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SA persists with renewables despite economic drag

SOUTH Australia wants to expand its bioenergy industry in a drive to have green energy supply hal...

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The SA government has revealed its bioenergy roadmap to help it reach its goals, which also include carbon neutrality by 2050 and for Adelaide to be "the world's first carbon neutral city".

Wind (34%) and solar (7%) provided 41% of SA's power in 2014/15.

However, it has come at a cost.

SA treasurer and energy minister Tom Koutsantonis recently called a crisis meeting of energy users and suppliers to deal with a sharp rollercoaster of wholesale electricity prices that threaten the redevelopment of the Port Pirie lead and zinc smelter to make metals for solar panels and mobile phones - even with a $291 million government subsidy.

"The state government recognises we must do more to address issues in the market as we transition to a low-carbon economy," Koutsantonis said.

The volatility of wholesale prices is believed to be caused mainly by SA's reliance on wind power and the ability of coal and gas power stations to charge high prices when the wind drops - a fundamental issue often cited by oilers as the kicker for the popular but economically troublesome renewables sector.

As the world figures out how to reduce greenhouse gas emissions, Snowy Hydro CEO Paul Broad has appealed for "rational" debate about what to do with coal-fired power stations, as there hasn't been much in the way of helpful suggestions for alternatives for reliable base-load power beyond has and nuclear.

"What are they going to replace them with, what it is going to cost the community and who is going to pay?" he said.

Ahead of the crisis meeting, Energy Users Association CEO Phil Barresi said security of power supply must not be forgotten in the relentless drive for renewables, though SA premier Jay Weatherill said there were bound to be "transitional issues".

"It's fine to talk about Europe and what's happening there with 100% renewables in various European countries, but the biggest growth sector in Europe at the moment is the rollout of interconnectors from France into other European countries in order to ensure their energy security through the provision of nuclear power," Barresi said.

"Unless the issue of baseload power is resolved in the second or third quarter of next year, we are looking at severe power shortages in the summer of 2016-17.

"It needs a rapid response."

Nonetheless, the SA government insists that, on a per capita basis, the state's performance is internationally significant.

It says current levels of market penetration of wind power in SA, as a proportion of total electricity generation, are competitive with leading international jurisdictions such as Denmark and Portugal.

SA's levels of solar installed, on a per person basis, are comparable with other high solar penetration countries in Europe, such as Germany, Italy and Belgium.

The bioenergy roadmap's first stage will outline the state's potential, including an analysis of conversion technologies, local demand, types and quantities of feedstock, which may include new energy crops.

This stage will identify two to three localised areas for further investigation.

Stage two specifically assesses these localised areas through convening community and industry groups to investigate potential collaboration in providing feedstocks, utilising energy outputs and assessing the feasibility of options.

Stage three is to build specific projects.

Bioenergy can be produced from organic matter, derived from plants, animals or manufactured food waste, known as biomass or biofuel feedstocks.

About 10 bioenergy plants are already operating in SA.

Koutsantonis said bioenergy could play a significant role in coming years by supplying a localised energy source in low input, peak demand periods.

"Biomass resources are a sustainable and environmentally-friendly feedstock that will contribute significantly to a diversifying our energy sources," Koutsantonis said.

"Electricity, transportation fuels, chemicals and materials currently produced from petroleum and natural gas could instead be produced from these biomass resources.

"As the costs of traditional energy such as electricity and gas continue to rise, we have the potential to make greater use of existing and new feedstock and allow bioenergy to contribute to the state's low carbon future."

SA has also become the first Australian state to sign up to an international agreement to limit global warming to less than 2C.

The "Under2MOU" agreement was signed by eight states, regions and cities during a ceremony hosted by California governor Jerry Brown at the US ambassador's residence on December 6 as part of the COP21 climate change conference in paris.

Eighty jurisdictions are now signatories to the Under2MOU, hailing from 22 countries, representing 614 million people and more than $18.6 trillion in GDP - a quarter of the world's economy.

Weatherill said the agreement was recently described as a potential "game changer" by UN secretary general Ban Ki-moon.

"While national governments are working towards an agreement on limiting global emissions, it will be the cities and states that will need to do the heavy lifting," Weatherill said.

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