Renewable energy advocates are urging the West Australian government to throw more of its weight behind rooftop solar and batteries, saying the state is running out of time to replace coal with large-scale green power projects.\u00a0<\/p>\n
In WA, the state government shields households from the immediate impacts of spikes in wholesale prices, but the more they happen, the more they can trickle down to bills.<\/p>\n
A complex market<\/p>\n
The ERA’s chair Steve Edwell said the Bluewaters blowout was part of an “increasing number” of electricity generators using their power in a concentrated market to charge higher prices than they should.<\/p>\n
Such behaviour is not allowed in WA as generators are only allowed to sell electricity to retailers, like Synergy, at-cost.<\/p>\n
But the Japanese-owned company said its pricing was necessary to ensure it could reliably power the WA electricity grid, and argues its market impact was only a fraction of the $30 million claimed by the ERA.<\/p>\n
“The alleged breaches relate to periods of time when Bluewaters faced coal and water shortages and was managing its generation,” a Bluewaters spokesperson said.<\/p>\n
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Bluewaters Power Station was the first privately-owned, coal-fired power station in WA. (Supplied: Sumitomo)<\/p>\n
Supply shortages can lead to reduced production capacity, which is often reflected in the market with higher prices.<\/p>\n
Bluewaters claimed the ERA had “misunderstood the relevant facts” and incorrectly applied the law.<\/p>\n
It follows another case earlier this year, where the ERA found Alinta had increased the cost of generation by $66 million over a similar time span, which the company is also disputing.<\/p>\n
One thing both the regulator and industry can agree on is the market, and the rules, have become increasingly complex with the uptake of renewable energy.<\/p>\n
Generators ‘take advantage’ of market<\/p>\n
Nationally, the Australian Energy Regulator’s (AER) last market report found electricity prices were staying relatively high despite increasing renewable generation, which is cheaper.<\/p>\n
Seven WA energy retailers overcharged customers, inquiry finds<\/a><\/p>\n Seven energy retailers in Western Australia has overcharged customers by taking automatic payments from closed accounts, an investigation finds.<\/p>\n That’s in part because some generators were withholding electricity from the market, which can artificially drive up prices.<\/p>\n “Participants can take advantage of market conditions to make significant financial returns,” the report said.<\/p>\n In a statement, an AER spokesperson said the practice of setting higher prices “cannot be false or misleading”, but was otherwise allowed.<\/p>\n “However patterns of this kind of behaviour could lead to inefficiencies in the market and may not be in the best interests of energy consumers,” the spokesperson said.<\/p>\n Cost of living concerns<\/p>\n The market behaviour noted by the AER is not allowed in Western Australia, where generators are only allowed to sell electricity to retailers at cost price.<\/p>\n Instead, they are paid to be available on demand, such as in times of high need \u2014 a sort of insurance policy in what’s called a capacity market.<\/p>\n Steve Edwell is chair of the WA Economic Regulation Authority Western Australia.\u00a0 (ABC News: Cason Ho)<\/p>\n Mr Edwell acknowledged the energy market was becoming increasingly complex with the onset of renewables, which may be contributing to some market breaches.<\/p>\n But he warned those companies still had to ensure they “only recover their legitimate costs”.<\/p>\n “It’s important that we pay no more than we need to, and that’s no more apparent than now with the cost pressures we’re all facing,” he said.<\/p>\n WA Energy Minister Amber-Jade Sanderson said it was not appropriate for her to comment on the Bluewaters case while it was being considered by the regulator, and did not respond to questions about reforms to regulation.<\/p>\n WA Energy Minister Amber-Jade Sanderson. (ABC News: Courtney Withers)<\/p>\n “It is my expectation that all generators operate lawfully to ensure customers are not disadvantaged,” she said.<\/p>\n<\/p>\n
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