The New Energy Economy Economic Opportunity for South Australia. Richard Turner SIMEC ZEN Energy

Transcription

1 The New Energy Economy Economic Opportunity for South Australia Richard Turner SIMEC ZEN Energy

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3 Background SIMEC ZEN Evolution & Highlights Founded in July 2004 as an R&D company in Sustainable Energy One of the largest renewable energy companies in Australia (Residential, Commercial, Industrial & Grid Scale) Largely credited for pioneering the modern Solar Industry in Australia Most awarded solar & energy storage company in Australia 2010 Australian Entrepreneur of the Year 2010 Fastest Growing Company in SA (two consecutive years) 4 th Fastest Growing Company in Australia Investment by Raymond Spencer bringing cross-ownership with Greensmith in the USA Sept 2015 Integration of Professor Ross Garnaut s consultancy business into ZEN Energy Ross Garnaut becomes Chairman of ZEN Energy

4 Background - ZEN Evolution & Highlights Oct 2017 GFG Alliance acquires 50.1% Majority Shareholding in ZEN Energy Sanjeev Gupta becomes Chairman of SIMEC ZEN Energy Ross Garnaut Becomes President of SIMEC ZEN Energy Acquisition made to significantly reduce the energy costs of the GFG Alliance Businesses in Australia Building on the successful UK model Broader vision to build Australia s next large scale Energy Generator / Retailer using clean energy sources Planned 1GW+ Generation Build Out (Press Release with AFR) 1GW Solar / 90MW-390MWh Pumped Hydro / 120MW-140MWh Battery / 100MW Demand Response 40MW Commercial Rooftop Solar (150 Sites) behind the meter (BTM) SIMEC ZEN Customer Solutions / SIMEC ZEN Developments / SIMEC ZEN Energy Markets

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8 SIMEC ZEN to build 1GW of Clean Energy Generation in SA 680MW Solar now increased to 1GW 250+MW in Whyalla Balance to support Industrial growth 90MW / 390MWh Pumped Hydro Facility Middleback Ranges (50km South-West of Whyalla) 120MW / 140MWh Li-Ion Grid Battery Port Augusta 20% larger then Tesla s 100MW/129kWh 100MW Cogeneration & DM Whyalla Steel Works ZEN Board Meeting Stamford Plaza Hotel Adelaide 30 th October 2017

9 South Australia s turn to prosper South Australia missed out under the old world fossil fuel regime South Australia has the BEST Renewable Energy Resource in the World Potential for very low cost energy under the Post Paris low carbon transition Influx and resurgence of heavy industry plus new industry development Economic Development & Prosperity for South Australia

10 New Industries from an abundance of low cost clean energy Graphite Mining & Refinement (30% of Lithium Batteries) Silicon Mining & Refinement (Solar Panels) Uranium Enrichment (Value add) Hydrogen Export (Clean energy over water) Direct connection to Indonesia (Feasibility study) Middle East of the new world

11 United Nations visits ZEN Energy Christina Figueres Executive Director of the United Nations Climate Change Council ZEN was only RE company in Australia selected for Christiana Figueres to visit after the Paris Agreement Absolute endorsement and praise for ZEN s Micro Grid and Energy Storage developments ZEN is in a world leading position with exportable technologies and business models We even received special acknowledgement from Al Gore when in Melbourne recently & Prince Charles on his 2012 visit

12 South Australian Electricity Pricing A closer look. Ryan McKee Strategic Customer Sales Manager - SIMEC ZEN Energy

13 What has caused the current high electricity prices?

14 Effect of Power Station Closure on SA Spot Price

15 2016 SA Swap Value throughout 2015

16 Gas Pricing link to Electricity Pricing (Sydney Morning Herald article: It's gas, not renewables, that is pushing up electricity prices, report finds 12 August 2017)

17 2018 SA Swap Value throughout 2017

18 2019 SA Swap Value since January 2017

19 Factors that may impact future pricing

20 Current Gas Pricing for Large Energy Users (ACCC Media Release 12 December 2017) Gas Production Costs (The Guardian article: The high price of Australian gas: is low supply really to blame? 29 September 2017)

21 Gas Generation Pricing Formula Electricity Pricing from a gas generator = gas price x heat rate. Pelican point, the most efficient gas generator in SA has a heat rate of 8. Estimated floor gas production price of $8/GJ + Haulage Costs of $1/GJ $9 x 8 = $72/MWh + $12-$20/MWh in variable operation costs & asset return expectations = $84-$92/MWh

22 Generation Plant Closure & Aging Coal Plants Liddell 2051 MW (NSW) Closure planned for 2022 Yallourn 1480 MW (VIC) 41 Years Old Eraring 2880 MW (NSW) 34 Years Old Bayswater 2640 MW (NSW) 34 Years Old Vales Point 1320 MW (NSW) 38 Years Old Some of these assets are approaching the end of their useful life and will need to be replaced.

23 SIMEC ZEN Energy Retail

24 A new electricity retail entrant New local, customer focussed retailer looking to break the current oligopoly Offers backed by new renewable energy investment contributing to additional supply in the market to drive down prices. Innovative contract structures providing value to customers for behind the meter demand management. Experts in behind the meter solar and storage technologies providing savings through offset of energy and avoided network charges.

25 Our First Retail Customer

26 Taking Control Behind the Meter Solar and Storage John Chiodo General Manager Customer Solutions SIMEC ZEN Energy

27 Behind the Meter Solutions - Solar & Storage Operating since 2004, our mission is to enable customers to take control and reduce their energy costs Both "in-front of the meter" (retail electricity supply) and behind the meter (solar and smart batteries)

28 Taking Control Installing Solar The savings from solar are remarkably consistent across numerous different applications. Company (Sector) PV Capacity Capex Year 1 Savings Simple PB A (datacentre) 200kW $292k $75k 3.9 years B (agribusiness) 300 kw $423k $116k 3.6 years C (food manufacturer) 600 kw $846k $228k 3.7 years D (sports club) 30 kw $27k $8.5k 3.2 years E (hospitality) 11 kw $13k $4.9k 2.7 years

29 Storage: SA Government Storage Demonstration Project In South Australia, simple paybacks from energy storage are currently: storage alone 15 years storage + solar years storage + solar + tariff shift 7-9 years Noting that equipment costs rapidly improving and that some sites may have opportunistic factors (ie: avoided costs, "insurance" value) which may result in substantially improved paybacks now.

30 For Further Information: Solar and Energy Storage Solutions Contact John Chiodo Retail Energy Solutions Contact Ryan McKee