Making wind energy dispatchable energy
Today our CEO, Andy Vesey announced a new product to give wind energy a way in which it can be contracted. That’s a big deal because the big problem for renewables is that energy generation is unpredictable, and that’s meant you can’t promise it will be available as a part of a forward contract.
The announcement of the National Energy Guarantee got us thinking though, how could we best provide dispatchable energy which also reduces emissions intensity, at least cost?
While the NEG has its detractors, we’ve been trying to think through how we can make it work, and with a little innovation we think it can.
There is an opportunity to bundle a firm and dispatchable energy source such as gas peaking generation with a non-dispatchable source such as wind, allowing wind to be a part of the contract market.
We didn’t want to wait for the NEG to be finalised so on Wednesday we offered a new product in South Australia and Victoria. It’s called a Wind Product Firming Unit and is listed by High Voltage Brokers via Reuters.
It means a wind farm can contract with us so that when they produce less energy than their forecast capacity and prices are high, we will give them the energy at the spot price, so they can still honour their contract.
It’s a swap deal that firms up variable supply sources to allow those sources to be contracted and we think it will help create liquidity in the market which is a key focus of the National Energy Guarantee.
We think it’s innovative and we think innovation is the only way to make a successful transition to a carbon constrained future.
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