The recent passing of the Hydrogen and Renewable Energy Bill in both Houses of the South Australian Parliament marks a significant milestone for the state’s clean energy endeavours. The legislation aims to leverage South Australia’s substantial wind and solar resources, solidifying its position as a key player in the global clean energy landscape.
Termed the Hydrogen and Renewable Energy Act 2023, this legislative framework stands as Australia’s inaugural structured approach to fostering and coordinating the growing hydrogen and renewable energy sectors.
Key Takeaways from ConstructionFront.com:
- The new act will provide more certainty for investors and unlock significant investments in the renewable energy sector in the State.
- Australia has been significantly investing and developing the renewable energy economy, with significant projects under development and construction aiming to reduce greenhouse gas emissions to 43% below 2005 levels by 2030.
South Australia's renewable and hydrogen energy background
The growing global interest in investing and developing South Australia’s hydrogen and renewable energy sector has prompted the need for a new legislative framework. This framework aims to capitalize on emerging opportunities and streamline operational processes to accommodate this surge in interest.
Notably, data from the South Australian Government Financing Authority indicates a remarkable shift in the state’s electricity generation.
More specifically, in just over 16 years, South Australia has transitioned from producing below 1% of its energy from renewables to over 70%, predominantly sourced from wind and solar power. This growth has been complemented by advancements in battery storage technologies (such as Horsndale Battery – more on it below) and gas.
Forecasts by the Australian Energy Market Operator project a further increase in renewable energy generation to approximately 85% by 2025-26, signifying the state’s progressive transition toward a net-zero emissions economy. Looking ahead, the ambition extends to positioning South Australia as both a national and global exporter of clean energy, potentially exceeding 500% of the current local grid demand by 2050.
Hornsdale Battery - The world's fist big battery
The Australian state has gained global recognition through the Hornsdale Project (see video below), delivered by a JV between Tesla and Neoen, the southern hemisphere’s largest lithium battery. Its primary function involves providing essential grid-support services, facilitating the integration of increasing volumes of low-cost renewable energy into the grid.
Currently, the battery boasts an installed capacity of 150 MW/194 MWh and is equipped to deliver grid inertia support services. Initially launched with 100MW capacity in 2017, the project expanded in 2020, adding an extra 50MW.
According to the Clean Energy Finance Corporation, the asset’s impact on electricity consumers has been substantial, resulting in savings of over $150 million in its first two years. This financial result underscores the considerable value grid-scale batteries offer to the National Electricity Market.
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The importance of the Hydrogen and Renewable Energy Act to South Australia
The new Act marks a significant breakthrough for South Australia’s renewable energy initiatives, enabling the progression of a substantial pipeline of renewable energy projects valued at approximately $21 billion, with expectations for further growth.
This legislation simplifies the investment process for companies seeking involvement in large-scale hydrogen and renewable energy endeavours in South Australia.
By consolidating aspects like land access, environmental impacts, and native title rights into a unified regulatory framework, the Hydrogen and Renewable Energy Act offers a more streamlined approach for interested parties.
A key addition introduced by the Act is the concept of release areas, providing developers and investors the opportunity to compete for access to prime wind and solar resources on government-owned land. This approach ensures the selection of projects that best align with the region’s and the state’s social, economic, and environmental needs.
Furthermore, the Act emphasizes the significance of extensive community and landholder consultation, emphasizing the responsible development of hydrogen and renewable energy projects that meet the expectations of local communities.
The government is committed to collaborating with stakeholders and rights holders to establish associated regulations for the Act and determine the release areas through a competitive tender process.