Solar policy is designed to fail

The federal government revealed the first projects shortlisted for funding under its Solar  Flagships scheme back in May.

The scheme provides $1.5 billion over six years, or just $250 million a year, to fund four solar power projects.

This is not enough money to seriously launch a solar industry—these are essentially demonstration plants. There is no suggestion of pursing a serious percentage of power generation from solar energy.

From eight shortlisted projects in round one, the government will announce two Solar Flagship funding winners in 2011.

Despite rhetoric from the government about launching the biggest solar energy rollout in Australia’s history, it is spending much more on subsidising fossil fuels.

According to a 2007 Greenpeace report, the federal government subsidises coal, oil and gas companies by around $9 billion a year.

And the federal government is promising over $2 billion in funding to develop Carbon Capture and Storage (CCS). CCS is essentially an ideological exercise to prolong the life of the coal industry, since it is estimated 20 years more development is needed. It looks likely to be too expensive to ever be used at a commercial scale. But the government is prepared to spend more pretending that CCS can work than on solar energy.

Wrong technology selected
The Solar Flagships shortlist has bypassed world leading solar companies, which are already building solar thermal power plants capable of providing power 24-hours a day, for large polluting companies that dabble in renewables.

For instance the government ignored a proposal from ACS Cobra, which builds one third of the world’s large-scale solar power plants. ACS Cobra’s overseas solar plants have molten salt storage, which allows them to operate at night.

Instead the government supported proposals from companies like TRUenergy. TRUenergy owns Yallourn brown coal power plant and previously abandoned its investment in the proposed Mildura solar power plant to be built by Solar Systems. Another proposal shortlisted would add solar mirrors to boil steam to the small aging Collinsville coal-fired power station in Queensland. It would still gas to boost the temperature of the steam.

According to climate campaign group Beyond Zero Emissions, “Without currently available molten salts storage a Solar thermal plant can not produce baseload power. It seems like the government is hell bent on supporting the status quo and making sure that the baseload myth is not busted.” This is the myth that solar power cannot supply 24-hour a day or baseload power, and which paint it as only an intermittent backup power source.

That the Solar Flagships scheme is even needed separately to the government’s Renewable Energy Target, shows that policy was never going to lead to large-scale solar power.

Under the Solar Flagship scheme companies are expected to source $2 of private funding for every $1 of government funding. Using the same flawed funding model, state and federal governments promised one third of the funding needed to company Solar Systems, to build a solar power plant in Mildura. Solar Systems failed to raise the necessary additional private capital, and collapsed. Over 100 workers lost their jobs in the process, leaving the Mildura solar power plant no closer to being built than when it was first announced in 2006. The market has failed again and again. What we need is much greater levels of direct government investment.

We need funding on the scale of tens of billions of dollars—enough to make a serious dent in Australia’s greenhouse emissions, and enough to provide tens of thousands of new jobs.

Chris Breen


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