The Entry Cost Shock and the Re-rating of Power Prices in New South Wales, Australia

"Australia has long been the beneficiary of low, stable power prices. A decade-long state of oversupply underpinned this result and while plant capital costs had been rising, the cost of capital had been declining. These offsetting effects locked the wholesale market into an average cost of $35-$40/MWh. However, from 2007, a simultaneous and sharp rise in new entrant plant capital costs and the cost of capital occurred. The combined effects crept up on the industry while it was in a state of oversupply. This 'entry cost shock' disrupted a 7 year long equilibrium price, with average power system cost rising to $60/MWh." Copyright (c)2010 The University of Melbourne, Melbourne Institute of Applied Economic and Social Research.

Investigation of an offshore thermal power plant with carbon capture as an alternative to CO2 transportation

Carbon Capture and Storage (CCS) technology is considered to be one option to reduce CO2 emissions in order to mitigate climate change. Conventional CCS technology has its own complexities including high costs and risks for storing CO2. This paper introduces the concept of an Offshore Thermal Power Plant with CCS (OTPPC), which eliminates the needs for transporting CO2 and therefore reduces the complexities of the whole system. A general design selection process for the OTPPC is established. A case study is carried out to demonstrate the application of the OTPPC. The cost-effectiveness of this concept is evaluated by calculating the Levelised Cost Of Energy (LCOE) for both the OTPPC and conventional CCS technology for an onshore power plant with the assumption that CCS is necessary

Getting governance right for a sustainable regionalised business model

The 1998 Ministerial Review of General Practice Training identified several areas for improvement that led to major changes in the provision of general practice training, including the establishment of General Practice Education and Training (GPET) and the regionalisation of training. The regionalised training business model has been in place for nearly 10 years, and several key organisations have been involved in its evolution, including the Australian Government, speciality colleges, GPET and regionalised training providers. Both the college-focused and regionalised-focused models have had some successes. These include recognition and support of general practice as a vocational specialty, increased numbers of junior doctors undertaking placements in general practice, and increased numbers of registrars training in rural areas. This period has also seen changes in the governance and decision-making processes with creation of a new framework that is inclusive of all the key players in the new regionalised training system. The future holds challenges for the regionalised training business model as the general practice education and training landscape becomes more complex. The framework in the current model will provide a base to help meet these challenges and allow for further sustainable expansion.Caroline O Laurence, Linda E Black, Mark Rowe and Rod Pearc

Water rights for variable supplies

The relative merits of different systems of property rights to allocate water among different extractive uses are evaluated for the case where variability of supply is important. Three systems of property rights are considered. In the first, variable supply is dealt with through the use of water entitlements defined as shares of the total quantity available. In the second, there are two types of water entitlements, one for water with a high security of supply and the other a lower security right for the residual supply. The third is a system of entitlements specified as state-contingent claims. With zero transaction costs, all systems are efficient. In the realistic situation where transaction costs matter, the system based on state-contingent claims is globally optimal, and the system with high-security and lower security entitlements is preferable to the system with share entitlements