The CIS (Capacity Investment Scheme) is supposed to deliver 40 gigawatts by 2030. Less than a single gigawatt has been finalized. There’s another 13 gigawatts in the pipeline.
The government has been subsidizing batteries for homeowners. They have been storing energy during the night and reselling them at periods of high demand. This has reduced prices in the afternoon/evening, and now the industrial wind plants are having trouble making money (despite being ‘cheap’ power).
Wind farm plans becalmed as Labor’s green scheme flounders
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The CIS has the lowest financial close success rate of any major renewable underwriting mechanism in Australia at just 17%, according to Rystad. “Many of the early winners were bid on yesterday’s economics and may never reach financial close without greater flexibility,” said Gero Farruggio, Rystad’s head of Australia.
The combination of high capital spending and subdued spot wholesale electricity prices has also kept the volume of overall power purchase agreements low, on par with two of the worst years on record in the early 2010s.
“Once the backbone of Australia’s energy transition, onshore wind is now being squeezed from every direction,” Mr Farruggio said. “Batteries have eroded the price premium that once underpinned wind economics, while construction costs have more than doubled and power purchase agreements have dried up.”
DB2