List of privately-owned merchant portfolio generators in Australia

Inquiry identifies privately-owned merchant portfolio generators in Australia

A report prepared for the Owen Inquiry by Morgan Stanley lists four privately-owned merchant portfolio generators in Australia. Reference: Morgan Stanley, Report to the Owen Inquiry: Securing Private Investment in New Generation in New South Wales, 31 August, 2007. 16/10/2007

17 October: cool weather for Victoria

Market report for Tuesday, 16 October: 10 negative price intervals see Tas with minus $96.41/MWh as NSW, Vic, SA and Qld rise 11-13pc to $31.36-$34.84/MWh range on higher demand

Ten negative price trading intervals with prices between minus $158.68/MWh and minus $999.68/MWh resulted in Tasmania recording an average of minus $96.41/MWh, with NSW, Victoria, South Australia and Queensland up 11-13 per cent to a range of $31.36-$34.84/MWh. System-wide maximum demand was up 712MW (2.7 per cent) with rises in all regions, led by the 316MW increase in NSW.

Market report for week to Saturday, 13 October: Storms, blackouts; Five days of spikes push Qld average price up 134pc, with Vic and Tas rising 1-11pc, SA steady and NSW down 5pc to overall $32.67-$111.53/MWh range on firmer demand

Market report for Wednesday, 10 October: Storms, $10,000 prices, directions and $3407.42/MWh spike in Qld push average price up 35pc, with NSW, Vic, SA and Tas down 1-14pc to overall $31-43-$113.39/MWh range on lower demand

An eventful day in Queensland with continuing storms, $10,000 dispatch prices to be reviewed, directions to three participants over credible contingencies and a spike with a top price of $3407.42/MWh saw average price rise 35 per cent to $113.39/MWh. Average prices fell 1-14 per cent in NSW, Victoria, South Australia and Tasmania to a range of $31.43-$35.73/MWh.

Market report for Thursday, 4 October: Qld spike, Tas negative price on day when average prices up 2-4pc in SA, Qld and Tas, down 7-10pc in NSW and Vic to $32.85-$46.94/MWh range on lower demand

An afternoon spike in Queensland and a morning negative price in Tasmania featured in a day when average prices rose 2-4 per cent in South Australia, Queensland and Tasmania and fell 7-10 per cent in NSW and Victoria to a range of $32.85-$49.94/MWh.

Market forecast for Friday, 5 October: Average prices steady in SA and Tas, down 11-30pc in NSW, Vic and Qld to $32.69-$36.73/MWh range on lower demand

Average prices are expected to be steady in South Australia and Tasmania and drop 11-30 per cent in NSW, Victoria and Queensland to a range of $32.69-$36.73/MWh.

Vox pop: Basic physics ignored in Vic desal idea; needs 300MW base-load power plant to get water to Melbourne

To desalinate 150 gigalitres of salt water and pump 150 million tonnes of fresh water from Wonthaggi to the Cardinia Reservoir was going to require a 300-megawatt base-load power plant, wrote Geoff Croker of Ashwood in a letter to The Age (26/9/2007, p.B4). Why water’s cheap: “That’s equivalent to using all of Australia’s current wind farms. To pump this water to Ballarat, Bendigo, Traralgon and Geelong would require wind turbines over an area equivalent to metropolitan Melbourne. Our existing nine reservoirs work mostly by gravity. That’s why water in Melbourne is cheap. Now I know John Brumby and Ted Baillieu seem to be ignorant of year 11 physics (and by implication cast aspersions on Melbourne Grammar’s ability to teach physics).

Silly Grammar boys: “You would think their engineers would have advised them about the foolishness of the proposition of a desalination plant to supply drinking water for Melbourne. But perhaps the proposed financier went to Melbourne Grammar and physics is irrelevant,” Croker added.

The Age, 26/9/2007, p. B14

Victorian Minister for Energy and Resources seeks suggestions for fair feed in tariff for small green generation P

eter Batchelor Victorian Minister for Energy and Resources said In Victoria’s Legislative Assembly on 19 July 2007 that small-scale generators of electricity should get a fair and reasonable price for any excess electricity they generate beyond their own needs and feed back into the grid. Initiative for small players: His Bill applied in particular to those generating less than 100 kilowatts, such as small businesses, schools, or other small-scale establishments, and that had been dealt with in this initiative.

Reference: Peter Batchelor, Minister for Energy and Resources, Legislative Assembly, Victoria, 19 July 2007.

Market report for week to Saturday, 29 September: Spikes push Qld average price up 9pc, with NSW, Vic SA and Qld down 5-9pc to $40.61-$54.90/MWh range on weaker demand

Spikes on three days with top prices between $153.12/MWh and $1710.58/MWh pushed up Queensland’s average price by 9 per cent while the spike-free regions of NSW, Victoria, South Australia and Tasmania fell 5-9 per cent to an overall range of $40.61-$54.90/MWh.

NEM Market forecast for Tuesday, 2 October:Average prices continue converging as they rise 6pc in SA, steady in NSW, fall 2-7pc in Vic, Qld and Tas to $33.02-$36.18/MWh range on demand surge

Market forecast for Tuesday, 2 October: Average prices are expected to continue converging to within $3.16 of each other ($4.20 on Monday) with rises of 6 per cent in South Australia, steady in NSW and falls of 2-7 per cent in Victoria, Queensland and Tasmania to an overall range of $33.02-$36.18/MWh.

NEM September pool price up 4-35pc on August to $43.02-$51.10/MWh, analysis shows

Average prices rose 4-35 per cent in the first month of Spring compared to the last month of winter, an analysis of price and demand statistics shows.

Vict Govt opts for PPP model to design, build and operate new desal plant by 2011

The Victorian Government opted for a public private partnership (PPP) model to design, build and operate the new desalination plant by 2011, reported The Australian (22/9/2007, p.41).

Proposed Vic enviro protection regs: large commercial and industrial energy, water users to develop Environment and Resource Efficiency Plan (EREP)

Notice was given in accordance with section ii of the Subordinate Legislation Act 1994 of the proposed making of the Environment Protection (Environment, and Resource Efficiency Plans) Regulations 2007, in The Age (21/9/2007, p.17).

Victoria’s desal a public-private partnership; five firms line-up for $1.6b bonanza of guaranteed cash-flow

According to Duncan Hughes, at least half of Victoria’s $3.1 billion desalination plant, the country’s largest, would be delivered as a public-private partnership, Victorian Premier John Brumby said on 19 September, reported The Australian Financial Review (20/9/2007, p.3).

SP AusNet close to buying entire suite of energy transmission assets Singapore Power acquired as a partner in the $8 billion Alinta carve-up

SP AusNet was close to buying the entire suite of energy transmission assets Singapore Power acquired as a partner in the $8 billion Alinta carve-up with investment company Babcock & Brown earlier this year, according to Vesna Poljak in The Australian Financial Review (20/9/2007, p. 17).

UQ starts course on-mined land rehabilitation as part of Masters of Mineral Resources: Alcoa gets a gong

When mining environmental scientist Elise Jeffery looks across a denuded landscape at Alcoa’s brown-coal mine in Anglesea, Victoria, she pictures an expanse of healthy indigenous woodland replete with rare and threatened plants and animals. But since 2000 Alcoa has engaged in restoring mined land to its original ecosystem to complement the surrounding area, listed on the National Estate Register by the Australian Heritage Commission because of its outstanding botanical diversity, wrote Helen Zampetakis in The Australian Financial Review (17/9/2007, p.35).

Vic SOG officers wary of forced-entry raid that led to shooting death, coroner hears

Special Operations Group police officers involved in a dawn raid on a Brooklyn house in 2005 expressed misgivings about the operation before a man was fatally shot in the house, a court heard, reported The Age (13/9/2007, p.9).

Bass Pipelines proposal could deliver Tasmania water to dry Victorian Latrobe generators

A Melbourne-based consortium was well advanced with plans for three massive pipelines from Tasmania’s North-West to southern Victoria, reported The Mercury (8/9/2007, p.1).

Open interest contracts rise 224 (0.6pc)to 39,462 in week to 17 September, d-cypha Trade summary shows

Open interest contracts rose by 480 (1.2 per cent) to 39,942 in the week to Monday, 17 September following a rise of 224 (0.6 per cent) to 39,462 the previous week, according to figures supplied in a media release by the d-cypha Trade/Sydney Futures Exchange (SFE).

15,000GWh of new gen could be supported by 2016/17, giving potential gas-fired output of 35,000GWh, says NEMMCO report

ACIL Tasman considered it reasonable to assume that some 15,000GWh of new generation could be supported by 2016/17 giving a potential gas-fired output for that year of around 35,000GWh, according to ‘Fuel resource, new entry and generation costs in the NEM’, a report to NEMMCO by ACIL Tasman (27/3/2007).

Australian Power and Gas acquires extra 15,000 Vic residential customers from distressed sale: under $67 per account

Australian Power and Gas Company Limited acquired an additional 15,000 Victorian residential customers from a distressed sale, according to a company statement (6/6/2007).

$1m total cost: This brought the total customer account base to approximately 45,000 since commencement of sales in February 2007. The purchase price was $1,000,000 with $750,000 payable straight away and the balance due on 30 December 2007 subject to variations for any customer losses. This represented an acquisition cost under $67 per customer account. CEO of Australian Power & Gas Pty Ltd, James Myatt, said, “This transaction is the result of an urgent sale and the price paid is at a significant discount to the normal market. We see this as excellent value, and well under the $1,000-plus paid for customers in recent industry transactions. It is also less than what we would normally expect to pay through our sales acquisition channels.”

Retailer of Last Resort: The acquisition enabled the vendor to avoid the customers being transferred back to the Retailer of Last Resort. Usually under these conditions customers were transferred back to incumbent retailers. “These customers are very attractive to Australian Power and Gas and will be profitable based on our wholesale supply agreement in Victoria. For the customers, this transaction ensures they will be handled consistently and ensures that they will receive the opportunity to obtain ongoing discounts that otherwise may not have occurred under Retailer of Last Resort obligations,” Myatt said.

Reference: Australian Power & Gas. Investor Enquiries: Andrew Butler. Australian Power & Gas Phone: (02) 8908 2711. Media Enquiries: Michael Mullane, Savage & Partners (02) 8281 3257

Erisk Net, 6/6/2007

Victoria’s three main gas distribution businesses, Multinet, Envestra and SP AusNet subject to Draft Decision from January 2008

A Draft Decision, which will be finalised in November, would apply from January 2008 to Victoria’s three main gas distribution businesses, Multinet, Envestra and SP AusNet, according to a media release by the Victorian Minister for Energy and Resources.

Regulator determines balance: The Gas Access Arrangements Review occured every five years, when gas distributors made submissions to the regulator about their expected revenues, the release said. The regulator then determined average distribution charges that fairly balanced consumer and industry needs, and maintained returns that allow further capital investment.

Drought affects industry: The Minister stressed that the energy industry continued to be hit by the current drought, which had pushed up the wholesale costs of gas and electricity. He said demand for gas increased because gas-fired electricity generation was substituting for reduced hydro and coal-fired electricity generation, due to water shortages caused by drought. Gas was an effective but more expensive form of electricity generation, the Minister said.

Reference: Media release from the Minister for Energy & Resources, Victoria, 28 August 2007. Contact: Dan Ward. Phone: (03) 9651 5799. Mobile: 0407 138 680. Website:
http://www.vic.gov.au

Erisk Net, 28/8/2007

Revolution: South Australian Bill follows Victoria: small consumer may sell-back solar to the grid

South Australia’s Energy Minister P.F. Conlon in the second reading debate on the Electricity (Feed in Scheme—Residential Solar Systems) Amendment Bill in the South Australian House of Assembly on 12 September 2007 explained the new policy which was to allow small consumers to sell-back solar, to the grid.

Who gave the advice: Adelaide Thinkers in Residence such as Professors Stephen Schneider and Herbert Girardet supported the introduction of a “feed-in-tariff” — a premium price paid to those who are prepared to invest in solar panels. Also, the Chairman of Green Cross International, Mikhail Gorbachev, wrote to the Government and recommended the introduction of the feed-in scheme.”

Academic and international support: “South Australia remains in the vanguard with its climate change legislation, and its strengths in centralised and decentralised renewable energy generation,” Conlon said. “The [Bill] represents another step in the development of a coherent and purposeful strategy to keep South Australia at the forefront of governments facing the momentous challenge of climate change.

Growing support for comparable schemes: “Feed-in schemes have been implemented in many jurisdictions internationally as a means of promoting renewable power generation,” Conlon said. “By 2005, at least 32 countries and 5 States or Provinces had adopted such policies, more than half of which have been enacted since 2002. However, this legislation, which stipulates a premium feed-in tariff, is a first for our part of the world in providing a specific bonus for owners of solar panels. In Europe, at least sixteen EU states have introduced feed-in mechanisms to support renewable energy sources including solar electricity.”

Home-grown scheme for competitive market: “The Government has investigated similar schemes around the world but has not found one that could be directly implemented in the context of Australia’s National Electricity Market,” said Conlon. “By consulting the electricity and renewables industries, regulators and energy officials, a scheme has been developed that is suited to the competitive electricity market that exists in South Australia. Other jurisdictions are following our lead. The Victorian Government has introduced an amendment to its Electricity Act to guarantee small renewable energy generators a ‘fair price’ for any excess electricity they produce. The form it might take is yet to be specified and it is our hope that the lessons learnt from South Australia going first with the specific scheme will be disseminated widely around Australia and South East Asia.”

Reference: P.F. Conlon, Minister for Energy, House of Assembly, South Australia, 12 September 2007.

Erisk Net, 16/9/2007

Vic Greens majority triggered: for the first time in more than four years, a Bill overturned

For the first time in more than four years, a Victorian Government Bill was blown away, and a mushroom cloud of outrage erupted from the government benches, reported The Age (8/9/2007, p.4).

Thumbs-down on nuclear: Delighted Liberals were momentarily stunned. The three new Green members – Greg Barber, Sue Pennicuik and Colleen Hartland – had just activated the balance of power entrusted to them by voters last November in the most surprising manner, siding with the Liberals to defeat a bid to give Victorians a vote on whether nuclear reactors could be built here. In fact, what preoccupied the Greens for most of their first 10 months in the parliament was below-the-radar grunt work of procedural reform – restructuring the parliamentary committee system and revising standing orders – which was just as they promised before the poll.

Forced to negotiate: As Sue Pennicuik insisted as she campaigned for her seat, it was in exploiting the process that the Greens would magnify their influence. The Greens have brought an added dimension of interest to government, said Nic Economou, “and what will be really interesting is what they do next, because I think the Brumby Government has a real problem brewing out on Port Phillip Bay – the channel”. While Labor has testily resisted being dictated to by the Greens on any amendments thus far, it might eventually think about negotiating, Economou said. But it would hurt.

Long animosity: The long animosity had only become more bitter since the contest last November, and ahead of the federal poll. “The Greens are seen by Labor as really serious rivals, political enemies,” Economou said. Labor couldn’t like the Greens despite – and because of – their shared constituency, said parliamentary analyst Professor Brian Costar. True, within parliament there were eyebrows raised at their concerns regarding the toxicity of the paint applied to Hartland’s office; bemusement at an insistence on environmentally friendly carpet; and consternation at their demands that the gas-guzzling vehicles they inherited from previous members be immediately traded in on hybrid vehicles (they’ve since secured one).

Greens are not extremists: But, “it seems to me that the three of them don’t fit the stereotype that the Exclusive Bretheren would have us believe the Greens are,” observed Costar. “They are common, domesticated garden Greens … not extremists.” They rejected Labor’s claims that they cosied up to the Liberals with a secret deal. Figures that they sided with the Liberals on 68 per cent of votes were selective, they said. “There have been 43 Bills that the government has put up, and we’ve voted against three of them.”

The Age, 8/9/2007, p. 4

$400m wave-powered combined 50 gigalitre desalination plant and 50 megawatt power station investigated for southern Australia

An emission-free privately-funded desalination plant capable of supplying one quarter of Adelaide’s water supply was being considered for South Australia’s coastline, reported The Advertiser (10/9/2007, p. 8).

Wave energy: Perth-based clean energy technology company Carnegie Corporation was investigating building the combined 50 gigalitre desalination plant and 50 megawatt power station at a site in southern Australia, the newspaper reported. The $400 million plant would use wave energy as its source of power. It would be the world’s first wave-driven desalination plant and would not produce greenhouse gas emissions.

Powerful waves attractive: Carnegie managing director Michael Ottaviano said locations on Eyre Peninsula between Port Lincoln and Ceduna, and the Limestone Coast between Robe and the Victorian border were under consideration. “We want to go into the area of greatest demand and SA is probably the state with the greatest demand at the moment,” he said. Southwestern Australia, western Victoria and western Tasmania also had been identified as possible sites because of their powerful waves. A decision was expected by early November. Construction could begin in 2009. The plant would become operational in 2011, increasing to full production in 2014.

The Advertiser, 10/9/2007, p. 8

Electricity Week 14 September 2007

Energy market turnover slumps $42m (23.7pc) to $135m in week to 1 September, lowest total of financial year, AER analysis shows

Energy market turnover slumped $42 million (23.7 per cent) to $135 million to the lowest total of the 2007/08 financial year, the Australian Energy Regulator (AER) said in its market analysis for the week from 26 August to 1 September.

Down $25 million on previous lowest total: The $135 million turnover was down $25 million on the previous lowest figure of $160 million in the week ending 18 August.

Ancillary services costs drop $128,000: The cost of ancillary services continued to fall, dropping $128,000 (19.5 per cent) to $527,000, compared to $655,000 the previous week. The $527,000 represented 0.4 per cent of the week’s total energy market turnover.

Average spot prices also down: The AER analysis also showed that spot prices averaged between $34/MWh in Queensland and $38/MWh in South Australia, compared to a range of $41/MWh in Queensland and $45/MWh in South Australia the previous week.

Turnover and ancillary service cost statistics: The following table shows weekly energy market turnover and ancillary services costs from the start of the 2007/08 financial year, with the weekly figures for June given for comparison purposes:

Week ending

Energy turnover

Ancillary services cost

Price forecasts more accurate:The AER analysis showed significant variations between actual prices and those forecast 4 and 12 hours ahead occurred in 62 (18.5 per cent) of the 336 30-minute trading intervals, down from 85 trading intervals the previous week.

Demand forecasts: Demand forecasts produced 4 and 12 hours ahead varied from actual by more than 5 per cent in about 20 per cent of all trading intervals across the market. These variations were most frequent in Tasmania and South Australia, occurring in about 33 per cent of trading interval

Reference: Australian Energy Regulator (AER) market analysis for week Sunday, 26 August to Saturday, 1 September. 5 September. Address: Level 11, The Tower, 360 Elizabeth Street, Melbourne Central. Melbourne. Vic. 3000. GPO Box 520, Melbourne. Vic. 3001. Phone: (03) 9290 1444. Fax: (03) 9290 1457.
http://www.aer.gov.au

Erisk Net, 12/9/2007

Market forecast for Friday, 14 September: Average prices up 1-7pc in SA and Tas, down 4-11pc in NSW, Vic and Qld to $43.48-$52.13/MWh range

Average prices are expected to rise 1-7 per cent in South Australia and Tasmania and fall 4-11 per cent in NSW, Victoria and Queensland to a range of $43.48-$52.13/MWh. System-wide maximum demand is predicted to be up 161MW (0.7 per cent) to 26,522MW, with rises in NSW, South Australia and Tasmania and falls in Victoria and Queensland. The forecast temperature ranges for the NEM capitals are: Sydney 14-28 degrees (11-23 on Thursday); Melbourne 13-18 degrees (9-21); Adelaide 11-17 degrees (14-24); Brisbane 14-28 degrees (13-25); and Hobart 10-16 degrees (7-18).

6.15 a.m. predispatch forecast: The following are the forecast prices and demands for the NEM regions at the predispatch at 6.15 a.m. today:

• NSW: The predicted average price is $46.79/MWh, down $4.70/MWh (9 per cent) on the $51.49/MWh average on Thursday. Maximum price is forecast to be $69.46/MWh. Average demand is expected to rise 55MW (0.6 per cent) to 8955MW on Thursday’s 8900MW while maximum demand is predicted to be 10,390MW, up 253MW (2.5 per cent) on Thursday’s 10,137MW.

• Victoria: The forecast average price is $44.77/MWh, down $1.96/MWh (4 per cent) on the $46.738/MWh average on Thursday. Maximum price is expected to be $62.08/MWh. Average demand is predicted to fall 8MW to 6024MW on Thursday’s 6032MW while maximum demand is forecast to be 6713MW, down 21MW (0.3 per cent) on Thursday’s 6734MW.

• South Australia: The expected average price is $43.48/MWh, up $0.62/MWh (1 per cent) on the $42.86/MWh average on Thursday. Maximum price is predicted to be $59.90/MWh. Average demand is forecast to be 1440MW, up 64MW (4.7 per cent) on the 1376MW on Thursday while maximum demand is expected to be 1751MW, up 158MW (9.9 per cent) on Thursday’s 1593MW.

• Queensland: The predicted average price is $49.42/MWh, down $6.05/MWh (11 per cent) on the spike-affected $55.47/MWh average on Thursday. Maximum price is forecast to be $71.50/MWh. Average demand is expected to be 5678MW, down 31MW (0.5 per cent) on the 5709MW of Thursday while maximum demand is predicted to be 6315MW, down 172MW (2.7 per cent) on Thursday’s 6487MW.

• Tasmania: The forecast average price is $52.13/MWh, up $3.42/MWh (7 per cent) on the $48.71/MWh average on Thursday. Maximum price is expected to be $62.10/MWh. Average demand is predicted to be 1151MW, up 33MW (3.0 per cent) on the 1118MW on Thursday while maximum demand is forecast to be 1332MW, up 37MW (2.9 per cent) on Thursday’s 1295MW.

The weather:
The Bureau of Meteorology (BOM) issued the following weather outlook for the following three days. In addition, it issued the following forecast for the coming day’s clear sky maximum UV (ultraviolet radiation) index for 1 p.m. (when the sun’s radiation was most intense) for Sydney, Melbourne, Adelaide, Brisbane and Hobart. The BOM has three categories for forecasts relating to cloud cover: Clear/scattered, when more than half the sky is clear of cloud; Broken, when there are some breaks in cloud but more than half the sky is covered; and Overcast, when the sky is totally covered in cloud.

• The forecast for Sydney today is mostly fine and windy with a moderate clear sky UV index of 5 and a temperature range of 14-28 degrees. Tomorrow should be fine and mostly sunny with a temperature range of 14-21. Sunday is expected to be fine with a temperature range of 11-23.

• The forecast for Melbourne today is for a few showers with a moderate clear sky UV index of 4 and a temperature range of 13-18 degrees. The forecast for tomorrow is for a shower or two clearing with a temperature range of 9-18. The forecast for Sunday is for rain later with a temperature range of 10-19.

• The forecast for Adelaide today is for an early shower or two with a moderate clear sky UV index of 4 and a temperature range of 11-17 degrees. Tomorrow should be fine and partly cloudy with a temperature range of 6-21. The forecast for Sunday is for a shower or two developing with a temperature range of 12-20.

• The forecast for Brisbane today and tomorrow is for a possible shower or storm with a high clear sky UV index of 7 today and temperature ranges of 14-28 degrees on both days. Sunday should be fine with a temperature range of 13-27.

• The forecast for Hobart today is for rain periods with a moderate clear sky UV index of 3 and a temperature range of 10-16 degrees. A shower or two is expected tomorrow with a temperature range of 6-14. The forecast for Sunday is for late rain with a temperature range of 6-17.

Erisk Net, 14/9/2007