What Impact Do Decreased Solar PV Cost and Carbon Tax Have On Solar Dawn Project of Australia?


Dear Friends, Visitors/Viewers/Readers,

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When I first heard about the Australian Solar Dawn Project coming to a halt, in the limbo stage, I was both shocked and disappointed.  Upon further investigation, I have a better grasp of the situation and please allow me to share some of these details with you.

For some background information on the Australian Solar Dawn Project:   the originally proposed 250 megawatt Solar Dawn power plant project was the preferred solar thermal power project of the Australian Government’s Solar Flagships Program.  It  was to be built near Chinchilla in South West Queensland to provide clean and safe energy, using Australia’s abundant solar resource to contribute to a sustainable solar industry in Australia, by offering an international showcase for utility scale, standalone CLFR (Compact Linear Fresnel Reflector) technology power project.  In the process of positioning Australia as a global leader in utility-scale solar thermal power generation, Solar Dawn Project would provide significant local employment and training opportunities and also involve long-term research collaboration with the University of Queensland.  This project would have consisted of approximately 450 hectares of infrastructure including a ‘solar field’ containing the mirrors and steam boiler tubes and a ‘power block’ with the steam turbine generators and ancillary equipment.  Originally, it was expected that the proposed project would have commenced operation in early 2015 following a three-year construction time frame. Below, is a video on AREVA’s Solar Thermal Technology, Solar CLFR (Compact Linear Fresnel Reflector) solar steam generators producing super-heated, high-pressured steam directly from the sun. The steam can then be used to spin an electricity-producing turbine:

But my friends, when one lives in an extremely dynamic time and dynamic industry (solar), there may be fluctuations and changing factors entering on scene: Firstly, the Australian Carbon Tax/Price ( $23 AUD per tonne of emitted CO2 on selected fossil fuels consumed by industrial emitters only) entered the scene on July 1st of 2012. This new development renders it unnecessary for solar energy to have government subsidies by the shear fact that the carbon tax/price has leveled the playing field for all energy forms (the original argument to have solar subsidies was due to uneven playing fields resulting from external factor, such as the cost of environmental cleanup, not being considered) . Secondly, the fact that solar PV panel price has been declining relentlessly in recent years;a critical decision in any business or policy decision is to minimize the cost of production.  Energy/electricity production via solar PV is now much lower than the cost of energy/electricity production via solar thermal using CLFR. (At this point, please allow me to clarify: solar thermal directly producing hot water is at a cost lower than that of solar PV producing hot water, but solar thermal converting into electricity is at a cost higher than the cost of solar PV producing electricity).   Thirdly, the Solar Dawn was unable to negotiate a power purchase agreement (PPA) with the Queensland government-owned electricity utility Ergon Power to meet the June 30 deadline, and so could not attract bank finance.  The question I pose here is how was the decision arrived by Ergon Power? If it were purely due to minimizing cost, the current lower cost of solar PV does weaken solar thermal’s position;but in our changing world, the cost of energy production in any form may still be subject to change, depending on how much R & D  support there will be ( electricity produced from  solar thermal via CLFR may cost more than solar PV now, but this may not hold true in the future) . If Ergon Power’s unwillingness to negotiate a PPA were due to concern/unfamiliarity with large scale solar thermal, then will it be possible for Solar Dawn to modify its plan into series of smaller scale solar thermal projects?  In the final analysis, in order to assure the success of any energy/power business,  it is necessary to have a purchaser/client once the power is produced.

Now, let’s look at the other side of the coin.  I believe that I am a rational solar advocate.  It is important to keep the cost in mind, but also make the argument for the need of more favorable playing field for solar.  Personally, of many many reasons in favor of solar, the two most critical reasons for me are: 1.  the speed at which our Arctic Ice is melting 2. potential  wars among nations fighting over the oil reserves.  Both of these will dramatically impact the lives of countless human beings.  One of my detractors commented, “my parents and I have all lived through wars, so what….”  I contend that we are living in a very different time from previous generations (WWI or WWII).  It is quite possible that any future large-scale war will cost the lives of billions of earthlings and make over half of our planet uninhabitable for decades.  So, my questions here are: How quickly is our Arctic Ice melting? How likely are we going to be at large scale war? By providing more favorable playing field for solar/renewables through policies/incentives, will these efforts avert my two main concerns ? Again, from the bottom of my heart, I have to thank Hermann Scheer of Germany for having made the most moral and ethical decision decades ago in having convinced the German Parliament to establish the equivalent of Feed-In-Tariff and German Renewable Energy Act.  He made an ethical decision, although not necessarily an economic one at the time…decades later, now people of Germany have benefited from that decision economically and renewably. Germany is a leader in Renewable Energy world/industry and has an extremely low unemployment rate compared to other developed nations (Please refer to European Commission Eurostat’s Unemployment Statistics)

Solar Dawn project director Anthony Wiseman said discussions would continue with the Queensland government, and with ARENA (Australian Renewable Energy Agency). “It’s important to understand that we have not ceased work on project,” he said.  He also commented that while the project delay represented a set-back, the consortium made up of AREVA Solar and Wind Prospect, University of Queensland, after CS Energy pulled out, will pursue discussions with the Australian Renewable Energy Agency and the Queensland Government to move Solar Dawn forward based on the project’s advanced status and the strong economic and environmental benefits it offers to the state and the country.  The Australian Solar Energy Society (AuSES) said that it is deeply disappointed with the Queensland Government’s decision to axe funding to the project, as it will put Australia at the forefront of the global solar thermal industry. Here, at Sun Is The Future, we wish Director Wiseman the best in coming up with a modified plan that will be able to attract an agreeable purchaser.  Then pursue the negotiation with Queensland government and ARENA. We have learned that time and time again, people in solar industry tend to have that extra ounce of optimistic energy, supplied by the magical dust from the Sun….

~have a variation of bright and sunny day~

Any of your comments or suggestions for any of the above questions are welcomed at sunisthefuture@gmail.com

gathered, researched, written, and posted by sunisthefuture-Susan Sun Nunamaker, sunisthefuture@gmail.com
Homepage:  http://www.sunisthefuture.net

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