Guest essay by Eric Worrall
Australia’s green conservatives are panicking that after years of political vilification, coal businesses are abandoning their plants, leaving a gaping hole in Australia’s baseload power reserves.
Guest essay by Eric Worrall
AGL digs in on coal plant closure as Turnbull government warns of ‘colossal failure’
Nicole Hasham James Massola
SEPTEMBER 6 2017 – 2:38PM
Energy giant AGL has issued a further snub to the Turnbull government, insisting it does not plan to sell its ageing Liddell power station nor keep it open beyond 2022.
In a statement to the Australian Stock Exchange on Wednesday, AGL said it was committed to closing the NSW coal-fired power station – Australia’s oldest operating coal plant – as planned.
But power company Delta Electricity has indicated it could be interested in buying the plant, subject to price and the cost of upgrading the station to keep it running.
Prime Minister Malcolm Turnbull on Wednesday said the government was still in talks with AGL over the future of Liddell and it was too early to say if the government would give financial incentives to a new owner of the plant.
A report from the nation’s energy market operator on Tuesday warned urgent action was needed to prevent blackouts on hot summer days. In response, Mr Turnbull said his government wanted to delay the closure of Liddell, in NSW’s Hunter Valley, for at least five years.
It is slated to close in 2022, which AGL says is the end of the plant’s operating life.
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The AEMO report on Australia’s dispatchable power shortfall, which mentions the AGL Liddell plant by name;
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The NEM is not delivering enough investment in flexible dispatchable resources to maintain the defined target level of supply reliability, as the transition from traditional generation to variable energy resources proceeds. This was vividly illustrated by the load-shedding events of February 2017 and by the Finkel Review analysis. Most stakeholders see changes to market rules as the most economically efficient way to remedy this deficiency. AEMO forecasts of NEM demand and published investment plans confirm the urgency of this task and short-term measures will be necessary until a long-term solution is agreed and becomes fully effective.
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Liddell Power Station retirement: Prior to the retirement of Liddell (announced by AGL to occur in 2022), around 1,000 MW of new investment is expected to be required to preserve reliability of supply in New South Wales (NSW) and Victoria at the NEM standard. Mechanisms should be established in the NEM design to address this, and similar requirements, for the long term.
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My impression is AGL simply don’t want to be the bad guys anymore. Thanks to massive government incentives, green energy is far more profitable than coal, so AGL appear to be running down their coal plants and abandoning them. The fact renewables are not a viable replacement for baseload power, the fact the risk of blackouts is skyrocketing, isn’t AGL’s problem; it is a problem for Australia’s overconfident politicians who thought coal plant operators would simply sit there and take the abuse, and the green pseudo-intellectuals who cheered on this political idiocy.
Some numbers behind the panic
http://joannenova.com.au/2017/09/62-of-australians-dont-want-to-pay-even-10-a-month-for-renewables/#comment-1944706
There is a related topic receiving considerable attention at jonova at present as you might expect :
http://joannenova.com.au/2017/09/62-of-australians-dont-want-to-pay-even-10-a-month-for-renewables/#comments
Particular worth noting , in view of the rose tinted visions of renewables given above are the figures for current coal v wind power generation in Australia given by “Tonyfromoz” (comment 21)
For example:
“The total Nameplate for coal fired power in Australia is currently 23019MW, and it regularly supplies between 15000MW and 19000MW.
It supplies that power from 16 coal fired power plants with 48 Units in all. At any one time there are at least 7 of those Units out of service for maintenance.
So we have 48 Units supplying a Nameplate of 23019MW, and while different plants have different sized units, let’s then reduce that Nameplate to a simple average.
That average PER UNIT is a tick under 480MW.
There is NO single wind plant in the whole of Australia that has a Nameplate of that size. The closest is Macarthur with a Nameplate of 420MW, and that has 140 turbines ….. ONE HUNDRED AND FORTY, and still not even close to the average size of ONE coal fired Unit. Keep in mind that wind power only has a Capacity Factor (CF) of 30%, so that takes the average for Macarthur down to only 126MW.
When you take the total for ALL wind power in Australia, there’s a Nameplate of 4400MW and with the CF, that’s down to 1320MW.
So, the average for wind power is just less than the average of THREE coal fired UNITS, and there are 48 of those.”
There is more and none of it pleasant reading for a resident of NSW or SA .
Eric, did you really mean this? “Australia’s green conservatives..,”
” … not delivering enough investment in flexible dispatchable resources to maintain the defined target level of supply reliability”
Bureaucratise for “It ain’t working.”
After years of asinine posturing by Greenwash Politicians on the CAGW fiasco for years and years, the shit is now starting to hit the Wind-Turbines in Australia. Politicians are finally beginning to grasp how much damage they have caused to the economy with their mindless obsession with CAGW. AGL’s problem is a problem specifically caused by Australia’s fatuous politicians who thought that they could get away with hammering coal plant operators who would simply sit still and cop endless abuse and costs without taking evasive action. Meanwhile, the Green Blob is still cheering on the chaos, power poverty of the Poor and encouraging further political idiocy involving costly Elon Musk Batteries which keep the power on for fifteen minutes and wild schemes to pump water uphill at great cost.
Too many people in Australia brainwashed by the greenies, including pollies.
The numbers of people who have not applied some common sense to the arguments shocks the socks off me.
Solar and wind will provide when we close down the dirty coal fired stations, to date I believe they supply 3% of our power, so how suddenly are they going to provide 100%.
I found myself having an argument with a green supporter who stated that solar would provide, did she not realize that 12 hours or so is nighttime, I replied, I haven’t noticed the moon being bright enough to provide solar energy. DUHHHHH!!!!, why oh why did I have to point that out to her.
Then she tried tuning it around and saying oh well wind power, I had to point out to her wind usually dies off at night as well.
I hope she was planning to live in the dark after the sun sets, just like our great grandparents, with oil lanterns, Oh wait they are powered by dirty Oil, so cannot possibly use them either.
It might be possible to sell a flashlight powered by solar cells to such a person …
solar LED lights (with phone charger) are a very useful item, especially to replace a kersone lamp which you have to fill with expensive kerosene.
What are you going to do with a phone charger, at moments when there are no electricity available …? Just as smart as using lamps/LED directly connected to solar cells, when dark, which my comment was all about …
Kerosene doesn’t rely on the wind blowing or the sun shining. It lights up regardless. And one lamp-full lasts for several nights (the wick will need replacing before the reservoir needs refilling). And one can will fill up several lamps. And the red-heavy flame won’t mess up your sleep cycle like blue-heavy LEDs will.
Lost in transmission, I missed ‘only‘ between ‘powered’ and ‘by’
AGL Senior Manager Skye Paris was activist for GetUp:
https://au.linkedin.com/in/skyelaris
She also worked for Jay Weatherill no less!
AGL will lose out ultimately when the power goes off in summer and the blame game starts , unfortunately it’s a lesson we have to learn the hard way but look out watermelons , electricity might be in short supply but tar and feathers are abundant .
When (not if) load shedding comes, maybe the power companies would shed the pollies’ first. That would see them about-face before a dingo’s pee hits the ground.
I strongly favour load shedding in inner city greenie, lefty electorates first. I see no reason why those of us who tried to stop this crap should have to suffer. And anyway, to be consistent, wont they only want power three percent of the time is they are so opposed to coal etc.
The irony of the argument by Green groups is that they say we need an agreed high renewable energy target so businesses will be given certainty and encouraged to invest in renewables which will bring prices down. Renewable targets can be achieved by two ways , invest in more renewables or shut down coal fired plants. If that occurs by definition the energy supply becomes more unreliable and more expensive . If energy supplies become unreliable and expensive companies will exit Australia especially big energy users like smelters and manufacturers . If energy companies face an environment of future customers disappearing because of unreliable ( and expensive ) supply why would anyone want to invest in renewables knowing by doing so they will create a fall in demand for their product. The removal of Ret and the exit from the Paris agreement is the only way that certainty can be returned to this sector. It also may be the only way the current government can stay in power which would also help reduce uncertainty.
Energy in Australia is a national disgrace and every voter who in State elections in particular voted for governments espousing these green policies should hang their heads in shame.
“Zigmaster
If energy supplies become unreliable and expensive companies will exit Australia especially big energy users like smelters and manufacturers .”
Already happened. No car making in South Australia any more. Most expensive energy, highest unemployment.
A major factor in car mfrs leaving was cost of labor compared to Thailand and other mfg hubs in Asia. Car mfg has been exiting Australia long before recent energy price increases.
Two of the reasons GM and Ford cited for exiting Australia were labor and ENERGY costs!
As an Australian, from my perspective, ever since they shut down 2 coal fired power station in the Peoples Republic of South Australia, and one is slated to close in Victoria, but is scaling back the capacity. I’ve been saying to anyone who will listen is that we are a huge chance to have brown outs and black outs this coming summer as the energy policies of Federal & State govts have led us to the ridiculous situation where a country that is overflowing with coal & gas cant power its own grid. Instead the focus of the media is on whether homosexuals should be allowed to get married…..**yawn**. It will hit many Australians in the face on a 40 degree day and no air con…….then it will become an issue. Instead of being proactive, govts will be their normal reactive self.
As an Aussie, an AGL customer for a decade as as one corresponding actively with AGL about their problems, I might be qualified to comment.
The biggest problem arises because –
1. Electricity is an essential commodity
2. AGL and a small number of other companies combine for a near monopoly
3. Electricity supply is largely governed by States, some of which have near-Communist premiers
4. Andy Vesey, CEO of AGL, is a confessed renewables advocate, evangelic in enthusiasm.
The basic problem is that historically and properly, the Federal Government should control the electricity supply, not an unelected green CEO of a company. One reason of many why this should be so, is to prevent a minority interest (a green CEO exercising his pet politics) from controlling National policy with its long term implications for Australia’s future.
The problem stemming from this structural failure is that current Federal politicians are incapable of making decisions to secure the low cost and reliable supply of future electricity. A large part of the reason for this is their fear of losing office because they might lose a green vote by making the evident hard decisions needed, which are anti-green.
Then, overarching all of this is the still-questionable hypothesis of greenhouse gases and global warming. The impetus to reduce CO2 emissions has been supported by learned societies, much of academia and the most recent couple of Chief scientists. I am really bitter that they have collectively not studied the global warming material in adequate depth to realise its unsuitability to inform national policy. Geoff
“The basic problem is that historically and properly, the Federal Government should control the electricity supply, not an unelected green CEO of a company.”
That’s how to keep the socialists out!
And if you have a Socialist government?
Nick,
This is a clear example of where the will of the majority should be determined and satisfied, is it not?
You are mistaken about the CEO, he has every intention of exploiting the spot price market. AGL are not in t h e coal or gas business, they are in the business of making money. Profits are projected to double in the next two years.
Old44,
I am prepared to revoke and apologise when I am shown wrong but that takes more than an assertion by you. What good evidence do you have for your surmise about Andy Vesey?
AGL most certainly are in the coal business, otherwise Vesey would not have been able to state that AGL is getting out if coal.
There is no sin in companies being focussed on profits. It is a strong force behind capitalism. Sadly, too many people have an image of profits like Scrooge McDuck swimming in a pool of hoarded profit money. In reality, profits go mostly to future growth and reinvestment back into the community. The path from profit to people can be hard to track, but it is invariably there. All companies should strive to profit but not at the expense of the common good through mad decisions like over-enthusiastic renewables investment and awfully bad, inexcusably bad, please-never-again bad decisions like getting out of coal. And planning to profit from subsidies that should never be there. Geoff
Part (perhaps the biggest part) of the problem lies with the Aussie voters. It seems we have been so thoroughly indoctrinated by the mostly left press that green is for the better, and the sooner the better, that the politicians, even if they knew what would actually be in Australia’s best interest, have no hope of holding onto power if they made the best interest decisions, because the majority would vote them into orbit next election.
Not so sure it really is green that is driving voters so much as there are now more people living off the government than paying for it. Any one who saves in this country is now being hammered as “greedy” despite the message from governments for years about saving for your retirement. Anyone for no representation without taxation?
Just how blind to Politicians become when they allow a Power Station (Hazelwood) that supplied over 20% of peak load close just because it is Coal Fired?
Sure it needed money spent but don’t tell me any thinking Pollie could not foresee the potential problems we now face.
Me too. AGL have Turnbull snookered.
AGL know it and so does Turnbull.
Everything is going to plan for AGL so what’s the problem?
Malcolm is the only one with a problem!
He’ll be kicked out next election and Bill will take over and give AGL what they want . . . a really high renewable energy target RET and more taxpayer funds and subsidies.
Actually sorry, there’s also a bunch of poor people who can’t afford to pay their electricity bills.
Most Australians want to be green (all credible surveys) so they’ll just have to pay-up now because its too late to change.
AGL aren’t stupid they’re run by the ‘fund managers’ . . . the green cartel.
Still waiting for the article that explains the proper method to use in order successfully plug in the lump of coal as depicted.
I have tried everything, and everyone just laughs every time I bring it up…
*sigh*
This works…
https://www.google.com.au/search?q=coal+fire+images&tbm=isch&imgil=7V3b9EnoUDUudM%253A%253Bub6UemLL8fK__M%253Bhttp%25253A%25252F%25252Fwww.farminmypocket.co.uk%25252Fsustainability%25252Fheating%25252Fopen-fire-heating&source=iu&pf=m&fir=7V3b9EnoUDUudM%253A%252Cub6UemLL8fK__M%252C_&usg=__vLZap9jV_8EpQxMbVk7Jdq2b8kw%3D&biw=1274&bih=615&ved=0ahUKEwi1otvR9JLWAhUEFJQKHQwbDQMQyjcIPw&ei=eyWxWfX4OoSo0ASMtrQY#imgrc=7V3b9EnoUDUudM:
If Tony Abbott was still pm, Australia would be doing just fine!
This road crash has been in the making since 1991. Thanks those who voted for this crap! Yes, voted! I am an Australian Permanent resident and thus cannot vote. But sure as hell have my wages abused by deductions.
The final political step could simply be nationalizing coal fired power plants. That would yield the worst of all worlds.
Please, please do not give our Aussie political morons any ideas.
The really interesting thing about the announcement was that following on from the advertising campaign about AGL getting out of coal it was stated that after Liddell was closed it would be repurposed. AGL owns massive gas resoures at Gloucester, about 100km away over Barrington Tops. With the shortage of baseload electricity caused by the annouced closure of coal fired power station a pipeline to supply gas to generators at Liddell would enable AGL to exploit the market. Just a thought.
I bought shares in AGL today.
Old44,
Why buy shares when they have been complicit in a near- doubling oif retail erlectricity prices, when they take income from subsidies instead of from skill and effort and when they are so dedicated to green that they announce they were getting out if coal — when the strong signal from countries like USA, Germany, Japan, China, India, Indonesia to name a few, is increasing new investment in coal. Have all those countries got their sums wrong? Over 1600 new global coal plants in the making and Australia, with abundant coal, should leave it in the ground?
I.D put my dollars behind a company that profits from skill in using solid substance planning, not reliance on subsidies and like in sky renewables. Thud as the shares go down. Geoff.
Thank god we have Australia and Californian politicians ready and wiling to sacrifice their economies and their people’s standards of living by willfully self harming their capable, affordable, sustainable and adeqaute on demand energy supply that their economies depend upon with an ovrdose of pointless renewables on the grid – so others can watch, maybe learn, and change energy susbidy policies to align with energy science facts – instead of preferring green delusion for a fast lobbyist Dollar.
The less efficient, affordable, reliable, sustainable, deliverable it is, the more you have to susidiuse it, Right? .Energy policy at work is the ultimate science denial, on the engineering facts. And you can’t make it up, that’s now government’s job. By law. CEng, CPhys, MBA.
The failure of the system to keep the lights on is not a consequence of Green policies it is the objective. Forcing a fall in population and a return to hunter gathering (with not too much hunting) is where their policies will inevitably lead. Intentionally so.
Exxon Mobil didn’t make any money in Paleolithic times and they won’t from now on!