The Victorian state Labor government has moved to break away from national electricity supply rules, hoping to short-circuit the bureaucracy keeping the state reliant on a 1960s-era energy grid.
The Labor government has said it will walk away from sections of the National Electricity Rules, leaving Victoria free to move quickly to upgrade obsolete electricity lines and fast-track projects such as giant batteries.
Energy Minister Lily D’Ambrosio told The Age newspaper the state’s ageing “transmission” equipment, poles, wires and other infrastructure that moves power around, was preventing lower-cost clean energy from wind farms and other renewable projects from getting to homes and businesses.
Ms D’Ambrosio said the state could not break its dependence on the ageing and unreliable coal-fired generators of the Latrobe Valley without new transmission equipment.
However, she said upgrade efforts have been bogged down for years in some cases in the Australian Energy Market Commission’s (AEMC) processes.
Labor moved in state Parliament today to amend the National Electricity (Victoria) Act 2005, giving the state the legal power to get started on projects without waiting for permission from the AEMC.
Ms D’Ambrosio said the vulnerability of the national energy network had been starkly revealed in recent months, with Victoria, New South Wales and South Australia narrowly avoiding load-shedding in late January.
The minister told The Age extreme heat was driving greater demand while the coal-fired stations grow older and less reliable.
The transmission system was vulnerable to bushfires and severe weather events, Ms D’Ambrosio said, such as the mini-tornado that brought down the Heywood interconnector this summer.
Meanwhile some of the new wind farms in Victoria’s north west were running at half capacity because the transmission system could not handle all the power they are capable of producing.
Another six projects in Victoria or southern NSW have been told by the National Energy Market Operator (NEMO) to wait nine months or more before they can be connected to the grid with the investment uncertainty prompting some renewable energy firms to walk away from the sector.
However, Ms D’Ambrosio said her reforms would speed up plans to get renewable energy moving.
She said the first project off the drawing board would be a boost to the capacity of the Victoria-New South Wales interconnector, which allows the two states to share electricity, probably with the construction of a giant battery capable of storing enough power for thousands of homes.
The minister told The Age Victoria was walking away from rules that had let the state down.
“The existing national energy laws have let us down, they have failed to drive investment in our electricity system or provide a 21st century grid for all Victorians,” Ms D’Ambrosio said.
“These reforms will help keep our energy system resilient as we face hotter summers, longer bushfire seasons, and increasingly unreliable coal-powered generators.
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