Board Meeting: May 2014
Agenda Number: 12 (ii)
File Ref: EL0034
LORD HOWE ISLAND BOARD
Business Paper
ITEM
Renewable Energy Program
BACKGROUND
In December 2011 the Lord Howe Island Board approved the LHIB Energy Supply Road
Map (the Road Map) which outlined a plan to provide 69% of the Island’s electricity needs
through renewable energy, thus reducing the reliance on diesel fuel. The Road Map
identified the commercially proven technologies of wind and solar PV which can be safely
integrated into the existing generation and distribution system.
The project is not financially viable for the Board without majority grant funding. The
Expression of Interest (EOI) seeking $5.43M of funding from the Australian Renewable
Energy Agency (ARENA) was submitted in November 2013. As a result, the Board was
invited to submit a Full Application. The major issues that ARENA highlighted from the EOI
included:
1. Community acceptance of wind turbines.
2. NSW and Federal Government environmental approval of wind turbines.
3. Assessment of the viability of all renewable energy being sourced with solar PV,
including ground mounted or private roof top and an incentive for private roof top.
Board staff submitted a funding request to NSW Treasury for preparation of the Business
Case to support the capital bid for the remaining $5.43M.
CURRENT POSITION
ARENA Funding Application
The Full Application to ARENA was submitted on 2nd May 2014 and was considered by their
technical Assessment Panel on 13th May 2014. The feedback from the Assessment Panel
centred around the optimisation of the proposed system and whether there was scope for
more solar PV. The project remains alive in ARENA, with the next steps to include:
 ARENA will appoint a technical due diligence consultant to review the project and
provide recommendations. Board staff have suggested the consultant visit the Island.
 1st week June - The project will return to the Assessment Panel for further
consideration following the technical due diligence.
 Late June – If successful with the Assessment Panel, the project will be referred to
the Board of ARENA for consideration.
 Early July – If successful with the Board of ARENA, a Funding Agreement \ Contract
would be signed with ARENA.
Despite the scrapping of ARENA in the recent Federal Budget, it will continue to operate
until its legislation is repealed when the new Senate begins sitting in early July 2014.
State Government Activities
The new NSW Environment Minister, Rob Stokes, provided a letter of support to the ARENA
CEO as part of the application process.
The NSW Treasury provided $66,000 for preparation of the Business Case to support the
capital bid for the remaining $5.43M. This work is currently out to tender with five companies
and prices are expected on 20 May 2014. The Business Case will be in Draft form by the
end of July 2014 and a final by the end of August 2014. The Business Case will then be
submitted to NSW Treasury for consideration as part of the capital bid process for 2015/16.
Community Survey
The Sustainable Energy Working Group conducted a community survey over Easter to
assess wind turbine acceptance and support for a community funded solar PV program.
The results are summarised as:
 147 responses, representing 74% of the 198 dwellings on the Island or 49% of the
population of 297 (over 19 years old)
 93% support for the integrated solution including wind turbines, 4% said no, 2% were
50/50 & 1% had no response
 55 respondents (37%) indicated their desire to install private solar PV for a total of
183kW, which is valued at $490,000 (3kW = $8,000)
 75 respondents (51%) indicated their desire to buy shares in a community solar
scheme to a value of $227,000
 Total potential private investment by the community around $717,000.
Board staff have submitted a request to the Minister to approve travel for the Manager,
Infrastructure and Engineering Services and a nearby resident to the wind turbines, to travel
to Coral Bay in Western Australian. The visit would assist in understanding the visual and
noise impacts of the same wind turbines proposed for Lord Howe Island.
Environmental Approvals
The Department of Sustainability, Environment, Water, Population and Communities
(Department) within the Federal Government is responsible for regulating activities which
may affect World Heritage values and impacts on migratory bird species. Both of these are
particular issues in this project with the wind turbines potentially affecting the exceptional
natural beauty of the Island and a nearby flesh-footed shearwater breeding colony.
An Environmental Impact Statement (EIS) will be required for this project, but has not been
commenced. The first step in this process is a referral under the Environment Protection and
Biodiversity Conservation Act 1999 (EPBC Act), which the Board has submitted to the
Department as a trigger to obtaining controlling provisions for the development of the EIS.
The Department is understandably reluctant to provide opinions on projects without proper
information and assessment. However, the Department did comment that the level of
community support for the project was a factor in their decision.
The NSW Office of Environment and Heritage (OEH) would lead the state government’s
environmental assessment of this project. The main concern will relate to impacts on
threatened sea birds such as the flesh-footed shearwater. Nicholas Carlile is a Senior
Research Scientist in Threatened Fauna and has long term experience on Lord Howe Island
with the sea birds. Nicholas’ opinion has already been valuable in developing the project to
date and his regular visits to the Island for research will allow regular and ongoing
discussions regarding the environmental assessment, design and construction phases for
the wind turbines.
RECOMMENDATION
It is recommended that the Board note the above information.
Prepared Andrew Logan
Manager Infrastructure & Engineering Services
Endorsed Penny Holloway
Chief Executive Officer