Wind farms up in the air

Portland Observer
Friday 22/9/2006, Page: 1

THE future of the Portland Wind Energy Project (PWEP) is up in the air following an announcement by Victorian Opposition Leader Ted Baillieu that he will scrap the Government's new Victorian Renewable Energy Targets (VRET) if elected in November.

The new VRET legislation, which increases the amount of renewable energy in Victoria from four per cent to 10 per cent by 2016, was passed through the Upper House of the Victorian Parliament last week, and was welcomed by Pacific Hydro.

Following an announcement by Mr Baillieu, Pacific Hydro has done a complete turn around, now claiming the scrapping of the VRET puts many projects in the firing line, including Portland.

In an article in The Age on Wednesday, Garry Weaven, executive chairman of Industry Funds Services, owner of Pacific Hydro, said "the company's Portland development faced shelving, and the Opposition's policy made contracts for wind farms impossible to find."

He said "Portland is under very serious consideration now ... Until that announcement by Ted Baillieu the answer was yes, it would be built ... the answer now is 'not necessarily' and we've got it under the microscope."

Member for South West Coast Denis Napthine said he was clearly disappointed Pacific Hydro looked like walking away from the PWEP. He said the PWEP offered enormous investment and job opportunities in the region and it was a project the community had been looking forward to for many years.

"It is simply unbelievable that given this project was approved several years ago and has been on the drawing board for a considerable amount of time, that Pac Hydro would now consider withdrawing from the project because of Liberal Party policies," Dr Napthine said.

"Clearly there are other, more substantial, reasons as to why Pac Hydro is now going cold on this project." Dr Napthine said there had been speculation for some years that the project was facing difficulties in raising finances and attracting a buyer for the electricity. "It would seem more likely these are the reasons for the delay or the stopping of the project."

Dr Napthine said it was also interesting that at the same time Pac Hydro was pouring cold water on the PWEP, other projects and a new hydro electricity project were going full steam ahead in Victoria. He has called on Pacific Hydro to be truthful and honest with the people of Portland and reveal what was really going on.

"The Portland community, including myself, have been very supportive of this project and we deserve to know the truth."

Pacific Hydro corporate affairs and marketing executive manager Andrew Richards denied Dr Napthine's claims. He said Stage 1 of the PWEP (Yambuk) was built based on the Federal Mandatory Renewable Energy Target (MRET). He said due to a lengthy approval process for the remainder of the project, by the time Pacific Hydro were ready to go, the MRET scheme had started to wind down and had become fully subscribed.

Mr Richards said the VRET would provide another market for green energy and, if that was taken away, the financial viability of the PWEP would become questionable. He said wind energy projects needed VRET to provide a level playing field in terms of the costs of competing against coal industries. If the project went ahead without the VRET in place, the financial business case would not stack up, he said.

"We are still working to get the project ready to go, we have some contractors already but others are waiting to see what happens with the November election before signing on." Mr Richards said Pacific Hydro was still very much behind the project and wanted to do it.

"We understand people are frustrated that it hasn't started yet, so are we, but because of a lot of delays in the planning process we need VRET to give us a market for green power. If it is taken away we need to seriously reconsider not only the PWEP but all projects in Victoria."

Mr Richards said he hoped it would not come to this, but if VRET is repealed by an elected Liberal Party then the Pacific Hydro board of management would need to make some serious decisions.