Brumby Sells Us a Solar Crock, Just as Even Gillard Sees The Light

Posted on Sun 08/01/2010 by

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By Andrew Bolt

The Brumby Government, desperate for Greens preferences, last month promised to make Victoria use much more of one of the most expensive forms of power known to man:

Between five and 10 large-scale solar powerplants will be built across Victoria under an ambitious Brumby government plan. Premier John Brumby announced a target of 5 per cent of the state’s energy coming from solar farms by 2020…

“The policies we are releasing today will make Victoria by far the solar capital of Australia,” Mr Brumby said.

Wow. Up to 10 new plants…

including an existing proposal to build a station outside Mildura by 2015.

Ah, yes. The Mildura plant. We’ve had that promised by desperate governments before, of course, along with an insane amount of taxpayer money to make the unlikely happen. From 2008:

MOST of Mildura could be powered by solar energy following a $290 million agreement signed by TRUenergy and Melbourne-based Solar Systems for the world’s largest photovoltaic solar power station to be built in the north-west of Victoria.

Building of the $420 million, 154-megawatt power station starts next year… TRUenergy will provide $40 million to Solar Systems in exchange for 20% ownership. It follows the $50 million contribution from the Victorian Government and a $79.5 million by the Howard government in 2006.

A $420 million plant, propped up with $130 million in government handouts, plus laws to make consumers pay extra for its product. So what’s it’s worth now?

Rooftop solar panel manufacturer Silex Systems will pay $20 million for the remains of Solar Systems, the failed Abbotsford business behind a groundbreaking proposal to build a $420 million plant near Mildura.

The sale – conditional on agreement on the final contract – follows five months of uncertainty over the future of Solar Systems and its pioneering photovoltaic solar concentrating technology, after it went into voluntary administration last September. It shed more than 100 of its 150 staff.

From $420 million to just $20 million? Despite all that promised cash from the federal and state governments? And even then, Silex, the new owners, say this plant on which governments have bet so much cash in the hope of seeming green may not be a goer:

SSG’s solar technology is applicable to large utility-scale electrical power generation using its proprietary “Dense Array” concentrating photovoltaic (CPV) solar conversion technology… Following completion of the acquisition, Silex will conduct a 12 to 18 month technology commercialization program in parallel with business development and marketing activities, with the aim of commencing commercial project activities in 2011. This program could then lead to the construction of a 2MW pilot facility in Mildura (potentially a precursor to a ~150MW power station), pending confirmation of financial support from the Victorian State and Australian Federal Governments (see attached Supplementary Information below)…

As noted above, approximately $150 million has been invested to date in research and development activities, power generation projects, manufacturing plant and equipment, and business development activities. The assets to be acquired include … (a) development site and adjoining acreage (option to acquire) for a proposed 154MW solar power station project in Mildura, Victoria. This project potentially has the support (to be confirmed) of the Australian Federal Government ($75m in funding previously announced – refer Media Release –
25/10/06 at http://www.solarsystems.com.au) and the Victorian State Government ($50m in funding previously announced – refer same)….

Let’s sum up. The only one of the five to 10 solar plants “promised” by the Brumby Government over the next decade that’s even likely to be built has already lost the original investors $130 million, with the new investors refusing to commit to actually completing the thing. It will provide uncertain and very expensive power, but only after the Victorian and Federal Governments agree to stump up the rest of their promised $130 million in handouts.

But the Gillard Government is actually pulling money out of solar research, presumably on the grounds that this is an insane money pit. For instance:

THE Gillard government has stopped funding Australia’s solar research centre. The University of New South Wales’ Photovoltaics Centre of Excellence – where the multibillionaire solar entrepreneur Zhengrong Shi studied – recently lost funding under the federal government’s Australian Research Council grants.

In fact, Gillard thinks other useless and expensive mirages have more substance even than solar:

Old car owners will score a $2000 rebate if they buy a new fuel-efficient vehicle, under a “cash for clunkers” scheme announced by Julia Gillard today… The $394 million cost of the scheme will be financed by cuts in several other climate programs, including $220 million coming off the solar flagship program.

John Brumby is just one more green con man.

UPDATE

Reader David Archibald explains why Government shouldn’t be backing winners like this with your cash:

No wonder Silex’s share price has come off. Solar Systems’ technology was an ok project when it started, but thin film PV is now cheaper and much easier to scale.The Californians are financing big experiments in solar technology in their deserts (20% renewable requirement by 2012). If we were smart we would wait to see how those play out before building anything.One further thing. Victoria is too cloudy for solar. Your solar plants would be better located a few hundred km north in central NSW.

But even thin film PVC isn’t meeting its initial expectations.

Andrew Bolt is a journalist and columnist writing for The Herald Sun in Melbourne Victoria Australia.
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