Want Insane Power Prices & Mass Blackouts? Then Wind Power’s your ‘Answer’

josh frydenberg
Energy Minister, Josh Frydenberg measures up the chances
of avoiding mass wind power blackouts.


The true cost of wind power is insane. Californians – victims of an early burst of ‘wind’ pay fully 40% more than the US average for power:

California’s Wind ‘Powered’ Dream Turns to Nightmare: Power Prices 40% Higher than US Average

South Australians dwell in Australia’s economically dismal ‘wind power capital’. Their attempt to rely on these things as a ‘meaningful’ power source sees them not only paying the highest power prices in the Nation by a mile (if not the world, on a purchasing power parity basis) – but sees them glaring at each other through Stone Age ‘gloom’ when its wind power output totally collapses, on a totally unpredictable basis:

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

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

SA 1 Nov 15

And SA’s mass wind power blackouts – like that on 1 November, caused when a sudden wind power output collapse crashed the overloaded interconnectors and plunged 110,000 homes into darkness (see above) – come at a time when its ‘Old Faithful’ Port Augusta power plant is still merrily chugging away, keeping Croweaters from freezing (or boiling) in the dark.

Come April next year, when Alinta shuts the doors at Port Augusta – a direct consequence of criminal distortions in the power market the product of ludicrously generous REC subsidies paid to wind power outfits – SA’s energy disaster will see mass blackouts become the norm; and rocketing power prices, to boot:

South Australia’s Unbridled Wind Power Insanity: Wind Power Collapses see Spot Prices Rocket from $70 to $13,800 per MWh

But it’s the chaos that wind power causes to grid managers that’s been drawn into focus, with reports from the Australian Energy Market Commission (available here); and Deloitte Access Economics (available here) on how attempting to rely on the Wind Gods is little more than an expensive and dangerous fantasy.

June 2015 National

Wind and solar ‘hits reliability of power grid’: energy tsar
The Australian
Annabel Hepworth
27 November 2015

The nation’s energy tsar has warned that the growing penetration of wind and solar power, just as coal and gas generators are being closed or mothballed, could pose challenges for the security of the electricity system.

In a major report yesterday on strategic priorities for the energy market, the Australian Energy Market Commission says the national electricity market is in a “disinvestment phase”, with 11 coal generators due to leave the industry between 2011 and 2023.

Meanwhile, 35 per cent of South Australia’s electricity generation in 2013-14 was from wind and, nationwide, 1.4 million households have rooftop solar panels.

“With intermittent capacity in wind and solar making up a larger proportion of the energy mix, this may present a number of technical challenges going forward around managing power system security and reliability,” the report says.

The report points to South Australia, where some of the state was plunged into blackouts this month when an incident at a substation owned by transmission provider ElectraNet affected supplies from Victoria via an interconnector.

The rise of intermittent generation, especially in South Australia, had “potential implications for the efficient operation of the wholesale market”, the energy report says.

The comments come as the Energy Supply Association of Australia warned yesterday that South Australia faced increased risks to reliability because it is at the “leading edge” of relying on intermittent renewable energy.

Releasing a separate report commissioned from Deloitte Access Economics, ESAA chief executive Matthew Warren warned that South Australians were “increasingly reliant on a narrower range of generation sources to meet their needs when the wind isn’t blowing and the sun isn’t shining”.

In South Australia, Alinta Energy has brought forward the closure of the Northern power station by March 31 next year, while AGL Energy will mothball four of its eight units at the gas-fired Torrens Island power station in Adelaide in 2017.

The Deloitte report says the intermittent nature of the state’s renewable electricity — which means it is available only when the wind is blowing or the sun is shining — “creates challenges” for an energy market designed around conventional power plants such as hydro or fossil fuels.

“These conventional plant types also have characteristics that allow them to contribute to the stability of the grid, including keeping frequency levels consistent and being able to restart the system after a major blackout,” it says. “Solar is not designed to contribute in this way and, while wind can (in limited circumstances) assist, its intermittency constrains its use for grid stability.”

Also yesterday, AGL chief executive Andrew Vesey highlighted the implications for the sector of the increasing penetration of renewables.

“If we think about large-scale renewables, we should be thinking about how are we going to encourage the other stuff — the other stuff being advanced batteries, large- or small-scale, high-speed gas turbines, something to make sure that the system stays secure and reliable,” Mr Vesey told a Committee for Economic Development of Australia lunch.
The Australian

The Energy Supply Association gave this synopsis of the Deloitte report as it relates to SA’s wind power disaster.

Renewables increasing the risk to South Australian electricity reliability: report
26 November 2015

South Australia faces higher electricity prices and increased reliability risk from being at the leading edge of integrating intermittent renewable energy into the grid, a new report has found.

The report by Deloitte Access Economics “Energy markets and the implications of renewables – South Australian case study” (available here) was released today by the Energy Supply Association of Australia (esaa).

The esaa’s chief executive, Matthew Warren, said, “as a result of a combination of different government policies, South Australia is now sourcing around 40 per cent of its electricity from intermittent sources, like wind and solar.  It has become an unintentional global leader in renewables integration for large, constrained networks.

“This accidental, living experiment is exposing new risks to reliable energy supply and higher costs that need to be addressed if we are to continue decarbonising our economy through this century.

“Renewable generation is reducing greenhouse emissions by pushing conventional gas and coal power stations out of the market.  By 2017 four of South Australia’s largest power stations will have been either partially or fully withdrawn.

“As a result, South Australians are increasingly reliant on a narrower range of generation sources to meet their needs when the wind isn’t blowing and the sun isn’t shining.

“The key message from this report is we need to urgently look at the best ways to manage this new, and largely unplanned energy system to ensure it remains reliable, stable and cost effective.  It is essential consumers and investors retain confidence in the security of electricity supply as it decarbonises,” Mr Warren said.

Deloitte Access Economics Report

The Deloitte report found that South Australia’s market volatility is increasing with increased penetration of intermittent technologies, and that the cost to hedge against the resulting growing market risk is becoming “prohibitive”.

“It is the intermittent nature of this renewable electricity that creates challenges for systems and markets that were designed around dispatchable plant such as hydro, fossil fuels and nuclear,” the report says.

“These conventional plant types also have characteristics that allow them to contribute to the stability of the grid, including keeping frequency levels consistent and being able to restart the system after a major blackout. Solar is not designed to contribute in this way, and while wind can (in limited circumstances) assist, its intermittency constrains its use for grid stability.”

Deloitte says that with further intermittent renewable investment likely, higher prices are expected in SA as the market price will be increasingly set by higher cost generation, such as gas-fired power plants.

While there are options for managing system stability and limiting further exit of baseload and mid-merit generation, there is no clear approach to addressing the challenges posed by an increased share of renewable generation. The report found there is a number of areas that require further investigation that would contribute to the policy discussion, namely:

  • The net market benefits of further electricity interconnection upgrades between Victoria and SA
  • Estimating the saturation point of both rooftop solar, wind and large-scale solar in isolation and in combination
  • Understanding the implications of network constraints outside of South Australia that may be affecting the ability to transport wind energy out of the state
  • Investigating if there is a case for a new market in capacity, noting that this would entail a fundamental change in market demand
  • Investigating the scope for efficient demand response that could allow a portion of demand to follow supply rather than vice versa, noting this would be a long-term development.

Deloitte says it is important that these investigations are agnostic of technology while recognising the importance of a transition to a lower emissions energy system.

Ok, Croweaters, can I have a quick show of
hands for all those in favour of wind power, now?

6 thoughts on “Want Insane Power Prices & Mass Blackouts? Then Wind Power’s your ‘Answer’

  1. STT has on many occasions demonstrated and provided evidence by way of figures and graphs and the citing of reports by various experts from around the globe the fact that ‘wind turbines’ produce electricity that is exorbitantly expensive and unreliable in the context of an efficient power grid system and as compared to various other generators of electricity including coal, gas, nuclear and hydro.

    This post is yet another example and the reports quoted provide statements from the Australian Energy Market Commission (AEMC), The Energy Supply Association of Australia (ESAA) and a Deloite Access Economics report having regard to the recent power failure in South Australia (all predicted).

    The AEMC acknowledges ‘challenges for the security of the electricity system’ and ‘challenges around power system security and reliability’. The ESAA warns of risks to reliability and Deloite’s notes grid stability problems and even further higher prices.

    All Australians and consumers of electricity need to know that Australia has a very clear legal framework and laws that govern the generation, supply and distribution of electricity and that every responsible body and planning authority, government – local, state and federal have responsibility to ensure compliance.

    Set out below is a summary for everyone to use to demand that those persons or bodies they know that continue to ‘break the law’ are accountable (or should be). There is absolutely nothing in what is known as ‘climate change law’ that contradicts the necessity to comply with what is called ‘National Electricity Law’; and the reports above are just further proof of the breaches to that law (and not surprisingly from the AEMC, which is the main body responsible for ensuring the law is complied with, including the operations of AEMO who do the practical work).

    The National Electricity Market (NEM) is a phrase that refers to a 5,000 kilometre stretch of Australia that includes Tasmania and all the mainland states and territories except for Western Australia and the Northern Territory. It includes 40,000 kilometres of transmission lines and cables.

    The NEM is essentially physically controlled by the Australian Electricity Market Operator (AEMO). National Electricity Law (NEL) and the National Electricity Rules (NER) prescribe how AEMO and the NEM is to function. The NEL is accepted by the Commonwealth, states and territories.

    References to sections of the NEL refers to the South Australian Act. Other States and the Commonwealth have essentially copied it.

    Basically, the generation and supply of electricity is prescribed by the National Electricity Law which covers the field in this area. (It is important to note that the NEL and AEMO existed under other names prior to 2005 – the National Electricity Code, for example, and NEMMCO.)

    Section 7 NEL sets out the National electricity objective –
    “efficient operation and use of, electricity services for the long term interests of consumers of electricity with respect to

    (a)price, quality, safety, reliability and security of supply of electricity and

    (b)the reliability …. and security of the national electricity system.”

    Section 7A sets out revenue and pricing principles.

    Section 8(2) requires that any MCE statements of policy principles (i.e. Ministerial Council of Energy being Ministers representing the Commonwealth, the States, the ACT and the Northern Territory) must be “consistent with the national electricity objective” i.e. as set out in Section 7.

    Section 33 states that the AEMC (which controls AEMO) must have regard to relevant MCE statements of policy principles and Section 32 says that the AEMC must also have regard to the National Electricity Objective i.e. Section 7.

    It is important to note that “electricity services” in Section 7 is defined in the Definitions as including “(a) the generation of electricity” as well as “electricity network services” and the “sale of electricity”.

    It is very important to note that in this legislation section 7 of the NEL is ‘the law’ even though it says ‘national electricity objective’. It is not a “preamble” but the substance of ‘the law’ which must be followed.

    I stress again that it sits with what is defined as ‘climate change law’ not in conflict with or in contradiction to it. The use of ‘wind turbine generators’ in the NEM is a breach of National Electricity Law section 7 and they should be turned off and disconnected, now.

  2. “While there are options for managing system stability and limiting further exit of baseload and mid-merit generation, there is no clear approach to addressing the challenges posed by an increased share of renewable generation”

    Actually there is a clear approach, but it has been kept largely hidden from consumers: you’ll only get electricity when it is available.

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