Future of energy, page-61

Hi Ash

I also think the ability to divert WF power to an owned battery is a powerful tool for renewable energy producers.

I am a little wary that the regulators could decide to mandate a minimum supply under some circumstances or emergency use of privately owned batteries. The fact that AEMO insists on separate metering shows that they are aware of the ability of producers to preference their own internal storage to support prices when scale storage comes online. The Govt has not had any problem meddling in this space before.

Given that there are contractual obligations for firmed power supply and the batteries are typically installed at least in part to allow those contracts to be increased, there is an argument for companies to cite maintaining minimum storage levels to ensure firmed contracts are met. That would be a reasonable argument to allow retention of energy at low demand prices.

We have seen examples of diversion to LBB at low price times or for contract customers so the precedent is there at least.
Anyway it is likely in my view that spot pricing will be an issue as we move out of the lock down phase and head into a likely recession. It may be that RR and team are trying to build a buffer to allow them to weather that and maybe be in a position for bargain buying of assets without arbitrage capability.

IFN is till a big solid rock in our portfolio right now and one of the best balanced defensive Vs long-term growth.

All IMHO