To Whom It May Concern

 

I am Chairman of a relatively new company called Solar Heat and Power Pty. Limited.  It was formed in 2002 around solar thermal power plant technology first developed at the University of Sydney.

 

Our factory in Singleton is currently engaged in building the first stage of Australia's largest solar power plant which is being purchased by Macquarie Generation, the largest utility in the country.  The power plant will be 36 MW electrical equivalent in peak output and will feed steam into the existing coal fired power plant at Liddell. 

 

A presentation is attached, but construction is at an early stage and the project will eventually cover about 250,000 square meters.   We have not publicly announced these developments, but an announcement is expected in February or March.  We are not seeking public listing at this stage, we have received no government assistance, and are operating out of revenue.

 

This project represents a transitional stage in development where we can use existing turbines and electrical infrastructure to enable extremely low cost renewable electricity.  However, engineering studies are beginning for the first large inland plant, a 100% solar 240 MW electrical stand alone plant which will eventually be fitted with thermal storage to allow base load operation.  It is estimated that this may be able to be fully completed by 2008 or 2009.  This plant would generate about 50 times all of the photovoltaic solar power currently installed in Australia.

 

Such plants would allow both take-up of new capacity requirements with dependable solar power, and also the  replacement of retiring coal-fired capacity.

 

Our technology is probably the cheapest renewable electricity in the world with the possible exception of the Geodynamics hot rocks technology, if that latter technology clears technical hurdles. However, the practical solar power resource is much greater the Australian hot rock resource, and much more accessible to Eastern grid markets.  We currently estimate that a large solar plant will generate electricity below next generation wind, and deliver a 20% IRR to the generator under current REC values.  It will generate power for about half the cost of the well known Solar Tower (Chimney) proposal and will be below advanced wind.

 

There is considerable interest in our technology from other countries, and two small projects are being planned for Germany already.  We also have strong interest from the USA and Spain.  However, we are pursuing an 'Australia First' approach, with the largest arrays in the world to be first demonstrated in Northern NSW before the technology is exported on any significant scale.

 

Ratification of Kyoto would allow Australia to mount very large carbon trading based projects in Australia which would allow international investment for the establishment of considerable new base load electricity capacity for Australia and a capability for low cost hydrogen exports generated in periods of summer excess supply.  We have some of the best sites in the world for such generation, and exports of hydrogen to, for example Japan, could be gradually built up using natural gas export infrastructure already in place.   Without ratification, we cannot so easily participate in such markets without locating offshore.  The industries we build up in Australia can be permanent, sustainable ones with permanent exports as a by-product because the primary solar resource remains here.  The technology would initially permanently employ many hundreds of people in regional areas of Australia, and this would grow to many thousands over time.

 

To be as clear about this as I can, we are talking about large scale solar generation.  The current small project will cost about $20 million, the 240 MWe baseload plant about $500 million, and replacement of coal fired capacity many billions.  This is a technology which, in its initial form, is 100% Australian made and in stand alone plant form will be about 80% Australian made (the turbines must be sourced overseas).  The employment and export opportunities are clear.

 

In the short term, our activity will not significantly affect coal exports.  In the longer term,  if coal is not replaced by solar, it will have to be replaced by something else.  So it is a superior industrial strategy for Australia to produce the replacement.

 

We therefore urge the Australian Senate to require the Australian Government to ratify the Kyoto protocol so as allow our company and our associated utility partners to benefit fully from international carbon trading investment.

 

For further enquiries, I can be reached at the address below, and our Managing Director, Mr. Peter Le Lievre, can be reached at  0412 862 939. His email address is above.

 

Yours sincerely

 

Dr. David Mills 

S O L A R    H E A T   A N D   P O W E R    P T Y.  L T D.
ACN 100 512 641

2 Chifley Square Sydney NSW 2000 Australia
GSMPhone  61 (0)41 1370 1260      Fax: 61 (0)2 8220 8080

email: david.mills@solarheatpower.com    web: www.solarheatpower.com