The Solar Tower  

Enviromission have recently announced that they have decided on a site for the solar tower they are building near Mildura. I've always thought this was something of a pipe dream, given the staggering cost, but they seem to be steadily progressing.

The mammoth project, worth hundreds of millions of dollars, will be built by the end of 2009.

The reinforced concrete tower will cover approximately one square kilometres at its base and will be surrounded by a "greenhouse" of glass, polycarbonate and polymer. Air at 30C at the edge of the glasshouse is heated up to 70C at the centre, where the tower draws it through 32 turbines to the cooler air above.

The power station will produce up to 200 megawatts of electricity and can generate 24 hours a day.

Enviromission floated on the Australian Stock Exchange in 2001. Its major investor is the owner of the solar tower technology, US company SolarMission Technologies.

Enviromission has the exclusive Australian rights to the technology, first developed on a much smaller scale in Spain in the early 1980s, using a German design.

One thing I've noticed with all the green energy projects going on in Australia is that they all rely heavily on a Renewable Energy Certificates (RECS) price of around $40 per MWh (for example, look at this report on Geodynamics, a geothermal energy company looking to build a 275MW plant this year).

The volume of RECS that need to be purchased each year is dependent on the Mandatory Renewable Energy Target (MRET) defined by the Federal government. RECS are created by renewable energy generators, such as hydro-electric plants, wind farms, bagas plants, tidal generators, biomass generation, solar generation etc and then sold to wholesale electricity generators so that they meet their renewable energy generation requirements defined by the MRET.

The total volume of renewable energy required to be generated rises from 300Gwh in 2001 to 9500Gwh in 2010, which by my rough calculations is equivalent to a 1084MWh plant operating full time (which would supply a fairly pitiful 3.5% or so of the market). [any corrections to these numbers would be gratefully accepted]

I've yet to see any analysis of the total renewable generation capacity that is planned to come online over the next 5 years, but if the 2 projects mentioned earlier actually work, they would supply almost half of the MRET target.

If by some miracle my arithmetic is correct, it seems likely that we'll have more RECS available than companies are required to buy, which doesn't look good for the prices that the financial assumptions are based on.

Of course, a change in government at the next election could well result in an increased MRET requirement, which would solve this particular problem, as well as contributing to dealing with some thornier issues.