24 November 2006
Wholesale electricity purchasers continue to support the growing renewable energy industry, by surrendering renewable energy certificates (RECs) for the fifth year in a row rather than pay the renewable energy shortfall charge.
The Australian Government's Renewable Energy Regulator today released details of the RECs surrendered under Renewable Energy (Electricity) Act 2000 (the Act) for the 2001 to 2005 compliance years.
Under the Act wholesale purchasers of electricity (liable parties) must contribute towards the generation of additional electricity to reach the target of 9.5 million megawatt hour (MWh) by 2010.
Each year, liable parties surrender RECs in proportion to the amount of electricity they purchase. The scheme was introduced by the Australian Government to increase renewable electricity generation within Australia. For 2005 the target was 3.4 million MWh of renewable electricity. The renewable energy certificate requirement for 2005 is approximately equivalent to the residential electricity consumption of about 1,200,000 people. The annual targets rise until 2010 when the peak level of 9.5 million MWh is reached, after this the target remains at this peak level until 2020.
"Over the past five years the number of companies choosing to meet a required renewable energy target by surrendering RECs rather than paying renewable energy shortfall charge has remained at very high levels," said the Regulator, Mr David Rossiter.
"The 2005 compliance by surrender of RECs exceeded 99.7 per cent, which is very good news for the renewable energy industry as RECs directly assist developers of additional renewable electricity generation systems in Australia."
All but six liable parties fully met their liability under the Act by surrendering RECs rather than paying a renewable energy shortfall charge. The six liable parties with shortfalls totaling 8,486 RECs are:
Alcoa World Alumina Australia, Alinta DEBO Pty Ltd, Hamersley Iron Pty Ltd, Hazelwood Power, Robe River Mining Co Pty Ltd and Yamasa Australia Pty Ltd.
Several liable parties, who had shortfalls in previous years, made up their shortfalls by surrendering additional RECs. For the four earlier compliance years 2001 to 2004, there is a cumulative total shortfall of 443 RECs from four different liable parties. This outcome further reinforces the strong support for renewable electricity generation from the electricity industry.
David Rossiter 0408 276 214
The Act requires wholesale purchasers of electricity (liable parties) to proportionately contribute towards the generation of additional renewable electricity to reach the target of 9.5 million MWh by the year 2010. Each year most wholesale purchasers of electricity demonstrate their support of electricity generated from renewable energy sources by surrendering RECs in proportion to the amount of electricity they purchase.
The renewable electricity requirement for 2005 was 1.64 per cent of liable electricity throughout Australia. The annual targets are progressively rising until 2010 when the peak level is reached and they continue at the peak level of 9.5 million MWh until 2020. Liable parties that fail to surrender RECs must pay the renewable energy shortfall charge of $40 for each REC not surrendered.
RECs can be created from eligible renewable energy power stations, small generation units and solar water heaters. One REC represents one MWh of renewable electricity generated above a power station's baseline or is equivalent to one MWh of electricity displaced by a solar water heater.
For more information on Australian Government renewable energy programmes, visit www.greenhouse.gov.au/renewable/government.html