Our letter to Victorian Member Kelly O’Dwyer on her misleading statements about the RET

12 Feb, 2014

Word for word, here is my letter to Victorian Member Kelly O’Dwyer.

Dear Ms O’Dwyer,

 I read with great concern your comments about the RET yesterday.

 I am deeply concerned that our leaders and media alike continue to make such outrageously false claims, especially when the facts are so plainly clear.  

 You may like to reference the Australian Energy Market Commissions detailed report released in December 2013, which concisely describes what the current and expected costs of the RET (and other contributors) are. The data from that report is summarised in the table below which clearly shows that:


  1. The cost of the SRES component of the RET is $0.0054 ckWh in 2013/2014 of the National average price of electricity, which is 1.9% of $0.2785 ckWh. This equates to a National average of around $34 per year.
  2. The cost of the LRET component of the RET is $0.0058 ckWh in 2013/2014 of the National average price of electricity, which is 2.1% $0.2785 ckWh. This equates to a National average of around $36 per year.


Importantly as the AEMC’s data shows, the SRES in particular is already declining and will continue to decline under business as usual. By 2016 it will be 0.9% or $15 a year. This is a 56% DECLINE. If you combine the SRES and LRET, together they will decline from 4% to 3.2% or almost 20% over the period.

 You may also note that there are a number of substantially larger contributors, that are set to increase, which logically would seem to be areas worthy of far more attention. One example is the Retail component (largely made up of Retailer profits). Retail profits are the third largest component of electricity costs and are forecast to rise from 13.6% to 14.7% over the same period.

 In both cases cited on the RET, the costs exclude any value and benefit that come from the deployment of renewables which include reduced wholesale costs and a reduction in peak demand and hence, the real cost is even lower. You may also note that although it’s not a done deal, I have removed the carbon price under the assumption that it goes which of course inflates the proportional costs of the RET.

 I am perplexed that you would make comments singling out the RET, given that it is such a proportionally low contributor to the cost of electricity and declining when far more substantial factors are set to increase.

 What possible justification do you have for suggesting that the $70 a year RET cost is the culprit, especially given its predicted decline?

 Frankly, your comments border on being grossly misleading and are shameful for a leader in our community.

 I would be delighted to discusss this with you or to provide you with further information and references, should that be of use to you.



Kind regards,

 Nigel Morris



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Post expires at 5:00pm on Thursday February 12th, 2015

About the author

Nigel Morris
Nigel Morris

Nigel is the Director of SolarBusinessServices. After almost 20 years working for other companies SbS Director Nigel Morris, established the company in 2009 with a view to providing other organisations with the benefits of his wide experience in the renewable energy industry.

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  1. February 17, 2014

    Fantastic response Nigel. It will be great to see what the response to your letter may be.

    • Nigel Morris
      February 17, 2014

      Thanks Philip; I’m looking forward to a response too, and can’t wait to hear the rationale behind the statements.

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