Tripling electricity interconnector would lead to cheaper power prices, Chief Scientist Dr Alan Finkel says

AUSTRALIA’S Chief Scientist has a plan that he says would boost the state’s access to electricity — and see soaring power prices drop.

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AUSTRALIA’s Chief Scientist has recommended tripling the electricity interconnector links between South Australian and Victorian power grids to tackle soaring utility prices.

It follows alarming spikes in power prices and a courtroom victory by power companies over the price-setting method.

Dr Alan Finkel, who took over as Chief Scientist at the start of the year, said “doubling or tripling” the connectors between Victoria and South Australia “would be a good thing to do” to address rising energy prices.

“(Government and industry has) to invest in better connectors between Victoria and South Australia so that if they go into the doldrums and don’t have wind — they’re becoming quite reliant on large amounts of wind electricity on good days — they can purchase it effectively,” he said. “They’ve been caught out.”

Energy Minister Tom Koutsantonis said “the entire Australian market would benefit from greater interconnection” and that “this is not a uniquely South Australian issue”.

The Australian Energy Regulator published in December that power prices in South Australia were at least 50 per cent higher than in any other region.

It estimated that interconnectors will supply 23 per cent of the state’s electricity generation in 2018, up from 13 per cent in 2015.

Doubling or tripling the electricity interconnector between SA and Victoria would lead to cheaper power, Dr Alan Finkel says.

Interconnectors send power generated in Victoria to South Australia, or vice versa, in exchange for a transmission charge.

The major interconnector with Victoria, owned by ElectraNet, is being upgraded.

Rainer Korte, ElectraNet’s executive manager for asset management, said his company was assessing the viability of further expansion.

“Increased interconnector capacity can help alleviate market price and address system security concerns from higher renewable concentration in South Australia,” he said.

Alinta is closing its Northern Power Station in 2018 and AGL will mothball Torrens Island Power Station in 2017, reducing the state’s power generation.

Liberal energy spokesman Dan van Holst Pellekaan said while it might sound appealing to just invest in or upgrade an interconnector, “it is very important to determine what the cost of that upgrade would be, how much electricity would come through and what would the impact possible be on the final price of electrify.”

“You need to weigh up the cost of the upgrade of the interconnector versus the cost of installing more generating capacity,” he said.

Mr van Holst Pellekaan called for the Government to carry out market impact statements before any more thermal wind projects are approved.

Mr Koutsantonis said the opposition’s “hesitation” on renewables “reveals a lack of commitment to tackling global warming”.

Electricity companies last week won a court battle against the Australian Energy Regulator.

As a result bills are likely to increase in NSW by between $100 and $300 and SA Power Networks confirmed that local bills would also rise but could not say by how much.