Renewable Energy Train Wreck: Australian Power Prices Set to Rocket (Again)

The moral of the story of ‘The Boy Who Cried Wolf’ isn’t don’t lie, it’s don’t tell the same lie twice.

Renewables rent-seekers continue to stick with the same grab bag of lies, myths and furphies, despite mountains of evidence revealing their marketing pitch is just so much polished propaganda.

South Australia (Australia’s so-called ‘wind power capital’) is held up by wind worshippers as the example of how to transition to a 100% renewable energy future.

When the wind blows for a few hours at a stretch (see above) the wind cult claims victory, and seizes the high moral ground. However, woe betide anybody with the temerity to point out that SA’s obsession with wind power has left it with the highest power prices in the world, retail power prices rocketing, year-on-year, at 20% and a tripling of power costs to business in just on two years. Oh, and heaven forbid, don’t mention state-wide blackouts and mass load shedding, caused by total and totally unpredictable collapses in wind power output (see above).

The problem for the wind industry, its parasites and spruikers is, and has always been, the facts. STT can only admire their ability to reinvent them, refashion and varnish them, as they try to deflect attention from the bleeding obvious. However, over time, each new ‘explanation’ put forward in the face of rocketing power prices seems to hit a brick wall.

One minute, they’re claiming that rising power costs are all about ‘gold-plated’ networks, the next, rocketing gas prices. The range of excuses is only limited by their imagination and the naïveté of a willing and gullible mainstream media.

Paul McArdle from WattClarity (who calls himself a ‘technology agnostic’) has spent the last few years either sitting on the fence or running all manner of excuses and claims about Australia’s power pricing and supply calamity, aimed at deflecting attention from the chaotic delivery of wind and solar. However, Jo Nova helpfully pulls apart McArdle’s latest effort to exonerate the obvious culprit: intermittent and unreliable wind power.

Electricity cost train-wreck arrives in Australia
Joanne Nova
joannenova.com.au
7 July 2017

Something very “seismic” has happened to our electricity prices.

Paul McArdle of WattClarity goes through each state looking at quarterly trends and prices, and remarks that things are going “off the chart”. We had some electricity crises in Australia in the last 12 months, and 2016 was a significantly more expensive than all previous years bar the major drought year of 2007. But ominously, prices haven’t come down in what should be a “normal” quarter.

In Tasmania there was a crisis last year when dams ran dry, and the undersea Bass cable broke. But this quarter, prices are only $3.20/MWh lower than the crisis levels of Q2 2016 despite water in dams and a working cable to Victoria. Something has gone seriously wrong with our electrical grid and market.

In both Victoria and South Australia prices are higher on average than any previous April-June quarter in the 19 year history of the National Electricity Market. In Queensland and New South Wales, prices are at the “second highest”.

McArdle goes to some length to explain that this is not “one factor”, which seems obvious and fair — it’s the combination of the closure of Hazelwood and Port Augusta coal generators; the extremely high gas-prices; the lack of wind; the increase of intermittent renewables; and the way electricity generators game the market. But what McArdle doesn’t mention is that these factors are not independent.

If there was more coal fired power there wouldn’t be such high gas prices, and if there weren’t intermittent, highly subsidized generators, there wouldn’t be as much room to “game” the market.

If there is some ominous leap in electricity prices, we know from years of experience that a grid with a lower renewables input provides cheaper time-weighted average prices even though for some isolated, miraculous moments every day, using a cherry picked description, and ignoring costs of transmission lines and auxiliary services (like “stability”) we could say we are getting “free electricity”.

A grid is a complicated animal, and people studying small separate parts of it can make accurate but totally contradictory statements. What matters is the total cost of electricity over all, after the wash, the games, the crises and the subsidies are played out. The high gas prices have other causes beyond coal and renewables, but there’s no question that Australia had a cheap backup, it could always use coal, which would mean the high gas prices wouldn’t have to hurt so much.

The renewables subsidies are pushing the cheapest electricity source out of business. There is an Easy and Obvious way to let the market fix this problem that the government hath engendered, but there is no easy and obvious way to run a grid off wind and solar and no easy way to control our climate in 2100 using electrical power stations in 2017.

Thanks to Paul McArdle for crunching these numbers. Even the ABC is paying attention now, writing both “Power prices are ‘off the chart‘ and there’s no relief in sight” and  “Victorian businesses struggling with power ‘train wreck’ as wholesale prices triple since 2015“. Go to his site for the gory details.

If spot price outcomes through Q2 2016 were “truly remarkable” then price outcomes for Q2 2017 were off the chart
Paul McArdle, Wattclarity

In Victoria, we see , we see the average price for the Quarter break $100/MWh (up at $104.92/MWh) – a gut-wrenching level for the vast majority of energy users in what has traditionally been one of the more “boring” quarters.

In Victoria, we see that average Q2 prices have never been higher, across all 19 years of NEM history.

Saving (in this case) the worst for last, we then step over to South Australia where the time-weighted average price for the quarter reached a staggering $115.93/MWh, … it is clearly the highest Q2 average price South Australia has seen over the 19 year history of the NEM.

In the same vein as last year, the most important take-aways from this analysis should be:

  1. That the outcome for Q2 2017 was even more remarkable than Q2 2016; and
  2. That it appears that we’re entering a new environment that’s distinctly different from the years that preceded; and
  3.  That this affects everyone, right across the NEM ; and finally that
  4. Those pre-disposed to draw overly simplistic “it was due to … [this one factor]” conclusion are unlikely to be correct, and could be dangerously misleading.


From the ABC:

Historical average price not enough to start generators
Two years ago, the average Q2 wholesale price ranged between Victoria’s $31KWh and $45/KWh in South Australia.

However the cost structure has shifted dramatically.

“These days generators can’t, or don’t bid, at anything much under $50/MWh,” Mr McArdle said.

See: Wattclarity for the rest.
Jo Nova Blog

Why 96 year old Donathan Roe Key can’t afford to heat her home.

About stopthesethings

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

Comments

  1. I’m speculating, but feel this entire renewable issue still has legs. When the failure becomes obvious to more than just a few politicians, it’s then we really need to watch out. They’ll realize the wind and solar power has run its course and will be desperate not to be tied to the scam, but will still be on the “green” track knowing their futures will depend on continued “green” largesse. They will likely try to introduce stupid, insane legislation meant to ingratiate themselves with future employers, such as the forced eradication of fossil fuel powered vehicles by 2040 or similar poison pill policies meant to bind future political action.

  2. Jackie Rovensky says:

    People can use the high cost of gas as an excuse but here in SA just how much gas do we produce and use. After all our wonderful Premier Jay Wherewithal has told us we are able to survive on the Wind we produce and even sell the excess interstate!
    If we were managing on wind then why are our prices so high?The little gas we use would certainly not create such a high price for our energy, yet we are paying the highest prices in the World.
    Is our wonderful Jay telling us fibs?
    Wouldn’t you think if we were selling excess wind energy as he claims he would be able to offset the cost to the end customers – Oh but then of course the State does not own the generators does it, so how can we the States population gain any benefit from selling excess energy interstate?
    Is he telling us another fib?
    While the whole Grid system is a monumental mess it is not too hard to see why we are paying such a high prices for an ESSENTIAL SERVICE, it’s because of the mess Governments have made of our energy production and supply.
    It’s a result of them jumping into a mire and being spat out crying ‘Renewables’ will save us and that renewables name is ‘Wind’.
    They then went out in service of this thing called ‘Wind’ and ensured profits would be made and sent away on the wings of the ‘wind’ industry – never to be seen again.
    Each time it looks as if the Governments are drying out from the mire, they sink again as ‘Wind’ drags them back to the bog, back to serving its needs for its food called ‘profit’.
    It seems until we find Governments who have not been soiled by the dirt from the mire of the ‘Wind’ cult we will continue down the path of National destruction.
    Or until Governments come to accept they have been blighted by the scourge of this thing called ‘wind’ and return to serving the peoples need for a cheap and reliable energy source that ensures the people of Australia are able to access an ESSENTIAL SERVICE that meets their needs and encourages growth within Australia by provisioning businesses and industry enabling them to grow and expand.
    This Grid needs a complete overhaul, and our governments need to stop this disgraceful one-sided support of our energy producers.
    When did we become a Nation where it’s OK to destroy an industry in favour of another even though it is a legal entity that provides an ESSENTIAL commodity to the people of this Nation?

  3. Reblogged this on UPPER SONACHAN WIND FARM and commented:
    UK and Europe take note……

  4. Reblogged this on Climatism and commented:
    “If there was more coal fired power there wouldn’t be such high gas prices, and if there weren’t intermittent, highly subsidized generators, there wouldn’t be as much room to “game” the market.”

    Again…

    WTF?

  5. Rob Leviston says:

    Not sure if I can add a pic, but I took a screenshot from the AEMO site earlier today, that showed a spot price in NSW of over $300! The other states weren’t far behind, and Tassie was around $136. No wonder our prices are going sky high!

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