Victorian renewable energy boost to be law

Fed up with waiting for a national renewable energy target, Victoria is going it alone.

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Legislation to lock in Victoria’s renewable targets at 25 per cent by 2020 and 40 per cent by 2025 was introduced into parliament on Wednesday.

“What we know is in the absence of policy certainty and leadership from Canberra, it’s up to states like Victoria to fill that void, to make sure that we’re doing everything we can to drive the transition that is incredibly important,” Premier Daniel Andrews told reporters.

Energy Minister Lily D’Ambrosio called the targets “ambitious yet achievable”.

“This is the policy certainties and the right policy that industry have been deeply searching for to make sure they can make the right decisions to invest,” she told reporters.

To further encourage investment, a renewable energy auction will be opened to industry to compete to build sources producing up to 650MW – enough to power 389,000 households.

The first auctions open in October and are forecast to bring forward $1.3 billion in investment.

Tenders have been awarded to build two new solar farms in the Sunraysia district and near Shepparton that will provide 138MW to power Melbourne’s tram network.

The government says modelling shows bringing in more renewables will cut power costs by about $30 a year for households, $2500 for medium businesses and $140,000 for large companies, by 2034-35.

The savings are based on scenarios “chosen by the Victorian government”.

The future of coal is not mentioned in the plan, but Ms D’Ambrosio told reporters it would play a role “for many years to come.”

During parliamentary question time Opposition Leader Matthew Guy said the government could only achieve its 2020 target with the closure of Hazelwood and asked if Yallourn W or Loy Yang A would close to meet the 40 per cent target.

“The simple answer is no, you are absolutely wrong,” Ms D’Ambrosio replied.

Mr Guy later told reporters energy reform was needed immediately to ease the financial pressure on consumers.

However he also said the Victoria should wait for a federal target because a state-based one would put it at a competitive disadvantage.

“It appears to be political vanity at great expense to consumers,” he said.

Sirtex shares drop on $26 million loss

Shares in liver cancer treatment developer Sirtex Medical have plunged after it ended a challenging year with a $26.

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3 million loss.

Sirtex said a previously announced $90.5 million writedown in the value of its clinical and research and development assets led to the loss, along with restructuring costs.

Excluding those one-off items, slowing sales growth contributed to a 21 per cent drop in underlying profit to $42.4 million in the 12 months to June 30 – the first fall since 2010/11.

Sirtex said it had a 5.4 per cent lift in global sales of doses of its core technology, a radiation therapy for liver cancer.

However sales growth in its largest market of America slowed to 4.6 per cent.

The company says referrals for the technology declined as competition for patients increased, including from drug-based therapies.

Sirtex also spent $4.1 million on restructuring the business in 2016/17, mostly on redundancies.

The company said it is committed to improving its market share and has cut costs to improve its financial performance, but some challenges may continue.

“We do anticipate the market conditions that manifested in FY17 may persist through FY18,” Sirtex said in a statement.

“Though the resetting of the business means we are now better positioned and more focussed on growing our core SIR-Spheres microspheres business.”

Sirtex shares dropped $1.70, or 10.5 per cent, to $14.56.

IMPAIRMENTS HIT SIRTEX AS SALES GROWTH SLOWS:

* Full-year loss of $26.3 million vs $53.6m profit

* Revenue up 0.9pct at $236.9m

* Final unfranked dividend 30 cents, unchanged

Higher IAG car claims push premiums higher

IAG will use higher motor insurance premiums to address the increased cost of claims that pushed down its full-year underlying insurance margin.

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The insurance giant lifted profit for the 12 months to June 30 by 48.6 per cent to $929 million after changes to compulsory third party insurance in NSW allowed higher than expected prior period reserve releases of $457 million.

That more than offset a rise in natural peril claims due to events including the Kaikoura earthquake in New Zealand and tropical Cyclone Debbie in Queensland.

But underlying insurance margin – IAG’s preferred measure of performance – fell from 14 per cent to 11.9 per cent partly due to higher motor claim costs in Australia and New Zealand, the insurer said on Wednesday.

IAG has already raised premiums to address the issue – helping lift gross written premium 3.9 per cent to $11.8 billion – and said the 2018 financial year should show further results of “ongoing rate initiatives to help address short tail claim pressures, notably in motor”.

Chief executive Peter Harmer said the plan was well advanced.

“We have a number of initiatives underway that look at how we can reduce the cost of managing claims in a way that creates affordable insurance options for customers both now and into the future,” Mr Harmer said.

“We expect these initiatives, which are being created in consultation with our customers, to be finalised in the first half of the 2018 financial year.”

Net natural peril claim costs rose to $822 million, which was up 24.7 per cent on 2016 and more than $140 million over allowance.

Investors were unimpressed, sending IAG shares down 54 cents, or eight per cent, to $6.22.

CAR CLAIMS CRASH IAG’S FULL-YEAR FINANCIALS

* Net profit up 48.6pct to $929m

* Gross written premium up 3.9pct to $11.8b

* Underlying insurance margin 11.9pct v 14.0pct

* Final dividend up seven cents to 20 cents, fully franked.

North Korea presses rocket program

North Korean leader Kim Jong Un has ordered the production of more solid-fuel rocket engines as he pursues nuclear and missile programs amid a standoff with Washington, but there were signs of the drama easing.

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The report carried by the KCNA news agency lacked the traditionally robust threats against the United States after weeks of heightened tension, and US President Donald Trump expressed optimism about a possible improvement in relations.

“I respect the fact that he is starting to respect us,” Trump said of Kim at a raucous campaign rally in Phoenix, Arizona.

“And maybe – probably not, but maybe – something positive can come about.”

The KCNA report, about Kim’s visit to a chemical institute, came not long after US Secretary of State Rex Tillerson appeared to make a peace overture, welcoming what he called the recent restraint shown by the reclusive North.

Kim was briefed about the process of manufacturing intercontinental ballistic missile (ICBM) warhead tips and solid-fuel rocket engines during his tour of the Chemical Material Institute of the Academy of Defence Science, KCNA said.

“He instructed the institute to produce more solid-fuel rocket engines and rocket warhead tips by further expanding engine production process and the production capacity of rocket warhead tips and engine jets by carbon/carbon compound material,” KCNA said.

North Korea has conducted two nuclear tests and dozens of missile tests since the start of last year, significantly raising tensions on the heavily militarised Korean peninsula and in defiance of UN Security Council resolutions. Two ICBM tests in July resulted in a new round of tougher global sanctions.

The last missile test on July 28 put the US mainland in range, prompting heated exchanges that raised fears of a new conflict on the peninsula.

Tillerson, however, noted what he called the restraint the North had shown and said he hoped a path could be opening for dialogue.

South Korea and the United States are conducting an annual joint drill this week involving computer simulations of a possible war, exercises that the North routinely describes as preparation for invasion. The drills started on Monday and run through to August 31.

The KCNA report said Kim had given “special thanks and special bonus” to officials of the institute, calling them heroes. A photograph showed Kim in a grey pinstriped suit, smiling before a large flow chart that described some kind of manufacturing process.

There was none of the fiery rhetoric of recent weeks, when Kim threatened to fire missiles into the sea near the US Pacific territory of Guam after Trump warned North Korea it would face “fire and fury” if it threatened the United States.

UNSW leads quantum computer project

Another Sydney university has joined the international race to develop the world’s first quantum computer.

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The University of NSW is the latest contender in what’s been called the space race of the 21st century after it launched Silicon Quantum Computing on Wednesday.

UNSW has partnered with Telstra and the Commonwealth Bank in the $83 million venture which will use technology developed at the university over the past two decades to build quantum computing hardware.

The University of Sydney in July revealed it had partnered with Microsoft to try and develop the world’s first quantum computer.

Quantum computers promise to deliver a massive increase in processing power over conventional computers by using a single electron or nucleus of an atom as the basic processing unit – a quantum bit, or qubit.

By performing multiple calculations simultaneously, quantum computers could be used to complete fast database searches, optimise traffic data and in artificial intelligence.

UNSW has received $8.7 million and $25 million boosts from the state and federal governments respectively to help create a prototype by 2022.

“It’s an exciting time to invest in this new industry that will shape the 21st century,” UNSW physics professor Michelle Simmons said in a statement on Wednesday.

Within the next five years, Silicon Quantum Computing will put together all the components of a quantum computer into a chip which will fast-track its ability to create a full-scale quantum computer, Telstra’s chief scientist Hugh Bradlow told AAP.

“UNSW is a world leader in this technology,” he said.

Skills Minister John Barilaro says this launch ensures NSW is a global leader in the space race.

“This new company, led by UNSW, will help to ensure we remain global leaders in the race to develop a silicon based quantum computer,” Skills Minister John Barilaro said in a statement on Wednesday.

The hardware will be built at the UNSW Sydney Kensington campus and at the University of Melbourne by a team of postdoctoral researchers, PhD students and lab technicians.