Participating in the energy market

Your renewable energy projects form a significant aspect of Queensland's energy strategy as part of the Powering Queensland Plan. Read about current initiatives, the energy market and how to connect to the electricity grid.

Solar and renewables projects

While we do not normally provide financial assistance to renewable developers, we have implemented specific programs to encourage growth of renewables in Queensland. Two of these projects are the Solar 150 program and the Renewables 400 program.

Solar 150 program

We are providing support to 4 large-scale solar farms by way of a long-term Contract for Difference. This will provide the projects with a guaranteed minimum level of revenue over the life of the project.

The Solar 150 program was implemented throughout 2016, and was instrumental in driving down the cost of solar in Queensland.

Renewables 400 program

In response to the recommendations of the Renewable Energy Expert Panel, we are in the process of running a reverse auction for up to 400MW of renewable capacity.

Under the Renewables 400 program, we are focusing on advancing renewable technology solutions that can support long-term system security, and will include a 100MW energy storage component.

Similar to Solar 150, successful bidders will be awarded financial contracts with the government for some or all of the electricity they generate.

Power purchase agreements

Although power purchase agreements (PPAs) have traditionally been used to manage the long-term revenue risk associated with renewable energy projects, we do not assist renewable energy developers in establishing or negotiating a PPA.

National Electricity Market

In the National Electricity Market (NEM), large-scale renewable generators generally receive 2 sources of income:

  • revenue from the wholesale pool market
  • revenue from the Large-scale Renewable Energy Target (LRET).

The NEM is a wholesale electricity market in which generators sell electricity and retailers buy it to onsell to consumers. Electricity cannot be stored easily, so the NEM works as a pool or spot market, where power supply and demand is matched instantaneously in real time through a centrally coordinated dispatch process.

Large-scale renewable energy target (LRET)

The national Large-scale Renewable Energy Target (LRET) supports the development of large-scale renewable energy projects through the creation of Large-scale Generation Certificates (LGCs) for each megawatt hour of generation by accredited renewable energy power stations.

Under the LRET, energy retailers are required to obtain and surrender to the Clean Energy Regulator LGCs proportional to the amount of electricity they purchase each year. This creates a market for LGCs and provides an additional revenue stream for renewable energy power stations.

Connecting to the grid

Most renewable energy generation projects will need to connect to a transmission or distribution network. Securing grid connection is usually a critical path item for projects as it can take many years to allow for the completion of connection studies and construction of network infrastructure. Network connection can also be a significant component of project costs.

To access the electricity grid, as a project proponent, you are required to liaise with either Powerlink Queensland (i.e. the transmission network) or Energy Queensland (i.e. the distribution network), depending on project location and size.

You should engage with these network businesses in the initial stages of your project's development, to ensure that the regulatory approvals process associated with both a connection application and development application are undertaken concurrently where possible.

Read more about connecting a renewable generator to the transmission network.

Read more about connecting a renewable generator to the distribution network.

Electricity licensing

If your renewable project has over 30MW generation capacity, you will need to secure a Generation Authority. This is issued by the Department of Energy and Public Works and authorises its holder to connect the generating plant to a transmission grid or supply network.

In order to secure a generation authority, you must apply in writing and pay the prescribed fee.

Read more about electricity licences, including guidelines for a generation authority.

Note: A generating plant with a capacity of 30MW or less does not need to apply for a generation authority.

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