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Renewable Energy Revolution? Energy Australia Warns of Blackouts and Price Spikes

Essay by Eric Worrall

A string of early fossil fuel generator retirements is endangering the stability of the Aussie grid. But an even worse problem could be looming over the Aussie economy.

Don’t let fossil fuel plants retire too early: EnergyAustralia

Colin Packham Energy and resources reporter
Nov 24, 2022 – 3.48pm

Australia must adopt agreements between governments and companies that govern when a fossil fuel generator can be retired to ensure grid stability, the head of EnergyAustralia has said.

Under mounting social and economic pressure, several generators have announced plans to accelerate the closure of fossil fuel plants. AGL Energy on Thursday became the latest, announcing it would shutter its ageing Torrens Island B gas power station in 2026, citing the construction of a new interconnector cable that is set to plunge the generator into deeper losses.

The closure could have occurred as early as next year, but the South Australian government has struck a $20 million deal to keep it going until at least 2026.

Although there has been wave of new generation assets pledged, Mark Collette, managing director of EnergyAustralia – one of the country’s most measured voices in the country’s energy debate – said Australia was not developing new renewable energy generation assets quickly enough to compensate for the loss of traditional power sources such as coal.

Read more: https://www.afr.com/companies/energy/don-t-let-fossil-fuel-plants-retire-too-early-energyaustralia-20221123-p5c0pc

The big missing asset is energy storage. But there are also massive shortfalls on the generation side.

So why would energy companies push forward with plans to retire fossil fuel generators early, presumably in the full awareness there are not enough renewable assets to replace the retired fossil fuel assets? Knowing that early retirement of reliable energy could hard crash the Aussie power grid?

Perhaps this is the wrong question. In my opinion, the right question is – how much taxpayer’s money would the Australian government be prepared to spend, if the Aussie electricity grid actually collapses? Millions of voters screaming for a solution, demanding the power be restored, no matter what the cost?

There is only one way Australia could rapidly raise the hundreds of billions of dollars required to set this nightmare scenario right – we would have to sell freehold access to our vast mineral resources. No taxes, no royalties, the new owners could come in, bring in their own workers, and extract whatever they wanted, keeping all the profits for themselves, in exchange for restoring Australia’s electricity supply.

If I am right, Australia’s leaders are walking Australian taxpayers straight into a trap, which could lead to an enormous long term loss of national income, and the rape of Australia’s mineral wealth.

Note I am not accusing anyone of deliberately attempting to engineer this nightmare. There could be bad actors involved, but bad actors are not necessary to explain what is happening. “Never attribute to malice that which is adequately explained by stupidity” – Hanlon’s Razor.

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Nick Stokes
November 25, 2022 10:17 pm

the head of EnergyAustralia has said”

EnergyAustralia is a wholly owned subsidiary of China Light and Power.

Nick Stokes
Reply to  Eric Worrall
November 25, 2022 11:08 pm

Eric,
I’m implying that he has an agenda. What he seems to be saying is that Australia should go faster with renewables. I don’t disagree, but clearly his company has an interest in the matter.

ozspeaksup
Reply to  Eric Worrall
November 26, 2022 3:51 am

torrens island is the ONLY thing keeping SA light and running- that goes and the states stuffed

AGW is Not Science
Reply to  Nick Stokes
November 27, 2022 12:42 pm

“Go faster with renewables” lol.

Presumably you think that would be “good” because of the roaring success it has been so far – skyrocketing electric rates, unreliable power grid, destruction of Australia’s industrial base and economy.

AWG
Reply to  Nick Stokes
November 26, 2022 6:26 am

Nick is right about being owned by China.
Go to EnergyAustralia’s “about” page and at the bottom of Our History we read:

Our owner CLP Group is founded in Hong Kong

then one hundred years later:

Our owner CLP enters Australia, acquiring majority interest in Yallourn Energy, operator of one of Victoria’s largest power stations

So yes, for this article (behind paywall) does seem to be reading tea leaves w/r/t China taking over Australia’s energy grid. Makes perfect sense since the West only understands waging war in a twentieth century form and knows nothing about the non-kinetic ways.

Bryan A
Reply to  AWG
November 26, 2022 7:12 am

Yep, Control a nations energy sources and you effectively control that nation

Duker
Reply to  Bryan A
November 26, 2022 12:17 pm

Offshore assets of a foreign power can be appropriated – ask the Russians

Writing Observer
Reply to  Nick Stokes
November 26, 2022 8:00 am

A rare upcheck for Nick, a rare downcheck for Eric.

You don’t make a huge profit trying to sell into a collapsed economy, any more than you get milk out of a slaughtered cow. You have to keep it alive long enough to milk it for everything you can get.

markx
November 25, 2022 10:40 pm

What’s never pointed out on these news articles is that the financial losses of the coal and gas generators occor because of the terrible artificial market construct that is Australia’s NEM.
Bids on half hour supply at short notice obviously hugely favour the wind and solar dispatchers (who are also deeply subsidised) and force coal and gas generators into idle periods where they run at full cost.

markx
Reply to  markx
November 25, 2022 10:52 pm

And… here it is, discussed in detail just now over at Jo Nova’s:

https://joannenova.com.au/2022/11/shh-despite-a-bloodbath-quarter-for-electricity-prices-hated-brown-coal-still-sells-at-just-4c-per-kwh/

“….The average wholesale price for all generators last quarter was 20 cents a kilowatt hour (or $200 per megawatt hour), but brown coal generators were still able to supply during that same incendiary quarter for just at 4c a KWh. That was the average “winning bid”.

So last quarter brown coal was one fifth the price of black coal, and one sixth the price of gas or hydro, and no one is talking about it.….”

strativarius
Reply to  Eric Worrall
November 26, 2022 12:53 am

Have they considered burning American trees a la Drax?

/sarc

ozspeaksup
Reply to  Eric Worrall
November 26, 2022 3:52 am

and a**holes like the atlassian dirtbag canon brookes are infiltrating agl and wrecking it inside out

Mac
Reply to  Eric Worrall
November 26, 2022 4:01 am

I lived in Sydney in the 90″s. I never understood Australian politics being from the US.
When I saw what I thought was a problem that needed to be addressed people would usually say “the government will take care of it”.
The Ronald Reagan saying I’m from the govt and here to help came to mind…

Mariner
November 25, 2022 11:47 pm

For 75 years I have had reliable light and power at the flick of a switch. Twilight years are not meant to be spent in the dark.

Mariner
Reply to  Eric Worrall
November 26, 2022 3:50 am

Eric you are quite right. Unfortunately I am a woose. My kids vote green, and to keep family harmony the subject is never raised. The other day, while on the school run, my grandson said ” Granddad you are lucky, you will die of old age but I will probably die of climate change” I could have cried.

michael hart
Reply to  Mariner
November 26, 2022 6:22 am

Sad.
But next time, remind your grandson that there is no climate on earth, hot or cold, that is not inhabited by humans.

doonman
Reply to  Mariner
November 26, 2022 12:33 am

Seniors should be exempt from saving the earth. It’s too late for them to notice the difference between successes and failures. They need warm houses and lights to stay on all night so they can get to the bathroom 3 or 4 times a night.

strativarius
Reply to  doonman
November 26, 2022 1:03 am

Now define what you mean by Seniors…

Retired_Engineer_Jim
Reply to  doonman
November 26, 2022 5:52 pm

Some of us can still see in the dark

AGW is Not Science
Reply to  doonman
November 27, 2022 2:17 pm

EVERYBODY needs warm houses and electricity 24/7.

And the Earth DOESN’T NEED SAVING.

And since CO2 DOESN’T DRIVE THE EARTH’S TEMPERATURE, no amount of doing what they say about “emissions,” NOBODY WILL EVER NOTICE THE DIFFERENCE.

The only thing anybody WILL notice is the misery and suffering that their POLICIES WILL CAUSE.

Patrick MJD
Reply to  AGW is Not Science
November 28, 2022 5:30 pm

Rather the Earth cannot be saved. It does have a shelf life.

Iain Reid
November 25, 2022 11:58 pm

Eric,

how much taxpayer’s money would the Australian government be prepared to spend, if the Aussie electricity grid actually collapses?”

If you are talking about a large scale grid trip money is not going to restore power. It will need dispatchable power plants, which as you say are being shut down. Wind and solar not being dispatchable will not be of much use.

In that event the power is likely to be off for a very long time, and someone is going to have to explain to the public the reason?

Retired_Engineer_Jim
Reply to  Iain Reid
November 26, 2022 5:55 pm

Is it possible that, seeing the disincentives to further investment on fossil-fuel power generation, the owners are just taking their marbles and going home?

lyn roberts
November 26, 2022 3:45 am

Eric – we my husband and I are also in Brisbane. Husband has a heart failure, has a monitor that downloads his pacemaker and sends a file to Prince Charles Hospital. When he had covid last year the hospital must have monitored him a little closer than usual as his monitor showed it was transmitting more than usually, once a day. He also has a cpap machine that breathes for him as he forgets to breathe for himself when asleep, regular issue as the cpap machine wakes me up working really hard in the middle of the night., I really have an issue with the thought that we may have power blackouts during the night. His Defibrillator will then fire off when his heart reaches 200bpm in an effort to oxygenate his body, has to be transported to Prince Charles hospital afterwards to establish if any damage. These machines keep him out of hospital and safe at home, I wonder how many other heart patients are in the same boat, needing continous supply of electricity to stay alive.

mikelowe2013
Reply to  Eric Worrall
November 26, 2022 12:16 pm

As I understand it, a UPS normally keeps the supply going for long enough for a computer to be shutdown. I had one once and it worked very well. But that is hardly a solution for a medical situation which may require several days for the supply to be restored. If the wind doesn’t blow and the sun doesn’t shine, it could last for several days – which is the very reason why these “renewables” are truly “unreliables”!

old cocky
Reply to  mikelowe2013
November 26, 2022 1:11 pm

As I understand it, a UPS normally keeps the supply going for long enough for a computer to be shutdown. 

It’s very much a case of “how long is a piece of string?”.
For laptops, it doesn’t much matter because they’re going to be using the battery anyway.
For desktops (does anybody still use them?), you’re typically looking at a couple of hours.
For a data centre, it’s long enough for the diesel generators to kick in + some contingency if the diesels have trouble starting. The gensets should start within a minute if all is well, but the UPS typically holds everything up for at least an hour.

The UPS + generator approach should work well in Lyn’s situation as well.

Duker
Reply to  Eric Worrall
November 26, 2022 12:24 pm

Yes. A lot more people may be buying their own small generators for household use, if they dont need need un interrupted power. As we all know when there are blackouts in local areas its extremely inconvenient, but currently rare on the once in 5-10 years . More often, as it appears to be heading for, and a small generator will do the trick and a lot cheaper than batteries

Retired_Engineer_Jim
Reply to  Duker
November 26, 2022 6:02 pm

Except in California, where our Noble Government has outlawed the sale of small-engined generators.

Patrick MJD
Reply to  Eric Worrall
November 28, 2022 5:32 pm

You are better off using something like the battery packs sold by Bluetti.

ozspeaksup
November 26, 2022 3:50 am

theyve pretty much sold us off freehold as it is
bugger all tax paid some royalties and all profits going os for the most part
flogged off taxpayer owned assets
privatised and weve been in the crapper ever since

druid144
November 26, 2022 11:54 am

Never attribute to stupidity that which is adequately explained by avarice” – Druid’s Razor

slowroll
Reply to  druid144
November 26, 2022 12:55 pm

Yes. The proper understanding of Hanlon’s razor is that it is quite commonplace to be both malicious , avaricious and stupid. Witness every member of the bolshiecrat party.

It doesnot add up
November 26, 2022 12:56 pm

After Tasmania ran down their reservoirs to maintain supposedly highly profitable sales to Victoria over Basslink they found themselves having to buy large quantities of diesel generators when the rains failed and the Basslink failed so they were unable to import coal fired power they might otherwise have had access to. Tasmanian demand is not all that large, but the bill was costly.

Duker
Reply to  It doesnot add up
November 26, 2022 5:24 pm

Yes . Even this summer past was the driest in 40 years, even while the mainland eastern states got constant deluges

Patrick MJD
November 28, 2022 5:27 pm

This is all by design. Australia is pulling down perfectly serviceable power plants long before any alternative is made available and like the mugs we are, we’re paying through the nose for it. The silly thing is the Govn’t is providing rebates for families struggling to pay their energy bills and there is a prediccted~35% rise coming year.

I am lucky I don’t consume much but there are families who regularly pay several thousand AU$’s per quarter.

And this whole drive to “Net Zero” within a few years is more madness. Still waiting to see evidence that ~0.04% CO2 is causing climate to change. But it’s no better in the countries I could migrate to.

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