Australian Power Generation Companies to Boost Portfolios to Meet New Renewable Energy Targets

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Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--Under the new carbon tax system, Australia is expecting to generate billions of dollars in favor of renewable energy. Though the Clean Energy Plan will not come into effect until next summer, last year's mandatory Large-Scale Generation Target is likely to prompt Australian power companies to strengthen their renewables portfolios. Last year, renewable energy accounted for nearly 9% of the country's electricity production, though the new target aims to boost renewables to 20% within the next 10 years.

Currently, Industrial Info is tracking more than $34 billion in renewable energy projects throughout Australia, including solar and wind power, as well as hydro and geothermal. Wind power projects are the most numerous, accounting for approximately 70% of Australia's renewable energy projects. Solar and geothermal projects are also numerous, though more than 90% of Australia's electricity is derived from fossil fuels.

Two of Australia's largest electricity retailers are already boosting their respective portfolios, as are many of the country's other power generation firms. Approximately $2.4 billion in renewable energy investments tracked by Industrial Info are headed by AGL Energy (ASX:AGK) (Sydney), which is in the process of developing more than 900 megawatts (MW) of wind power projects. One of the companies largest investments, the $1 billion Macarthur windfarm in Victoria, is currently under construction and is due to be commissioned early in 2013.

Origin Energy (ASX:ORG) (Sydney) is not only boosting its wind power capacity, but is also seeking to tackle geothermal power as well. It is currently planning overseas geothermal power plants in tandem with Contact Energy (Wellington, New Zealand) in New Zealand and Tata Power Company Limited (BSE:500400) (Mumbai) in Indonesia, as well as with Energia Andina (Santiago, Chile) in Chile. Origin is also evaluating domestic options and is conducting appraisal drilling in Cooper Basin. However, one of Origin's most important renewable energy endeavors is the 417-MW Stockyard Hill windfarm scheduled to commence late next year in Victoria. Origin is considering the development of more than 3,000 MW worth of wind power projects throughout Australia.

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