N E W S D NSW W F P G: Policy, Planning Systems and Reform

14 March 2012 Policy, Planning Systems and Reform Department of Planning and Infrastructure GPO Box 39 SYDNEY NSW
2001 By Email innovation@planning.nsw.gov.au
To Whom it May Concern
NEW ENGLAND WIND SUBMISSION ~ DRAFT NSW WIND FARM PLANNING GUIDELINES
Please find below New England Winds submission to the proposed new NSW Wind Farm Planning Guidelines. This is presented with an Executive Summary together with our detailed submission. Our submission is particularly focused on how the proposed Planning Guidelines affect community renewable energy initiatives such as New England Wind. Further background information regarding the community renewable energy sector is detailed in the Appendix. New England Wind has a vision to establish NSW's first community-owned wind farm and in so doing make a significant contribution to the long-term energy and economic selfsufficiency of the region, particularly by providing affordable renewable energy and associated local investment returns, employment and business. The recently completed feasibility study shows overwhelming community support for renewable energy in the New England and by way of comparison almost no support for coal or gas (conventional or unconventional). More than 100 landholders have offered to host wind turbines on their properties for the community wind farm. New England Wind follows and builds upon the very successful $6.5m Farming the Sun community solar project which won a NSW Green Globe Award for Sustainability 2011 and which resulted in a large increase in the uptake and awareness of solar systems ~ power, hot water and heating/cooling systems ~ in New England.
NEW ENGLAND WIND is a partnered community enterprise of Starfish Enterprises Network Limited PO Box 991 ARMIDALE NSW 2350 | ABN 26 150 552 962
www.newenglandwind.coop
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New England Wind is focussed on establishing an initial community wind farm of 8-10 turbines (12-15MW equivalent) requiring $30m in capital. This is to be raised equally from community investors, professional investors and debt finance. We see that the community energy sector warrants specific attention in the Wind Farm Planning Guidelines as it will underpin community understanding of and support for both clean energy policy and the roll out of clean energy infrastructure. The economic and social benefits of these projects are significant and will play a vital role in building the broad social licence for renewable energy development. Please feel free to contact me should you wish to discuss our submission further or require any additional information. Sincerely yours
Adam F Blakester Project Director | New England Wind www.newenglandwind.coop Executive Director | Starfish Enterprises Network adam@starfishenterprises.net | 02 6775 2501 | 0419 808 900 www.starfishenterprises.net
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EXECUTIVE SUMMARY
New England Wind compliments the NSW Government for presenting a clear and thorough set of proposed planning guidelines for wind farms, and welcomes the continued commitment to the 20% Renewable Energy Target and development of a NSW Energy Strategy. The length of time that has been provided to consider and comment on these guidelines has been good, as were the public presentations which provided opportunities to meet directly with planning personnel. While the increased levels of transparency and opportunities for community input into these developments is a positive policy direction, proposed regulations create unfair and inequitable restrictions for wind development in comparison to other energy developments.. There are valid reasons to be concerned that this lack of balance could drive wind farm development out of the state, undermine regional economic development and further increase electricity prices. New England Wind is particularly concerned about the impacts these overly onerous restrictions could have on the critically important community renewable energy sector. This sector is widely recognised for its significant role in regional economic development, energy security, community building and in turn social license for large-scale commercial wind and energy development. We recommend the following changes for consideration: Exemption of community-scale wind farms (less than $30m) from the Community Consultative Committee requirements; Development of specific NSW Government policy to enable community-scale and community-owned renewable energy infrastructure; Consistent application of noise limits with other energy (and other) developments, and removal of requirements regarding low frequency noise; and, Replacement of the 2km set back with a merits-based process that ensures the siting of turbines takes into account real and legitimate effects only.
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DETAILED SUBMISSION
Case for Community-Scale Renewable Energy Development
Community-scale renewable energy (CRE) development is significantly different to commercial development (see Appendix for more details). CRE is characterised by being organised by local investors, landholders, community members and stakeholders where they design their renewable energy development in a way that is acceptable and desirable for their needs and requirements. This form of development can play a critical part in building community understanding and support which in turn are key ingredients to social license ~ which is significantly harder to establish with commercial developments in the absence of community ownership and structures, or with undesirable energy developments such as coal and coal-seam-gas. More than 90% of wind farms in Germany are owned through CRE structures. Over the last three years a range of large surveys and research throughout the New England Region have identified overwhelming public support for renewable energy, particularly wind and solar. By way of contrast these surveys have confirmed almost no public support for coal or gas (either conventional or unconventional). The Guidelines ignore the significant opportunities presented by CRE, which can create thousands of regional jobs and hundreds of millions of dollars in regional investment. There is a very real concern that this planning process is both too costly and too uncertain. This could be prohibitive to CRE and potentially lead to commercial wind developers moving outside NSW (and Victoria). The most devastating effect will be on small-scale projects that potentially provide the greatest benefit for local communities.
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Case for Wind Power

Wind power is all but essential to cost-effectively meeting the agreed NSW Government renewable energy target of 20% by 2020. Wind is the most affordable and commercially viable renewable technology available today. South Australia demonstrates the cost-effectiveness of wind power in achieving this target, with over 20% of their energy generated in 2010/11 from wind power. At the same time their greenhouse gas emissions have declined by 20% since 2005/06 and their wholesale price of power has also declined.
Illustration 1: Say Yes2renewables ~ Friends of the Earth
Inhibiting wind power development could further drive up NSW electricity prices. For example, modelling by Bloomberg New Energy Finance predicts the restrictions imposed by the Victorian Government on wind farm development could force up the price of electricity for Victorians by up to $2 billion over the next decade. At the very same time, without strong growth in renewable energy NSW greenhouse gas emissions will continue to rise and to contribute to global warming ~ which creates extreme risks which also require application of the 'precautionary principle' (to continued expansion of fossil fuel development, dependency and usage) as much as this principle is being applied to poorly justified concerns against wind farms.
Unfair & Inequitable Guidelines

The Draft NSW Wind Farm Planning Guidelines detail a rigorous range of requirements for wind power which are more onerous than other energy developments, such as coalfired power stations, coal mines or coal-seam-gas, and in so doing setting a precedent which is both unfair and inequitable.
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The combined effect of these guidelines could be potentially prohibitive in terms of additional cost and uncertainty and result is lost affordable renewable energy development throughout regional NSW. The recent Victorian survey by Essential Media found 76% believed the state government should cut emissions and not leave it to the federal government to take action through a carbon tax or other steps, and just 22% of voters considered wind farm laws that give households right of veto over turbines within two kilometres of their house fair (50% said the laws were not fair.)
Noise
The proposed noise limits are significantly more stringent than those required for other formed of development (energy and others) and significantly more stringent than limits required for wind farms in other Australian states and overseas. To quote the Guidelines: The criteria are the most stringent in Australia and amongst the most stringent in the world. They are approximately 5 to 10 decibels lower than most European countries allow. Victoria, South Australia, New Zealand and night-time European standards are 40dBA, 3.2 times the acoustic power. The US and Netherlands standard is 50 dBA. Existing NSW Department of Planning acoustic amenity standard for rural areas allows 45 dBA at night, ten times the acoustic power of the proposed wind noise standard. The proposed inclusion of low frequency noise is problematic ~ both in terms of predictions during the proposal stage and measurement when the wind farm is operational. According to Marshall Day Acoustics low frequency is typically not a significant feature of wind farm noise. There is significant uncertainty associated with prediction of low frequency noise. It is particularly problematic to measure low frequency noise in windy environments, and indoor noise measurement requirements introduce a range of complications by way of interference with indoor devices (such as fridges and freezers as shown in the below diagram) which create competing low frequency noise.
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2km Buffer Zone

Under the proposed guidelines the consent of all residents living within a 2 km radius of a wind farm will be required. Otherwise a very complex and costly consultative process must be undertaken, a process that could take months and which could be prohibitive for small-scale projects and might discourage large investors. Importantly, the 2km buffer zone is likely to be more onerous than even the stringent noise criteria in most cases, creating an unnecessary duplicate standard. Distance is not the best criterion to use for measuring noise from a wind turbine. Topography, vegetation and wind direction are also important. The set limits on noise levels make it unnecessary and confusing to also have large buffer zones.
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The 2km setback is an arbitrary distance that bears no relation to actual visual or noise impacts of a wind farm and this is even recognised in the guidelines themselves. The proposed strict 35dB noise limit proposed is depicted in Figure 2 of the Guidelines (copied above for reference) on conservative estimates to typically be reached at less than 1.5km from the wind farm. Further, the notes to Figure 2 state In NSW noise setback distances typically vary between 0.8 1.5 km due to project and site-specific factors such as turbine configuration, design, intervening topography and vegetation. It is proposed that a merits-based process be used instead to ensure that the siting of turbines takes into account real and legitimate effects only. By this it is meant that objective assessments of measurable sound levels, changes to visual amenity and so on form the basis of decision-making.
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Onerous Community Consultation Processes

The community consultation process is again more rigorous than for coal mines, coalseam gas or minerals processes. The process is both lengthy and costly. This is another example of regulation that is inequitable and contributes to making renewable energy less competitive. For example, the increased Public Exhibition period (a minimum of 60 days, rather than the statutory 30-day period) and additional consultation for Site Compatibility Certificate through the Gateway Process. The requirement to establish a Community Consultative Committee (CCC) early in the process increases the up-front costs of development, particularly during the challenging 'at-risk' stage of capital raising. In contrast the NSW Strategic Land Use Plan gateway process doesn't apply before or during exploration, leaving areas completely unprotected until very late in the process, and provides means for the NSW Cabinet to over-ride the gateway process. Any increases to the up-front development costs, such as the CCC, will be a significant inhibitor for community-owned wind farms (see the Appendix for further details). It is strongly recommended that community-scale development (below $30m) be exempted from the CCC requirement.
Public Health Concerns

The involvement of NSW Health (with applications able to be referred to the Ministry of Health as part of the assessment process) is another instance where the proposed planning rules for wind farm developments will differ to other energy developments. While the guidelines state this is to adopt a precautionary approach to the consideration of health issues, which has been developed in consultation with the NSW Ministry of Health, this is in contrast to the now public briefing from NSW Health to the NSW Ministry advising that fears wind turbines make people sick are not scientifically valid. Wind farms have no demonstrated health effects. Internationally, 17 major reviews of evidence find no link between wind farms and physiological health problems. By way of contrast there are well evidenced public health impacts from fossil-fuels through local pollution and climate change contributions. For instance, the US Center for Health and the Global Environment have applied full cost accounting to the coal industry and identified USD1/3rd Trillion in externalised costs borne by the public and taxpayer system (which is the equivalent of 18c/kWH). These costs include health
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problems in mining communities and pollution around power plants, such as elevated rates of cancer, respiratory and other illnesses, environmental damage, lost tourism opportunities and climate change. The NSW Strategic Land Use Plan does not apply these health precautions for most small communities from dangerous coal dust, setting dust limits only at Narrabri and Gunnedah. In light of the above reasons it is our view that the Draft NSW Wind Farm Planning Guidelines should be seriously reviewed and revised to ensure that the opportunities for wind power, particularly community-scale and community-owned models, are fully realised for NSW and its residents.
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APPENDIX ~ ABOUT COMMUNITY RENEWABLE ENERGY

What is Community Energy?
Community energy projects (CRE) are distinguished by being organised by local people as well as frequently being majority or wholly owned by locals. This approach brings immense social license and support and a very different dynamic to development by external parties, including government. CRE projects empower communities to play a constructive role in addressing their own energy requirements and responding to issues such as rising power prices, regional economic development and climate change. They embody leadership by example, provide social cohesion and a sense of control over their energy requirements as well as lasting economic benefits for regional communities. Key elements of community energy projects include: local participation in planning and ownership financial benefits remain in the area being welcomed by the local community built and managed to create local jobs and business opportunities are accountable to the local community are scaled to the communitys energy requirements. increase awareness and education about renewable energy
Importance & Benefits

Although community ownership of renewable energy projects is a relatively new concept in Australia, it is common practice in several European countries and North America. Empowering communities to be proactive in regional development, energy selfsufficiency and reducing carbon emissions Direct ownership changes attitudes at the local level, and leverage committed individuals in a community, giving them a positive outlet for action Community ownership increases support for additional climate change mitigation measures and improves broader environmental awareness by establishing a connection between the community and its energy supply Delivering regional economic benefits Projects create jobs in regional areas, and generate new income streams for communities adding depth and resilience to local and regional economies Significant project profits remain in the community and deliver a genuine felt benefit
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Hepburn Wind & Embark

Hepburn Wind is Australia's first communityowned wind farm. They have almost 1,900 members, mostly local to the area, who have invested a total of almost $10m to build the wind farm. They see their community as a beneficiary of renewable energy, and not, as some elsewhere fear, a victim. Being a community co-operative has meant there has been effective engagement across the community and significantly reduced divisiveness which has beset many larger corporate wind farms. Hepburn will generate $25m income during the course of its operations, of which $1m will be directly invested back into the community through their fund, plus 'better than bank' returns to the community investors. The operation employs 3 people directly and a range of businesses for services, with more than 40 skilled up as part of the development process. The Hepburn Model holds massive potential for hundreds of Australian communities, while offering regional communities employment and local investment opportunities. It is in this vein that Embark has been created, to support community renewable energy across Australia. Nearly 50 other communities are working towards the goal of establishing their own community renewable energy.
Tapping into a New Funding Source The Community Investor

Community ownership encourages greater investor base diversity and taps into a new and lower-cost source of capital. Experience in the UK demonstrates that community projects tend to attract serial investors, who invest in a series of community related initiatives. Community investment can add leverage to private and public investment in energy infrastructure.
Enduring Social Benefits

Locally-owned initiatives unite people around a common goal, creating social cohesion and a sense of purpose. Projects generally operate for 20-25 years, establishing a long-term sustainability dialogue with stakeholders and supporters. Building social licence and accelerating renewable industry development
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Once successful local examples that directly benefit communities are established, opposition to renewable energy will be reduced. Local participation and contribution to decision making process often leads to smoother and quicker planning approvals. Small projects often lead to large ones. In Europe, community initiatives have led the way for large-scale corporate investment in renewable energy. A 2004 study by the U.S. General Accounting Office found that local ownership of wind farms generates an average of 2.3 times more jobs and 3.1 times more local dollars compared to absentee ownership.
Bridging the Gap Between Individual and Corporate Action

The average rooftop solar installation delivers up to 1.5 kW of electricity, while a large-scale renewable energy project may deliver in excess of 100 MW. Between these two extremes lies an enormous opportunity for medium-scale initiatives. Community projects, typically in the range 1-20 MW, can deliver efficiencies that approach those of utility-scale infrastructure without sacrificing the social benefits of small-scale initiatives.
Delivering Broader Grid Benefits

Community renewable energy infrastructure promotes medium-scale distributed generation. Distributed generation reduces losses, can improve grid stability and reduces the load on the transmission network, thus improving overall grid efficiency.
Barriers
Despite high levels of interest, the passion of committed individuals and promising business models, very few communities have yet progressed renewable energy projects past the conceptual phase. Specific barriers include:
Economics Financial challenges are heightened for communities as these types of projects do not have robust balance sheets to support the formation stages of the project. Capacity for a community to weather uncertainty and withstand shocks or delays during a project can be lower. Access to capital, particularly the critical up-front at-risk capital. Traditional equity and debt providers are reticent to commit funds as the community renewable energy sector does not yet have a long established track record in Australia. Institutional investors avoid smaller, one-off projects because due diligence
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requirements are proportionately high. Non-Traditional Market Player Developing a renewable energy project is highly complex and requires a range of specialist skills not available in most communities. The ease and cost of grid connection is site specific. The greater the electricity exported into the local grid by the renewable generator, particularly an intermittent one, the more complicated and costly it will be to achieve the connection. Off-take agreements are bilateral and very challenging to negotiate in the current environment. Inadequate Policy Framework While Australia has well developed (but unstable) policies covering domestic-scale renewable energy systems and solid policy for large-scale utility generation, federal and state policies have neglected the middle ground where community initiatives naturally fall. Inefficiencies in Scale Larger projects are generally more efficient as fixed costs are spread across greater generation capacity. Power Off-take The tightly held electricity retail market with little more than a dozen providers, and the oversupply of renewable energy certificates, are creating a situation where it is extremely difficult to arrange a power-purchase-agreement. These negotiations are further complicated by the small-scale of community renewable energy projects and the reduced bargaining power they have with the handful of Australian electricity retail companies. By way of contrast, Switzerland, with half the population of Australia, has more than 1,000 electricity retail companies. Capacity and Skills To move projects forward, community groups need to transition from volunteer-based organisations to local social enterprises with paid staff.
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14 March 2012 Policy, Planning Systems and Reform Department of Planning and Infrastructure GPO Box 39 SYDNEY NSW

2001 By Email innovation@planning.nsw.gov.au

To Whom it May Concern

Case for Wind Power

Illustration 1: Say Yes2renewables ~ Friends of the Earth

Unfair & Inequitable Guidelines

2km Buffer Zone

Onerous Community Consultation Processes

Public Health Concerns

APPENDIX ~ ABOUT COMMUNITY RENEWABLE ENERGY

Importance & Benefits

Hepburn Wind & Embark

Tapping into a New Funding Source The Community Investor

Enduring Social Benefits

Bridging the Gap Between Individual and Corporate Action

Delivering Broader Grid Benefits

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