News | 2nd Nov, 2012

Wind farms lower power bills: authorities

2 November 2012
Samantha Landy, Weekly Times Now

WIND energy is helping decrease South Australian energy bills, not increase them, clean energy authorities say.

Climate and energy think-tank Beyond Zero Emissions said the suggestion wind farms upped power bills was a common misconception.

It said a draft determination by the Essential Services Commission of SA released last month, which proposed an 8.1 per cent reduction in the default retail electricity price from January 1, meaning a $160 per year reduction in the average household's bill, proved otherwise.

"To conclude that wind farms are driving up prices shows an ignorance of the facts,'' BZE executive director Matthew Wright said.

"Wind turbines have no fuel costs once built.

"In the electricity market, they out-compete fossil fuel generators and cause a lowering of prices.''

Mr Wright said this is known as the `merit order effect', which means if you introduce more of a product into a market, that is increase supply, then prices fall.

Clean Energy Council policy director Russell Marsh said ESCOSA figures showed the large scale renewable energy target, which comprises wind energy, contributed less than two per cent to the average household energy bill in South Australia in 2012.

This equates to about $32 per year.

Network costs (42 per cent or $823 per year) and wholesale electricity costs (39 per cent, $760) made much larger contributions.

"The facts are that whichever state you're in, the main driver for price rises in not renewable energy, that only plays a small part,'' Mr Marsh said.

"This has been confirmed by governments and state regulators.''

Mr Marsh said wind energy had been hugely beneficial for South Australia, significantly reducing carbon emissions and creating jobs and investment in the state.

The clean energy authorities’ comments came in response to GoSwitch chief executive Ben Freund's suggestion that an increase in the amount of energy produced by wind in South Australia to 26 per cent had contributed to its rising power costs.

A GoSwitch report revealed the state's residents were paying 40 per cent more for electricity than a year ago, with the average annual bill jumping from $2303 to $3247 after price rises on July 1.

Mr Wright said blaming wind farms meant "letting the real culprits get off the hook''.

"Further price rises are coming as wholesale gas prices are set to double, making gas-fired power stations much dearer.

That's all the more reason to build wind farms and solar,'' he said.

"South Australia is leading the nation on these renewables and should be proud.'' 

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