MERC Newsletter – June 2020

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Introduction

Delegates, here is the June MERC Newsletter, submitted to delegates in very different times to what it was several months ago for your information, but it looks like there is some brighter light at the end due to the reaction by government and the community, as long as Victoria can contain the virus.

Most of the information in this newsletter is about MERC business is in view of the COVID-19 Virus situation, with some interesting but relevant articles..

Please circulate this to your fellow Councillors and senior staff, so they can appreciate and understand the excellent work the Association and you are doing on behalf of your Council and community, with regard to mining and energy related matters.

 

COVID-19 Virus Impact on MERC

The NSW Government is working with councils to support communities across the state in response to COVID-19. Consequently, there have been certain changes that will affect MERC and members going forward as a result of the NSW Government’s respective Ministerial Public Health Orders to implement controls as necessary to combat the COVID -19 Virus, latest details from Circular No 20-28 are provided from the Office of Local Government below:

“What’s new or changing

  • The Minister for Health and Medical Research, the Hon. Brad Hazzard MP (the Minister), made the Public Health (COVID-19 Restrictions on Gathering and Movement) Order (No 4) 2020 on 30 June 2020.
  • The new Public Health Order further relaxes restrictions on attendance at meetings by persons other than councillors and staff.

 What this will mean for your council

  • Councillors and council staff may attend council and committee meetings in person. However, councils must continue to allow councillors and staff to attend and participate in meetings by audio visual links where it is reasonably practicable to do so.
  • Members of the public are permitted to attend meetings. However, councils must not allow persons to attend a meeting if the size of the meeting venue is insufficient to ensure there is 4 square metres of space for each person attending the meeting.
  • Councillors and council staff are not to be counted when calculating the space available for each person at the meeting venue and the number of persons who are attending a meeting.
  • Where councils exclude members of the public from meetings, they must livestream their meetings using audio-visual links to satisfy the requirement under section 10 of the Local Government Act 1993 for members of the public to be permitted to “attend” meetings.

Key points

  • A failure to comply with a direction in a Public Health Order is an offence under Section 10 of the Public Health Act 2010 that carries a maximum penalty of imprisonment for 6 months or a fine of up to $11,000 (or both) plus a further $5,500 fine each day the offence continues.

 Where to go for further information

  • For further information please contact the Council Governance Team on 02 4428 4100 or by email at olg@olg.nsw.gov.au.
  • More information on the new Public Health Order is available here.
  • For more specific guidance on compliance with the Public Health Order contact the NSW Police Force.

The MERC meeting held on 7th May 2020 was conducted as an Executive Committee meeting using bluejeans.com video conferencing through Warrumbungle Shire Councils’ facilities with Chair and Executive Officer present in their chambers, with assistance from staff at the Council.

Whilst the Executive Committee is happy to continue this way for future meetings (if required), however for the August meeting, with the approval of the Chair given, the host Orange City Council are keen to assist with arrangements for the conduct of an “ in-person” meeting with access to audio visual technology to assist those delegates that can’t attend in person and the COVID 19 Virus situation.

Consequently given the changes to the Public Health Order and the Councils preparedness and capacity to work within the guidelines MERC will revert to a normal meetings format for the 13/14th August 2020, details from Orange City Council  will be forwarded when to hand shortly. Next meeting will be in Orange in the larger Orange Ex Services Club where COVID restrictions can be managed easily.

 

Two year terms for Executive Committee

MERC is to consider the Executive Committee being elected for two year terms and to clarify the wording in Clause 7.1 of the constitution on the composition of the Executive Committee on whether two from any one member can be on it, at a future Special General meeting of MERC in August 2020.

Executive Committee currently comprises Chair, two Deputy Chairs and three other delegates with all to come from separate council areas and they are elected annually, however recent events have demonstrated the clause needs rewriting for clarity purposes.

 

Next Meetings for the Association in 2020

The locations/dates for meetings in 2020 were agreed to be held at Orange on 13/14th August in the Ex Services Club and now in Blayney in November.  The meeting on 7th May 2020 agreed that Blayney will host the November meeting and dates provided from the Council are Thursday/Friday 19/20th or 26/27th November 2020. Either of these appear to suit the meeting cycles of members and the Executive will determine what suits at the next meeting.

Under the constitution, MERC is required to have one General Meeting (the Annual General) a year and as many other General Meetings as the Executive Committee determine. It must have four Executive Committee meetings a year. Consequently it has been practice to have four Executive Committee meetings, four General meetings after the Executive Committee, Special General meetings as required and one Annual General meeting a year.

 

Update on the Voluntary Planning Agreement

The Guidelines for VPA’s and a VPA framework agreement (including scope and calculation methodologies) has now been agreed to by NSWMC & the MERC VPA Working Party. The aim is to have it endorsed by DPIE (in a way similar to that of the Blueprint for Renewable Energy that Northern JO’s developed and was circulated by DPIE) and to be sent to members and all LGA’s in NSW.

The matter has been raised with Mike Young at our meeting 5th March 2020 and MERC has sought a response as to why the delay, given his commitments in March to release the document.

Mike has since acknowledged this and indicated that his response has been delayed due to reforms being considered by the Government on EPA Act Infrastructure Contributions system made by developers having an impact on the VPA Framework and Guidelines. The Executive Officer has followed this up several times and lately Mike has indicated the following:

“In regard to the Guideline, the Department does not intend to place this document on the website as it relates to an agreement between third parties, and it may result in confusion for some stakeholders as the website already includes a range of documents published by the NSW Government regarding developer contributions.

I also note that there are a number of councils and mining companies that are not members of either the Energy and Mining Related Councils or the NSW Minerals Council.

While many of the recent reforms to developer contributions may not apply to mining projects, the NSW Government has also asked the Productivity Commission to undertake a review of developer contributions and report to government by the end of the year. The recommendations of the Productivity Commission may have implications for the current arrangements relating to fixed levy contributions and voluntary planning agreements.

However, happy to discuss alternative approaches, noting that the document is available to your members and the members of the Minerals Council to use as required”

The Executive Officer will take this up with the Executive Committee to consider a course of action to promote and release the Guidelines document.

 

Resources for Regions (R4R)

In MERC’s pursuit of the R4R being changed to a better program to suit mining affected Councils, the MERC working party was involved in the early discourse with the government’s Resources NSW staff and persistently chased the review team on the details.

Details were recently released on Round 7 of the Resources for Regions Program as announced by the Deputy Premier, Hon John Barilaro. Those members that are on the list of 24 would have received a letter to Mayor/GM on the allocation for your eligible Council.

This is subject to your Council initially contacting the Regional NSW staff to ensure your proposed projects meet the Guidelines and to meet all of the other requirements therein as well. Whilst the R4R Program has been improved it appears there are still hoops to jump through, hopefully they aren’t too onerous for eligible members.

No doubt there will be some issues to clarify given the guidelines and as requested in the brochure, please make initial enquiries to the following contacts, numbers & email, and if  MERC can be of assistance to lobby the government for further changes please raise with Executive Officer, the Chair and/or the Executive Committee.

“Contact us on 1300 679 673 or at regionalnsw.business@dpc.nsw.gov.au or contact your local Business Development Manager at the Department of Regional NSW”. Clarification on what is the role and composition of the Assessment Panel has been sought.

 

Regional Advisory Forum (RAF)

Delegates raised the benefits of having a RAF with a delegate from MERC on it being retained with Mike Young on 5th March 2020 and he requested MERC put forward an argument for its retention.  This was done by the Executive Officer.

The Executive Officer has now sought a response to this again recently and asked the question in emails and a txt – “is the RAF a dead duck or if not will MERC have a voice on it?”, hoping a short simple question will get a short simple reply of Yes or No?

 

Membership Campaign

At the Ordinary meeting in Sydney on 5th  March 2020, it was agreed that MERC authorise the Executive Officer to develop and implement a marketing campaign in consultation with the Chair and relevant MERC membership staff to include pamphlets, notepads with “We are your voice – become a member” or suchlike on them for handouts, a banner indicating locality of members throughout NSW, a video to play on a laptop to link back to the webpage, set up a membership page on the website, etc to the value of $5000 plus take a stand at the LGNSW Conference in November 22-24, at Cessnock and do a presentation to the Country Mayor’s Association at a future meeting.

A stand has been booked for the conference and actions underway with the other strategies outlined where discussions on the web page and the marketing content with the principal of Cibis has occurred and is being written to suit the 2020 -2023 Strategic Plan review changes. Samples of promotional materials have been procured and will be provided to Executive Committee on 13th August to consider before placing larger orders. Membership page wording for the web page has been almost finalised. Some faces and voices are needed for the video to accompany the promotions. Banners and maps still to be finalised.

 

List of Speakers for future meetings of MERC

MERC will be continually pursuing the following speakers for future meetings with The Greens now listed:

  • Hon Rob Stokes, Minister for Planning & Public Spaces, Liberal Party;
  • Hon Matt Kean, Minister for Energy & Environment, Liberal Party;
  • Hon John Barilaro, Deputy Premier, Minister for Regional NSW, Investment & Trade, Leader of NSW National Party;
  • Hon Adam Marshall, Minister for Agriculture & Western NSW, National Party;
  • David Shoebridge MLC (Energy) & Abigail Boyd MLC (Mining), from The Greens;
  • Other relevant Opposition party members and government senior officers will also be pursued for meetings as required depending on locality of the meetings;
  • Relevant Senior Departmental Executives;
  • CEO’s, Clean Energy Council and Clean Energy Finance Corporation, ARENA, etc.

Minister Kean and Senior staff of his Department have accepted to address delegates in Orange on Renewable Energy Zones (REZ) particularly the Central West/ Orana REZ.

 

Research Fellowship Update

Peter Dupen has been busy seeking partners for the consultation project likely to be in the Central Western area of NSW and hopefully the COVID19 Virus doesn’t impede his progress too much. A report on this was provided to delegates at the meeting on 7th May where a draft proposal has been received and adopted for signing by the Executive Committee. This has been signed and sent to UTS who have been impacted by COVID 19 Virus possibly delaying progress with this project.

However, the latest from Peter is: “As mentioned, we are in discussions with Aurelia about a potential application of the collaborative modelling in a small underground base metals prospect near Cobar.  We will certainly keep you informed about this, but if any other prospects appear on your radar, please let me know” He is working with DPIE staff on finding a suitable project and to suit their development approval timing.

 

Strategic Plan 2020 – 2023 Review

A Sub Committee consisting of Clr Michael Banasik (Executive Committee – Wollondilly Shire Council), Cr Jo McRae (Orange City Council) and Glenn Wilcox (General Manager, Warren Shire Council & Life Member) are working with the Executive Officer to present a draft document updating the current plan to the August meeting of MERC. Information is coming together from the working party to have a draft for the August meetings. A draft has been completed by the Executive Officer and will be circulated to the sub committee for consideration in July 2020 with changes suggested.

 

Update on CRC for Transformations in Mining Economies Approval.

MERC was invited last year to be a NSW partner in the establishment of the national Cooperative Research Centre (CRC) for Transformations in Mining Economies (CRC TiME) being established in Perth, Western Australia at University of Western Australia, at no cost to MERC. This fits in with our strategic plan by being involved in making a difference through research partnerships with Universities in Australia on various topics such as rehabilitation and post mining impacts on economies.

The national partnership was required in order to get the grant to set up the CRC for transforming mining economies from mining to no mining plus value add them. More will come from this partnership and delegates will be kept informed in due course from their regular newsletters.

Since then CRC TiME has been conducting a series of webinars and have been overwhelmed by interest in them seeking to connect people into the research planning process for the recently announced CRC for Transformations in Mining Economies on topics such as regional economic development, operational solutions and risk, evaluation and planning. The Executive Officer is being kept informed of these webinars and will pass them on when relevant.

 

Renewable Energy Zones

The NSW Government is working to develop a pilot 3,000 megawatt Renewable Energy Zone (REZ) in the Central-West of NSW as part of the Electricity Strategy, Net Zero Plan and Commonwealth-NSW Memorandum of Understanding on Energy and Emissions.

To support this work, they have been seeking information from proponents of existing and proposed renewable energy, energy storage and emerging energy projects in this region through a Registration of Interest (ROI) for the Central-West REZ in June 2020 and received 38 responses from interested investors.

The ROI will help them understand the scale, location and type of projects that could be part of the Central-West REZ. By responding to the ROI, proponents will also help ensure their projects are considered as part of technical design and planning for the REZ.

They are committed to developing the Central-West REZ in partnership with communities and industry and welcome your questions or comments on the Central-West REZ at any time.

The Chair, Cr Shinton and Executive Officer had a zoom conference with Minister for Energy and Environment and senior staff recently on the REZ where it is agreed that MERC become involved with the department to conduct a workshop on what the REZ is all about. This will put MERC in front of many non-member councils involved in renewable energy developments through NSW and is an exciting opportunity for the Association. Extending the boundaries to envelop Councils around Warren Shire Council in the REZ were considered as worthwhile extensions by the Minister.

The Chair and Executive Officer of MERC along with the Mayor’s and GM’s of Dubbo Regional, Warrumbungle and Mid Western Councils (all members of MERC) were invited to meet the Minister for Energy and his team plus Transgrid, in Dubbo recently for their workshop on the REZ pilots.

At the meeting the Minister and his team expressed an interest in meeting MERC delegates on 14th August 2020 in Orange, to outline details on the REZ. Their attendance has now been confirmed. A report on the meeting will be presented to delegates at the next MERC meeting in Orange from the slides provided.

For more information about NSW REZs please visit www.energy.nsw.gov.au/renewable-energy-zones, or email the team at rez@planning.nsw.gov.au.

Submission to the Review of the EPA Act Infrastructure Contributions System

The submission was completed on 12th June 2020 and distributed to delegates as information.

 

Related Matters of Interest – Mining and Energy Issues

“Release of review into the Geological Survey of NSW and Mining, Exploration and Geoscience response to the recommendations” DPIE report from Jessica Rossell, who has addressed delegates previously with the consultant and this is her summary.

“A key action of the NSW Minerals Strategy is a review of the Geological Survey of NSW (GSNSW). In 2019 an independent consultant was commissioned to carry out the review. The aims of the review included an assessment of GSNSW’s roles, products and services to determine whether they are delivering the best public value.

The review is largely positive, finding that GSNSW produces high quality, objective products and services, as well as trusted expert advice that for the most part deliver public value to NSW. The review makes seven recommendations, including recommending the publication of an overarching Strategy for GSNSW and a change to GSNSW’s structure.

Mining, Exploration and Geoscience (MEG), formerly the Division of Resources and Geoscience, has considered the review and supports, or partly supports, all of its recommendations. The review report and MEG response are on the MEG website.

If you have any queries or would like further information please contact Jessica Rossell, Manager Resources Policy, at Jessica.rossell@planning.nsw.gov.au, Office of the Deputy Secretary, Mining, Exploration and Geoscience, DPIE”.

Renew Energy Newsletter – This web site is recommended to interested delegates to keep abreast of renewable energy options and examples that are happening in Austral and internationally. The author is Giles Parkinson and he writes material everyday which is relevant to MERC members. Following are some examples of the information delegates can read, providing you click on the link which you will have to go to the web site to subscribe and receive the daily email. Relevant articles will still be provided in MERC newsletters. Refer www.renewenergy.com.au to subscribe.

Australia’s big smelters could also be giant batteries, and go green at same time: Australia is already host to the world’s biggest lithium-ion battery – the 100/129MWh Tesla big battery at Hornsdale in South Australia, which is about to commission a 50 per cent expansion. And they are about to get bigger: Twin batteries are proposed to upgrade Victoria’s main link to Victoria, and a 600MW big battery near Geelong is being mooted for a similar purpose by Hornsdale owner Neoen. And there is the massive 30GWh battery proposed in the Northern Territory by the Sun Cable consortium looking to also build the world’s biggest solar farm.

But perhaps the biggest, and cheapest, battery in Australia right now are the ones that we already have, and don’t quite know it – the huge smelters that account for 10 per cent or more of state demand in regions such as NSW and Victoria. Nothing says “baseload” quite as much as the power needs to power one of these monoliths. It’s one of the main arguments thrown up against “intermittent” wind and solar, and it’s true that until now these smelters have relied on usually heavily subsidised supply of power from a fleet of coal.

Energy storage: It’s not just size that counts, but how long it lasts:
The seasonality of supply is a big deal and requires very long duration storage. Our modelling of South Australia shows that 4-10 hour storage supplied by batteries and/or pumped hydro was often full during excess wind and solar periods, and equally was often empty during periods of excess demand. This led to a need for gas or its equivalent to ensure there was no unserved energy demand.

An extremely crude estimate of the firming cost was around $12/MWh and the majority of that cost was the gas capital and operating costs. We note the gas generation capacity already exists.

Gas ended up supplying 7.5% of the energy and so South Australia would have been very low carbon emissions in this scenario. Overall the results suggest that even with the benefit of exports and imports it’s likely some long duration storage will be required NEM wide as VRE penetration increases. However, much more work remains to be done in studying storage duration requirements before we at ITK really know what we are talking about.

The seasonality of wind and solar is a big deal

Recently, ITK looked at the excellent prospects for batteries and the increasing amount of evidence that utility scale batteries are finding a place in the market.

We noted that in the US, where, somehow, ancillary services and frequency control don’t seem to be the issues that they are in Australia, batteries were starting to be of longer duration. Many of the 2GW of the battery contacts signed by leading US utility NextEra Energy are for four hour duration.

In Australia though, all the grid scale batteries are of 2 hours or less duration.

Figure 1 Source: ITK

We’ve ignored a couple of smaller Queensland based batteries, even though Lakeland actually does have around 4 hours storage. The Australian total committed to date of just over 500 MW is a meaningful amount of power. Average NEM wide demand over the past 12 months is a shade over 21GW, so batteries will be capable of delivering  2.5% of power by 2023 and most of us will be amazed if there aren’t more batteries by then.

The most prominent value case for these batteries is contingency frequency control and for that purpose very little duration is needed, as most contingency events last only a few minutes. ITK boldly predicts that batteries and grid forming inverters will end up being the bedrock of the NEM control system as their overwhelming advantage in frequency control and the “smoothness” of battery current simply can’t be beat.

But for the main task of providing energy storage ……… read on with the caveat that this note is looking at things from the point of view of minimising unserved energy at lowest cost. It is not looking at the prospects of an individual battery or pumped hydro operator. They might and probably would have a quite different set of factors.

The mismatch between variable renewable energy and demand is significant and will grow
 
Our previous article on “Let’s talk about batteries” looked at grossing up existing wind and solar output in South Australia in the 1 September 2019- 24 May 2020 time frame. The time period is arbitrary but chosen because it is recent and because there is 61% VRE (variable renewable energy) in South Australia, so it’s the closest thing to the future we have here in Australia.

 

Disclaimer The comments and details in the articles in this newsletter do not reflect the views, policies or position of the Association or its member Councils and are sourced and reproduced from public media outlets by the Executive Officer to provide information for members that they may not already be exposed to in their Local Government areas

 

Contacts

Clr Peter Shinton (Chair) peter.shinton@warrumbungle.nsw.gov.au 0268492000 or Greg Lamont (Executive Officer) 0407937636, info@miningrelatedcouncils.asn.au.