23 May, 2017
Courtesy of the Townsville Bulletin (print edition)
The next 2000 megawatts of electricity generation licensed in the state must be developed in North Queensland, economic development body Townsville Enterprise has declared.
The measure is one of five “solutions” the organisation has raised in submission to State and Federal Government to resolve the region’s worsening power crisis.
The organisation’s other solutions are to:
- Fast-track the developments of cost-effective base-load generation;
- Police the pricing behaviour of generators;
- Review the regulatory framework to address issues relevant to North Queensland; and
- Ensure North Queensland has access to competitively prices natural gas.
Townsville Enterprise director policy and investment Michael McMillan said lower prices were critical to not only attract industry but retain existing customers such as Glencore.
Earlier this month Glencore warned its North Queensland copper processing assets were at risk if energy prices continued to rise.
Mr McMillan said State and Federal governments needed to work together. He hoped a review of the National Electricity Market by Chief scientist Dr Alan Finkel to be released shortly could provide the impetus.
“There’s clearly a need for Federal and State governments to come together to determine how we can place downward pressure on electricity prices in North Queensland,” Mr McMillan said.
According to the submission, base electricity prices, exclusive of network and environmental charges, have more than doubled in North Queensland in the past three years and continue to increase at a rate of 30 per cent year on year.
It says wholesale prices have increase across the National Electricity Market with the Queensland price soaring 168 per cent in the five years to 2017.
The submissions point to the state having a key role because it owns or controls the dispatch of nearly two-thirds of the generation capacity in Queensland and nearly of the state’s network infrastructure companies.
But the submissions call on both State and Federal governments to use their influence to police the behaviour of generators so that wholesale prices match the costs of production rather than having prices being driven by “market distortion”.
About 750 MW of solar generation is being developed in North Queensland this year but Mr McMillan said base-load or round-the-clock generation was needed to support industry.