Three reasons why big solar changes what’s possible

Time is ticking on the Renewable Energy Target and wind turbines don’t just spring out of the ground overnight. But competitive utility-scale solar could be the game-changer.

There is a serious concern held by a range of energy industry participants that there is not enough time left to build the amount of power capacity required to meet the current legislated renewable energy target of 41,000 gigawatt-hours. This equates to roughly around 7000 to 8000 megawatts of wind power. But it may be that we don’t need that much wind because solar could also play a part.

This concern about achieving the level of the target, at least among those who know what they’re talking about, is not because there aren’t enough quality wind farm sites available in Australia, nor that the grid capacity is insufficient and the power system can’t cope. According to the Australian Government’s Bureau of Resources and Energy Economics, there are 15,000MW of wind projects currently under development in Australia. So we’ve got more than enough prospective wind farm sites. In addition, analyses by energy market analysts ROAM Consulting and the Australian Energy Market Operator suggest we could achieve the 41,000GWh target without substantial new transmission capacity nor fast-response generation, while maintaining reliability.

The problem is more one of time. This 7000-8000MW of wind power needs to be in the ground and spinning all within five years. And wind turbines don’t just spring out of the ground overnight.

It’s not enough to simply find a site that has good wind speeds, there’s considerable preparation involved before you can even start constructing the project.

You have to sign-up the landholders whose land you’d like to put the turbines on. This usually involves multiple landholders because wind farms tend to need to be around 100MW or larger to be commercially viable and this will be spread out over a large land area. 

In addition because wind turbines are very large and prominent structures, neighbours tend to have some strong views about them being put up nearby. So you might also want, or need in the case of Victoria, to come to agreements with the landholders neighbouring all these turbine sites to get their support for the project. You also need to do lots of studies to get government approvals. In addition to connect 100MW or more to the grid is not a straightforward process and this requires further studies and lengthy negotiations with the network company. On top of this you need to negotiate the commercial arrangements around who will buy the output, who will finance the project and who will build the project.

Only once you’ve sorted all that out do you then get to physically build the project which takes a further year or so.

Complicating matters is that we’ve got to build lots of these wind farms concurrently. Wind farms involving several turbines of 100m in height require very large transportable cranes. There aren’t in great supply in Australia because there’s not that much use for them outside of wind farm construction. So we’ll need to fix this supply constraint too in short order or will encounter further delays.

In light of these time constraints, this is where the emergence of competitive utility-scale solar power projects becomes a major game-changer. 

Until very recently solar’s costs were too high to be considered viable against wind power in the market for large-scale renewable energy certificates or LGCs. Something Miles George, chief executive of renewable energy project developer Infigen Energy, confirmed to me in August last year. But as explained in yesterday’s article (Can big solar take on wind? Look to the banks), the cost of utility-scale solar could be within striking distance of wind if Australian financiers were willing to apply the same financing structures and costs to solar projects as they do for wind.

At the Clean Energy Week conference I caught up with Colin Liebmann who heads up the Australian division of Recurrent Energy – a developer of utility-scale solar power projects with 515MW of operating solar capacity in North America. Some examples of the projects and associated utilities are illustrated below.

Graph for Three reasons why big solar changes what’s possible

Now the thing about Liebmann is he isn’t only familiar with solar. He knows all about developing wind farms and the challenges associated with them, having spent over a decade as a wind farm developer at the company RES.

He pointed out how solar has three key advantages over wind if you need to move fast. 

Number 1 - Grid connection should be more straightforward.

There are economy of scale benefits for solar, just like wind, but ideal scale lies closer to around 30 to 50MW instead of 100MW. In addition if the project is located near to a regional town, because it generates during the day when demand is high, a fair proportion of its generation gets sucked up locally. Smaller size and better match to local demand means less stress on available grid capacity making connection less challenging.

Number 2 – Compact size

Secondly he explained that with a solar project it is more concentrated and compact in size, so you only have one landholder to deal with. Also, solar projects don’t tower into the sky so there are less issues with neighbouring landholders.

Number 3 – Simpler construction

Thirdly, partly because the projects don’t tower into the sky and involve small modular components, construction is more straightforward and takes less time.

If solar developers in Australia can manage to convince financiers to take the same approaches as they do in the United States, and they can get the Australian construction supply chain humming (a big ‘if’), then it completely changes the discussion around whether or not there is enough time left to achieve the 41,000GWh target.

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