Energy cost fight goes on

The Agriculture Energy Taskforce reaffirmed its commitment of a 16 cent maximum ceiling for electricity costs. Picture: FILE

By Aaron Goodwin

The Agriculture Energy Taskforce met to hear from key leaders as part of energy transition in Australia and to work through opportunities for agriculture industries, relating to the roll out of technologies, with a focus on regulatory costs for the agriculture sector.

The cost of energy over recent years has caused significant impacts on the ability of Australian farmers to produce food and fibre at a sustainable cost, particularly in the operation of pumps for irrigation, cooling for storage and processing and packaging for many industries.

The Taskforce reaffirmed its commitment at the meeting in supporting the target objective of a medium to long term price capped at eight cents per kilowatt-hour for the electrons (R) and a similar ceiling of eight cents per kilowatt-hour for the network (N).

The Ag Energy Taskforce was established in September 2014 to advocate on behalf of Australia’s agriculture sector, to alleviate the impact of high electricity costs on the agricultural sector.

National Irrigators’ Council Energy Committee Chair Dale Holliss said for a long time the taskforce has advocated for a 16 cent maximum ceiling for electricity costs.

”That’s because coal costs around four cents a kilowatt to produce retail and to make a reasonable margin, we think a ceiling of eight cents is enough,” Mr Holliss said.

”Similarly in Ergon’s case we’ve actually had a lot of investigations into how much it costs them to run the network, the entire state runs a network for around eight cents per kilawatt.

”Having Dr Finkel confirm that our calculations are pretty much spot on, was something we took great comfort from, after advocating for it for a very long time.

”Here in Queensland, we’ve had some tariffs negotiated with Ergon which suit irrigators, that are below that 16 cent threshold.”

Advocacy work from bodies such as the Queensland Farmers Federation, CANEGROWERS, Cotton Australia and the Bundaberg Regional Irrigators Group has seen electricity costs improve for irrigators.

”In some cases it is a reality that we have some tariffs that are below that 16 cent threshold,” Mr Holliss said.

”It’s continual advocacy with the Queensland government as the 100 percent owners of Ergon and some other electricity providers.

”With sugarcane we need six-eight megalitres per hectare of applied irrigation on an annual basis.

”When electricity prices are too high that’s a limiting factor and it means a lot of growers can’t afford to put anymore on then say three.

”At the higher levels we are looking at production levels of between 100-140 tonnes per hectare.

”At lower production levels we are looking at 80 tonnes per hectare.”

A key guest at the meeting, Dr Alan Finkel, Special Adviser to the Australian Government on Australia’s Low Emissions Technology, spoke to issues relating to the Technology Investment Roadmap and its role in achieving lower emissions and driving down energy costs.

Dr Finkel indicated that the 8 cents and 8 cents target set by the Taskforce appeared to be a reasonable cost and suggested that on average during the year, industries might be able to achieve that.