Australia’s large renewable investments hit new low

: Electricity
24/03/13

Financial investment commitments to utility-scale renewable energy projects in Australia reached their lowest level in several years in 2023. But they can get back on track with the expanded Capacity Investment Scheme (CIS) scheme, the Clean Energy Council (CEC) said today.

A total of A$1.5bn ($991mn) was committed to a combined 1.3GW of new large-scale renewable projects last year, down sharply from A$6.5bn for 3.8GW in 2022, the CEC said on 13 March in its annual report. This is the lowest level since it began tracking investment data in 2017.

The slowdown reflects issues such as a constrained electricity grid, slow planning and environmental assessment processes in some states, higher costs and tighter markets for equipment and labour, the CEC noted. But regulatory uncertainty also played a major role, as investments have been gradually falling since Australia met its Renewable Energy Target (RET) ahead of the 2020 schedule, with the scheme's end date of 2030 affecting investment decisions, it added.

Large renewable plants typically get accredited under the RET and can issue and sell Large-scale Generation Certificates, a key support mechanism that is scheduled to end at the end of 2030. The industry had been lobbying for the federal government to commit to a new long-term national policy mechanism, which led to the creation of the CIS in 2022 and its expansion last November.

The government plans to issue tenders every six months until 2026-27 to support 23GW of renewable generation capacity such as solar, wind and hydro and 9GW of dispatchable capacity such as pumped hydro and grid-scale batteries. Winners will need to start operating their assets by 2030, which could help the Labor party-led federal government meet its target of sourcing 82pc of electricity from renewable sources by 2030 across the National Electricity Market covering east Australia.

‘Urgent policy design' needed

While the expanded CIS could put Australia back on track, "urgent and careful policy design" needs to be carried out in this year's first half to ensure the programme realises its objective of driving up private-sector investment in the sector, the CEC said.

There were 56 renewable projects under construction as of December 2023 for a combined capacity of 7.5GW, down from 72 projects making up 9.5GW at the same point in 2022.

Australia installed 2.8GW of new utility-scale renewable capacity in 2023, up from 2.3GW in 2022 and a "solid number" according to the CEC, but well below the figure of at least 6 GW/yr estimated by the Australian Energy Market Operator for the country to reach the 82pc renewable target. Out of the total last year, 1.9GW came from solar and 942MW from wind compared with 841MW and 1.4GW respectively in 2022.

An overall 5.9GW of renewable additions were achieved in 2023, up from 5GW in 2022, driven by 3.1GW from rooftop solar compared with 2.7GW the previous year before, the CEC said.

New financial commitments to utility-scale batteries reached a record of A$4.9bn, including hybrid projects with a storage component. This was up from A$1.9bn the previous year, with capacity under construction rising to 5GW/11GWh at the end of 2023 from 1.4GW/2GWh in 2022.

Renewables accounted for 39.4pc of Australia's electricity generation last year, up from 35.9pc in 2022, the CEC said.

By Juan Weik

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25/03/19

Swedish wind output structurally shifts Nordic hydro

London, 19 March (Argus) — Higher Swedish wind output is a structural supply shift that could support Norwegian hydro stocks over the long term, as recent record hydro reserves come despite below-average rainfall between October 2024 and February 2025. Combined Nordic hydropower reserves have held a surplus to the 10-year maximum for eight of the first 10 weeks of 2025, peaking at seven percentage points in week 10, as Norwegian hydro reserves unexpectedly increased from a week earlier. Reserves across Finland, Norway and Sweden closed week 10 at 55.6pc of capacity, seven percentage points above any other week in the previous 10 years and 5.1 percentage points higher than in 2008, the next highest year. Hydro production in Norway fell on the year in 2024, dropping to an average of 12.1GW, down from 12.2GW in 2023 and around 7pc below the five-year average of 12.9pc. Tighter hydro conditions in the first half of the year weighed on generation. Still, in the final six months of 2024, hydro reservoir output also fell on the year, dropping by 4pc to an average of 11.4GW, down from 11.9GW. That is despite combined Nordic reserves last year holding an average stock surplus of 5.2 percentage points to 2023 between weeks 34 and 52. At the same time, Swedish wind output increased to an average of 4.6GW last year, up by 18pc on the year from 3.9GW a year earlier and ending last year around 34pc higher than the five-year average. Higher wind generation weighs significantly on regional day-ahead prices and discourages hydro production by lowering the spot below the perceived water value of stored hydropower capacity. Rising wind capacity and its effect on the power mix is particularly notable during the first and fourth winter quarters, with generally the highest prices, with Swedish wind output averaging 5.8GW last year between January and March and October and December, up by 22pc from the equivalent periods in 2022. That displacement represents a structural supply shift in the Nordic power market that can support hydro reserves beyond rain and temperature outlook patterns going forward and during below-average precipitation periods, as the call for hydro production falls in hours when wind output is highest that — before significant wind capacity additions in Sweden — were routine output hours. Furthermore, higher run-of-river generation last year, up by 8pc in 2024 compared with a year earlier to an average of 3.4GW, captures the higher stock feed-in and water volumes that supported Nordic reservoirs in 2024 leading into 2025 and emphasises that, like wind output, run-of-river, which is generally not dispatchable undermines the regional spot price and reduces the call for reservoir hydro output. Norwegian hydro production last week peaked at 19.7GW on 13 March and averaged 17.9GW between 10 and 16 March, exceeding the monthly average of 15.9GW in March so far. Higher Norwegian hydro output was directly correlated with lower Swedish wind generation on those days, with Swedish average daily wind generation falling to 1.1GW and 1.5GW on 12 March and 13 March, respectively, while Norwegian hydro output topped 19GW on both days. By 15 and 16 March, Norwegian hydro production fell back to 16.6GW and 14.5GW, as Swedish wind generation rose to 7.6GW and 8.2GW. Unseasonably high reserves have consistently weighed on summer delivery power contracts and supported a substantial €59.20/MWh discount for Nordic June to the German equivalent on 18 March and an average discount of €59.13/MWh between 3 and 18 March. The Nordic third quarter last closed at a €66.10/MWh discount to the German equivalent and has averaged €67.23/MWh below Germany's front quarter over the previous 30 days. Reserves ended last month at 57.8pc of total capacity, some 3.4 percentage points above the 10-year maximum and in Norway, reserves were just 0.5 percentage points below the long-term national maximum, with stocks since switching to a 2.8 percentage point surplus to the maximum in week 10 and a 2.4 percentage point surplus in week 11. This was despite precipitation between October and February being up on the year, it remained below the region's seasonal norm by nearly 20.6mm, with rainfall in Bergen over the same period below the average in four of the past five years. Precipitation over the five months last exceeded the seasonal norm in 2022, totalling 1,804.8mm and registering a 422.9mm surplus to the average. But at February's close, hydro reserves in 2022 were 17.2 percentage points below the equivalent week in 2025, underscoring increased Swedish wind output's impact over the 2024-25 season. By Daniel Craig Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

UK wealth fund to prioritise ‘clean energy’ investment

25/03/19

UK wealth fund to prioritise ‘clean energy’ investment

London, 19 March (Argus) — The UK government has set "clean energy" as a priority investment sector for its new national wealth fund, and set out a plan for the fund to interact with newly-formed Great British Energy to drive decarbonisation. The two organisations will interact to provide a "strong end-to-end clean energy development and finance offer" and help the country hit its net zero targets, the government said. Great British Energy — staffed by specialists in the sector — will provide "development expertise", while the wealth fund will deliver finance, the government said. Great British Energy "will develop, invest in, build and operate clean energy projects across the UK", including owning stakes in the projects it develops itself, the government said. The organisation will develop "clean energy assets from inception", as well as co-develop and invest in more advanced projects. The national wealth fund "will unlock over £70bn ($90.7bn) in private investment to help deliver economic growth, make Britain a clean energy superpower, and strengthen the defence sector", the government said. The fund will prioritise investment in "clean energy, advanced manufacturing, digital technologies, and transport", and flagged likely spending on carbon capture and green hydrogen projects, as well as gigafactories and "green steel". The government has made commitments to "clean power" deployment and hitting the UK's legally-binding net zero by 2050 target central to its approach, sticking to pledges made ahead of last July's election . The government is targeting 95pc "clean power" by 2030 and consulted on a "clean energy future" for the North Sea earlier this month . By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EU mulls competitive metals decarbonisation

25/03/19

EU mulls competitive metals decarbonisation

Brussels, 19 March (Argus) — The European Commission today presented its steel and metals action plan, setting out actions to boost the sector's decarbonisation while countering unfair competition from outside the bloc. The plan has a strong focus on combatting global market distortion, whether in terms of trade or combined with circumvention of the bloc's emissions trading system (ETS) and carbon border adjustment mechanism (CBAM). "We will strengthen the current safeguard clause. We aim for a reduction of up to 15pc in [steel] imports," said industry commissioner Stephane Sejourne. Aside from revised steel safeguard measures , trade actions include a ferro-alloys safeguards investigation "expeditiously" by 18 November. And the commission promises to assess whether the bloc's use of the lesser duty rule regime requires changes. In addition to a CBAM scheme for exported goods , the measures also cover energy prices, decarbonisation through electrification and more flexible rules for low-carbon hydrogen. The commission promises revised rules to enable more EU states to provide indirect cost compensation for steel and aluminium firms for carbon costs passed on through electricity bills. And Brussels wants EU states to lower costs for energy-intensive industries through network tariffs, facilitating power purchase agreements (PPAs) and lowering electricity taxation to zero. With direct electrification not always possible or cost-effective, the commission points to hydrogen as a key enabler of decarbonisation in the steel and metals industries. Some measures have been toned down from drafts. The commission's plan no longer mentions implementing a melt and pour clause , "effective immediately". The commission will now "assess" whether it should adapt its practice by introducing a melted and poured rule, regardless of the place of subsequent transformation and origins. But the commission now promises that the delegated act on low-carbon hydrogen will provide rules that are "as flexible as possible" to achieve greenhouse gas emission-reduction goals for low-carbon fuels in a "technology neutral way". Industry association Hydrogen Europe welcomed the commission's direct acknowledgment of hydrogen as the best route to decarbonisation for primary steel production. "Labelling schemes, sustainability criteria, and dedicated funding mechanisms are necessary first steps to incentivise the offtake of green products," said Hydrogen Europe's industrial policy director Laurent Donceel. The commission's paper sends a clear message that "a strong European Union needs a strong European steel industry", said Henrik Adam, president of European steel association Eurofer. But the association also called on the EU to implement "meaningful solutions through ambitious measures". By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Groups to sue Alliant over Iowa coal ash discharge

25/03/18

Groups to sue Alliant over Iowa coal ash discharge

New York, 18 March (Argus) — Three environmental groups intend to sue Alliant Energy subsidiary Interstate Power and Light, alleging that groundwater discharges from the Ottumwa coal plant's coal ash impoundment in Iowa violate the Clean Water Act. The groups — the Iowa Environmental Council, Sierra Club, and Environmental Law & Policy Center — filed a formal notice to sue the utility on 12 March, initiating a 60-day period for the company to respond and comply with the Clean Water Act. The environmental groups claim Ottumwa has continued to release groundwater with arsenic and other toxic pollutants into the Des Moines River through a drain under the plant's lined coal ash pond despite being told by Iowa regulators in 2023 that such releases were not allowed under the plant's stormwater permit. The utility also has not applied for a new permit since the Iowa Department of Natural Resources mentioned the issue, the groups claim. "We want the unpermitted pollution to stop," said Environmental Law & Policy Center senior attorney Josh Mandelbaum. "We will evaluate any response by the utility, but if there continues to be unpermitted pollution, we intend to act." Alliant said that it is abiding by all regulated and required groundwater monitoring processes. The company "proactively" reached out to the Iowa Department of Natural Resources about the permit and has been "actively communicating" with the department while "systematically working" toward a solution for the groundwater discharge. "The system under the landfill is engineered so the groundwater does not come into contact with the contents of the landfill," the coal plant operator said in its statement. Still, environmental groups insist that "a solution has not been implemented and Alliant continues its unpermitted discharge". The Ottumwa coal plant received 1.27mn short tons (1.15mn metric tonnes) of coal from four Wyoming mines in 2024, according to the most recent US Energy Information Administration data. By Elena Vasilyeva Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Norway cold on EU VAT power sales harmony

25/03/17

Norway cold on EU VAT power sales harmony

London, 17 March (Argus) — Norway will not harmonise its value-added tax (VAT) legislation for cross-border power sales with the EU despite pressure from market operator Epex Spot, with the country's finance ministry claiming that its current rules are "satisfactory", it told Argus . Norway's finance ministry has not "found any reasons" to consider better integrating its VAT procedures on cross-border power sales, the ministry said, adding that EU rules are not "binding" and that, as such, "there is no ongoing work" to align the Nordic country with the broader European market. The decision follows a series of letters sent by Epex Spot that highlighted its significant objections to the existing VAT arrangements. The market operator argues that the system allows for potential double taxation on some sales while others can go completely untaxed. They added that this increases the risk of VAT tax fraud in Norway, with the system "leav[ing] the door open to well-known tax fraud methods", Epex Spot's public and regulatory affairs director, Davide Orifici, told Argus last year . In response to the ministry's statement, Epex Spot told Argus that while the legislation "is not binding for Norway", it hoped that Norway would align with EU rules "on a voluntary basis" to "secure the Norwegian power market against VAT fraud". It added that Norway's "tax authorities themselves" had confirmed to the media that Norway was, in effect, "keeping the doors open to fraud". Epex conducted discussions with Norway's tax authorities late last year, which were characterised as "good", but the finance ministry appears to be unmoved on EU VAT harmonisation. This is the latest flashpoint in a lingering dispute within Norwegian politics over whether it is best to pull back or move closer to the EU power market. Norway's coalition government fell apart earlier this year as the country's centre party left the ruling alliance over lead-partner Labour Party's willingness to align Norway more closely with the EU and adopt the bloc's fourth energy package. This leaves the Labour Party to govern as a minority government until parliamentary elections take place on 8 September. By Daniel Craig Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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