Australasian Science: Australia's authority on science since 1938

Solar Blockout

By Simon Grose

Governments have won big headlines for big money allocated to big solar projects – but kept the money.

Knowing that the government has allocated $1.5 billion for a Solar Flagships program to support “construction and demonstration of large-scale, grid-connected solar power stations” might make you feel we are getting serious about harnessing Australia’s solar resource. But when you know that the program was announced in 2009 and has yet to make a grant, you wonder what’s been going on.

Fifty-two bids were culled to a shortlist of eight. In June last year the 150 Mw Moree Solar Farm photovoltaic project and the 250 Mw Solar Dawn solar thermal project planned for Chinchilla in Queensland were picked as winners.

But for each get upwards of $300 million they need to get twice that amount from commercial and state government sources, and both failed to do so. Solar Dawn has been given until June to scratch it together while Moree Solar has been tossed back in with three other shortlisted projects “to demonstrate whether it is still the most meritorious project”.

This is a rerun of the experience of the previous government’s announcement of funding in 2006 for the 153 Mw Solar Systems project in the Riverina, which also failed to find the matching dollars.

It should be apparent that the matching funding model does not work for solar power. It may seem a worthy way to ensure that taxpayers’ money is invested in viable projects, but the commercial realities of the energy market and the rawness of the solar technologies on offer mean that no project is going to be viable – despite existing state and federal incentives and rebates and the looming price on carbon.

The planned Clean Energy Finance Corporation will likely make it worse. The government has said it will have $10 billion to spend, but not as grants. It will invest “in businesses seeking funds to get innovative clean energy proposals and technologies off the ground” and “is intended to be commercially oriented and to make a positive return on its investments”.

On that basis, and informed by the experience of the Solar Flagships program and its predecessors, not a lot of that $10 billion will make it out of Treasury’s coffers in a hurry. And hurry is what is needed when it comes to generating energy without burning fossil fuels.

If ever there was a “market failure” where the public purse should be opened for the common good of the nation, the large-scale solar market is it. Yet the government insists on imposing the “investment” model on the money it offers to this market while throwing $40 billion into the National Broadband Network to impose a new publicly-owned monopoly onto a market where there is no failure – just a lot of viable competitive players.

Me no get.

Simon Grose is a Director of Science Media (