Power Surge: Weather Dependent Wind Power Means Massive Summertime Price Hike for South Australia

Things SA did last Summer: wholesale prices doubled.

 

South Australia is renowned for the world’s highest power prices and mass blackouts, thanks to its risible ‘reliance’ on sunshine and breezes.

In Australia’s RE capital, sunset and massive, sudden and unpredictable collapses in wind power output not only result in mass load shedding (controlled blackouts), but send spot prices for power into the stratosphere.

With increasing reliance on wind and solar, and no apparent intention to replace the reliable coal-fired power plant blown up by its renewables obsessed Labor government last year, South Australians – already suffering the highest power prices in the world – are set for much worse to come.

Power bills predicted to soar this summer
The Australian
Michael Owen
6 October 2018

Electricity prices on the east coast and in southern states could spike early next year because of the impact of a gas price crunch forecast by the consumer watchdog, energy experts warn.

Most exposed is South Australia, which already has among the highest power prices in the world because of the former Labor government’s renewable energy policies, as it relied on more than 50 per cent of gas generation to power homes and industry.

The Australian Competition & Consumer Commission published LNG export prices this week for the first time to help major gas users in contract negotiations.

The ACCC has forecast gas prices to continue to rise to about $15 a gigajoule over summer, and not fall below $10.60/GJ for the rest of the year.

The publication of LNG “netback” prices — a measure of an export parity price that a gas supplier can expect to receive for exporting its gas — was a federal government directive as part of the gas inquiry.

Australian Power Project chief executive Nathan Vass said the ACCC data showed that domestic gas prices may jump to $15/GJ in January and February — four times the historical prices of $3 to $4/GJ and 40 per cent higher compared with this year’s average of $10.68/GJ.

“The impact on electricity prices will be huge,” Mr Vass warned.

He said ACCC modelling showed for every $1/GJ rise in gas prices, the wholesale price of electricity spiked by up to $11 per megawatt-hour.

Mr Vass said South Australia was particularly exposed and noted the current average spot price of electricity in the state was $90/MWh at $10/GJ for gas.

“So if gas jumps to $15/GJ you could see the average wholesale price hit $140/MWh,” he said.

“The closure of cheap and reliable coal-fired generators and the shift to gas-peaking plants has left South Australia more vulnerable to gas price shocks than any other state.”

Grattan Institute energy program director Tony Wood agreed there was a risk of higher power prices on the east coast and in South Australia over summer because of rising gas prices.

But he said the degree of price increase was dependent upon the amount of gas generation required, which in turn was dependent on weather, as gas kicked in when “the wind was not blowing and the sun was not shining” and the grid was under pressure.

“That’s why there is so much interest in building another electricity interconnector between South Australia and NSW — that would reduce reliance on gas generation,” Mr Wood said.

“We have in the past seen that when the gas prices come down, so, too, do the power prices in places like South Australia.

“The retailers bear the price rises, but it does flow through to consumers.”

However, federal Energy Minister Angus Taylor told The Weekend Australian that any electricity cost hike because of gas price rises would be “minimal”.

“The ACCC has shown that an increase in the gas price will have on average only a minimal impact on the electricity price in a competitive market,” Mr Taylor said yesterday.

“We expect the retailers to bring down electricity prices and will be watching closely to ensure they do.”

South Australian Energy Minister Dan van Holst Pellekaan said the new state Liberal government’s policies, including a home battery scheme and interconnection to NSW, “will reduce SA’s reliance on gas and the degree to which gas prices set electricity prices”.
The Australian

South Australians can only despair at the lack of wit demonstrated by their Liberal government. Their Energy Minister is delusional if he thinks strapping a few Teslas to suburban homes in Adelaide will have any impact on either supply or price. And he is dreaming if he thinks that the Federal government is going to fund an interconnector between his economic backwater and New South Wales.

South Australia’s obsession with breezes resulted in the construction of 1,810 MW of wind power capacity.

The statewide blackout in September 2016 that put SA on the map was the result of wind turbines being deliberately shut down during a blustery spring storm, the collapse in power output tripped the Victorian interconnector, cutting SA from the Eastern Grid, plunging the entire State into pre-industrial darkness; parts of it for more than a fortnight.

Following which, the grid manager placed a cap on wind power output at just under 1,300 MW (see above). The result being that on those brief occasions when wind conditions might result in actual output approaching or matching the notional capacity of SA’s whirling wonders, up to 500 MW of that capacity is ‘curtailed’ – as soon as the cap is reached or breached the grid manager directs wind power outfits to shut their turbines down.

The 1,300 MW cap relates to the capacity of SA’s last remaining base-load plant, AGL’s Torrens Island gas-steam plant which has a capacity of just on 1,280 MW. That plant is able to hold ‘spinning reserve’ (meaning that its boilers are kept at operating heat and pressure, but that power is not being dispatched) able to instantly add power to the grid and be capable of matching sudden and total collapses in wind power output – collapses in the same order as the entire capacity of Torrens Island (never mind that in holding spinning reserve to account for sudden wind power collapses, millions of precious gigajoules of gas are being consumed by Torrens Island each year, without generating a single watt of power).

The interconnector between SA and NSW – begged for by SA’s Energy Minister and being feverishly promoted by the wind industry – has two purposes.

The first is to dump that extra 500 MW of excess wind power into NSW, allowing SA’s wind power outfits to get around the 1,300 MW cap in SA and flood the NSW power market with electricity, precisely when it doesn’t need it.

The second is to sponge off NSW’s enviable fleet of reliable coal-fired plant whenever the sun sets and/or calm weather sets in in SA. However, on those occasions NSW and SA are in the same boat: neither has sufficient reserve capacity to meet their own demand, whenever demand surges in hot weather and householders and businesses crank up their air conditioners.

Even without purportedly wind and sun ‘powered’ SA leaching large volumes of coal-fired power from NSW, NSW is unable to satisfy the demand from its own users: Wind Power Output Collapses Send Power Prices into Orbit: The World’s Biggest Joke Just Got Serious

NSW will have no hope of powering itself if SA gets the interconnector it so desperately wants.

STT hears that the Federal Energy Minister, Angus Taylor has no intention of pandering to SA’s petulant demand for another interconnector.

Apparently, Taylor believes that SA dug its own grave and shouldn’t visit its own stupidity on NSW (Taylor’s home State). But, with SA’s grid on the brink of collapse and power prices spiralling out of control, expect to hear plenty more bleating about the purported ‘benefits’ of the SA/NSW interconnector from SA’s hapless Energy Minister and a desperate wind industry.

Sorry Dan, instead of sucking up to to the wind industry, you’d be a whole lot better off building some meaningful generation capacity in your own state, rather than attempting to throw an extension cord over the neighbour’s fence.

We mentioned the gas-steam Torrens Island plant but, beyond that, SA relies upon a fleet of highly inefficient and costly to run Open Cycle Gas Turbines, some of which are run on diesel, rather than gas. As well as a fleet of diesel generators shipped in by Jay Weatherill on the eve of the last state election, in the hope of avoiding a summertime blackout and an electoral wipe-out. Weatherill was duly wiped out and his obsession with wind, solar and a $150,000,000 Elon Musk mega-battery (capable of powering the state for less than four minutes) has practically wiped out any hope of economic recovery in SA.

Where every other state’s population is growing at double-digit rates, immigrants avoid SA like the plague and locals with any skills and talent are leaving like rats leaving a sinking ship.

The article above talks about average wholesale prices reaching $140 per MWh. Behind that surge is what happens in the spot market, whenever the wind stops blowing, which is what South Australians can expect plenty of this coming summer.

Here’s one prepared earlier by David Bidstrup. [STT has added a few graphics from Aneroid to help him cover the point.]

Gaming the System
Catallaxy Files
David Bidstrup
3 July 2018

An article in “The Australian” (July 2 2018), reported on power price rises due to “gaming the system”.

Earlier this year I did an analysis of SA wholesale prices for January 2018 to look at price changes on 3 of the hot days using data from AEMO Price and Demand reports. If anyone has doubts about the horrendous “market” we have or the possibility that generators might “game the system” this might give some insight.

Each day was over 40 degrees and the details for each day are in the table below. The colours refer to the chart lines for each day. The number in parenthesis in the “average $/MWh” column shows the multiplier based on the average price on 6 January.

Date Max Temp Daily wholesale cost Max price $/MWh Average $/MWh over the day Total MWh consumed
6 Jan 43 $3,047,470 $113.69 $78.58(1) 38,784
18 Jan 43 $67,965,999 $14,166.50 $1,404.45(18) 48,393
19 Jan 44 $59,969,400 $13,408.28 $1,195.28(15) 50,172

 

The chart below shows load and price/MWh over the course of the day. The AEMO data is given in 30 minute intervals so the X axis shows forty eight 30 minute intervals from midnight to midnight. The load lines are in the lower part of the chart and are reasonably similar in shape although their peaks vary a bit.

The price/MWh for 6 January follows the X axis as the scale of prices is such that it barely makes it above the axis. The price/MWh for both 18 and 19 January do so until the afternoon “peak” hits when they go through the roof.

On 18 January the afternoon “peak” from 3 p.m. to 7.30 p.m. cost $63,343,640.00, ($4,723.00/MWh), which is 93% of the total daily cost. On 19 January the “peak” from 2.30 p.m. to 7.30 p.m. cost $53,103,892.00, ($3,772.00/MWh), or 88% of the total daily cost.

Wind power went AWOL due to a large high pressure system, a frequent occurrence in summer, and the system was on the edge. As you can see, the generators made a meal of it and the suckers paid the bill.

If the Port Augusta power station had not been sacrificed on the altar of climate change it would have been able to provide the shortfall from wind power and removed the opportunity for generators to wait until the last minute and then rape and pillage at will.

The last chart shows the comparison between Q1 2018 wholesale prices in the various states that make up the “National Electricity Market”.

I wonder why, if it is a “national market”, prices vary so much from state to state. (Numbers at base of the chart show % comparisons against the Q1 “average” over total supply and cost.)
Catallaxy Files

Welcome to your wind powered future!

More to come: SA’s power prices crushed this man’s business last year.

About stopthesethings

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

Comments

  1. Jackie Rovensky says:

    As a South Australian I am extremely disappointed in our Liberal Energy Minister – though I must say when I went to a pre-election meeting with him present I had little hope he would be capable of dealing with this States energy crisis, he was even then clearly going to push us further into the mire of energy supply uncertainty.
    If he and others just kept an eye on the AEMO Dashboard they would see that a connector to NSW was a complete waste of money.
    NSW struggles much of the time to meet its own energy needs even with its massive coal fired generation – so why would they be willing to pass any on to SA.
    SA struggles to meet its requirements.
    All the meaningless talk from our Liberal/come Labor Energy Minister that we will be able to sell our excess Wind produced energy to NSW is a waste of time – WE, and most people take that to mean the people of SA will profit by the sale is wrong. The Energy companies will be the ones to sell it to NSW not the SA Government, instead we the residents of SA will be the ones who will be paying the cost of construction and maintenance of a new Connection to NSW!!!
    What we need is for our hard earned money to be spent on a State Government owned and operated clean coal or nuclear energy plant, a plant where WE the people of SA will benefit from our own energy production and possibly even selling some to other States, after all Victoria is even going to go down in flames if it continues with its push for Wind in Western Victoria.
    What is the SA Government waiting for – miracles are not flown in by money hungry conglomerates only interested in their own bottom line.
    The type of miracle this State needs is one our own Government creates, for the benefit of the State and its people. The money spent on an energy plant would also provide work for more people from construction to operation and supply of source operating materials.
    We have gone down the road of oblivion and watched our State destroy itself now we want the new Government to help bring us back with positive comprehensive well thought-out policy’s that do not destroy us but strengthens us.
    Gas is OK but it is now the only answer it is part of a whole encompassing energy mix that truly bring security and prosperity to this State – we have done our bit with respect to ‘renewables’, to our detriment, in many ways including our peoples health and livelihoods, now lets get back on track and get this State working again.

  2. This whole renewable energy fiasco could be decided once and for all by disabling the interconnector to South Australia.
    Then let the fun begin!
    Monitor the results for a year. (As if we don’t know what the result would be)
    Then start building some reliable and cheap generation, not the cheap, cheap, cheap unreliables!

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