Power infrastructure to level playing field

The benefits of allowing mining in north west Queensland to compete on a level playing field for electricity with the rest of the country will be promoted at the coming North West MPX mining conference and expo. Co-Founder of CopperString 2.0 John O’Brien will be speaking at the May event in the wake of the project’s sale to the state government. CopperString 2.0 aims to build an electricity transmission network to link north west Queensland to the national electricity market (NEM). The effects will centre as much around access to the electricity market structure as it will be to cheaper electricity said Mr O’Brien who cited the recent blackouts as an example where mining operators in the north west had to cover electricity supply costs even though they had no service. “If you are a major miner, you actually have to get your electricity supply by buying or contracting for generation capacity plus contracting for gas supply or/and for fuel supply and contracting for the transport of that fuel,” he said. “And those contracts are all based on ‘take or pay’. You pay, whether you use that capacity or not. “When you connect to the national market, you do a retail contract, you don't have to contract for generation capacity, you don't have to contract for fuel. The market structure in the NEM is set up to ensure that there is adequate generation capacity and that you don't pay take or pay contracts. Related: State to deliver $5b CopperString energy project “So, you pay basically for what you use. And that, that is the biggest economic impact for the north west.” CopperString 2.0 Co-Founder John O'Brien In some cases to guarantee capacity, mining operations in the north west were currently opting for what would otherwise be the most expensive electricity generation option, said Mr O’Brien. “If you are a new mine and you want electricity, you actually have to underwrite an expansion of the existing generation capacity. And that's why a number of the mines put in diesel, it's actually cheaper for them to run and in today's sort of society that is unbelievable. “If they connected to the existing North West network and tried to get supply from that, they would have to underwrite gas fired generation expansion, whereas it's actually cheaper and this is incredible, for them to actually put diesel plant in and import the diesel. “And that's cheaper than having to pay to underwrite the gas generation expansion and gas supply that would be needed for a new load.” The north west MPX runs from 9-11 May at Mount Isa Civic Centre.

Power infrastructure to level playing field

Industry Queensland

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