EcoGeneration’s Sally Commins spoke with Mr Crockett on the Federal Government’s Senate Inquiry into rural wind farms, the Victorian Government’s proposed new guidelines for wind farm developments and why a carbon tax won’t increase investment in renewable energies – yet.

Pacific Hydro recently gave a submission to the Federal Government’s Senate Inquiry into the Social and Economic Impact of Rural Wind Farms. Why do you think the Inquiry came about?

We’re not absolutely clear on how [the Inquiry] came about – it’s an inquiry that was called for by Senator Fielding. It would appear that there has been quite a bit of activity in western Victoria with a number of wind farms going through the planning system. I guess what may have happened is that a particular wind farm ended up with some community members who were unhappy about it, and somehow Senator Fielding’s picked up on that, and has decided that it warranted an inquiry.

So we’re obviously happy to be part of that inquiry because we think it’s a chance to get some truth and facts onto the table. We think there are a lot of things that get said about wind farms that are patently incorrect and so we’re happy to see the record set straight.

However, when you put large infrastructure into regional areas that aren’t necessarily used to it, you’ve got to work with the communities for them to understand and appreciate the impacts and get comfortable with them. That’s something we’ve been doing for 10 years; we’ve had our Codrington Wind Farm operating for 10 years now and we’ve never had a problem with it. It’s very well supported by the local community.

And generally so, too – we have done some independent polling and that shows that if one had the choice between a wind farm, a gas-fired power station, a coal-fired power station in your region, which would you prefer? 80 per cent would choose the wind farm over the other forms of generation. So it is very strongly supported by communities and by the population in general.

Some people are impacted and in the odd case you get some who are impacted and unhappy about it. But – while I’m not going to comment for other companies – that simply has not been the experience with our wind farms.

There have been some health claims that state that living within 10 km of wind farms causes illness. We strongly dispute these claims. There is no evidence whatsoever, no peer-reviewed published evidence and there is no reputable medical body in Australia that supports that view in any way.

We have to rely on medical bodies, and what has become difficult is if you have somebody who has [the title] doctor in front of their name telling people they’re going to get sick, people get worried, they get extremely anxious. So we now have members of the public ringing who have been living near our wind farms for years and have never had any issues saying “will we get sick”. So that is an issue that we are now having to manage because somebody is out there who is in our view being irresponsible.

We think it’s good that the inquiry is going on; it’s an opportunity to get the real facts out on the table rather than innuendo and myth.

The Victorian Liberal Government’s new guidelines for wind farms has led Pacific Hydro to state that the process now places the industry at a competitive disadvantage to other energy generation technologies. Will the wind energy industry be able to work around the new guidelines, or will this deter wind energy investment in Victoria?

The policy is still grey, particularly in terms of any arbitrary setbacks that are being talked about. [To read the proposed guidelines, go to page 60]. I can’t say specifically yes or no, but what I can say is if there were arbitrary setbacks put in place then it means that you put into planning law something that would restrict this technology relative to others.

In other words, it will be easier to put in a new coal-fired power station next to somebody’s residence than it will be to put a wind farm near to it. The same goes for gas-fired generation and those types of infrastructure that emit gases with pollutants, so it would seem on a very simplistic level quite a bizarre thing to happen.

However, if you look at the Victorian Planning and Environmental Law Association submission to the current wind farm enquiry they do address some of this, and they say that they consider it to be a difficult precedent to put arbitrary setbacks in because you are breaking effectively what is hundreds of years of planning law precedents.

You’re effectively ripping off the top of a can of worms because as soon as you do that for one part of infrastructure planning, then surely you can start to argue that it’s the case for any infrastructure.

We have three wind farms in Victoria that already have planning approval so they shouldn’t be impacted, and we’re still looking to develop those wind farms under the Renewable Energy Target (RET). We acknowledge and respect that the Government is following through on its election commitment and we appreciate that they are not proposing that the new laws be retrospective.

Pacific Hydro is involved in a bid for the Federal Government’s Solar Flagships program in partnership with BP Solar and Spain-based Fotowatio Renewable Ventures. What will be Pacific Hydro’s role in the utility-scale project in New South Wales?

This is a very exciting project. The people of Moree are very excited about it. We’re determined to be the winning consortium. [At the time of writing, Solar Flagships results had not yet been announced.]

It will be the largest photovoltaic (PV) generating facility in the world and there will be a lot of learning to take from it, and those are the sort of learnings that we as a consortium would learn and would diffuse through to the rest of the solar industry.

Fotowatio is an expert developer in solar but the company is based overseas; BP Solar is the technology provider, so the company knows what it is doing with the technology but has never done any large projects in Australia. So what they’re looking for in Pacific Hydro is our knowledge of how to work through planning parts of the projects, the community liaison parts of the project, the development and delivery expertise that we have here in Australia from having developed and delivered a number of wind farms and hydro projects. And our Australian ownership is a plus. We’re owned by 5 million Australian superannuates through the Industry Super Fund, so having that investment in Australia is a benefit to the country.

The Solar Flagships program is a wonderful opportunity. We think we have a strong bid and we hope that the Government will agree.

The proposed Australian carbon tax has been touted as a market signal for investment in renewable energy. Do you believe that the carbon tax, if legislated, will lead to an increase in wind farm investment across Australia?

The implementing of a price on carbon in Australia is important to start to transition the economy to a low carbon economy. It is not in the early years going to drive any new investment in renewables, because a carbon price of $20–30 is not reflective of the full cost of emitting carbon. It is effectively a lower price to help the economy, to avoid the shock as you bring it in.

In fact all the investment in the near-term that is put into renewables is a direct result of the RET. There is a slight offsetting in that if you introduce a price on carbon, then you’re able to reduce the price of the Renewable Energy Certificate. That is the basic form under which you are able to make the investment.

Until a price on carbon has reached the $50–70 mark, which is more representative of the real cost of carbon-related externalities, the RET is what will drive investment in renewables.

I’m really keen that people understand that putting a price on carbon at $20–30 does not drive investment in renewables. It puts a cost signal on the economy that starts to change the way people do things, and I think that’s really important, but you have got to have the RET as another measure on the side.

The International Energy Agency recently put out a report after having reviewed 70 countries, and it basically said that if you want to get bang for your buck and start to transition you need to put a price on carbon and you need alternative measures that drive renewables until your price on carbon is high enough to do it.

At the end of the day, what we seek is that all renewable energies have a level playing field, and that there is no such thing as an externality anymore; currently it’s not considered that we’re a mainstream industry. That’s what it needs to be to make a transition.

What is your ideal vision for renewable energy infrastructure in Australia?

Australia is absolutely blessed with renewable resources and just because we have a history of coal doesn’t mean we have to have a future of fossil fuels. There is no reason why Australia can’t transition; in fact it’s been shown that a transition to 100 per cent renewables is entirely possible as we have an abundance of renewable resources. The environmental and health benefits of that well exceed the costs of transitioning. I see a future where we are powered wholly by renewables in Australia, but I can recognise that where we are today to where I’ve just suggested is quite a big change.

How can Australia best position itself in the international renewable energy market?

I think that unless you have a vibrant industry here, then you really can’t play on the international market in any way. I think that programs like the Solar Flagships are very important; it’s an absolute step up for the country to do something like that because it immediately puts you on a world stage. If you’ve built the biggest plant in the world then people want to look at it, they want to know about it, ask questions about how you did it. It results in international interest in Australia’s ability to manage large-scale renewables.

At a broader level, if you create a vibrant industry here, then various things will get exported offshore. At a secondary level, you start to transition our economy – which is very emissions-intensive – to a low emissions economy, and in the future that is going to be important when you have a carbon-constrained world, and it’s going to be important that Australia has a low emissions economy because the country won’t be able to compete. The costs imposed on products here, the things that we just tend to dig up and export at the moment, they are going to lose value.

Australia needs to think a fair way ahead to be able to operate efficiently and have a strong vibrant economy relative to our overseas partners.