Rocketing Prices AND Blackouts: South Australians Lament Their Dark & Dismal Wind ‘Powered’ Future

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A week back we covered the unfolding calamity in South Australia – where a sudden wind power output collapse plunged 110,000 homes into darkness, across most of the State, without warning:

Wind Industry’s Armageddon: Wind Farm Output Collapse Leaves 110,000 South Australian Homes & Businesses Powerless

What’s become painfully clear to the general populace (although probably at times when they’re without the aid of electric light) is that attempting to ‘rely’ on a wholly weather dependent generation ‘system’ is a seriously dangerous fantasy.

In the aftermath of one of the worst blackouts in recent history, politicians of all persuasions copped a grilling on radio stations; from people like ABC’s Matt and Dave; and 5AA’s, Leon Byner.

Byner is to South Australian airwaves what Alan Jones is to national radio broadcasting; sharp and to the point – and with a “take no prisoners” attitude. As the interview below attests.

First, a little background on the protagonists. Christopher Pyne is a Liberal member of Federal Parliament, steeped in South Australian Liberal politics.

Tom Koutsantonis, Industry Minister in the State Labor government, has been top head kicker and part of Labor’s squad; going back to Premier Mike Rann – the principal offender in South Australia’s unfolding wind power disaster.

Danny Price, energy market expert with Frontier Economics, hates wind power with a burning passion; and has been pointing out the ludicrous costs of subsidising wind power, as well as the insanity of trying to rely upon a wholly weather dependent generation source, for years now.

What follows is a very telling exchange amongst them.

SA’s State power outage and Renewable Energy
Leon Byner with Tom Koutsantonis
5AA
2 November 2015

LEON BYNER: The Industry Minister joining us, Christopher what do you say?

CHRISTOPHER PYNE: Good morning Leon, well the point that I wanted to make was that South Australians pay the highest energy prices in Australia.

We have one of the most unreliable supplies of energy. We’ve been obsessed for some years with renewable energy, which in itself is not a bad thing. But I think the public, it always surprises me how they don’t understand that they are subsidising wind and solar power to such an enormous extent.

They seem to think when I talk to people in the supermarkets in my electorate for example, that this is all coming without a cost. But the truth is the only reason wind power is viable in South Australia is because of the massive subsidies being paid by the taxpayer and the same goes for solar power.

And even more concerning to me, to have solar power in years gone by you needed to stump up the several thousands of dollars to get the solar energy and then you got the subsidy. Which means the poorest South Australians were subsidising some of the most well off South Australians, who have got much lower energy costs as a result of solar power.

So, I just think that in the debate the public need to know the facts, which are that these things don’t come without a cost.

LEON BYNER: What would you be suggesting the Government do, Chris?

CHRISTOPHER PYNE: Well obviously the Government has made some bad decisions and bad choices over the years because of an ideological obsession with renewable energy and I wouldn’t discourage renewable energy. But they also made it harder for Alinta to stay in business.

When Alinta said that they were closing Leigh Creek and Port Augusta, one of the factors they stated was because of the subsidies for wind and solar power. Now how they produce those subsidies is something that the State Government needs to look at, because it’s a question whether they are sustainable at the level that they are into the future, especially if they are not delivering, as we saw last night, reliable power to South Australia. Or maybe the South Australian Government needs to invest in another way of connecting with interstate energy rather than the one we have through Hayward at the moment.

LEON BYNER: Ok what do you say Tom?

TOM KOUTSANTONIS: Well I think a lot of what Christopher says is right. There is only one problem, it’s not the State Government that’s subsidising Leon, it’s the Commonwealth Government. They are the ones that give the subsidies to the wind generators, but the reality is, is that we needs to be a national solution to this problem because coal is not sustainable. The world is not going to keep burning coal to generate electricity; the world is going to look to other sources…

LEON BYNER: Yes but we have an immediate need and I don’t think you were…

TOM KOUTSANTONIS: Yes I understand that. We have an abundant transitional energy source here in South Australia, which is gas. Now we should be doing as much as we can to incentivise gas. We are in this perverse position where the Commonwealth Government are incentivising renewables as has the state in the past with the solar feeding tariffs off peoples rooves and then coal is given preferential treatment and the transitional fuel in the middle, gas and which is probably the solution to our energy needs gets almost nothing.

Now the reality is we need to be looking at what our natural abundant resources are, especially in this state and we have two of them: uranium and gas. So we should be doing as much as we can to support and incentivise the export of uranium out of the state for the world’s power needs and doing as much as we possibly can to incentivise the extraction of gas for generations to come in South Australia.

LEON BYNER: Yes but you see you can do all the extraction you like, it’s still got to be viable. Chris, what do you say to that?

CHRISTOPHER PYNE: Well I think it’s hard for Tom Koutsantonis to claim that the Rann-Weatherill Government didn’t do a great deal to encourage wind generators to be set up in South Australia.

I mean they provided a great deal of support for wind power and Mike Rann trumpeted South Australia’s growing reliance on wind power as has Jay Weatherill.

Now I agree however with Tom that what we do need to do is get our uranium moving out of Australia and that’s why the current Federal Government is trying to settle a deal with India to sell them uranium and I’d encourage him to encourage his federal colleagues to make that easier rather than harder, because that well help us get the revenue he needs and the Commonwealth needs and particularly the South Australian Government needs to invest in energy.

This is something that needs to have a bipartisan approach between Labor and Liberal and he can help us with his federal colleagues to make that treaty with India around uranium sales sail smoothly through the Parliament.

LEON BYNER: Now Tom so let me get this right, you’re going to make an announcement sooner rather than later on incentivising some kind of, either other interconnection or indeed base load power, because as Danny Price pointed out with the upgrade of the interconnector, lightening or other problems aren’t going to be much use to us.

TOM KOUTSANTONIS: Yes that’s right; we need to incentivise the existing base load energy that we already have…

LEON BYNER: And you’ll be making an announcement about that when?

TOM KOUTSANTONIS: I will very, very soon and I’ll come on your programme and I can talk to your listeners, I’m quite happy to do that with you Leon. But I’ll just point out this, the Howard Government, the Rudd-Gillard-Rudd-Abbott-Turnbull Governments all subsidise wind.

The support we give them is planning approval and the actual subsidy for the power generated comes from the Commonwealth Government. So I don’t want to get into a he-said, she-said with Christopher other than to say this is a national problem and we need national solutions and this State Labor Government, especially me as Energy Minister and Treasurer, I am very keen to work with Christopher to come up with a solution that benefits South Australia and the nation.

LEON BYNER: Alright just quickly, Danny Price is what you’re hearing today is that ‘hey they get it’ yet or what?

DANNY PRICE: Nothing else has this ability to concentrate with this level of political interest and I’m kind of pleased to see this, because this has been a long time coming. I think what the Minister’s saying about wind farms is exactly right. I think it’s disingenuous to say that this is just a Commonwealth problem. But I also agree with the Treasurer that it has to be a national solution. South Australia is just part of what we call the national electricity market. It has to be a national…

LEON BYNER: One question, we got nothing up the connector and there are those who say why didn’t the other states that have got electricity feel any pain? Or was it just because of our reliance on wind that failed?

DANNY PRICE: Well the market is basically designed to as much as possible cut the cost consequences of local problems to that local region and that’s precisely why the market is set up that way.

Now in South Australia people are now looking for solutions for supply in South Australia, that’s what the market is designed to do.

My only concern with what the Treasurer seems to be hinting at is that it may be that he’s thinking about contracting directly with the Pelican Point power station, but the problem with that of course is that you have to think about the consequences down the line and so if these primary generators suddenly think that they’ve got the Government over the barrel and the Government is prepared to directly contract with these generators, you might find them offering less on the market than they would otherwise which forces the Government’s hand. So you’ve got to be careful about starting that game.

LEON BYNER: Danny Price thank you. Well know you’ve got the full story about what happened last night and the fact that it won’t be the end.
5AA

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Despite Koutsantonis being an entrenched member of the team that created the wind power debacle in South Australia, he was remarkably quick off the mark to throw responsibility back at the Federal Government when he (rightly) says: “the actual subsidy for the power generated comes from the Commonwealth Government”.

Indeed it does; soon to be a figure in the order of $3 billion a year – all added on top of already rocketing Australian retail power bills:

Out to Save their Wind Industry Mates, Macfarlane & Hunt Lock-in $46 billion LRET Retail Power Tax

But Koutsantonis’ line that his State Government merely facilitated the rollout of 1,477MW of wind power capacity with SA’s 17 wind farms is kind of glib – reminiscent of war criminals who, when thrown in the dock by the victors, claimed they were “only following orders”.

All too cute, for STT’s liking. His former boss, Mike Rann saw to it that SA went harder and faster into the wind power fraud, than any other State; for his (and his relatives) own selfish, pecuniary interests; and did so without ever even considering the costs or putative benefits of a subsidy-scam loaded with the former; and bereft of the latter.

But, precisely the same can be said of the successive Federal governments that set up and have maintained the Large-Scale RET – the largest, single industry subsidy scheme in the history of the Commonwealth by a country mile (see the link above).

Although, as things are turning out, the accusatory finger-pointing between State and Federal governments, over just who’s responsible for South Australia’s calamitous energy mess, is of no real concern to South Australians.

Among the 110,000 homes and businesses that were plunged into darkness, two weeks ago, when wind power disappeared in the blink of an eye, there isn’t a whole lot of interest in whether it’s State or Federal policy to blame. These people are already sick and tired of paying the highest power prices in the Nation (if not, on a purchasing power parity basis, the highest in the world).

Plunging them into darkness without warning (placing them and their families at unnecessary mortal risk – think people at home on life support systems; and unlit intersections without functioning traffic lights) simply because wind power output collapsed is, for most, a bridge way too far.

Despite the best efforts of the wind industry’s top propaganda merchants, South Australians are a wake up to the fact that it wasn’t the fault of the interconnectors – that are designed to merely transport power (when available) from Victoria and New South Wales – but, rather, the fact that the 40% of SA’s generating capacity (said to always come from wind power) collapsed, because the wind stopped blowing that fateful Sunday night. Funny about that.

It’s a little hard for the wind industry and its spruikers to blame something else; when, for more than six years, they’ve been ramming the ‘wonders’ of wind power down South Australian throats, with maniacal zeal.

If you’re continually talking up SA’s brilliant “wind resource”; and bragging out loud via every media outlet about those (few) occasions when wind power output registers a half-decent proportion of its actual capacity, you’re going to have trouble explaining away those occasions when total (and totally unpredictable) collapses in wind power output coincide with mass blackouts. As this one, most certainly did.

No, this time around the cat is well and truly out of the bag.

In the hierarchy of media, when an issue becomes the top story on Channel 7’s Today Tonight, you can guarantee you’ve reached not only a substantial audience by number; but that you’ve also hit political dead-centre – in terms of reaching voters capable of deciding elections; and policies on the way to them.

The Today Tonight viewer mightn’t be a Twitter jockey, but he or she is a first-class talker; whether it’s at work or backyard barbecues, whatever they’ve seen soon becomes the topic of the day (or the week). When the topic is their spiralling power bills and, despite paying through the nose for the stuff, suffering statewide blackouts to boot, you can guarantee plenty of fist-waving fury being added to tea room and backyard debates on just who, or what’s to blame.

Just how dire things are for the wind industry, is laid out in just such a barbecue-stopper of a Today Tonight broadcast; one that has snapped South Australians out of their complacency about energy policy, in general; and their wind power debacle, in particular.

The only trick that Today Tonight missed, was the fact that the blackout wasn’t the interconnectors’ fault. As detailed in last week’s post (and the graph above), the interconnectors ‘failed’ because they became overloaded, as wind power output plummeted that night. The ‘load’ being drawn by SA over the interconnectors rose exponentially (and inversely with the wind power output collapse) until they hit the limit of their capacity and ‘tripped’, plunging SA into pre-historic gloom for hours.

STT hears that Today Tonight has been directed to our blackout post; and is keen to follow up with a story that sets the record straight, laying the blame – where it belongs – fair-and-square on SA’s ludicrous ‘reliance’ on the vagaries of the wind.

(Click on the image below to reach Today Tonight’s video of the broadcast – transcript appears below)

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Transcript:

Rosanna Mangiarelli (Presenter): Good evening and welcome to the program. First tonight the price we’re all likely to pay for South Australia’s renewable energy experiment. Now as power stations close and we rely more and more on wind and solar power, the outlook, according to some experts is dim. Job losses, skyrocketing prices, and ongoing blackouts and as Hendrik Gout reports, they’re just some of the risks the state’s taking as we enter the untested and the unknown.

Hendrik Gout (Reporter): We South Australians are living in an experiment, a world first. We’re the white mice in this state-sized laboratory.

Mathew Warren (CEO, Energy Supply Association of Australia): South Australia is an accidental experiment in the deploy of renewables at scale in a large grid around the world.

Danny Price (Managing Director, Frontier Economics Australia): South Australia is the canary down the mine as it were. It’s more likely that there’s going to be blackouts because of the combination of your reliance on the interconnector, but particularly because of the large reliance on wind.

Mathew Warren: When we look around the world the problem is no one is doing it as aggressively as South Australia.

Hendrik Gout: Sometimes this experiment goes catastrophically wrong. On the night of Sunday the 1st of November 2015, Adelaide went black. It was lights out at 10 PM. 100,000 homes, businesses, service stations, all the streetlights, all dead, because of this – the interconnector. Think of it as a heavy-duty extension cord, taking electricity from Victoria’s Latrobe Valley power stations to energy dependant South Australia. And when it fails…

Danny Price: Unless those interconnectors are running it’s extremely difficult to reliably meet supply in South Australia.

Hendrik Gout: Danny Price from Frontier economics has shocking news for South Australia.

Danny Price: South Australia is an experimentation in systems control, power systems control and I think people are struggling to work out how it’s going work.

Hendrik Gout: Thomas Playford, Premier from the 30s to the 60s, decided South Australia should be electrically self-sufficient. His government developed the Leigh Creek coal fields to fuel this, South Australia’s huge Port Augusta plant. 800 million watts, for thoroughly modern living.

Narrator: You will envy this little lady, and say to yourselves, I would like an electric range myself.

Hendrik Gout: Here on Torrens Island, locally produced thermal electricity.  And then ten years ago we cast our fate to the wind.

Mike Rann (Former SA Premier): Bit by bits we’ve started the process of making South Australia the leader in wind energy in Australia.

Pat Conlon (Former Labor Minster for Energy in SA Government): The truth is, green energy isn’t any cheaper in terms of dollar price than conventional energy but it is much, much cheaper for the environment.

Hendrik Gout: But from Starfish Hill to Snowtown, Waterloo to Wattle Point, Waymouth to Woakwine, it was new dawn for some and the end of an era for others. Fuelled by easy State Government approval, often overriding local objections, wind farms grew exponentially. Yet they produce power only intermittently.  They’re unreliable, and sometimes they have their share of itty-bitty problems.

How many windfarms do we have, installed, planned, approved, or under construction? This many – 39.

Mathew Warren: Certainly the numbers that we are at now, around 40% of generation coming from solar and wind is incredibly high by global standards. And the world’s watching. The world is interested in how South Australia manages this.

Hendrik Gout: Australia’s Energy Supply Association is the industry’s peak national body.  Its boss is Mathew Warren.

Mathew Warren: Clearly we need to pay very close attention to South Australia. It’s really at the cutting edge of integrating renewables in the world and that brings with it both, you know challenges but also risks.

Hendrik Gout: And those risks, well somebody accidentally unplugging this extension cord.

Mathew Warren: Sunday night was an event that no one planned when there was a fault, and the interconnector was out, and the consequences were an outage.

Hendrik Gout: The potential problems, says Danny Price, will get worse when the Northern Power station at Port Augusta closes early next year.

Danny Price: That’s the largest, single largest power station in the state and one that provides large quantities of reliable cheap energy.

Hendrik Gout: And South Australia has the most expensive electricity in the country. You probably pay more than $2,500 a year for electricity. People who live in the ACT pay not even $1500. In 2010 an 18% hike, 17% the next year, nearly 13% in 2012. Down by 1.8% (somebody probably got sacked for that) and then up again in 2014.

Hendrik Gout: So how much are your electricity bills a quarter?

Robert Bell: They’re up to around 3 grand.

Hendrik Gout: And what were they when you started?

Robert Bell: They were about $800-$900.

Hendrik Gout: Robert Bell sells fish from his Glynde aquarium. His tanks have heaters, pumps, bubblers.

Robert Bell: It’s now the second biggest bill that we have here, behind rent. It’s tripled in the last 6 years. It’s got a double edge sword effect for us. The customers are closing down their tanks and all the while, our overheads are going up here, with electricity.

Hendrik Gout:  So fewer people are buying and your own costs are going up.

Robert Bell: Exactly.

Hendrik Gout: Compounding the problem –these -Solar PV systems.

Mathew Warren: South Australia has around 25% of its housing stocked now with solar panels on their roofs. This is the highest rate of roof-top solar PV penetration in the world.

Hendrik Gout: And that’s also pushing up prices through generous State government subsidies.

Mathew Warren: The renewable technologies, once they displace conventional generators are more expensive. If they were cheaper it would be a lot easier to manage this challenge.

Hendrik Gout: The closure of the Port Augusta power station also comes at a cost. A human cost – hundreds of South Australian jobs disappear as we switch to Victorian power, made by Victorian labour. According to Danny Price, wind power isn’t filling the vacuum.

Danny Price: We don’t actually develop any wind technology here, we buy it all. We just simply assemble and that technology and it doesn’t take much labour to run it.

Hendrik Gout: An increased risk of blackouts, crippling power prices and the country’s highest unemployment.

Robert Bell: The economy is in a bad state and Adelaide, itself, is in a really bad state.

Hendrik Gout: The perfect storm.

Robert Bell: It really is for business owners in South Australia at the moment.

Danny Price: Some of the largest employers are those who use quite a lot of electricity. I am extremely doubtful that any new business would set up in South Australia. I think that they would be mad to, simply because of the high cost of electricity, which is set to get higher and unfortunately, more unreliable.
Today Tonight