Tariff arrangements for wind farms benefiting some councils but not others in Tasmania

In the remote northeast corner of Tasmania, where the “Roaring Forties” hit the scenic coastlines, dozens of colossal wind turbines power not only the grid but also the local refuse department.

Dorset Mayor Greg Howard said the Musselroe Bay Wind Farm was the council’s biggest taxpayer, helping to fund local services from roads to recreation.

“That was a huge advantage,” he said.

“We still have a reasonably small fare base but a large network of roads and a large network of bridges, which need to be constantly renewed and repaired.”

Renewable energy projects are springing up across Australia as investors and communities take advantage of the clean energy boom.

But while Tasmania’s east winds fill council coffers, the westerly winds do not.

The Granville Harbor Wind Farm on the west coast of Tasmania.(Port of Granville wind farm)

No West Wind Rates

The construction of a $280 million wind farm in the quiet shack community of Granville Harbor has been met with great fanfare and government support.

The potential rates have excited West Coast Council, which has struggled to maintain a sprawling network of aging infrastructure as the closure of major mines has caused a collapse in the council’s population and income.

But Mayor Shane Pitt was surprised to find the development wouldn’t pay any tariffs while a $100,000 home did.

“We don’t want to be greedy about it, we just think we want something from these industries to give back to the West Coast,” he said.

Shane Pitt, Mayor of West Coast Council of Tasmania
Shane Pitt is the Mayor of the West Coast Council of Tasmania.(ABC News: Lachlan Bennett)

The reason why two wind farms of similar size, built a few years apart, have different rating agreements, is a matter of ownership.

Councils generally charge rates based on the value of a property as determined by the Assessor General, but Tasmania refused to include wind turbines when assessing the Granville Port site.

A spokesman for Tasmania’s Department of Natural Resources said wind farms built on operator-owned land were assessed for tariffs.

But if a wind farm is built on leased land and it is a condition of the lease that “above ground improvements” such as turbines are removed at the end of the lease, “these improvements will not be included in the capital of the underlying. ground”.

Wind turbines in an open enclosure.
Legal arguments over whether or not wind turbines are “movable property” have taken place in New South Wales and Victoria.(ABC News: Craig Heerey)

In practice, turbines worth millions of dollars, stretching more than 100 meters in the air, requiring gargantuan concrete foundations, connected to specially designed transmission lines and expected to operate for decades are considered facilities. temporary and not as a fundamental part of the property. .

Thus, only the agricultural land on which the wind farm is built pays tariffs, not the plant itself.

‘Urgent reform’ needed for renewable energy projects

Legal skirmishes over whether or not wind turbines are “movable property” have broken out in New South Wales and Victoria, but different courts have come to different conclusions.

Mr Pitt is demanding “urgent reform” to ensure his district reaps the rewards of renewable energy, but the state government appears to have little appetite.

In a letter to West Coast Council, Tasmanian Local Government Minister Nic Street said there would be “significant complexity and risk associated” with Mr Pitt’s proposal and that the increase land tariffs would be weighed against the “risk of disincentive to investment”.

Mr Pitt dismissed the idea that it would be a ‘handbrake’ on investment, as the Granville Harbor wind farm had repeatedly called the council asking for its tariff bill.

“They were of the view that the wind turbines would be assessed,” he said. “It was in their feasibility study.”

A wind farm “proud” of community support

A spokesperson for Granville Harbor Wind Farm said it was “happy” to discuss the matter further with the council, but that pricing policy was “a matter for the state government and the general appraiser”.

“And so it is not for us to comment on these matters,” they said.

The company, however, was “very proud” of its support for the West Coast community.

“Each year, the wind farm provides an estimated $2.12 million increase in local economic output, we employ eight people on site, and support the community with annual grants to good local causes worth a minimum of $20. 000 dollars a year,” they said.

Netball coach Aleisha Maskell and Jessica Bonner with young players.
Netball coach Aleisha Maskell (second from left) is grateful for the wind farm’s charity to local organizations.(ABC News: Lachlan Bennett)

One of the grant recipients was a junior netball program in nearby Zeehan and coach Aleisha Maskell said the wind farm had been a “wonderful” supporter.

“Because without it it’s hard to move forward and give our next generation a sport like this,” she said.

To the east, Dorset’s mayor is hoping his council won’t miss out on fares for the upcoming North-East Wind project, which is 10 times larger than Granville Harbour.

“You would think it would be inappropriate for a $2.7 billion construction project in your municipality and your council not to receive any benefit,” Howard said.

Mayor of Dorset Council in Tasmania, Greg Howard
Greg Howard says Dorset Council has reaped the benefits of the wind farm.(ABC News: Lachlan Bennett)