We ain’t mad but the more we look, the more troubled we is.
We know the Media Watch episode on the Cumming report in The Australian is now last year’s news. And yes, we know we said we would move on.
But we can’t. There’s more to say, cuz. A lot more.
But this comes with a warning.
Discussions about power generation can be mind-numbingly dull. Yer feel me?
We all want power. We want to be able run our air conditioners and flat screens and boom boxes without any interruption. And we want to pay small chedder for it.
So give us our power and shut the hell up. There’s enough boring discussion out there without us adding to it.
But we must speak.
We did us some MySpace investigation.
Media Watch’s comments on its September 24 show were so brain-dead, well hell. Shoot your uncle, Holmes. It don’t work. Can’t do it. You were just wrong, bro.
You got a problem with this?
(We’re gonna put aside the rap talk for a moment. This is too serious to fool around with.)
First some background. Think of this as electricity 101. This is the research you should have done, Jonathan, before you went to air, before you started talking about wind farms and the national electricity market.
1. There is a market system that governs the national flow of electricity.
2. The technical nature of the electricity generation and transmission system has its own rules that must be obeyed.
There are important constraints or bottlenecks in the transmission system that cause distortions in market behavior and problems in the technical management of the overall system.
Electricity provision is a dynamic, real time system where all factors have to be managed from moment to moment.
Throw in weather and temperature patterns – a major factor influencing demand for electricity – and that further increases complexity.
The amount of renewably-derived electricity relative to fossil fuel-derived is still small.
The interconnectors between Victoria with New South Wales, South Australia and Tasmania are not infinite. They are constrained by size. The interconnectors between SA and Victoria are particularly constrained.
That means even though there is a market in Victoria and NSW for wind power generated in SA, the small interconnector size constrains the amount of wind power that can be exported into the eastern sub-markets and the amount of variously-fueled power that can be imported into SA.
That all makes sense, doesn’t it, even for one of your researchers on $65,000 a year? (You people really need to pay your people more. I said people, Holmes – temporary carbon based life-forms that like digital watches.)
The Victorian and NSW markets for renewable energy are not specifically wind, hydro or photovoltaics.
When customers enter into a premium green energy contract, their retailer will procure renewable energy from any source.
When the wind doesn’t blow (and hell, how often does that happen?) or given the constraints of the SA interconnector, or even if the wind is blowing in SA but enough electricity can’t be exported into Victoria or NSW to meet their demand for green energy, the retailers will turn to other renewable sources.
Via Basslink, Tasmania has been exporting expensive hydro power into Victoria and via the Vic-NSW interconnect, into NSW, to meet some of that premium demand. In turn, Victoria has been exporting much cheaper brown coal-fired power into Tasmania to meet their demand for cheap power.
So your “revelation” that power crosses state borders is quite correct. Awesome, Holmes. You get credit.
And yes, there is market management across state borders distributing premium green power, brown coal-fired power and black coal-fired power. So you’re right on that point. Release the hounds, Holmes.
You gave the impression there is a free flow of electricity across state borders. There isn’t.
You incorrectly depicted the NEM as consisting of a kind of perfect interconnected market where electricity can flow freely across state borders. It doesn’t.
But your argument really starts coming unstuck when you talk about the amount of coal LaTrobe Valley power stations (or any other base load coal fired power stations) burn and whether this is affected by intermittent renewables coming on and off the line.
There are two important points here:
1) Base load power stations strongly resist ramping up and down in response to short term rises and falls in demand because they are not designed to do this. They are steady-state systems that chug along, 24/7, at a constant rate.
2) In order to avoid being ramped up and down, power is either dispatched into markets where there is demand or, if there is no market or there are constraints preventing full dispatch (eg interconnectors are full), the power stations keep the boilers operating at a steady state but blow off the now “additional” and not-needed steam via an escape valve.
They do this instead of directing it into the turbines to generate electricity.
Are they producing the same amount of emissions when this happens? Yes. Do they reduce their boiler temperatures and reduce the amount of coal they consume when wind power comes on line? No.
Holmes, are yer listening? Can yer hear what we’re sayin’? Do yer feel me?
You also didn’t mention spinning reserve.
This is generation capacity ready to go at any time to meet unanticipated demand beyond forecasts. Spinning reserve is the insurance factor in the generation system – the last line of defence to make sure the supply-demand formula can be met. The boilers are boiling, the chimneys are smoking, coal is being burned and emissions produced – but power may or may not be generated depending on the situation in the market.
It implied they ramp up and down their power generation in a short term scenario whereas that may not be (and probably isn’t) the case at all. The answer needed further interrogation – e.g. when do they reduce their power production?
Are they talking about maintenance outages? And/or, given that Loy Yang A has picked up the contract to supply Alcoa with electricity as well as selling into the wholesale and spot markets – what are their overall contract positions?
Are they reflecting in their answer that their coal use has a relationship to their longer term contractual obligations? Isn’t this very different to ramping up and down their generators, and adjusting their coal use accordingly, in response to intermittent wind power coming on line and disappearing as whimsically as it appears?
The same with the subsequent answer provided by IDG Suez – their overall contract positions with retailers and others decide their overall coal supply-consumption formula – not intermittent wind power coming on and off line.
The amount of wind power relative to the amount of coal fired power is an important consideration in this matter, too. There simply isn’t enough wind power in the system to yet alter the fundamentals of power generation and dispatch, particularly the baseload element.
Regarding electricity flowing across state borders, have you bothered to read AEMO reports? If you did, you would know the SA interconnector constraint is very significant. If and when power does flow into SA from Victoria, you may be partly witnessing cheaper Victorian brown coal-fired power displacing more expensive SA wind power.
As mentioned above, the same situation is occurring for expensive Tasmanian hydro power coming onto the mainland via Basslink, and cheaper brown coal-fired power going to Tasmania. This is relevant. Why you not talking of this, Holmes?
The other thing you “forgot” is that general electricity consumption patterns are down (not to be confused with summer peaks, which are higher than ever before due to domestic refrigerated air conditioning).
This has an implication that the amount of gas and renewables is increasing, black coal-fired power decreasing and brown coal remaining steady. The reasons for the flat consumption is, in part, loss of lots of energy consuming manufacturing industry, improvements in energy efficiency of other appliances, and people trying to use less electricity because of higher power prices.
That flat consumption and a flaccid market (as opposed to fat consumption in a flaccid body, pictured left) are, in turn, providing some opportunities for brown coal-fired power to compete with black coal-fired power on price, even though brown coal is a less efficient fuel source.
The current market is also not encouraging investment in cleaner forms of base load power generation using e.g. combined cycle gas.
The national electricity market certainly isn’t aiming to reduce consumption, emissions or anything like that, although one would have concluded that from your comments.
It’s actually constructed around periods of excessively high consumption, underpinned by cheap, highly polluting base-load generation, and with some highly intermittent wind and other renewables that are politically determined but, in this market, act to leverage up prices in other market segments without counteracting the causes or consequences of those excessively high peaks. Get it?
The AEMO report you attached to your analysis referred to all this but to be honest we doubt you read it. If you did, you didn’t understand it.
(It directly contradicted the Pitt and Sherry pronouncements you rolled out so proudly, Holmes. Iz you crazy?)
And there’s more. Much much more.
This may come as a surprise to you but power companies are in this market to make a profit – not to green-up their operations.
And although we know apologizing is not really your bag, baby, we await your response anyway. As do Hamish Cumming and Graham Lloyd.
There’s no half stepping here, Holmes. We ain’t mad atcha but this mother is off the chain.