As modern Hollywood ‘gangstas’ often remonstrate with their fellow ‘homies’ – when the LAPD appears in numbers, out of nowhere and hot lead starts flying – ‘this shit just got real’.
With South Australians baying for political blood – after yet another wind power output collapse knocked out SA’s wholly weather-dependant power supply – and their compatriots in neighbouring states demanding some kind of reliable power sanctuary to avoid the debacle playing out in SA – in the Nation’s Capital, Canberra the politics of subsidised wind power just got very real, indeed. So frightening, in fact, it’s fair to call it a ‘horror show’.
Turnbull slams Labor’s power ‘horror show’
Sarah Martin & Meredith Booth
10 February 2017
Malcolm Turnbull has blasted Labor’s renewable energy “horror show” by seizing on blackouts in South Australia to warn of outages across the country under the “insanity” of Bill Shorten’s 50 per cent renewables target.
As the energy crisis dominated parliamentary debate, the national energy market operator ordered a mothballed Adelaide gas-fired power station to fire up to increase supply and prevent further outages.
As Canberra residents were urged to restrict electricity use today by limiting cooking and avoiding using home appliances such as dishwashers, the Prime Minister warned that the blackouts could be repeated in other states under Labor’s policy for a national rollout of the failed renewable energy “experiment” in South Australia.
Wind power generation collapsed in the state on Wednesday night and deliberate load shedding was used to reduce demand.
Mr Turnbull, who yesterday convened a meeting of the newly formed energy committee of cabinet, used question time to aggressively pursue the Opposition Leader over Labor’s national target. “Why is he threatening the jobs of every Australian? Do you want to know how many Australian families will be worse off under a government led by this man? Every single one,” Mr Turnbull said.
“How many South Australians are worse off because of the Labor Left ideological approach to power? I tell you: every single one. Every single one that wants to turn the lights on, wants to put the airconditioner on, wants to have a job, wants to have some investment. Families cannot keep their children cool on a 41C day — that’s insanity for you.”
Brandishing a lump of Hunter Valley coal in the House of Representatives chamber, which was then passed among Coalition MPs on the government benches, Scott Morrison accused Labor of “coal phobia”. “Don’t be afraid, don’t be scared: it’s coal,” the Treasurer said.
“Those opposite have an ideological, pathological fear of coal. There’s no word for coalophobia officially but that’s the malady that afflicts those opposite, and it’s that malady that is afflicting jobs in the towns and industries.”
Opposition energy spokesman Mark Butler rejected suggestions Labor’s renewable targets were to blame for the state’s serial power outages, saying “none of these blackouts are directly connected to renewable energy”. He pointed the finger at the Australian Energy Market Operator, saying it had “forced blackouts” on South Australians by not turning on the second generator at Pelican Point.
With heatwave conditions lifting electricity consumption across South Australia and NSW and placing additional strain on the national power system, the Australian Energy Market Operator has directed the mothballed 240MW Pelican Point to power up as “reduced generation reserves” in both NSW and SA were set to continue over the weekend.
ACT government climate change minister Shane Ratenby warned of the potential for blackouts today and urged Canberrans to set air conditioners at 26 degrees, turn off unnecessary fridges, avoid using dishwashers, dryers, vacuum cleaners and TVs or computers to play games.
The operator said rolling blackouts across Adelaide on Wednesday evening were prompted by wind power dropping to 2.5 per cent of the state’s energy demand, putting strain on the Heywood interconnector between Victoria and South Australia operating “at full capacity”, and an unexpected spike in consumption after the working day.
A request for gas-fired Pelican Point to power up on Wednesday came too late for it generate power in time, leaving 90,000 homes experiencing blackouts as the market operator sought to reduce demand. While firing up the Pelican Point generator from a “cold start” takes up to six hours, the plant’s operator Engie could have decided early on Wednesday to have it ready in anticipation of the expected demand.
The Australian understands that the South Australian government has the power to ask AEMO to intervene and order the plant open using emergency provisions, but it did not do so. Blaming the regulator for failing to bring extra power into the network, South Australian Premier Jay Weatherill said the state was preparing to “intervene dramatically” in the market, suggesting the government could even “completely nationalise the system”.
“It would involve breaking contracts and exposing us to sovereign risk, and the South Australian taxpayer to extraordinary sums of money,” Mr Weatherill said. “It’s not a preferred option, but we’re ruling nothing out.
“One thing that is absolutely clear to us is that SA is now on its own in relation to the national electricity market. It’s on its own because the National Energy Market Operator is unable to run a system which can guarantee us security of electricity supply.”
The South Australian Labor Premier, whose government has been in power for 15 years and has enthusiastically pursued renewable energy targets aiming for 50 per cent by 2025, accused the federal government of having “abdicated its responsibilities”.
Senior federal ministers joined the Prime Minister in attacking Labor’s “triumph of ideology”, saying the state’s heavy reliance on wind power had resulted in the blackout when the wind dropped during the heatwave. Energy Minister Josh Frydenberg said Mr Weatherill was “trying to blame the umpire” for the bad game it had played in determining the state’s energy mix.
“It wasn’t the operator’s fault. It was Jay Weatherill’s fault and now the Leader of the Opposition wants to take this horror show national with a 50 per cent renewable energy target,” he said.
Mr Butler seized on a statement from power station owner Engie, which said it needed to be directed by the market operator.
“This exposes beyond any doubt the desperate attack of the Liberal Party on renewables and Labor as utterly baseless and built on pure fiction,” Mr Butler said. [click on the image below for a clearer view of the latest round of fallacious excuses]
Yesterday, electricity spot prices soared in both South Australia and NSW, with forecasts of $14,000MWh in peak times, compared with $235MWh in Victoria, with demand expected to put pressure on supply amid soaring temperatures in the next few days.
Energy Minister Tom Koutsantonis warned that South Australia’s energy problems would extend to the eastern seaboard as more coal-fired power generation dropped from the system. “I think what you’re seeing at a national level is ignorance that the problem that’s occurring here is coming to a city near you on the eastern seaboard soon,” he said.
Australian Industry Group CEO Innes Willox said rolling blackouts and supply uncertainty would “further sap business confidence and investment”. He said neither the blame game nor writing cheques to build infrastructure would solve the state’s needs, and the grid needed to operate more effectively. Senator Nick Xenophon said he would question AEMO at a Senate inquiry into the energy market.
As we have pointed out, just once or twice, South Australia’s power pricing and supply calamity is ALL the product of the Federal government’s Large-Scale RET and has nothing at all to do with the merely tokenistic, notional State-based renewable target set in SA.
The power problem in SA – that now threatens every other State – is all Malcolm Turnbull’s to fix or flub, as Judith Sloan points out in this piece.
Turnbull can no longer fiddle while Weatherill is burning
10 February 2017
Another day, another blackout in South Australia. Embattled South Australian Treasurer and Energy Minister Tom Koutsantonis is now blaming the rules of the Australian Energy Market and the operator.
I guess he couldn’t blame a storm, the broken pylons or the interconnector this time. Mind you, he is running out of excuses.
While the plight of South Australia might be good political fodder for Malcolm Turnbull and federal Energy Minister Josh Frydenberg, their dilemma is that they really don’t have any solutions, unless they are prepared to modify the renewable energy target, at a minimum.
We should not forget that South Australia is in the pickle it is because of national energy policy; the state’s longer run ambition of being 100 per cent renewable by 2050 — everyone stop laughing — is not having any impact now.
(By the way, Premier Jay Weatherill was not wrong when he claimed at the Paris climate talks in 2015 that South Australia “is running a big international experiment right now.” Mate, it has failed; it’s time to change course.)
The bottom line for the federal government is this: the three objectives of energy policy are not compatible. They are reliability, affordability and meeting Australia’s overly ambitious Paris emissions reduction targets, which the Turnbull government ludicrously confirmed on the same day Donald Trump was elected US President.
We simply cannot expect to have cheaper, reliable electricity with the RET as it is. By giving such overwhelming preference to unreliable, non-synchronous renewable energy, the RET is squeezing all other sources of electricity generation out of the market and driving up prices.
It is only going to get worse.
I have said it before: it is not a matter of ditching the RET but improving the RET.
We need to move to the broader, technology-neutral clean energy target, which will mean that gas and cleaner coal generation can make a bigger contribution to supply. This will also solve the growing instability of the grid, a cost that should be sheeted home to renewable energy operators.
The idea that we can keep the RET and subsidise clean coal electricity generation is just piling a further distortion on another distortion.
But here’s the thing: if we subsidise some new coal power plants, it won’t be long before the existing plants come along and ask for the same deal — cheap capital, guaranteed cashflows.
Before you know it, we will have a quasi-nationalised electricity generation system that is very expensive (although with some of the costs paid by taxpayers rather than electricity customers) even if it is more reliable.
Whether it would meet the emissions reduction targets, which should be reviewed immediately in any case, is anyone’s guess.
We have reached a crossroads. With Hazelwood about to close — accounting for at least 20 per cent of Victoria’s baseload power supply — the outlook is for electricity prices to rise even more and for reliability standards to slip.
In the meantime, the Victorian government is twiddling its fingers, just as the South Australian government did when the Northern power station was about to close, never to reopen.
Meanwhile, the federal government just looks on.
This is the time for the Prime Minister to accept that policy is more important than politics.
Sure, Labor’s 50 per cent RET by 2030 might be worse than 23.5 per cent by 2020, but the government’s RET is causing problems now.
It’s time to act rather than just make cheap political points.
Judith’s suggestion of moving to a ‘clean energy target’ is based on a model involving replacing RECs (LGCs) with carbon credit units (CCUs), which we dealt with here: Frydenberg’s Carbon Credit Capers: Coalition Signals the End for Australia’s Renewable Energy Target & Wind Power
Because that model looks like a CO2 tax, sounds like a CO2 tax and operates like a CO2 tax, there is absolutely no way it will get any traction in the Coalition party room. With all due respect to Judith, her ‘clean energy target’ is a dead duck even before it starts waddling.
The first practical and politically achievable move is to alter the rules of the National Electricity Market, such that wind power generators are designated as ‘scheduled’, rather than ‘semi-scheduled’; thereby forcing them to deliver nominated volumes of electricity at nominated times, over nominated periods, predetermined in advance (at a minimum 30 days ahead of time). The effect of the current market and grid wrecking NEM rules are dealt with here: Turnbull’s Reliable Power Play: Australian PM Pushes Coal-Fired Future
If South Australia’s wind power generators were treated by AEMO as ‘scheduled’, there would have been no load shedding in SA last week: conventional generators would have known in advance when they were going to be able to dispatch power (and more importantly when they were going to get paid for doing so), how much power they would be able to dispatch and for how long.
If Judith Sloan is keen to push a quick fix, then designating wind power generators as ‘scheduled’ is it. The only people who will complain are wind power outfits and the operators of inefficient peaking power plants; like AGL and Origin, who have already started railing against Malcolm Turnbull’s plans to build HELE coal-fired power plants because doing so will crush their ability to rort the power market, charging $14,000 per MWh for something that costs coal-fired plant less than $50 to generate, profitably.
The next move is to cap the LRET at 16,000 GWh – what is being generated now (depending on the weather, of course) and the limit of what will be generated annually by 2020 – thus avoiding the ‘shortfall charge’ that is set to cost all Australian power consumers $20 billion, for no benefit of any description (save reducing the budget deficit).
But Judith is absolutely right on this score: the Federal RET is at the heart of the problem and the time for action is right now.