RESTORING TASMANIA S RENEWABLE ENERGY ADVANTAGE: Putting People First

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1 RESTORING TASMANIA S RENEWABLE ENERGY ADVANTAGE: Putting People First 1

2 Restoring Tasmania s Renewable Energy Tasmania has enormous potential in renewable energy. Our intergenerational investment in hydro power, abundant wind resource and extensive renewable energy expertise means we should be leading the nation on energy. Instead the last four years of Liberal Government has been characterised by mismanagement, squandered opportunities, a lack of vision and a catastrophic energy crisis. Not one major renewable energy project has been completed in the past four years. Labor is committed to restoring Tasmania s renewable energy advantage. Fostering a more diverse energy generation system will reduce power bills, protect our energy intensive industries, provide energy security in times of drought and enhance the case for a second Bass Strait interconnector. Lowest sustainable power prices The national electricity market is undergoing a significant transition. Tasmania should be benefiting from this transition, with lower power prices for business and customers in the State, and increased revenue opportunities for our renewable generators across the Bass Strait. Instead Liberal Government inaction has resulted in price spikes for Tasmanian customers, some of which have seen bills more than double in the past year. 2

3 Tasmanians can t wait three years for relief. Within 12 months of a Majority Labor Government, we will ensure that energy prices are linked more closely to Tasmania s cost of production, which is amongst the lowest in the country. Labor will continue to sell power into the National Electricity Market but we will provide a national voice for reform to ensure that the market reflects the challenges and opportunities of the future. Labor will ensure that affordable energy is again used as an economic driver and job creator for our state, to attract and retain energy intensive industries and advanced manufacturing. Energy businesses should not be treated as cash cows for government. While they provide an important contribution to the budget, they can also play a critical role in creating economic activity by driving down energy costs. Labor will ask Government Business Enterprises to review executive bonuses and ensure that, if they are paid at all, they are linked to operational efficiencies and reductions in energy costs for households and small businesses rather than company profits. Labor will keep our energy businesses and their subsidiaries in public hands so that they can work for the benefit of the entire state. We will ensure that we keep skills in Tasmania by offering secure, full time jobs not outsourcing core functions to the private sector. Diversifying Tasmania s Energy Mix The 2016 energy crisis demonstrated the danger of an overreliance on any one source of energy. The Liberal Government s reckless decision to decommission and sell the Tamar Valley Power Station in return for a $75 million dividend left the state dangerously exposed to the energy crisis, which ended up costing the state $180 million. We can never let that happen again. Labor will commit to keeping the Tamar Valley Power Station, as a critical energy security asset. 3

4 But we will also future proof Tasmania s energy sector by providing a supportive environment for diversified energy projects. Labor believes we shouldn t settle for simply being self-sufficient we will set a target to generate more than 120 per cent of Tasmania s energy needs from renewable sources within 5 years. Labor will actively support large-scale renewable energy projects, like UPC s Robbins Island wind project. We will support the adoption of innovative technologies like hydrogen, wave and tidal energy. And we will foster a new wave of small scale renewable energy projects. Labor s initiatives will bolster the business case for a second interconnector to sell excess renewable energy to mainland states. Distributed Energy Target The future of energy is changing rapidly. The steady reduction in cost of battery storage and solar panels is making it possible for more and more individuals and businesses to generate and use their own energy. We want to put control back into the hands of energy users by enabling the development of distributed energy. Distributed energy, or on-site generation, refers to small-scale renewable energy installations that provide power to an immediate area, as well as feeding into the grid. These installations offset power costs to connected homes or businesses, but can also supply the grid during times of peak demand. The most common form of small-scale generation is residential rooftop solar. Labor will set a Distributed Energy Target to increase distributed energy installations by more than 80 per cent from 120MW to 220MW by The target will stimulate up to 5000 installations per year and create up to 1500 new jobs. 4

5 Distributed energy presents both a threat to the traditional energy grid, but also an opportunity if harnessed strategically. Thanks to the reforms initiated by Labor, Tasmania is in a unique position to harness this transition, with TasNetworks now being the single operator for both transmission and distribution networks in the State. Labor will reinvest $25 million in dividends from TasNetworks to fund a range of initiatives to take advantage of technological advances in renewable energy generation and storage. 5

6 Community Solar Hubs 2.0 Labor has been a long advocate for the development of community solar hubs small networks of solar installations powering groups of buildings and houses. Labor will deliver a two staged roll-out of Community Solar Hubs over the next four years. Stage 1 Stage 1 will involve partnering with community housing providers to deliver cost of living relief for low income households with a ground-breaking solar energy trial. We will identify a community of up to 100 existing low income homes to install solar and battery storage. In addition, under Labor s Homes for Tasmanians every new public housing property built will have solar panels and batteries installed adding up to 1000 installations over six years. Individual households would receive the benefits of reduced power bills, through a model which incentivises energy conservation and efficiency. Participants would have access to real time feedback on energy use and conservation. TasNetworks will have the ability to monitor household energy use and draw down on stored energy during times of peak demand. They would also have the ability to turn appliances like hot water services off when not in use to manage loads. 6

7 The trial will allow TasNetworks to prepare for the inevitable take-up of battery storage and better understand how these systems can work in harmony with the traditional grid. Stage 2 Labor will seek financing assistance from the Clean Energy Finance Corporation and ARENA to expand the Community Solar Hub program to government buildings such as schools, hospitals and offices. We will also seek to partner with businesses in light industrial zones, particularly in energy intensive industries. Labor s policy will be to create a virtual power plant of connected homes, businesses and government buildings capable of contributing to the state s energy security. Following the model announced by the South Australian Government, Labor will seek to engage a new retailer to aggregate and manage this new distributed resource, thus bringing both generation and retail competition to the Tasmanian electricity market. 7

8 Agriculture Labor understands the significant impact that energy prices have on businesses, particularly in energy intensive industries such as farming. Labor s investment in irrigation has unlocked huge potential for high value agriculture but for some, energy costs are acting as a handbrake on growth. One answer to rising energy costs is for farms to generate their own electricity through renewable sources such as solar and wind. However, under current policies, energy that is generated through a renewable energy installation can only be used to offset costs behind one meter. That means if a large bank of solar panels is attached to a dairy it can only offset energy costs at the dairy, it can t be used to power a pump or pivot irrigator on the same property. A Majority Labor Government will work with TasNetworks to change the policy so that energy generated at one site can be used across all meters on the same property, provided it is used in real time. Landholders would be responsible for bearing the costs of transmitting energy on their property, including any infrastructure upgrades such as transformers. This simple policy change will help to drive jobs and investment in renewable energy, as well as allowing for greater on-farm intensification and productivity. It is estimated the policy change could unlock more than $20 million in direct on-farm investment. This policy will make an important contribution to achieving Labor s 220MW Distributed Energy Target, and will add to the opportunities associated with the Virtual Power Plant. 8

9 Putting People First Feed-in Tariff To support the Distributed Energy Target, Labor will commission the Economic Regulator to review solar feed-in tariffs. With the grandfathered feed-in tariff due to expire this year, it is prudent to conduct a review to establish a new sustainable tariff that supports an increase in solar uptake, without distorting prices for other users. Community Wind Initiative As part of the development of new wind farms, Labor will explore the opportunities of community co-ownership of Under co-ownership a percentage share of a large scale renewable project is sold to a community-owned energy company. It allows individual members of the community to buy into renewable energy projects for as little as $5000, in return for some share of generation revenue, including energy sales. Co-ownership has been pioneered in Denmark, and successfully adopted in the United States, where 42 million people are served by community owned energy companies. The model is also being implemented at the $588 million Sapphire Wind Farm in NSW. 9

10 New Energy Storage Technologies The generation of additional renewable energy, particularly from intermittent resources such as wind and solar necessitates the development of innovative storage solutions and network redesign. Labor will empower TasNetworks to work with renewable energy storage developers to future-proof their network and assets and take advantage of technological advances in renewable energy generation and storage. We will leverage a minimum of $1 dollar of private investment for every public dollar spent to enable developers of energy storage systems to trial a portfolio of new energy storage technologies, including batteries and electrolysers for hydrogen production. Energy Efficiency We know that energy efficiency is the best way to reduce household power bills. Simple measures like draft proofing, insulation and LED light globes can save hundreds of dollars a year. Labor will provide energy efficiency upgrades for two thousand low income families around the state. Public housing tenants will receie energy efficiency upgrades such as water saving shower heads and draft proofing, insulation along with education to assist with lowering the power bill, with an average saving of $400 per household a year. Heating Upgrades Labor believes it is unacceptable that some residents in public housing cannot afford to heat their homes. That is why Labor is committed to installing 1000 heat pumps into the homes of tenants in the oldest public housing properties. 10

11 Alternative Fuel Transport To achieve the vision of becoming truly self-sufficient, over time we need to steadily decrease our reliance on fossil fuels. Tasmania has the highest rate of car ownership in the country. We spend more than $1 billion on petrol and diesel imports every year. We also pay amongst the highest fuel prices in the country. Refocussing Tasmania s energy network to support new electric vehicle technology not only provides savings in energy costs, it has the potential to create an entirely new industry for our state, built on our renewable energy capacity. Labor will commit $7.5 million to roll out a staged plan to make Tasmania a leader in electric and alternative fuel vehicles. Labor will take a leadership role in developing a network of electric vehicle charging stations for Tasmania. A carefully planned network of fast charging stations will extend the range of electric vehicles. This is crucial if we are to market Tasmania as an electric vehicle friendly place to visit. Labor will pilot the roll-out of electric vehicles across the Government vehicle fleet. We would also work with local government, the University of Tasmania, taxi and hire car companies to achieve economies of scale in fleet purchasing. Labor is committed to realising advanced manufacturing opportunities, based on alternative fuel transport. Labor will establish a pilot program to convert existing Metro busses to run on electricity and other alternative fuels like hydrogen. This program would retain specialist manufacturing jobs on the North West Coast and establish a new, modern industry for the region. Across the globe a hydrogen-electric fuel cell revolution is occurring and vehicles have been released in the global marketplace. These vehicles can be refilled in less than three minutes and offer mileage of up to 700km on a single tank. Fuel cell vehicles are therefore the perfect complement to battery-electric vehicles ensuring that we can achieve the transition away 11

12 from fossil fuels across the broader range of personal and commercial mobility applications. Hydrogen is created by using electricity to separate water molecules into hydrogen and oxygen. The production of hydrogen in Tasmania will introduce a new use for our electricity, it will help reduce our dependence on imported fossil fuels, and at a larger scale create a product that could be exported to international markets. Project developers such as The Hydrogen Utility are working at the forefront of hydrogen infrastructure commercialisation in Australia with projects underway in Sydney and Melbourne and with world-leading hydrogen supply chain initiatives such as the one recently announced for Port Lincoln are also based in our State. Industry Investment Attraction Labor recognises that increased renewable energy generation must be underpinned by a strategy to increase electricity consumption. Labor will use proven initiatives like the Payroll Tax Incentive Scheme to attract new industries and employers to Tasmania. Tasmania should aspire to become a centre of excellence for small scale, high value industry, advanced manufacturing and food production. Sparking a new wave of investment in renewable energy will also help attract complementary industries to the State, in the same way that the Woolnorth wind farm attracted Danish wind turbine manufacturer Vestas to establish a plant in Wynyard. New opportunities could include manufacturing hydrogen and electric charging stations and retrofitting public transport. Labor s policy will restore the opportunity to attract investment in data centres, which require high levels of energy security and are increasingly seeking a low carbon footprint. Renewable energy will also be a key competitive advantage for energy intensive major industrials. Investing in new renewable energy generation capacity will help protect 12

13 Tasmania s vital major industrial base, while also helping to attract new industries into the future, including the potential for a magnesium smelter to take advantage of the state s abundant magnesite resource. Securing Existing Assets and Expertise Labor will commit to retaining the Tamar Valley Power Station (TVPS). TVPS and the Combined Cycle Gas Turbine (CCGT) are critical strategic assets for Tasmania. If the Liberal Government had succeeded with its plans to sell the CCGT prior to the Basslink failure the cost and magnitude of the energy crisis would have been far greater. Labor will also ensure that long term gas contracts for the power station are secured on a commercial basis to avoid unsustainable price hikes for other gas users. Tasmania s greatest energy assets are its people. Staff within Hydro Tasmania s consulting arm, Entura, have provided expert advice on renewable energy developments right around the world. Labor believes Entura and its skilled staff should remain in Tasmania so that they can be fully utilised in the pursuit of new renewable energy opportunities. Similarly, Labor will maintain ownership of Hydro Tasmania s mainland retailer, Momentum. Momentum s market reputation as a supplier of renewable energy has been damaged as a result of the energy crisis and the Basslink outage. Labor s investment in renewable energy will restore and strengthen Momentum s reputation and allow the retailer to gain GreenPower accreditation. 13

14 For more information go to taslabor.com Authorised by Rebecca White, 33 Cole Street, Sorell