Australia’s Self-Inflicted Energy Crisis: Renewable Policies a Crime Against the People

Robert Gottliebsen is an economics columnist with The Australian, who has recently weighed into Australia’s unfolding renewables driven energy calamity. Late to realise the cost and consequences of Australia’s suicidal renewable policies, Gottliebsen is gobsmacked at what can properly be described as a crime against the Australian people.

Energy crisis: time to invest in emergency power
The Australian
Robert Gottliebsen
27 March 2017

All businesses and households in Victoria, NSW and South Australia need to seriously consider investing substantial sums in diesel generators, batteries or other sources of emergency power. Banks need to be ready to fund the massive investment required during the next nine months.

It is now absolutely clear that each of the state governments have not invested in sufficient emergency power to back their wind and solar installations and now have a network of wires that is unsuitable for the power generation grid they have established.

And the Commonwealth promises a partial solution in two or three years via the Snowy but has washed its hands of the looming disaster next summer.

That means that businesses and residents who need power in hot summer days are on their own. Prepare for massive food rotting and equipment (including computer) disruption for those who did not recognise the extent of the destruction of power security by three state governments.

Last week I wrote a three-part series stating that NSW, Victoria and possibly South Australia face a 75 per cent chance of blackouts because their once great networked power systems had been vandalised by politicians who made the easy decisions of plonking solar and wind generators in their state but not the hard and expensive but essential decisions of investing in the grid and providing back up. It was rank irresponsibility, although decisions were made complex by the different owners of the various parts of the network and the need to earn a return on investment.

Following my series, The Australian Energy Market Operator took the unprecedented step of announcing that Victoria faced an incredible 72 days of blackouts and power shortages if Hazelwood was shut this week (April 1).

Businesses in Victoria from restaurants to supermarkets and offices/factories that do not respond to the combination of my warning and that of the Australian Energy Market operator have only themselves to blame. Meanwhile, Victorian Premier Daniel Andrews walks around with his proverbial fingers crossed hoping Victoria will have another cool summer.

But NSW is not much better. It went very close to blackouts last summer but was saved by Victoria’s Hazelwood power station, which is set to close on April 1. Assuming Hazelwood is shut should it be Sydney or Melbourne that gets hit by the likely combined power shortages? Last summer when Sydney ran short of power Bendigo was scheduled to be blacked out to cover the NSW government’s failure to ensure adequate power for a hot summer. Bendigo residents were outraged that they should pay the price for NSW mistakes but they were lucky and kept their power.

NSW made its own Hazelwood mistake three years ago by allowing the Wallerawang power station to shut (it was about two thirds the size of Hazelwood) without ensuring the necessary investments were made to ensure supply during a hot summer. The owner of Wallerawang found that for long periods during the year the station was not required so made a commercial decision.

So if it’s a hot summer in 2017-18 who should be blacked out – Sydney or Melbourne? It will actually be determined by how the grid is operating but let me hypothetically intervene. I think it fair that NSW suffer one third and Victoria two thirds of the blackouts given that the Hazelwood closure is bigger than Wallerawang

The NSW and Victorian governments are also presiding over the fastest growing populations in the country, which is multiplying the effect of their vandalism.

South Australia made similar gambles and was caught with blackouts last summer (partly storm related) but now says it will go alone to secure its power. Businesses in South Australia have to decide whether to punt their government’s assurances or do what the businesses in NSW and Victoria must do and invest in back-up generation and/or batteries.

As I emphasised in last week’s series that it’s not a question of carbon or non-carbon energy. If governments want to go non-carbon then they must do the job properly and change the grid and have back up.

Both the NSW and Victorian governments need to get hold of the world’s best engineers to see what can be done to repair their vandalism. As I understand it there are alternatives even at this late stage. Meanwhile when the lights, computers and refrigerators go down at Point Piper, Cronulla and Kooyong I suspect the Commonwealth members for those areas (Turnbull, Morrison and Frydenberg) will get a big chunk of the blame for not declaring a state of emergency and keeping Hazelwood open by giving the French owner of the station some relief on the $1 billion rehabilitation that is required.

Turnbull needs to warn power users that prices must rise much further to cover the state government mistakes. Instead, he talks about lower prices.

Footnote: I hope the French in the submarine contract behave better than the French power people who own Hazelwood and also own the South Australian gas plant that remained shut for most of last summer. It was not economic to open it.
The Australian

In response to the energy emergency in Australia’s wind power capital, South Australia, its vapid Premier, Jay Weatherill, is determined to throw $550 million of taxpayers’ money at a 100MW battery that would power South Australia for all of four minutes and 200-250MW of diesel generation capacity which would cost over $400 per MWh to run, compared with the $40 per MWh that power from the now-defunct Port Augusta power plant once cost to produce.

In isolation, that move might seem almost sensible. However, notwithstanding the obvious culprit, Weatherill is still enraptured with wind power; and aggravating the level of his malfeasance, it has to be noted that the current calamity could have been avoided for a paltry $25 million, which is all that Alinta, the owners of the Port Augusta power plant wanted from Weatherill’s government to keep it up and running. Former Liberal trade minister, Andrew Robb is happy to call that kind of conduct for precisely what it is.

Stakes raised over gas ‘crime’
The Australian
Robert Gottliebsen
30 March 2017

Former trade minister Andrew Robb has taken an unprecedented and important step towards bringing the politicians who vandalised our power and gas systems before the courts.

I emphasise that Robb did not describe as “criminals” the politicians who put NSW, Victoria and South Australia at risk of blackouts and forced hundreds of thousands of Australians to consider installing their own generators or batteries.

But at this week’s Food Forum Robb did describe what happened as a “crime”. I believe it is the first time a former Coalition minister has used the word “crime” to describe the destruction of low-cost energy.

He did not discuss blackout danger but, if anything, that is a greater “crime”.

I emphasise that Robb did not say politicians should be prosecuted, but now the “crime” word has been used, if we have power blackouts in NSW, Victoria, or South Australia over the next two summers an enraged community is going to demand that the perpetrators of the “crime” — the politicians — be hauled before the courts.

As I have described previously there is a 75 per cent risk of blackouts in NSW and Victoria. But it might not happen. The politicians could be lucky.

We are fortunate in Australia to have a section of the criminal code that covers politicians and public servants who make false statements or mislead the public. It sets out that if they are guilty of an offence they can be punished with 12 months jail. Every word uttered by ministers as they vandalised the network and created higher prices needs to be examined to determine whether an offence has been committed. It’s not my job to say they have committed an offence and, as is their right, the politicians will fight any prosecutions with great vigour.

The question for the courts to decide will be whether the community was told by the politicians that, to guarantee supply security, solar and wind installations required backup facilities and a reconfiguration of the power network, which the politicians did not undertake.

In addition, was the community told that blocking gas developments in NSW and Victoria would create supply dangers given Gladstone required southern gas. Prices of energy would have to rise.

Quite rightly, Senate crossbencher Nick Xenophon is refusing to allow tax cuts until the power and gas mess is sorted out. And he is right. Few local or overseas groups are going to make substantial new investments in Australia while power and gas prices are out of control, plus substantial gas shortages and blackouts are on the menu.

The federal government may need to declare a state of emergency and restore Hazelwood, given that a “crime” has been committed, as well as accelerating the Snowy plan and quickly taking other emergency measures.

Like Andrew Robb and my readers, I can’t help thinking about why our politicians made such fundamental and catastrophic errors. I have written about the need for advice outside the public service and the “yes” people among the ministerial advisers. But watch question time in state and federal parliaments and you will see politicians using too much of their time thinking up ways to abuse each other.

That time could be used to make sure we avoid blackouts.

Vast amounts of state and federal government resources are used to duplicate what the other is doing, and usually one bags the other so no decisions can be made. We need to synchronise power structures so states control some areas and Canberra others. When duplication is ended, not only do we save countless billions but real policy can be determined, rather than developing new weapons for the state/Commonwealth fights.

Paradoxically, it was Andrew Robb who in the lead-up to the 2013 Abbott election victory was shadow finance minister and set out detailed plans to save those billions by ending state-federal duplication.

But Tony Abbott made him trade minister, and since then the Coalition in government has set about increasing duplication and infighting, which takes state and federal politicians’ eyes off the ball and leads them to poor decision-making.

Maybe long blackouts and gas shortages are what the community needs to rewrite federation and change the way we make decisions. It is the most important issue in the nation.
The Australian