Penny Wong (SA, Australian Labor Party, Minister for Climate Change and Water) Share this | Hansard source

I thank Senator Boswell for his question. He has consistently advocated for the interests of this particular company and I do have some information for him. The government has announced a redesign of the renewable energy targets to put in place two streams, as it were. One, a large renewable energy target, will give certainty to projects such as the one he is outlining. The second is a small renewable energy scheme which would enable small-scale householder type renewable energy products to receive support under the scheme.

In relation to the New South Wales sugar milling plants, I understand that when this project commenced the REC spot price was around $30—this was in 2005. I would again indicate that the price of these certificates—the RECs—is set by the market and depends on the supply of renewable energy as well as the demand created by the annual targets. I believe that the REC price on the spot market is currently around $40—I will check that but that is my recollection. I am obviously not aware of what contractual arrangements were entered into by the proponents of this project. If it is the case that the proponents have not entered into a long-term contract for the sale of renewable energy certificates outside the spot market this would obviously mean that they were more exposed to fluctuations in the spot price. I am advised that these plants in Broadwater and Condong commenced operation in late 2008. From the commencement of operations to mid-2009 the price of RECs on the spot price was between $40 and $50. I note that there have been some media reports that the plant’s difficulties are also related to lower than expected quantities of sugar cane trash being available for conversion. (Time expired)