Contributed By: Jasper Noort, Senior Analyst, Schneider Electric Energy & Sustainability Services - Australia
The incumbent Labor government has won the Queensland state government election on October 31, extending its number of seats to at least 50 out of 93 with three seats yet to deliver a clear result. Regardless, there will be a new Energy minister after the current minister, Anthony Lynham, decided not to run in the election.
The level of commitment to the Queensland Renewable Energy Target (QRET) of 50% by 2030 was a clear difference in election commitments between Labor and the Liberal National Party. While LNP professes to support renewable energy including mandating investment by government-owned companies, it has not committed to a target. The Labor commitments are much more comprehensive and will now be progressed in the next four years.
Key commitments are:
- Continuing progress towards the 50% QRET by 2030
- Investing $145million to establish three renewable energy
- Supporting CopperString 2.0 (a new transmission line to connect the current standalone Mt Isa network to the NEM) including investing nearly $15million to fast-track support for the project
- Supporting a hydrogen industry with $10million in funding
All three government-owned energy companies in Qld (Cleanco, Stanwell and CS Energy) announced contracts with renewable projects in the last few months ahead of the election, supporting the construction of over 1,100MW of wind generation and 450MW of solar PV generation. It is likely that similar commitments will flow ahead of the next election, locking in progress towards the 2030 QRET well beyond the current period of government. The investment in renewable energy zones should make these more attractive for investment and reduce costs for new projects in these zones, allowing developers to offer lower prices for Power Purchase Agreements (PPAs).
While CopperString 2.0 will increase NEM demand by adding demand in Mt Isa, it will also unlock significant renewable resources along its path and allow the Diamantina power station in Mt Isa to provide firming capacity to the NEM. It may also reduce grid constraints by increasing local demand for the output from current renewable energy project in Northern Queensland.
This is an excerpt from our Australian Energy Market Weekly Outlook. To read the full report, click here.