The Government expects the target, which would be aspirational rather than enforced by penalties, to create 750 megawatts of energy storage capacity in South Australia within the next seven years.
It says that quantity of power is 25 per cent of the average peak demand for electricity in South Australia.
Premier Jay Weatherill announced the policy, as well as an increase in South Australia’s renewable energy target from 50 per cent to 75 per cent by 2020, at a press conference this morning.
He said the renewable energy storage target was aimed at sending a message to the global market and providing an incentive for companies to invest.
“We’re sending, really, a market signal to the world to come to South Australia,” Weatherill told reporters.
“I think South Australians are proud of our leadership in renewable energy. They can see that we’re a world-leader, they don’t want us to stop (and) they want us to continue to set ambitious targets.”
He conceded that there would be no penalty for failing to invest in energy storage under the target, but that the Renewable Technology Fund essentially acted as a subsidy.
Energy Minister Tom Koutsantonis said the target was the first of its kind in Australia.
Weatherill and Koutsantonis unveiled the policies outside the former Holden site this morning.
Pelligra Group, the new owners of the former Holden site at Elizabeth, will fit out the facility with a three-megawatt solar power and two-megawatt battery system worth $8.3 million.
Pelligra won a $3 million grant to help fund the project – which will see the installation of about 8000 to 9000 solar panels on the roof of the plant, equivalent to powering about 1000 households – from the Government’s Renewable Technology Fund.
Weatherill said the solar system would take up about 20 per cent of the roof-space of the facility and help “create jobs and opportunity” in Adelaide’s north.
“The assembly of the battery and the solar panels will create the ‘micro-grid’, but it will lead to a 20 per cent reduction in energy prices, which will create a surge of new businesses to actually (attract) tenants,” he said.
“Our ambition is to do with this site what we did at Tonsley – take an old manufacturing site and actually create the new jobs, the new prosperity for the northern suburbs here.”
The assembly, fabrication and installation of the system is expected to create about 20 jobs.
Weatherill said renewable projects already planned to be built in South Australia made the government confident of achieving the new 75 per cent renewable energy target by 2020.
“We’re confident we can get there with the projects we know are on the drawing board,” he said.
Koutsantonis defended the Government’s record on reducing power prices, arguing prices would be forced down by more renewables and more competition in the market.
“What we’re seeing in South Australia is more generation – more electrons,” he said.
“You are seeing large retailers offering very large discounts because of competition that is flooding into the system.”
But Liberal Leader Steven Marshall said the high cost of power was destroying jobs in South Australia.
“The most important issue when it comes to power is its cost,” said Marshall.
“The cost of energy under Jay Weatherill, Tom Koutsantonis and 16 years of Labor is sky-high – it’s expensive for households and it’s destroying jobs right across our state.
“Labor doesn’t have independent analysis to show that prices under them will go down, so they’re taking the lazy option of setting a target 5, 6, 7, 8, 10 years down the track rather than doing the work needed to lower the prices for households and businesses in South Australia.”
Marshall said South Australia had the highest spot prices for power in the country.
“We heard three years ago that prices were going to fall by 9 per cent.
“Since then a massive 66 per cent increase putting real pressure on the family budget and crippling new jobs in South Australia.
“If you need any proof, have a look at the national spot rates over the course of this year so far. January’s figures are out, February’s figures are out. Who’s the highest in the nation? South Australia.”
The Liberal Party’s energy plan involves a $200 million 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.
Marshall added: “A Liberal priority in South Australia is lowering costs and we’re the only party that has a comprehensive positive plan to lower costs here in South Australia.”
more to come
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