Renewable energy is so complicated it’s got Pauline Hanson confusing mirrors with solar panels, the market operator trying to wrangle everything together, and investors figuring out what makes one development better than another.

The last detail is a knotty one: you can assess a lithium project by how good the grades are, you can read on oil or gas development based on its reserves.

But to know how good a solar or wind development is, there are a few moving parts, some of which are controlled by changes happening in the regulatory space and have less to do with the site itself.

Green Energy Markets director Tristan Edis says to measure a decent wind or solar farm you ideally need community support, access to a good transmission line, and decent amounts or wind or sun irradiance.

The details are a little more complicated.

Some people just won’t have it

Edis says developers have told him there are no-go zones where wrestling communities or powerful individuals is simply too hard.

These include south of Adelaide, east of Melbourne, and the southern highlands around Sydney.

Famous community fights include Ferrier Hodgson cofounder Tony Hodgson, a man who reportedly called Genghis Khan “a bit of a piker”, who in 2013 threatened to sue his neighbouring landholders in Collector, NSW, if they hosted wind turbines proposed for the area.

 

Last year in NSW the Jupiter wind farm south east of Tarago was rejected by planning bureaucrats again after a mix of community opposition, led by Residents Against Jupiter Wind Turbines, supported by then-NSW Liberal MP, Pru Goward.

In South Australia, a community group is fighting a wind farm development by Neoen, the owner of the Hornsdale wind farm and Tesla battery, in Crystal Brook.

Those MiLFs

Access to transmission lines is also a thorny problem.

As explained by Stockhead this year, if the Australian Energy Market Operator (AEMO) judges the network near a new project too weak to take more intermittent solar or wind electricity, a few things will happen.

They’ll be given a lower ‘marginal loss factor’ (MLF) which outlines how much energy the grid is capable of delivering from a wind or solar farm to the end user.

Over 1 and the grid can take more energy than a generator can produce. Every point under 1 is a percentage discount on how much power your farm is delivering: 0.8 means AEMO expects only 80 per cent of your power to get to customers (this is their official report).

This is what AEMO thinks, as of May, of the ability of their producing assets to get power to customers for 2019/20. AGL was punished especially hard, having to take 19 per cent and 29 per cent discounts on the energy AEMO believes they can get to market — a major financial blow.

Company nameCodeProjectLocation2019-20 MLF2018-19 MLF% change year-on-year
AGL ENERGY AGLWattle Point wind farmSouth Australia0.810.83-0.0191
AGL ENERGY AGLSilverton wind farmNSW0.841.01-0.1925
AGL ENERGY AGLHallet wind farm 1South Australia0.970.970.0033
AGL ENERGY AGLHallet wind farm 2South Australia0.980.970.0056
AGL ENERGY AGLNorth Brown Hill wind farmSouth Australia0.970.970.0057
AGL ENERGY AGLThe Bluff wind farm South Australia0.970.970.0057
AGL ENERGY AGLMacarthur wind farmVictoria0.981.00-0.0159
AGL ENERGY AGLNyngan solar farmNSW0.980.980.001
AGL ENERGY AGLBroken Hill solar farmNSW0.760.98-0.2916
GENEX POWERGNXKidston solarQueensland0.870.88-0.0197
MERIDIAN ENERGYMEZMt Millar wind farmSouth Australia0.890.91-0.0134
MERIDIAN ENERGYMEZMr Mercer wind farmVictoria0.970.99-0.0249
NEW ENERGY SOLARNEWManildra solar farmNSW1.031.020.0029
NEW ENERGY SOLARNEWBeryl solar farmNSW0.920.97-0.0445
ORIGIN ENERGYORGShoalhaven pumped hydroNSW1.001.01-0.0174
TILT RENEWABLES TLTSalt Creek Wind farmVictoria0.971.01-0.0355
TILT RENEWABLES TLTSnowtown wind farmSouth Australia0.910.92-0.012
TILT RENEWABLES TLTSnowtown wind farm 2 northSouth Australia0.970.98-0.0095
TILT RENEWABLES TLTSnowtown wind farm 2 southSouth Australia0.970.98-0.0095
TILT RENEWABLES TLTCrookwell 2 wind farmNSW0.971.00-0.0223
TILT RENEWABLES TLTDysart solar farmQueensland0.960.96-0.0046
WINDLABWNDKiata wind farmVictoria0.920.99-0.0796
WINDLABWNDOaklands Hill wind (with AGL)Victoria1.011.01-0.0077
WINDLABWNDCoonooer Bridge wind farmVictoria1.001.01-0.0101

“The complexity is that ideally you want to connect to as low a voltage [transmission line] as you can because it lowers the costs involved in all the connection equipment,” Edis said.

“But [with lower voltage lines] you carry a higher risk of transmission losses and being constrained off if someone else connects to the line,” because higher voltage (stronger) lines can carry more power.

Bring “constrained off’ means a farm is not allowed to send all of the power it produces into the grid.

There are seven listed companies Stockhead monitors with renewable energy projects in the Queensland, NSW, Victoria, Tasmania, and ACT National Energy Market (NEM) which have been assigned MLF figures (Western Australia and the Northern Territory have their own versions).
 

You don’t actually need a heap of wind or sun

And finally, there is the resource.

But unlike a lithium reserve you can game this too.

With wind, turbines have gotten taller and blade lengths have become longer, which means it’s possible that farms using the latest tech in low wind areas can be more productive than older farms in high wind areas.

For example, the turbines being opposed at Crystal Brook are proposed to be 240m high. GE’s design in 2017 of a similarly sized turbine had blades 158m long.

Edis says one developer he knows now simply looks for “a great big vacant open field” close to a good transmission line, rather than for high wind areas.

Bigger turbines in lower wind areas also has a cost factor: foundations don’t need to be sunk as deeply because turbines aren’t hit as hard by wind.

With solar panels, there hasn’t been the same level of technical innovation but developers can try to game the market.

Victoria is not nearly as good a place to build a solar project as Queensland, but it does have higher midday power prices and more demand.

As a result, while the places where solar farms can be built is limited to west and north of the Great Dividing Range — Shepparton and the “rhombus of regret” in the north west where projects are sandwiched within a diamond of maxed-out transmission lines — it’s still worth doing.

Edis says the “rhombus of regret” is “pretty much full” and projects up there are likely to have their power output constrained off from entering the grid, as well as having to spend a lot on connection equipment, until the network is upgraded come 2025.