The Federal Budget includes $1.365 billion for a Solar Flagships program, which will seek to develop up to four individual solar generation plants on the national grid, totalling 1,000 megawatts by 2015.

“The Government plans to invest with industry in the biggest solar generation plant in the world, three times the size of the world’s current biggest, which is in California,” said Mr Rudd.

The Government will define the tender specifications for industry, with successful tenders to be nominated in 2010. To maximise the technology demonstration and learning benefits, the solar flagships will include up to four technologies – two solar thermal and two photovoltaic.

Clean Energy Council CEO Matthew Warren said “Australia is blessed with world class roaring 40s wind and is the sunniest continent on earth – we should be making the most of these clean energy assets.”

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Mr Warren said the endorsement of clean energy, like solar, and energy efficiency, by the government is the next big step toward developing the new green jobs market and reducing national greenhouse emissions.

The budget lays out $4.5 billion for its Clean Energy Initiative, representing about $3.5 billion in additional spending for clean energy measures.

The Solar Flagships program incorporates part of the Renewable Energy Demonstration Program (REDP). The first round of the $435 million REDP closed in April 2009, attracting applications from solar, ocean, geothermal, and biomass energy companies. A portion of this funding – $135 million – has now been transferred to the Solar Flagships program. The ocean, geothermal and biomass applications will be assessed for support from the remaining funds, while the most prospective solar applications will be further considered by Renewables Australia. All the REDP solar applicants will be able to participate in the Solar Flagships Program.

The government expects a single solar flagship project manager to manage the development and operation of the power stations as an integrated commercial enterprise. The government has said that storage will be part of the solar flagship projects, recognising energy storage technology as an important adjunct to solar generation, and enabling the capacity factor to be extended.

A further criterion in selecting companies and technologies to develop the solar flagship power stations could be their potential to develop manufacturing and export activities in Australia.