Time to kill the RET & scrap the REC

From our recent posts it appears that out of control renewable policy in Britain means it will soon be a case of: “will the last man out please turn off the lights”?  A situation confirmed in the piece below from The Telegraph.

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Sir Humphrey, I think we might turn at least some of the lights off –
the bill was just a little steep last month.
It’s alright, Prime Minister, the public are paying.

Well folks, when you strip back our RET/REC policy – and look at the impact of our misplaced reliance on wind power on power prices – Australians will soon be in the same rather dimly lit boat.

In recent weeks STT readers have learned that when the wind stops blowing everywhere in South-Eastern Australia – as it inevitably does – generators ramp up the prices for power supplied to the grid from $40 per MW/h to more than $2,000 per MW/h – with spikes up to $12,200 per MW/h – as grid managers struggle to keep the grid supplied and the lights on. This situation plays out around 80-100 times a year.

This was the situation we reported on for 3 June 2013 in South Australia, when wind power output dropped to zero for about 12 hours straight. As predicted in that post, the wind was barely a zephyr from Monday through to Wednesday – apart from a small spurt on Tuesday – which meant that the price chiselling driven by the collapse in wind power output continued off and on for a big part of the week.

In this report on what happened for the rest of the week, you will note in the graph in the section “Prices spike on Low Wind Generation” how – on every occasion when the wind stopped blowing and wind power output plummeted – the dispatch price rocketed from less than $50 per MW/h to over $2,000 per MW/h.

This rampant price gouging is a feature of the need to backfill every “missing” megawatt of wind power with fossil fuel generated power – including power generated with Open Cycle Gas Turbines which cost around $300 per MW/h to run instead of the cost of hydro power to the grid, for example, which is less than $30 per MW/h.

In one of the perverse little ironies of renewable energy policy the Open Cycle Gas Turbines (OCGT) used – emit more than double the amount of CO2 per MW/h of output – by comparison with gas thermal or Combined Cycle Gas Turbines.

The cost of buying peaking power from generators is averaged over the year by retailers and incorporated in your power bills. As wind power capacity increases, so does the need for increased capacity from backup generation and, in particular, peaking power from fossil fuel sources.

If there is more wind power capacity, it simply means higher generation costs from quick start-up gas turbines – which are urgently fired into action to make up for collapses in wind power output.

Oh yes, and there’s gold in supplying peaking power from OCGTs – wind power “heavy” AGL has a stack of them – so it profits very handsomely from its own “inability” to supply meaningful power from its wind farms.

But STT can’t pin the blame on AGL for the wind being naturally intermittent – that’s just a fact which it has been allowed to exploit thanks to the RET and the REC.

The retailers use the exorbitant costs of peaking power now being supplied to the grid (5,000% higher than the average cost of $40 per MW/h) to justify ever greater increases in their charges to their retail customers. The government regulators who “control” retail prices have no argument against it – the spikes in power prices occur with meteorological certainty dozens of times each year.

This is a government sanctioned system that allows generators to collect an amount for a single MW/h of electricity ($2,100) that would let you pop 3 bottles of Grange in your cellar – rather than the normal dispatch price of $40 which – these days – barely covers the cost of a carton of beer. Not a bad “mark-up”, we think. The boys from Enron would be chuffed – if only they were still in on it.

As STT has been saying for quite some time with increased “reliance” on unreliable and intermittent wind power the only way retail power prices can go is North.

Based on figures supplied to us by a “switched on” young member of the Coalition, retail power prices will inevitably double again over the next 2 years – with more power price punishment to come beyond that – if the current RET/REC policy is retained, that is.

This Coalition member’s predictions of power price penury have recently been confirmed with one of the industry’s really BIG players – which is dead keen to scale back the RET – if not kill it – and, coincidentally, is running a mile from wind power.

As a precursor to what Australia might look like in future, here’s another article from The Telegraph’s Chris Booker.

MPs want to turn your lights off. A shame no one told you
The Telegraph
Christopher Booker
8 June 2013

Within six years you could be expected to reduce your electricity consumption by a quarter

Last Tuesday something happened in the House of Commons so weird that it must be counted as one of the more terrifying episodes in the entire history of our Parliament. Towards the end of a seven-hour debate on its virtually incomprehensible, 200-page Energy Bill, the Government slipped in a new amendment proposing something so utterly mad that, if anyone present had understood its implications, it might have made front-page news.

What MPs were being asked to endorse was that, within just six years, we should all be forced by law to make a mind-boggling cut in how much electricity we are allowed to use.

The reason why no one seemed to grasp this was that the amendment was so opaquely dressed up that only an MP with some knowledge of the basics of electricity might have twigged the enormity of what was being proposed. By 2020, it said, Britain must reduce its electricity use by “103 terawatt hours”, rising by 2030 to “154 terawatt hours”. This could have been understood only by someone aware that we currently use each year some 378 “terawatt hours”. So what was being proposed was that this must be cut down in six years by 27 per cent – more than a quarter – rising 10 years later to a cut of more than 40 per cent, or two fifths.

In the course of his mind-numbing speech, Greg Barker, the minister proposing this, carefully avoided any explanation of what it was all about. Not one MP picked him up on it. At the end of a vacuous debate, during much of which the House was virtually empty, MPs dutifully poured in from all over Westminster to nod the Bill through by 396 votes to eight.

It was clear that, apart from a vapid document it published last year called Electricity Demand Reduction, the Government hasn’t the faintest practical idea how such a massive cut might be achieved without doing irreparable damage to our economy and our way of life. It was simply a measure of the inadequacy of those elected to rule us that the MPs could meekly agree to such an absurd proposition. But what it also brought home, more than ever, was the scale of the shambles the Government is making of our energy policy, skewed by its obsession that the world is in the grip of runaway global warming and that Britain alone must do something to halt it. In order to “decarbonise” our electricity supply by 2030, the Government wishes to build thousands more wind turbines, so heavily subsidised that this doubles, or trebles, the price of the electricity they unreliably produce. It babbles about “carbon-free” nuclear reactors, although companies are refusing to build them unless they are also allowed to sell their power at double the price. The Government is deliberately trying to drive out of business the CO2-emitting fossil-fuel power stations which still supply more than two thirds of our electricity, by charging them a “carbon tax” which, if they survive at all, will also eventually double the price of their electricity.

Yet because the Government knows that the wind doesn’t always blow and that we will soon be running out of proper power stations to make up the difference, it has now come up with this brilliant idea that it calls “Electricity Demand Reduction” (or “negawatts”). By this it somehow imagines that it will be able to impose by law a quite ludicrously crippling reduction in how much electricity we are all to be permitted to use.

No other politicians in the world would for a moment contemplate such a spider’s web of insanities. But that is what, last week, our Government solemnly proposed, and our MPs almost unanimously voted for, dressed up in such deceitful, jargon-packed language that not a single MP or journalist – led, of course, by those global warming-obsessed babies from the BBC – noticed what was going on. When, a few years back, I wrote a book called The Real Global Warming Disaster, this was very much the disaster I predicted that we seemed to be heading for. Last week’s abysmal performance by our MPs simply brought it another giant step nearer.

Not much of a saving, Mr Balls

Much highlighted by the BBC and others last week was the centrepiece of what Ed Balls, the shadow chancellor, called his “tough” plans to reduce our public-spending deficit: his promise to scrap the £200 winter-fuel allowance to higher tax-rate pensioners. This, he proudly claimed, would save £100  million a year. What was not explained – by him or the BBC – was that, since our borrowing is running at £120 billion a year, this saving would only cover seven hours of the year. That leaves a mere 8,753 hours in the year for which Mr Balls has to come up with another “tough” plan.
The Telegraph

To avoid what has happened – and is happening – in Britain, Australia needs to completely scrap the RET/REC policy and start again.

We have pointed to waste and mis-management of our hydro resources. Hydro power is the only sensible and truly RENEWABLE generation system – since when did giant fans rain down from the heavens?

Hydro is base-load and pollution free – STT has called for a policy which will can the fans and upgrade the dams.

Let’s see what the greentards are really made of. Are they really driven by a need to reduce GHG emissions from electricity generation sources? Or are they looking to extend the brilliant work of their idols, Marx, Lenin, Mao et al – and drive Australia towards certain economic disaster?

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The Chairman would be delighted to learn that electricity is
now being treated as a bourgeois luxury – after all this champion
of the people starved 20 million of his own to death.
But all for the greater “good”, of course….

See you at the rally, June 18, Parliament House, Canberra.

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Trackbacks

  1. […] reaches the same conclusion that we’ve been banging on about for months now – the RET and the REC are going to drive power prices to economy destroying levels faster than you can say – […]

  2. […] Maurice Newman had the courage to point to the elephant in the room: spiralling power prices being driven through the roof by intermittent and unreliable – subsidy fuelled – wind power – driving Australian […]

  3. […] help with your answers have a look at our friendly cheat sheets here, here and […]

  4. […] STT has looked at the consequences of what happens when the wind does what it has done since the dawn of time – ie stop blowing – on the wholesale price of electricity when ultrahigh cost Open Cycle Gas Turbines are cranked up to make up for “lost” wind power capacity in our posts here and here. […]

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