Wind taken out of State's renewable energy sails

The Examiner, Page: 15
Saturday, 13 May 2006

The warnings of the renewable energy industry have come true with the shelving of the $300 million Heemskirk wind farm proposal. Back in 2004 there was outrage at the federal government's refusal to increase its mandatory renewable energy targets, with industry warning that the decision would lead to millions of dollars of investment heading offshore. This week, Roaring 40s decided that without access to renewable energy certificates, its Heemskirk proposal and a similar proposal at Waterloo in South Australia would be unviable. The company also announced that it would wind back other developments around the country, putting the future of the $230 million musselroe bay wind farm on the east coast in doubt.

It comes as a devastating blow to Tasmania, which, of all states, prides itself on its use of clean, renewable energy. The loss of a $300 million development will also impact on the economy. Last month, leading economic forecaster bis shrapnel warned that engineering construction in Tasmania would slump sharply within three years as electricity generation projects wound up. Without Heemskirk, that slump could come much sooner.

Tasmanian economist Bruce Felmingham said the loss of just one wind farm meant the state would miss out on about 100-150 jobs and $200 million in gross state product."timing of this is now important as it is likely other investments will wind up, leaving the state with no replacements," he said. Suddenly, after what appeared to be a bright future for wind energy in Tasmania, the turbines of progress are grinding to a standstill. State energy minister David Llewellyn has every right to blame the federal government.

The Howard government's lack of support for renewable energy leaves a lot to be desired. It's an attitude born out of extreme short-sightedness and the considerable lobbying power of the coal industry."They (the federal government) have expressed a view they are effectively supporting the coal industry and they have chosen not to extend the MRET programme, which is a disappointment," Mr Llewellyn said. Environment minister lan campbell maintains that the federal government is supporting the industry with"hundreds and hundreds of millions of dollars" over and above the $3 billion invested in the MRET scheme.

But it is clearly not making Australian attractive player on the world market. Demand for wind technology is booming in Asia, where Roaring 40s has significant investment opportunities."This isn't a tactical thing - we can't put more effort into this - we have got opportunities in other countries and we are going there," Roaring 40s managing director Mark Kelleher said."Obviously we would like to be doing more at our home base but we just can't get the projects up.

"The state government has said it will look into establishing its own subsidy for renewable energy developments, similar to that introduced in victoria. Any Tasmanian scheme would be second-rate to that offered nationally, and if companies can get better returns offshore, that's where they will go. The current MRET scheme costs about $3, or the cost of a cup of coffee, on an average domestic power bill. The federal government is quick to point out that increasing the target will cause a further increase, with large companies the hardest hit.

But with a $10.8 billion budget surplus, a further subsidy would be an investment in the environment and the future.