Renewable energy generation increased sharply in 2016 on the back of a resurgent hydro sector. Overall, renewable energy supplied 17.3 per cent of Australia’s electricity throughout the year – enough to power the equivalent of almost 8 million average homes. It was a breakthrough year for the sector, with renewable energy providing the highest proportion of Australia’s electricity of any year this century.
It was a significant rise on the 14.6 per cent generated by renewables the year before, and much of the improved performance for the sector was delivered by a boost in hydro generation of more than a quarter (26 per cent) compared to 2015. The difference was improved rainfall in the dam catchment regions of Tasmania and the Snowy Hydro Scheme, which returned to more typical levels following several dry seasons.
Project activity was subdued, with only three new wind farms becoming operational along with seven solar power plants. The solar plants were relatively small, with the exception of Fotowatio Renewable Ventures’ (FRV) Moree Solar Farm, the second largest in the country, and Elecnor’s 25 MW Barcaldine Solar Farm. Almost all of these projects had additional support beyond the Renewable Energy Target, with two out of the three wind farms supported by the ACT Government’s reverse auction program and many of the solar farms attracting support from the Australian Renewable Energy Agency (ARENA). Consequently, the contribution of wind power to overall generation rose only modestly. Solar output rose 29 per cent during the year across small, medium and large-scale projects.
The fastest-growing sector of the solar market has been commercial systems between 75-100 kW, helping to push up the average size of solar power systems to 5.56 kW at the end of 2016. Commercial systems between 30-100 kW are particularly popular in the ACT, New South Wales, South Australia and the Northern Territory, where they make up about 30 per cent of sales.
Tasmania remained the leader in the use of renewable energy as a percentage of its power use, with renewable energy supplying more than 90 per cent of the state’s electricity, largely thanks to hydro. However, a damaged Basslink cable and low dam storages leading into 2016 meant the island used higher levels of gas – and also some diesel generation – to secure its energy supply than it had in the past. The higher rainfall over the winter months and the repair of the damaged Basslink cable in June helped the system to return to normal operation.
With the Northern coal-fired power station shutting down in South Australia for economic reasons, 48 per cent of the state’s electricity came from renewable energy. Wind power was the leading source of energy for the first time during 2016, delivering 40 per cent of the state’s electricity and just edging out gas-fired power. Given Northern did not shut down until May, it appears almost certain that renewable energy will end up delivering more than half of the state’s power during 2017, meaning the state’s target for renewable energy will have been met eight years ahead of schedule.