The dogma of sustainability and renewables is ruining the power system

‘Sustainability’ is a modern buzz-word, a fashion, a vital tool for preservation and all-to-often a cover for dangerous covert agendas, not the least being the danger of related policies returning electrical power delivery to third-world status

Check at the end for links to previous articles

Australia’s power policies are killing its economy

Australia’s power policies are killing its economy  By Ian Plimer, The Australian 23 October, 2017

You couldn’t make it up if you tried. Australia is a huge exporter of energy as coal, LNG and uranium, yet it has unreliable and ­expensive electricity. South Australia has achieved a first for ­Australia: it has the most expensive electricity in the world. A short time ago it had cheap coal-fired power.

Australia remains the only G20 country with no nuclear power yet has 30 per cent of the planet’s in-ground uranium, mainly in South Australia. Vic­toria has banned drilling for ­onshore gas in its two gas-rich ­basins yet suffers a gas shortage.

Australia’s energy crisis is based on a flawed fundamental. Global human emissions are only 3 per cent of total annual emissions. It has never been shown that human emissions of carbon dioxide drive global warming. If it were shown, it would also have to be shown that the 97 per cent of emissions from natural processes such as ocean degassing, volcanoes, natural chemical reactions and exhalation don’t drive global warming.

In the geological past, Earth’s atmosphere had hundreds of times the CO2 content of the modern atmosphere yet there were no carbon dioxide-driven catastrophes. The past shows that climate change is normal, that warmer times and more atmospheric carbon dioxide have driven biodiversity and that cold times kill.

Ice core drilling shows that 800 years after natural warming, the atmosphere increases in carbon dioxide. The zenith of the Little Ice Age was 300 years ago and since then we have slightly warmed and cooled during a long-term warming trend. Instrumental temperature measurements over the past 150 years show no correlation between human emissions of CO2 and ­temperature. On all timescales it can be shown that there is no correlation between CO2 emissions and global warming. Without correlation, there can be no causation.

The worldwide temperature record has been changed. Cooling trends have been “homogenised” to warming trends. In the corporate world, if a loss is “homo­genised” to a profit, it is fraud. Why is climate science different?

No genuine environmentalist could honestly support subsidised wind turbines that despoil the scenery, slice and dice birds and bats, damage human health and spread toxins. This is not environmentalism. It is power over people by unelected activists, often ­funded from outside Australia.

Unless the laws of physics are changed, solar power cannot be made more efficient. Solar facilities result in the clearing and environmental degradation of huge acreages and depositing of toxins.

Construction and maintenance of wind and solar facilities ­release far more carbon dioxide than they are meant to save over their working lives and they need to be sup­ported 24/7 by coal-fired generators. The Spaniards invented a way of producing solar power at night without changing the laws of physics. Diesel generators with floodlights illuminated solar ­panels. Subsidies were so generous that profits could still be made at night. No wonder Spain went broke.

Australia’s CO2 emissions are only 1.3 per cent of global human emissions, which are 3 per cent of the total global emissions. To reduce Australian emissions will have absolutely no effect on the planet’s temperature. The only effect will be a rapid reduction in jobs as electricity prices skyrocket.

Those who signed the Paris ­Accord actually believed they can twiddle the planetary dials to minimise warming to less than 2 Celsius yet seemed blissfully ­unaware that whatever humans do, they cannot change Earth’s orbit and radiation released from the sun that drive climate. Australia’s signed a suicide note yet didn’t seem to notice that China, India, Indonesia and the US did not commit to reducing their large carbon dioxide emissions.

The grasslands, crops, forests and territorial waters of Australia absorb more carbon dioxide than Australia emits. Australia should demand the Paris Accord shell out some of the billions sloshing around in the climate business.

The subsidies for wind and solar power and the must-take mandate have attracted all sorts of dodgy enterprises, lickspittles and carpetbaggers to the renewable energy honey pot. The National Energy Market was the nail in the coffin and, after 40 years of falling electricity costs and a reliable grid, Australia now has energy poverty and destruction of businesses. Electricity is not a luxury; it is a necessity for any civilised society.

The solution requires political courage. Cancel the renewable energy target, large-scale RET, ­renewable energy certificates, clean energy target and any funding that subsidises renewable ­energy. Cancel funding for climate research institutes, climate conferences, carbon capture schemes and jaunts for signing suicide notes.

If any energy company provides electricity to the grid, decree that it must have 90 per cent availability 24/7 and get rid of the must-take mandate. Cancel the charitable status of feral activist groups like Greenpeace. Change the Corporations Law such that green activists, environmentalists, unionists and lobbyists abide by the same conditions of probity as company directors.

Because investment confidence in energy in Australia has been destroyed, governments must build modern coal-fired and nuclear power stations. Australia needs a nuclear industry that could start by using modular reactors for isolated mines and towns before growing a vertically integrated nuclear industry.

Only elections can change the madness but no major political party has nation-building leaders and a coherent policy to cut electricity costs and ­increase reliability. Politicians fiddle around the edges. As soon as the words emissions, climate change and Paris are used, you know you are being conned and that the world’s biggest scam will continue.

 Australia’s energy policy is based on the fallacious assumption that human emissions of CO2 drive global warming. This underpins the Finkel and Australian Competition and Consumer Com­­mis­sion reports, the Paris ­Accord and political quick-fix ­solutions. Renewable energy has become ruinable energy, thanks to green ideology.

 I fear there will be years of ­increasing pain before there is enough political courage to bring Australia to what it had in the past: cheap, reliable employment-generating electricity.

Emeritus Professor Ian Plimer’s Climate Delusion and The Great Electricity Rip-off (Connor Court) has just been published.

===================

Australia’s electricity is far too expensive and unreliable

Australia’s electricity is far too expensive and unreliable  By Nick Cater, The Australian, 6 June 2017

There’s an app for everything these days, even one that tracks in real time the startling cost of Australia’s ­ludicrous energy policy.

We are indebted to PocketNEM for informing us that the spot price of electricity on the National Energy Market shot above $150 a megawatt hour in the eastern states late on Sunday afternoon, hitting $365 in the windmill-powered dystopia known as South Australia. During a largely overcast and windless winter weekend, SA and Victoria sucked up megawatt after megawatt of coal-generated electricity from NSW and Queensland, stretching the interconnectors to their limits.

To whom will the cost of these expensive buy-ins be charged? To the customer of course — you, me and the business we rely on to provide jobs, goods and services.

When the dust settles, the 33,000 gigawatt-hour renewable energy target will prove to be the costliest legacy of the Rudd and Gillard governments. Sure, there are plenty of other multi-billion-dollar blunders to choose from — the cost blowout to the National Disability Insurance Scheme, for example — policies that, like the RET, were implemented with noble intent but vacant attention to detail.

Yet on the scale of bureaucratically orchestrated disasters they are dwarfed by the RET, a Soviet-scale exercise in market intervention that is unravelling before our eyes, presenting Malcolm Turnbull’s government with a diabolical policy challenge that cannot be deferred.

How quickly the world has changed. Barely nine months before Turnbull became Prime Minister the Australian Energy Market Commission, which is supposed to know about these things, predicted that scrapping the carbon tax, falling electricity demand and increased capacity would cause retail electricity prices to fall.

The AEMC’s latest forecast presents a very different picture. Household electricity bills will rise acutely, particularly in South Australia and Victoria. The closure of SA’s brown-coal-fired Northern power station 13 months ago, followed by the closure of Victoria’s Hazelwood power station this year, means that for the first time in at least a half-century there is a shortage of active generation ­capacity.

Last December, the AEMC calculated that the closures would increase the cost of wholesale energy by 55 per cent in Victoria and Tasmania and 41 per cent in SA by the next federal election.

The Turnbull government will get only one shot at fixing this mess before rising power prices start to bite, and it will steady its aim this Friday with the release of Alan Finkel’s review of the National Electricity Market.

It is a chance to rescue energy policy from the sectional interests that want the renewable energy gravy train to keep running, and to frame it to serve the national ­interest. The ideologues, aided and abetted by the self-interested renewable energy lobby, will try to make this a debate about “sustainability” in the hope of deflecting attention from our demonstrably unsustainable energy policy. We must ignore their soft-headed nonsense and focus on securing what we really need: a reliable supply of affordable energy within our carbon emission targets.

The review is unlikely to recommend, nor is the government willing to countenance, the abolition of the RET, attractive as that may seem to energy market ­rationalists.

It should, however, help us recognise that putting most of the burden on the electricity grid to deliver Australia’s promised carbon emissions reduction was a ghastly mistake. It has neither assisted the reduction of carbon emissions nor encouraged the development of new technology.

Even Ross Garnaut, the Rudd government’s professor of choice, called for it to be phased out. The RET “does not necessarily encourage the lowest cost means of reducing emissions”, he wrote in 2011, “nor does it encourage innovation: it favours the lowest cost established technologies that are eligible within the scheme”,

In fact, it can cost up to $100 a tonne to abate carbon emissions through large-scale wind and solar, and up to double that amount using small-scale domestic solar panels.

Meanwhile another arm of government, the Emissions Reduction Fund, can do the same job for less than $12 a tonne. Allowing thermal generators to offset emissions by purchasing credits from the ERF instead of renewable energy certificates at eight or nine times the price may give them a fighting chance.

The review also presents the opportunity to end the sacred treatment of wind and solar and to share subsidies, if subsidies there must be, with low-emission thermal energy production such as gas and clean coal. It would not fix the gas shortage but at least it would give the owners of mothballed gas plants a little more confidence of a return on investment.

If common sense is allowed to intrude, we will no longer pay subsidies of about $85 a megawatt hour for the fitful supply of unstable energy using subprime technology of windmills.

Renewable energy suppliers have little incentive to improve the reliability of their product since it is the public, not they, who are forced to pick up the bill for buying in thermal power at the spot price when the blades stop tuning.

The energy market as currently constructed is a classic example of moral hazard where one party decides how much risk to take, while another bears the cost when things go wrong. If renewable energy companies were made to shoulder all, or at least part, of the cost of their failure to provide electricity at 50 hertz for 24 hours a day, they might invest more in the development of storage.

What could go wrong? After all, Alan Kohler assured us in his column in The Weekend Australian that wind and solar are at the point of becoming cheaper than coal and gas, and batteries are just around the corner. We are about to see a flood of renewable investment that will spell the end of coal.

A clear-headed readjustment of the RET will allow us to test that somewhat brave assumption. Oh, and help us keep the lights on.

Nick Cater is executive director of Menzies Research Centre.

================

A Dead Man Warns of a Dying Grid

A Dead Man Warns of a Dying Grid  By Alan Moran, Quadrant Online, 5 April 2017

 Not long before his sudden and premature death, Australian Energy Market Operator chief Matt Zema spoke candidly at a private conference of power-industry executives. The enormous subsidies heaped on renewables, he said, mean one thing and only one thing: “The system must collapse”

 

Matt Zema, inaugural head of the Australian Energy Market Operator (AEMO), attended a meeting a year ago of the Regulation Economics Energy Forum at which a number of prominent electricity industry executives were present.  Proceedings at the meeting were private, but the need for confidentiality was removed with Matt’s sad death three months later. The following were among his remarks:

 

“The renewable developments and increased political interference are pushing the system towards a crisis.  South Australia is most vulnerable with its potential for wind to supply 60% of demand and then to cut back rapidly.  Each new windfarm constrains existing ones and brings demand for more transmission. The system is only manageable with robust interconnectors, but these operate effectively only because there is abundant coal-based generation in Victoria…

… wind, being subsidised and having low marginal costs, depresses the spot price and once a major coal plant has a severe problem it will be closed…

… wind does not provide the system security.  But the politicians will not allow the appropriate price changes to permit profitable supply developments from other sources.  And the original intent of having the generator or other beneficiary pay for transmission and services over and above energy itself has now been lost so there are no market signals, just a series of patch-ups that obscure the instability and shift the problem to include Victoria. In the end the system must collapse…”

A month later South Australia’s coal-fuelled Northern Power Station was disconnected from the network because it was unable to operate profitably against subsidised intermittent renewable energy that has priority over other supplies.

In September, 2016, as a result of this capacity reduction, South Australia lost all its power when storms triggered outages and several wind generators were unable to “ride through”,  causing the main interconnector with Victoria to shut down.  A more limited loss of power took place in February, 2017, when wind supply dropped from 800MW to under 100MW in four hours.

The September, 2016, blackout is estimated to have cost the state $367 million. BHP, whose senior executives have long engaged in virtue-signalling in favour of carbon taxes and exotic “clean” renewables, reported a loss of $US105 million with their Olympic Dam project — a loss magnified by the company being forced to suspend its proposed doubling of the mine’s capacity as a result of power uncertainties.

Alan Moran’s new book, Climate Change: Treaties and Policies in the Trump Era
can be ordered by clicking here

Engie, the owners of Hazelwood announced in November, 2016, that the 1600 megawatt facility (supplying between 20% and 25% of the state’s power) will be the fourth big coal-fired power station to close. Hazelwood had been allowed to deteriorate as a result of subsidised wind making the plant unprofitable, which did not stop Engie  being ordered to complete major repairs to at least five of the eight boilers in order to meet occupational health and safety regulations.

The bottom line is that the loss of the coal-powered stations has resulted in at least a doubling of the wholesale electricity price in the southern states and the concomitant loss of reliability.

Blame shifting between politicians has characterised the various events. Reliable coal plants are being forced to close due to competition from renewables which currently enjoy a subsidy of $84 per MWH, double the actual price received by coal plants.  The forced closure of these plants has compounded the cost impost by forcing up pool prices. The subsidies favouring renewable energy include several put in place by state governments, but the most important regulations are at the Commonwealth level — especially those requiring increasing shares of wind and solar within the supply mix.  These regulations give rise to the current subsidy for wind and solar, currently at $84 per MWh and capped at $92.5 per MWh.

The roll-out of new subsidised power is on-going.  And various schemes are being floated for buffering and overcoming wind’s intrinsic lack of reliability. Among these is the mooted South Australian battery investment using the technology developed by Elon Musk and the proposal floated by the Prime Minister to augment the Snowy hydro system with “pumped storage”.  These measures, should they go ahead, allow the transfer of power over time and, in doing so, reduce the gross power available.

New “solutions” using subsidised wind and solar abound.

Last week, for example, South Australian Premier Jay Weatherill announced a new solar-battery combination, Lyon Solar in the Riverland, which promises 300 Megawatts of capacity.  This is the equivalent of perhaps 80 megawatts of coal fuelled electricity and comes at a cost of one billion dollars.

The now-shuttered Northern Power Station had 540 megawatts, yet Weatherill declined to take up an offer that would, for a mere $25 million, have kept it open. Instead, he plumped to spend $500 million-plus on a gas generator of half that capacity and, plus Elon Musk’s much bally-hooed batteries!

On paper, the new Lyon Solar facility is profitable only because of the penalties imposed on coal. These include the subsidy under the Renewable Energy Target of $84 per MWh.  In addition, the facility benefits from the forced closure of the coal-fired stations. This has resulted in the wholesale price of electricity rising to a new norm of $130 per MWh, compared with the average price in the four years to 2015 of $50 per MWh. The bottom line is that the consumer will pay $214 per MWh for $50-per-MWh worth of electricity from the new facility.

With that sort of money being littered around the industry for gee-whizz exotic projects it is little wonder that moochers are circling the state like moths round a candle. In the end, renewables require at least three times the price of the supposed dinosaur facilities they are displacing; consumers and industry will need to pay this and, in addition, fork out for grid additions to offset some of the inevitable deterioration of reliability the brave new energy world entails.  Obviously many outfits, especially those in the energy intensive mining and smelting and agricultural processing sectors will not find it profitable to remain in an Australian market where wholesale electricity prices have more than doubles and the system’s reliability has deteriorated.

We are seeing the future with these renewable energy facilities and it is not working. The contagion that is undermining the South Australian economy and impoverishing the state’s households is spreading to Victoria.

Ominously, on the very day that Hazelwood closed, Victoria evidenced what will be the new norm.

Incredibly, with no heatwave or any other factor to inspire a spike in electricity demand, it had to import electricity from New South Wales and Tasmania.

 

Alan Moran’s latest book,  Climate Change: Treaties and Policies in the Trump Era, is now published and, if not in your local bookshop, available on Amazon and direct from publisher Connor Court.

=================

Previous Articles

About Peter Senior

I'm a very experienced and pragmatic management consultant. I've reviewed and led the restructuring of many organisations - large and small corporations and Government Departments, much of the time as President of the New Zealand Institute of Management Consultants. Before that I was General Manager of a major NZ newspaper; earlier, an analyst for IBM UK. I gained an honours degree in engineering at London University, and studied management at Cambridge University. This wide range of experience has left me frustrated: I continue to see too many examples of really bad management. Sometimes small easily fixed issues; sometimes fundamental faults; and sometimes really tricky problems. Mostly these issues can be fixed using a mixture of common sense, 'management 101' and applying lessons from years of management experience. Unfortunately, all too often, politics, bureaucracy and daft government regulations get in the way; internal factors such as poor culture and out-of-date strategies are often evident. So what's gone wrong, and why, and most importantly, how to fix 'it'? I hope there are like-minded people 'out there' who will share their thoughts enabling 'us' to improve some significant management failures that affect the general public. If you just accept bad management, you don't have the right to complain! If you'd like to share thoughts on any aspects of management, send me an email to petersenior42@gmail.com . My latest project has the interim title 'You’ve been conned. Much of what you were taught and read is largely irrelevant, misleading or plain wrong – this is the REAL story of life: past, present and our possible future.' The working paper so far comprises 105 pages, many listing references and interim conclusions. The main problem is finding sufficient credible evidence, and realising the more Iearn, the more I realise I don't know!
This entry was posted in Environmental battles. Bookmark the permalink.