Registering LGCs from small power stations pdf

 Information Sheet
Registering LGCs from
small powerstations
This information sheet describes some of the key considerations associated with the creation of
Large-scale Generation Certificates (LGCs) for power station owners and developers. Green
Energy Trading is an experienced creator of LGCs and is available to facilitate this process.
Please do not hesitate to contact us for further information.
Background
On 1 January 2011 the enhanced Renewable Energy Target (RET) came into effect. This change
split the existing RET framework into two separate schemes; the Large-scale Renewable Energy
Target (LRET) and the Small-scale Renewable Energy Scheme (SRES).
The LRET target is 41,000 gigawatt-hours (GWh) by 2020 generated from any renewable
generation facility registered as an accredited power station, under the Renewable Energy
(Electricity) Act 2000.
The SRES is an uncapped certificate scheme for smaller renewable systems. Only small-scale
solar PV, small wind and micro-hydro systems are eligible to create small-scale technology
certificates (STCs) up-front under the SRES.
Table 1. Systems capacities eligible for STCs (installed from 14 November 2005)
Technology
Rated system capacity
Total annual electricity output
Solar PV
no more than 100 kW
less than 250 MWh
Small Wind
no more than 10 kW
less than 25 MWh
Micro-hydro
no more than 6.4 kW
less than 25 MWh
Where a renewable generation system is not a technology listed or is above the capacity and total
annual electricity output listed in Table 1, the system must register as a power station under the
LRET.
A registered power station can create large-scale generation certificates (LGCs) retrospectively,
based on actual generation. An LGC represents one megawatt hour (MWh) of net renewable
energy transmitted to electricity consumers, through a suitable grid. Unlike Small-scale
Technology Certificates (STCs), which are created upfront for 1, 5 or 15 years of deemed energy
production, LGCs can only be created for renewable energy once it has been generated.
Our services
As the Australian renewable energy market continues to evolve, small power stations are
becoming an increasingly attractive option for renewable energy suppliers and developers.
Green Energy Trading Pty Ltd
ABN 21 128 476 406
2 Domville Avenue
Hawthorn VIC 3122 Australia
T 1300 077 784 | +61 3 9805 0700
F +61 3 9815 1066
[email protected]
greenenergytrading.com.au
Rewarding sustainable choices
Part of the Green Energy Group
Green Energy Trading is now offering services, which cover every aspect of the LGC creation
process. Our services, enables our clients to utilise our experience and expertise in the renewable
energy regulatory environment and the LGC market. Green Energy Trading will alleviate you of
your compliance burden, allowing you to concentrate on your core business.
Services provided by Green Energy Trading include:
•
Registering power stations with the Clean Energy Regulator
•
Creating LGCs produced by the power station
•
Conducting performance monitoring of the power station
•
Acting as primary contact point of contact with the Clean Energy Regulator
Registering as a power station with Green Energy Trading
The process starts with the system owner nominating Green Energy Trading as the registered
person responsible for the power station’s certificate account. With the provision of necessary
information and data from the system owner, Green Energy Trading will apply to the Clean Energy
Regulator for the accreditation of the power station with the RET/LRET scheme. Data required to
complete this registration includes:
•
Basic station profile
•
Details of the metering system, electricity transmission and use
•
Certificate calculation methodology, taking into account energy losses, auxiliary use etc
•
Details of project approvals
•
Generation projections
Once accredited and operating, the system owner is to provide Green Energy Trading with
metering data on a quarterly or biannual basis, or other basis as required. Green Energy Trading
will create certificates from each data set, and ensuring compliance and accuracy, will register the
certificates with the Clean Energy Regulator. The system owner will be paid for the certificates
created when they have been approved and registered with the Clean Energy Regulator.
Green Energy Trading will also be responsible for submitting the Annual Electricity Generation
Return by 14 February each year for renewable generation in the previous year. The system
owner must provide Green Energy Trading with metering data and details of electricity generation
and use required to complete the Return.
LRET liability
Under the legislation, liable parties must purchase LGCs based on the Renewable Power
Percentage (RPP) and the amount of energy they sell or consume. LGCs can be purchased
through contracts between the liable parties and certificate creators, or through the over-thecounter wholesale market.
LGC prices
Like any other commodity market, the supply of certificates available to the LGC wholesale market
at a given time and the demand for certificates at that time determines the LGC price. It is only
though trades on the wholesale market that the true value of the certificates is transparent to the
entire market. The slow rate of commitments for new large renewable energy projects means an
undersupply of LGCs could occur in the foreseeable future.
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Worked examples
An LGC can be created for every whole MWh of renewable energy generated above a power
station’s baseline and delivered to an electricity network or an equivalent point of use. The LGCs
created by a power station will not equate precisely to every MWh of renewable energy generated;
an adjustment must be made for electricity consumed in the generation process or during
maintenance as well as for transmission losses.
The formula to calculate LGCs is:
TLEG is – (FSL + AUX + (DLEG x (1 – MLF))
Where:
1.
TLEG
is the total power in MWh generated by the power station
FSL
Fossil fuel component of the power generated by the power station
AUX
Auxiliary power consumed during production or maintenance
DLEG
eligible generation exported to network (TLEG – FSL – AUX)
MLF
Marginal Loss Factor (determined by NEMMCO)
1
In the example of a photovoltaic power station, electricity consumed by the inverter is considered to be auxiliary
losses.
The following calculations are examples of 100 per cent solar farms with no fossil fuel component.
Example 1
A developer plans to install 150 kW of PV in Baroota, South Australia. The average daily
production for PV in that region is approximately 4.2 kWh per day, so the annual energy expected
to be produced for a 150 kW array would be 229,995 kWh. The Marginal Loss Factor in that area
is 0.9834 and they expect to use 2.5 MWh in the process of production and maintenance.
So if:
TLEG
is – (FSL + AUX + (DLEG x (1 – MLF))
TLEG
= 229.95
FSL
=0
AUX
= 2.5
MLF
= 0.9834
DLEG
= 229.95 – 0 – 2.5
And:
= 227.45
Then:
LGCs
= 229.95 – (0 + 2.5 + (227.45 x (1 – 0.9834))
= 229.95 – (2.5 + 3.76)
= 223
2
2.
LGCs are rounded down to the nearest integer.
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Example 2
A developer plans to install 1.5 MW of PV at a factory site in Ingleburn, New South Wales.
Average daily production in that region is 3.9 kWh across the year so a 1.5 MW system would
expect to create 2,135.25 MWh per year. Of this total generation, 1,200 MWh is consumed onsite
by the factory.
The Marginal Loss factor for transmission is 1.0006. They expect to use 30 MWh through
production and maintenance.
So if:
TLEG
– (FSL + AUX + (DLEG x (1 – MLF))
TLEG
= 2,135.25
FSL
=0
AUX
= 30
MLF
= 1.0006
DLEG
= 2,135.25 – 0 – 30
And:
3
= 2105.25
Then:
LGCs
= 2,135.25 – (0 + 30 + (2105.25 x (1 – 1.0006)))
= 2,106
3.
4
Although a portion of generation is consumed on site, this electricity still considered to have been delivered to an
electricity network. Consequently the Margin Loss Factor adjustment is applied to this portion of generation.
4.
LGCs are rounded down to the nearest integer.
About Green Energy Trading
Green Energy Trading is a leading, independent environmental certificate agent and clean energy
market advocate. We strive to make clean energy options more accessible to Australians by
enabling access to available financial incentives and affordable finance options.
Contact us
For more information:
T 1300 077 784 | 03 9805 0700
F 03 9815 0166
[email protected]
greenenergytrading.com.au
The information in this document is believed to be accurate at the time of writing and we do not guarantee the accuracy of any information
or data contained and accept no responsibility for any loss, injury or inconvenience sustained by users of this document.
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