renewable energy target.”

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With NSW having such a questionable renewables track record, the recent announcement of the Emerging Energy Program is a much-welcomed development. However, critics and sceptics site a propensity for the NSW Coalition Government to talk plenty, but do very little.

The budget for the project is an underwhelming $55 million. This, too, raises the ire of renewables advocates and feeds the scepticism.

On a more positive note, the initiation of the program is seen as broad acceptance that a complete energy transition is now upon us, and is the shape of our energy future. State Government acceptance ensures the transition can begin moving forward with purpose, less hindered by the regressive energy politics harboured by the incumbent on Capital Hill, Canberra.

Let’s take a closer look at some details. Is there reason to be hopeful that this is a positive step in the renewables direction? Or are the doubters justified in not holding their breath until some genuine outcomes are delivered?

The positives

  • At least (it would appear) the NSW coalition is finally doing something about transitioning to a modern, clean form of electricity generation. It would appear that the NSW coalition now accepts, not only an inevitable transition but a need to act quickly and with determination. Let’s hope.
  • It appears that the regressive fossil fuel baseload energy and climate policies espoused by the Federal Coalition do not concur with those of their NSW coalition mates.
  • It is predicted that in 15 years, 70% of coal-fired power plants in NSW will be replaced by renewables. While only a projection as yet, this is a substantial benefit should it be achieved.
  • Eligibility requirements for program funds exclude coal or ‘clean coal’. The exclusion is not explicit but an emissions intensity cap of 0.5 tonnes of CO2e has been placed on any project, and coal cannot possibly comply. This leaves the door open for gas projects, however, it is envisaged gas will fail to compete with the rapidly falling prices of solar and wind.
  • The program will provide $10 million in capital funding per project and up to $500 thousand for feasibility studies. From a pool of only $55 million, many would see this as a negative. However, it’s something when, until now, there has been nothing.
  • The program explicitly rules out extensions and upgrades to existing power stations. This ensures any back doors are closed to fossil fuel generators (coal) making application.
  • The government has stated that they want the private sector to drive investment. This notion is indeed positive as it would shelter already overburdened taxpayers. However, while the intent is positive, it should be taken with a grain of salt until we see what eventuates.

The negative

  • The total budget for the program at only $55 million dollars is indeed modest. Particularly when compared to other states, already investing substantially more.

Considering that $4 billion was available from the sale of the Snowy Hydro to re-invest in energy, and not 1 cent was invested in renewables, the current program budget seems a pittance, barely cursory. It certainly supports an argument that the program is strategically political and disingenuous.

Further to this, the NSW coalition flagged $2 billion to spend on replacing two perfectly good sporting stadiums. Such an agenda seems criminally stupid, making the feds look like regressive policy amateurs.   

Considering the critical need to transition to renewables, building stadiums where perfectly good stadiums already exist is the equivalent of a cruise ship captain painting freshly painted deck chairs instead of repairing the gaping big hole in the hull, now sitting below the water line.

Given the NSW coalition desires to spend recklessly on profoundly unimportant agendas, one could successfully argue that the NSW Emerging Energy Program is a case of political expediency.

The diminutive scale of the program, relative to what could be achieved, has to be seen in a negative light. The program, in anybody’s language, is less than ambitious.

NSW Emerging Energy Program: Conclusion and comments

So, can we give the NSW coalition the benefit of the doubt? Can we applaud them for giving a little as opposed to nothing at all? Taking coalition projected renewables objectives of any sort on face value is difficult.

However, ‘something’, is better than ‘nothing’. Be it political expedience or a genuine government injection to stimulate the speed of transition, at least ‘clean energy’ in NSW is moving politically, however underwhelming.  

There is more than 17GW, or $21 billion, of projects for wind, solar, gas and generator upgrades that are seeking planning approval in NSW. According to the NSW energy minister, most of this is wind and solar.

That’s an astonishing figure. Perhaps the NSW coalition might be able to inject some funds into expediting approvals; a few more staff in the approvals bureaucracy? Surely there’s a little pocket change left to facilitate this, following the $55 million splash out.

Has the Coalition recognised the renewables writing on the wall? Are they now begrudgingly accepting that they have to do something; like perhaps show climate and renewable leadership? Or is the NSW Emerging Energy Program a cheap political strategy to appease climate change activists and renewable energy advocates within the electorate, without completely enraging fossil fuel fans?  

We all know that the first step in a new direction can be the hardest. Maybe NSW is seeing the early signs of genuine energy leadership. However, it’s very hard not to be cynical when the energy conservatives, the policy sceptics and the renewables hopefuls can feed in equal parts on the same political carrot.

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