Rocketing Power Prices Mean Australia’s Renewable Energy Target is Unsustainable and Ready to Implode

Look into my eyes, look into my eyes: your power bills
just went DOWN 20%, thanks to AGL’s subsidised wind power.

***

Renewables rent-seeker, AGL has launched a propaganda war in Australia’s media, since the release of Alan Finkel’s fantasyland review of Australia’s power market calamity.

Finkel’s report promised Australia’s very own Enron, among others, the opportunity to rape and pillage in a power market with an effective 42% RET, dominated by intermittent and unreliable wind and solar power.

No doubt, Andrew Vesey & Co were salivating at the prospect of Finkel’s clean energy target (CET) being snapped up by the Liberal/National Coalition government.

Alas, it wasn’t to be: hence Australia’s print and broadcast media have been blitzed with a multi-million dollar campaign launched by AGL in an attempt to con Australians into believing that the reason that their power bills are now close to the highest in the world, is because Australia simply hasn’t got enough costly and erratic wind and solar power in its system.

As that crazy little German with the funny moustache reckoned, “Make the lie big, make it simple, keep saying it, and eventually they will believe it.”

Trouble is, the Coalition have heard the wind industry’s lies so many times that they have determined not to swallow them, any more.

Turnbull turns to new coal for energy fix
The Australian
David Crowe
21 June 2017

The Turnbull government is preparing to back the construction of new coal power stations to prevent a dangerous shortfall in electricity supplies, using “reverse auctions” to replace ageing coal-fired generators with new technology already embraced in Japan and China.

The new agenda promises to scale back the need for a controversial clean energy target and clear the way for a peace deal within the Coalition after a bruising debate last week over reforms to favour renewable energy.

The move comes as the government pledges “immediate” action to boost the supply of gas by forcing exporters to divert production into the domestic market to prevent local prices soaring above the amounts paid for Australian gas in Asia.

Malcolm Turnbull declared the government was open to using “clean coal” technology to replace existing generators as he emphasised the need to prevent price rises and power outages across the national electricity market.

“I’ve said in the past that I think that, as Australia is the largest seaborne exporter of coal, it would be good if we had a state-of-the-art, clean-coal power station in Australia,” he said yesterday.

“But that’s not to say that the federal government should be building it or would be building it.”

Under the reverse-auction plan, private operators would put forward proposals to fill the gap left by the closure of ageing coal generators, allowing the government to choose between clean coal, gas or other options that meet a benchmark for reliability.

Households are being hit with a 20 per cent spike in electricity prices as the east coast market reels from the closure of the Hazelwood coal-fired power station, a surge in gas prices and a court decision last month that ­allows power companies to pass huge costs on to customers.

The call for a clean energy target, put forward by Chief Scientist Alan Finkel 10 days ago, sparked fears within the Coalition about price rises from any scheme that punished coal and gas by linking financial rewards to low carbon emissions.

Cabinet ministers are now making the case for the reverse-auction concept to give new coal power stations — using high­-energy, low-emissions, or HELE, technology — a chance to bid for the right to replace ageing coal generators when they shut down.

Informal estimates within the government suggest a plan to replace “dirty” coal stations with “clean” HELE generators would help Australia meet its commitment to cut emissions by 26 to 28 per cent by 2030.

This would ease the burden on a clean energy target to achieve some of the emissions reductions, making it a “softer” target with a smaller incentive for renewable energy providers.

The government is seeking to avoid a repeat of the withdrawal of about 25 per cent of Victoria’s power generation when Hazelwood closed in March, intensifying concerns about the impact on supply and prices when more power stations close over the decade ahead.

A “reverse auction” is winning support among Coalition backbenchers as a way to encourage energy companies to build HELE plants to fill the gap from the closure of the Liddell and Vales Point power stations on the NSW central coast, the Gladstone station in Queensland and the Yallourn brown-coal power station in regional Victoria.

Dr Finkel called for a three-year notification period for any big generator planning to shut down, setting up a process to consider the best way to make up the shortfall.

Mr Turnbull said it would be up to the Australian Electricity Market Operator to suggest a reverse auction in line with the approach being used in the US, Britain and Germany. “They’ve got to define what the size of the problem is likely to be: what the shortfall, what the need for dispatchable power, baseload power, is likely to be,” he said.

The Coalition partyroom yesterday gave Energy Minister Josh Frydenberg in-principle support on 49 of 50 recommendations in the Finkel report, including the notification period and a “reliability obligation” on wind and solar farms to require them to install batteries or other back-up power for reliability.

The clean energy target was the most controversial proposal in the Finkel report but it was not endorsed by the partyroom and is yet to be approved by federal cabinet. While a clean energy target could supersede the existing Renewable Energy Target over time, there is no sense of urgency with this issue compared with the “immediate” decisions on gas supply and the power of the federal regulator to stop price hikes.

As expected, the government will go ahead with the plans announced earlier this year for an Australian domestic security mechanism to tell the three big liquefied natural gas exporters on the east coast how much to put into the domestic market. Resources Minister Matt Canavan will sign the regulations next week to commence the scheme on July 1, but he must wait on advice in September to decide the export curbs to start from January 1.

The new curbs will not set a preferred price for the Australian market but are aimed at ensuring enough supply to keep prices in line with Asia. With analysis predicting prices above $11 or $12 in Australia, the government aims to get the price closer to $7 or $8, although the final rate depends on the cost of transport through pipelines from Queensland gasfields to city customers.

Mr Frydenberg also announced plans to legislate stronger powers for the Australian Energy Regulator by limiting the ability of electricity companies to challenge its decisions in the courts. A Federal Court decision last month rejected the regulator’s arguments and cleared the way for big energy companies to pass on billions of dollars of expenses to their customers.
The Australian

Coalition heads to where the votes are: HELE power plants.

***

Australia’s Large-Scale RET is a policy which has all but destroyed the reliability of the Australian power grid and which has sent retail power prices into the stratosphere: across the country retail power prices have doubled in less than five years, with a year-on-year increase of between 16 and 20%, effective 1 July 2017.

At the political, economic and social level such a policy is simply unsustainable. A point well made by The Australian’s, Graham Lloyd.

Energy policy: Turnbull government must rediscover market forces
The Australian
Graham Lloyd
21 June 2017

Malcolm Turnbull has turned to market intervention on gas in search of an early win on energy policy but the federal government will need to rediscover market forces to find an enduring solution.

Rewriting the rules on renewable energy subsidies is the first step. It is now obvious that existing measures, which pay for renewable energy to wreck system reliability and raise prices, are unsustainable.

The government must turn the discussion away from what the power sector alone can do to meet Australia’s targets. It must make maximum emissions reductions at minimum cost the core objective.

Two recent reports show Australia can easily meet its 2030 Paris target with measures that enhance business profitability and hold genuine co-benefits for the land sector, although there are difficult politics around land clearances.

The pay-off is to build space to take pressure off the power sector, which in turn will reduce power prices and maintain employment.

Technological advances hold real promise of measurable carbon dioxide emissions savings in fossil fuels. But the renewables sector has yet to be made accountable on its claims that CO2 emissions savings are real, not just modelled.

A market system based on buying carbon permits to offset emissions offers a demonstrably more efficient, cost-effective way forward. Discussions are well advanced on how such a system could look. It melds Chief Scientist Alan Finkel’s recommendations and the federal government’s emissions reductions target inquiry to cement a durable solution. In that way, Finkel’s CO2 emissions target replaces the large-scale renewable energy target.

Rather than buying renewable energy certificates from low-emissions generators at high prices, power retailers would be able to buy permits elsewhere, including overseas, where carbon permits are trading as low as $7, or through an extension of the direct action reverse auctions, which achieve emissions savings for about $12 per tonne. This compares with the $90-plus default price on RET renewable energy certificates.

Under Finkel’s plan, efficient gas and new-generation coal plants could qualify for permits based on their lower emissions profile relative to coal technology. The challenge is to ensure lower-emissions baseload plants have adequate market access, requiring a level playing field on subsidies.

Such a policy would address the big picture of energy security, affordability and promised greenhouse gas emissions savings in a truly agnostic, ideology-free way
The Australian

Nice work Graham, we couldn’t have said it much better, ourselves.

STT has said it before and will keep saying it: the Large-Scale RET is unsustainable; and any policy which is unsustainable will collapse under its own imponderable weight, or its creators will be ignominiously forced to scrap it.

What Finkel managed to do, oh so brilliantly, was to reveal just how insanely expensive intermittent wind and solar power truly are, drawing attention to the nonsense claims that adding more of either would actually lower retail power prices. As an avowed wind power advocate, Finkel managed to call in an airstrike on his own position: taking all of his fellow travellers with him.

With the Coalition rejecting Finkel’s CET alternative, Australia’s renewable energy policies are all set to implode: now, it’s a matter of when, not if.

Alan Finkel: called in an airstrike on his own position.

About stopthesethings

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

Comments

  1. “Rather than buying renewable energy certificates from low-emissions generators at high prices, power retailers would be able to buy permits elsewhere, including overseas, where carbon permits are trading as low as $7, or through an extension of the direct action reverse auctions, which achieve emissions savings for about $12 per tonne.”
    This is type of rubbish the brain dead intellectuals come up with paying some carpetbagger in a third world country huge amounts of money for bit’s of worthless paper so Australian would be allowed to turn on their lights. How long will it be before we are paying some Africans to live in our own country. Hasn’t Graham Lloyd heard of a countries own sovereignty and not some rubbish that comes from a signing up to UN agreement that no other country in the world takes serious unless it’s a dumb Greenie Australian. Enough is enough Australia for Australians and fuck the rest of the world which couldn’t give a fart about CO2 emissions unless one of the worlds developed countries is willing to give them Billion$ in extortion money.

  2. Do Aussies without rooftop solar realize that electricity prices are so high in part because a big part of their electricity payments are paying those homeowners who have got solar on their roofs? I wonder what the actual amount works out to be. Hmmmm!

  3. “Rocketing Power Prices Mean Australia’s Renewable Energy Target is Unsustainable and Ready to Implode”.

    I’m afraid, you may be underestimating the human capacity for innovation. In this case: Innovation to sustain a renewable energy industry. I hope I’m wrong.

    It might indeed be unsustainable and ready to implode, but there’s a lot of support for renewable energy among policy makers and they’ll do whatever it takes to avoid the embarrassment (and jail time perhaps????) of a huge economic disaster being tied to their term/s in office.

  4. Herbert Adams says:

    Wind energy has collared another victim here in SA with a Kilburn plastic recycling plant going into liquidation.
    The owners stating that a rise of a $100 k per month in their power bill killed the business.
    The states energy minister Tom Koutsantonis said his party was doing all they can to reduce energy prices, this is a national problem and it stated 20 years ago when the liberal party sold the network.
    With 35 people losing their blue collared jobs you would think Tom might come to realise his pro wind govt is devouring those people he is meant to represent. In Toms world there is only Tom and unfortunately the lights aren’t always on.

  5. What is it with these US CEOs? They escape the mess in the US and then just start recreating the same mess here.

    • If there’s a bucket of money sitting out in the open, don’t expect a CEO or a politician to walk right on by.

  6. Reblogged this on ajmarciniak.

  7. Jackie Rovensky says:

    Infigen have this week had their shares take a dive due to wind projects not performing – not enough wind blowing and its not the first time.
    They work on averages of wind being present, but it seems they’ve not taken into account averages change constantly, after all the wind is a natural force that cannot be called up when and where they want it.
    Averages would have come down after their last wind shortage, but it seems they forgot to adjust them expecting them to remain the same.
    Will they expect the average for the next period to remain as it was when they built their projects (SA’s started in 2005), or will they reduce the average for the coming period due to the shortfall of this last quarter?
    Today SA was for a while producing nothing and actually went into deficit = using energy from the grid to keep their turbines warmed up. Victoria wasn’t doing much better either.
    No matter what AGL proclaims in well funded advertisements renewable’s are a failure in providing a secure and price effective energy source for the nation – let alone safety and welfare concerns they elicit.
    As for clean coal, the sooner they get it online the better, there are sites ready to be used – one in SA and one in Victoria, sites that have already been used for the industrial purpose of ‘manufacturing’ energy from coal. The sites can and should be re-used rather than looking for others. The old plants are being or are already pulled down, but there should be rail line and grid connections ready to be updated and put back into service. Likewise Grid connection pathways should still be there.
    As for moans and groans from Labor and their minions the Greens about emission targets and not wanting coal to be used, they should wake up to reality and stop trying to ruin the country.
    Australia is meant to be a country of ‘a fare go’.
    Unfortunately it has not been the case with energy production since wacko’s who blindly attached themselves to the coat tails of the Wind Industry, went all out to destroy an industry that has truly looked for new technology to ensure we can keep the lights on at an affordable price, using resources we have plenty of in this country.
    Having a level playing field is hopefully returning, as long as this reverse auctioning is handled properly and not overtaken by more of the wacko’s who are not adverse to trickery to get their way by making out Wind and Solar are able to supply backup power -, using batteries.
    If they do we will have an environment of thousands of acres of land covered by batteries, which will need constantly replacing as they discharge faster than ‘Superman traveling at the speed of sound’. With all the nasties in them having to be safely ‘stored’ because they cannot be re-used.
    However, for anyone to consider gas – it has to be from conventional sources as the dangers of fracking are evident around the world and should not be ignored. We produce sufficient gas for our needs and have plenty left to sell overseas. Actions of the Government to ensure our needs should not be just a short term thing it needs to be ‘set in stone’. These resources belong to us, Governments are our servants therefore we are their bosses and we should tell them to ensure WE COME FIRST, no matter whether its gas, coal or any other exportable commodity.
    Finally, turbines that have caused harm to local residents should be removed immediately, no more should be approved or if already approved installed. All turbines that reach a stage of costing more to maintain than they produce in energy should be removed and not replaced. The focus of Governments – our servants – has to be to have all removed as more efficient and cost effective measures of energy production come on line.
    So one day our beautiful rural and regional country can once again stand proud to the world as a place of peace, happiness, health and contentment.

  8. Neighbours of wind farms have been recording and reporting observations of impacts on good health, nuisance noise, vibrations, turbine faults and turbines which haven’t operated for months and years. What we notice from our homes is being ignored and dismissed by the authorities meant to show a duty of care and responsibility in executing their duties to the public, etc. We pray for no wind to ease the endless torment from infra-sonic pulses but no wind also means higher electricity bills and living costs. We ask for a moratorium on wind farms until the problems are eradicated.
    Commonsense says ‘Once bitten twice shy’.

    To add additional expense with battery back up not proven yet to be sustainable, messes the system further. Should the public pay over and over to perpetuate the ignorance and greed allowing the injustices to continue….No. Should the public have a vote or say in this decision making process which impacts all Australians and the future generations…

    It will be greed not climate changes taking us rapidly back to the dark or ice ages.

  9. Son of a Goat says:

    We sell our coal to the Japanese to use in their HELE plants, whilst we export our natural gas all over the world at export prices cheaper than what we can buy it for in Australia.

    Now we have a yank earning $7 million a year who is in charge of one of our largest generators/retailers preaching that coal is obsolete and renewables are the way forward, whilst we the citizens of this country get taken to the cleaners with the astronomical rise in power prices.

    Australia’s future growth is being paralysed by delusion.
    I find it difficult to reconcile that our chief scientist could submit a report that Australia’s economic growth and environmental sustainability could be built around wind and solar power.

    The facts about fraudulent wind energy have been there for some time and are being so capably illustrated in SA, why cant our politicians come to terms with the situation at hand.

  10. Grant Winberg says:

    With the Australian justice system being responsible for inadequate terrorism sentences and facilitating the largely foreign owned energy companies’ price gouging, there is a need to have market intervention by government to ensure fairly priced and non-intermittent energy for Australians. Australian politicians should not place keeping their jobs above serving and protecting Australian citizens. The Australian government is responsible for the imposed forced use of wind generated electricity, leaving other forms of power generation unable to plan or charge for the power they generate 24/7. That is called market intervention. There needs to be some market intervention by Government to compensate Australian citizens for the unreasonable increases in the cost of energy, and to do whatever it takes to prevent blackouts. Whatever it takes! And the Australian justice system must remain in its ivory tower and keep out of the way.

  11. swan101 says:

    Reblogged this on UPPER SONACHAN WIND FARM.

  12. Terry Conn says:

    Why the ‘professional elites’, like Finkel, Vesey, Chloe Munro (clean energy regulator) and now Aubrey Zibelman (new AEMO CEO) et al who are all highly paid public sector employees (with the exception of Vesey) are hell bent on literally destroying any kind of chance of the ‘working masses (the proletariat) getting ahead and having a fair go in life is beyond me – these ‘elites’ rule the swamp now, but it is high time the rest of us pulled the plug on them. Note: with Zibelman in charge of New York’s power its power prices went up 55% between 2013 – 16. She promotes ‘Finkel’s plan — surprise surprise.

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