Want to Destroy Your Economy? Then Follow the World’s Wind Powered Leaders: Germany & South Australia

German power prices

As any student of that dismal science will tell you: for businesses, input costs matter. While wind-cultists claim that their beloveds wouldn’t hurt a fly, let alone wreck whole industries, the reality is a long way removed from eco-fascist fantasy. Jack up power prices and, all things equal, an energy hungry firm’s profits must fall and, along with profits, employment must fall too.

South Australia, Australia’s ‘Wind Power Capital’ has seen power prices rocket (the forward price, at $90 per MWh is more than double its neighbour Victoria’s) and unemployment with it: worse is yet to come, on both scores. Then there’s the grid instability and state-wide blackouts that come with routine, total and totally unpredictable wind power output collapses.

One of its power hungry businesses, Whyalla’s Arrium Steel Works has just been placed into administration, with 3,000 jobs under immediate threat, in a town that will become a rust-ridden ghost town if the plant closes.

whyalla smelter

Whyalla’s Steel Works: the lifeblood of a region. But for how much longer?

****

Come back, Craig Emerson, and this time get your horror lyrics right
The Australian
Judith Sloan
8 April 2016

It was probably the most cringe-worthy political moment of the past decade when Gillard government minister Craig Emerson took the tune of Skyhooks’s Horror Movie and penned some new words in July 2012, with the first line: “No Whyalla wipe-out.” (you can hear the Horror here)

He then sang a tuneless rendition in one of the courtyards of Parliament House. His purpose was to demonstrate that the carbon tax was no biggie. (Actually the exemption of the steel industry from the carbon tax was only going to last four years and would be impacting the industry now were the tax still in place.)

I’m wondering whether Emmo might consider a Nellie Melba, although the words will have to be changed to “Whyalla wipe-out’’.

Here’s the thing about Arrium (formerly OneSteel), the company that runs the Whyalla steelworks, being put into administration — it was only a matter of time. Arguably, the steelworks should have been closed years ago; it is a long time since they returned the cost of the capital employed and the operation has been bleeding cash for some time.

Who should we blame for this state of affairs? The problems go back many years, but the recent turbulence in the global steel market has not helped matters. This market is seriously oversupplied (China is now a dominant producer) and prices are falling.

The entire British steel industry faces closure, including the massive Port Talbot steelworks in Wales. There have been large lay-offs in the US steel industry. Yet Arrium’s problems extend beyond the impact of this relatively recent adverse global trend.

Too many overpriced assets were purchased using debt and some of the biggest assets of the company have been incurring large losses. The appointment of an administrator was inevitable.

Now the banks are essentially out of the picture; so much for the Premier of South Australia telling them they needed to act in the ­national interest. I guess he thinks the owners of the banks, the shareholders, don’t count.

Mind you, we have had plenty of baloney being spouted by all sides of politics. Federal Industry Minister Christopher Pyne, a South Australian, was running a similar line about the banks. And opposition industry spokesman Kim Carr, a dripping-wet interventionist from way back, has called for a national steel plan, as if that would do anything to help Arrium now.

Australian Workers Union national secretary Scott McDine has told us the only thing that matters is the workers — again, pity about the shareholders, bankers, noteholders, other creditors and contractors.

There have been the usual calls for more protection, just don’t call it protection; ramping up the Anti-Dumping Commission; insisting on preference for local steel in all government-funded infrastructure projects; and loans and handouts. It’s only a matter of time before someone starts talking about nationalising the steel industry — for national security and defence reasons, of course.

Did it have to end this way? It is interesting that the enterprise agreements covering Arrium workers are classic examples of relatively low base wages with multiple allowances, coupled with significant restrictions on the ability of mangers to actually manage the operations.

With high rates of unionis­ation, the AWU has effectively called the shots for years. In recent times, there have been some concessions made: the steelworkers agreed to a pay cut, although the miners refused. By this stage it was probably too late.

Then there is a state government keen to boast about its green credentials, with the highest proportion of electricity generated from (expensive) renewable sources. The fact electricity prices are so high in South Australia is death to heavy industry.

The state government can’t have it both ways: either it wants to retain a manufacturing base, which needs competitively priced electricity, or it would prefer to pursue a de-industrialised economic future.

How should the Turnbull government respond? There has already been one handout offered — bringing forward the replacement of the Tarcoola-Adelaide railway track using Whyalla steel. But there is no way that the federal government, even in partnership with the state government (which is close to broke, in any case), can financially bail out Arrium nor should it.

The way forward is to offer assist­ance to displaced workers, including help to relocate, and hope a restructuring can entice new investors to salvage the viable bits of the business. The last thing the federal government should consider is a reversal of its opposition to corporate welfare.
The Australian

What Judith had to say about South Australia’s wind power debacle:

Then there is a state government keen to boast about its green credentials, with the highest proportion of electricity generated from (expensive) renewable sources. The fact electricity prices are so high in South Australia is death to heavy industry.

Applies with equal force to Germany, where its ludicrous energy policy has all but crippled its power hungry businesses. As goes South Australia and Germany, so goes Britain.

We’re following Germany to an energy disaster
The Telegraph
Christopher Booker
2 April 2016

A far darker shadow is hanging over Britain than that of the collapse of our steel industry. As she is the sister of a leading figure in the campaign to keep Britain in the EU, we may not be surprised by the warning from Amber Rudd, our Energy and Climate Change Secretary, that “Brexit” would raise our energy bills by £500 million a year. Her brother Roland, as a key behind-the-scenes strategist for Stronger in Europe, might be described as “the Rudd who doesn’t want us to leave the sinking ship”.

But in making that “half a billion a year” claim, Ms Rudd must hope that we don’t recall those recent figures from the Office for Budget Responsibility projecting that within four years – due entirely to her own Government’s policies – we will be paying £13.6 billion a year in climate change levies alone, up a further £7.6 billion from the year just ending.

Even this is only a small part of the disaster Ms Rudd is heading us towards, as she sets about “decarbonising” our economy by closing down all the fossil-fuel power stations which, until recently, were supplying two thirds of all our electricity, in order to rely instead on ever more “renewables” and those new nuclear power stations which simply aren’t getting built.

Just where this policy is leading us, as I predicted five years ago, can be seen by looking at the one country still ahead of us in the rush for the cliff edge. A long article in Handelsblatt, Germany’s leading business journal, paints a devastating picture of the chaos now resulting from its pursuit of a “green” energy policy remarkably similar to our own (except that, post-Fukushima, their 17 nuclear power stations have been closing down even faster than ours).

Already 77 nuclear and fossil-fuel plants have closed. Their largest power companies, RWE and E.On, have run up debts totalling £43 billion. And after £170 billion was poured into “green” subsidies, giving it the largest number of windmills in Europe (26,000) and causing huge problems for its grid when the wind isn’t blowing, Germany’s electricity bills have soared to the point where last year 350,000 customers were cut off because they couldn’t afford to pay.

Thanks to those rocketing energy costs, many of Germany’s top manufacturing firms, such as Siemens and BASF, are moving their production facilities abroad, with the loss of hundreds of thousands of jobs. Those jobs are going not least to the US, which has energy costs less than half of Germany’s (the same effect is seen here in Britain, where our “carbon tax”, crippling energy-intensive industries such as steel, is now four times higher than anywhere else in the world).

Yet the irony is that last year Germany’s “carbon emissions”, due to increased demand for heating and the burning of cheap “dirty” coal to keep costs down, actually rose. Ms Rudd may claim that her energy policy is “setting an example” to the world. But if she wants to know what happens next, even before our lights have gone out, she should look instead at the example being set to us by Germany.
The Telegraph

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About stopthesethings

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

Comments

  1. The “renewable energy” push is actually a resounding success. It costs an astronomical amount and is ineffectual. What more effective way to end western civilisation is there? It will preserve the nature world for the plants and other animals and the human virus will be at an end. Ask any deep green.

  2. Normally, I’d say “the market knows best” – (and that is undoubtedly true about energy efficiency because companies inherently adopt the lowest overall energy usage because it is always a significant cost).

    However, when you have eco-fascists wrecking the normally efficient market mechanisms and almost certainly increasing net energy usage in order to buy “green” energy, then the market no longer functions efficiently to reduce energy use.

    And no … I’m not being daft. Going for “green” involves huge amounts of wasted infrastructure which consumes vast amounts of energy, and so there is a massive energy outlay in “going green”. And when the payback is so small … more than likely more energy is consumed “going green” than if the market were just left alone (bananas I know – but you won’t find any research that might reveal just how wasteful the “green” market is)

  3. Reblogged this on Climatism and commented:
    A MUST READ.
    Spread this far and wide to warn others of the destructive and devastating realities of Industrial Wind Power to economies and indeed the environment – flora and fauna.

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