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Marshall’s energy plan: home solar batteries, interconnector, exit fee ban

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The SA Liberal Party has released a suite of energy policies it says will lower energy prices, stabilise the grid and secure interconnection with New South Wales – but it is yet to decide who should benefit from $100 million in subsidies for home solar batteries.

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The energy policy includes $200 million for an interconnector with New South Wales, an $100 million fund for household batteries, a reverse-auction mechanism aimed at unlocking available South Australian energy generation during periods of exceptional demand on the grid, a ban on electricity companies charging exit fees for consumer energy contracts and a removal of the state’s 50 per cent renewable energy target.

This morning, Marshall unveiled his party’s energy policy armed with modelling from consultancy firm ACIL Allen, which projects a $302 annual average saving for South Australian consumers by the year 2021-2022.

Under the plan, households would be eligible for a $2500 subsidy for installing a battery with an existing a solar system. Home solar batteries currently retail for about $10,000.

Liberal Party energy spokesperson Dan van Holst Pellekaan told reporters this morning that the subsidy would apply to 40,000 SA households, and would be means tested.

But he would not say at which income-level households would benefit.

“It will definitely have a means tested component – it might be that it’s only available to lower income families; it might be that higher income families receive a lower subsidy and lower income families receive a higher subsidy,” he said.

“On a later date we will announce the details of how we’ll roll that out … (but) making sure lower income households are advantaged by our policy is an incredibly high priority.

“We didn’t want to go too deep into our policy before announcing it today.

“We still want to work through some of the details of that … with some of the key sector representatives.”

The release of the Liberal Party’s energy policy comes days after Senator Nick Xenophon announced his bombshell incursion into state politics ahead of the March state election.

The ACIL Allen modelling compares the Liberal Party’s suite of policies – in a scenario where it is assumed that Elon Musk’s giant Tesla lithium ion battery will operational by the end of this year – with a “static scenario” which does not include any impact on prices from the battery.

That’s despite van Holst Pellekaan acknowledging that the Government has signed contracts with Tesla and that the battery will be used whichever party wins government at the next election.

Van Holst Pellekaan denied that the non-inclusion of the giant battery in the base scenario for the modelling – which Premier Jay Weatherill has argued will place “downward pressure” on power prices – inflated the impact of the Liberal Party’s policies.

“The battery is in the (Liberal) policy scenario but not in the ‘static’ scenario,” he told InDaily.

“We’re comparing it (the Liberal Party’s plan, including the battery) to a world with neither policy in place.

“That’s (Labor’s) job – to explain the benefits of their policy.”

The ACIL Allen report projects wholesale electricity prices declining each year in the “static scenario”, but shows even lower prices, over the next seven financial years – with the most dramatic impact expected in 2021-2022, the year of the $302 average saving – under the Liberal Party policy scenario.

Marshall said his party’s policies would be “welcome relief for the people of South Australia who have really been struggling to make ends meet”.

“And it has a flow-on effect for our small business sector, and in fact, larger businesses across the state.

“We need to get our state moving in the right direction – a fundamental reason why we’ve been held back is Labor’s chaotic energy policy settings.”

The reverse auction mechanism would “secure 276MW of emergency generation … avoiding the ongoing operating costs of the generator”.

The Liberal policy document says the reverse auction, which “can be scaled down as the reliability of the market improves over time”, would achieve “the same level of supply security for a comparable operating cost for as long as it is required, rather than in perpetuity”.

The Liberal Leader said the State Government had been talking about better interconnection with eastern states’ energy markets since 2002 but had failed to make any progress.

“Here we are in 2017 there is no increased interconnection,” he said.

The Liberal Party’s planned 650 MW interconnector between NSW and SA – to be operational by mid 2021 – is to be funded by not converting the State Government’s diesel generators into a permanent stand-by gas generator, as Labor intends.

However, the Liberals do intend to continue to lease the State Government’s back-up diesel generators until 2019.

Weatherill argued the Liberals’ policy suite was a “bad plan” because heavier reliance on interconnection with New South Wales would reduce SA control of the state’s “energy future”.

“We looked carefully at the interconnector … at funding it ourselves, and it was a bad idea,” said Weatherill.

“Remember, on the10th of February this year the Liddell Power Plant in New South Wales shut down in the middle of a heatwave – that’s what Steven Marshall wants us hooked up to and be reliant on.

“We want to take control of our own energy future.”

 

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