Life Support: Government’s Obsession With Subsidised Wind & Solar Destroyed South Australia’s Economy

South Australia has more wind and solar capacity per capita than any other place on the planet. It also suffers the world’s highest retail power prices and has been the butt of international jokes thanks to a run of mass blackouts, including one that plunged parts of the state into Stone Age darkness for more than a fortnight, back in September 2016.

Dozens of energy intensive businesses have been wiped out, such as Stephen Scherer’s Plastic Granulating Services when his electricity bill of about $80,000 a month spiked to $180,000 a month back in June 2017.

And hundreds of others have had their profits squeezed to breaking point: South Australia’s Wind Power Obsession Leads to Highest Power Prices in the World

If South Australians thought that that lunacy would end when they voted out the renewables obsessed Labor government headed up by Jay Weatherill, they must be experiencing a sense profound disappointment bordering on despair.

The (notionally conservative) Liberals that replaced them have proved to be even worse. Their witless Energy Minister, Dan van Holst Pellekaan has as little grip on energy matters has the appears to have on reality.

Here’s The Australian’s Economics Editor, Judith Sloan taking us down the rabbit hole that is South Australian energy and economic policy. Brace yourselves.

Only reliable electricity can give the economic jolt we’ll need
The Australian
Judith Sloan
12 May 2020

These past few months have taught us many things, including the fact many state government ministers are none too bright.

Competition for the wooden spoon has been fierce, including Victorian Health Minister Jenny Mikakos, who claimed the response of her department to the runaway COVID-19 outbreak at a Melbourne abattoir had been “perfect”. Mind you, NSW Health Minister Brad Hazzard has been giving her a run for her money.

But the competition is not confined to health. The recent actions of South Australian Energy and Mining Minister Dan van Holst Pellekaan demonstrate a failure to appreciate the new economic challenges and his determination to hammer the last nail in the coffin of the worst-performing state economy.

Last week, this minister expressed his support for SA accelerating the date at which the state should reach 100 per cent renewable electricity generation. The current time frame is 2030.

I don’t know what he thought he was doing attending the launch of the newly constructed gas-fired electricity generation facility at Barker Inlet in Adelaide last November. The minister raved about the plant, built by AGL Energy, being “good news for affordability and reliability of electricity supplies in South Australia”. Are we to assume that the plant will be closed down by 2030 (or before) for the state to meet its renewable energy target?

And I wonder how he interprets the depressing results of SA becoming an electricity island earlier in the year? As a result of the need to repair the interconnector linking SA with Victoria, the Australian Energy Market Operator was forced to drastically curtail the amount of renewable energy generated in the state and instead rely on expensive gas generation to ensure the stability and reliability of the grid.

The cost of managing the power system was $310m in just the first quarter of this year, more than double the previous record set in 2008. It is estimated that managing the grid accounted for 8 per cent of all energy costs compared with the historical average of between 1 per cent and 2 per cent.

South Australian voters might have expected a change of direction when the longstanding Labor government was voted out. But the Liberal government headed by wet Premier Steven Marshall is every bit as beholden to the renewable energy players as the previous government.

The dream is that a new interconnector will be constructed between SA and NSW that will allow the excess renewable energy generated in SA to be exported to NSW — when the wind blows and the sun shines, that is.

And because the interconnector will be regulated, consumers will bear the cost. This will significantly inflate electricity prices.

According to the witless policy advice to the SA government, reliable electricity could be imported from NSW and Victoria to offset the inherent unreliability of renewable energy, even given the addition of short-living and expensive batteries. This way the illusion of SA being 100 per cent renewable can be maintained.

The economics of baseload or intermediate electricity generation in those other states is undermined by virtue of renewable energy being sent across the border. And let’s not forget that the NSW government has silly plans in relation to the promotion of renewable energy, too. The same goes for Victoria and Queensland.

At this rate, all the eastern states could become an electricity island, awash with unreliable energy and insufficient backup.

Into this policy quagmire comes the advice of the ideological Australian Energy Market Operator, telling us that it would be technically possible to have 75 per cent renewable energy electricity generation. That’s if we spent a lot of money — for example, on more expensive interconnectors, transmission and distribution — and changed the rules to favour renewable energy providers even more than they do now. This is poor advice.

The only sensible alternative in the post-COVID world is to junk the obsession with renewable energy (which is an inefficient way of reducing emissions, particularly when measured on a life-cycle basis), to kill the subsidies and to secure affordable, reliable electricity based, in all likelihood, on new gas plants.

When green rent-seekers start calling for a green new deal — more subsidies for renewable energy — the response should be that we have had a green new deal for more than a decade. And it has worked out badly for Australia’s industrial competitiveness. It’s time for a change.

And when the rent-seekers moan about fugitive emissions from gas, tell them these have already been taken into account when emissions are calculated by the federal government. Estimates, including by the CSIRO, put fugitive emissions at between 1 per cent and 1.4 per cent of total production.

With the lower price of gas this year and the possibility that new reserves will be developed in the Bowen and Beetaloo basins and possibly Gippsland, we are on the cusp of an exciting new phase for electricity generation and other heavy industry. With cheaper and reliable power, it’s easy to foresee substantial investments in the manufacture of explosives, paper, glass and bricks, and in food processing, among other possibilities. It simply won’t happen if we depend on renewable energy.

To be sure, we won’t need to junk the raft of renewable energy that already exists in the electricity grid, although some will begin to wear out in the not-too-distant future. (Several overseas renewable energy construction companies are already leaving the country.) But only firmed electricity — that is, 24/7 power with backup — should be accepted from these providers, a requirement that exists in most parts of the world.

We have paid a heavy penalty — some of the highest electricity prices in the world — for allowing renewable energy providers to offer electricity into the grid without bearing the costs of reliability and stability (frequency/inertia).

Unless the SA government takes a realistic stance in relation to energy and other matters, the place will be just a footnote in our economic history in 50 years.

And I haven’t even mentioned the urgent need for the federal government to cancel the expensive and unviable submarine project. That might be the last straw for the state’s economy — or a wake-up call for the South Australian government to get real rather than chase rainbows.
The Australian

SA’s wind & solar obsession killed Stephen Scherer’s recycling business.

About stopthesethings

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

Comments

  1. Reblogged this on ajmarciniak.

  2. Crispin bpm says:

    A 100% renewable energy target is highly likely to place severe limitations on South Australia’s future growth. To illustrate this point, take the Byron Bay solar train for example. Then compare this with the high speed mass passenger transportation system in France, which is currently supplied with energy sourced largely from a nuclear based grid.

    The first video clearly shows the limitations of a solar powered train.

    Video published by North West Historical Railway.

    (Byron Bay’s Solar Train)

    Compare this with the French TGV (Train à Grande Vitesse).

    Video published by Mike Loshchinin

    (TGV passing by @ Haute-Picardie)

    Spot the difference?

    The video below illustrates just how long this high speed train technology has been with us. It is dated from 1981! That’s nearly 40 years of navel gazing Australia. That must be some kind of record!

    Alas, now we are ‘Naval’ gazing! The country is taking proven French nuclear submarine technology and negotiating with the builder to supply an inferior diesel powered equivalent. This makes as much sense as signing an order for a fleet of TGV high speed trains and converting them to solar!

    In other words, NO SENSE AT ALL!

    Video published by AERORAIL.

    (Record de vitesse TGV 1981)

    Now this is just showing off! But the video below does serve to illustrate what the technology is ultimately capable of. Additionally, the test shows that daily in service operations of around 300 km/h are well within the limitations of the train. But it does raise the question as to what would happen if ‘Skippy’ were to step out in front of one of these speeding bullets! Clearly any high speed rail operations in Australia would have to include adequate kangaroo proof fencing with regular wildlife underpasses. My personal thoughts are that High Speed 1 (HS 1) should connect Sydney, Canberra and Melbourne. HS 2 could connect Sydney, Gold Coast and Brisbane. And HS 3 could run from Melbourne to Adelaide.

    Option 2 could see the return of rail services to Murwillumbah. However, I won’t hold my breath, especially where the New South Wales Labor government are concerned. They in their infinite wisdom, under Premier Bob Carr, closed the line back in 2004! The very line the solar train now partly occupies.

    Trains reduce CO2 emissions, especially when powered from nuclear baseload technology.

    Video published by sancsab

    (TGV speed record 574,8 km/h)

    • Crispin bpm says:

      To the Grattan Institute’s Transport Expert, and their response today in the media on the future of high speed rail in Australia…

      Fat Boy Slim sums it up.

      • Crispin bpm says:

        Thanks for publishing this comment STT. I won’t make a habit of using strong language. But it really sums up the situation.

        Crazy stuff.

        Go Fatboy!

  3. An often-overlooked side effect of renewable energy is the way it reduces carbon emissions by forcing energy-intensive industries to close or move elsewhere in search of cheaper electricity prices. What is also overlooked is their almost negligible effect on reducing carbon emissions. Most of the CO2 reductions thus far have come from switching from coal to gas. Switching from coal to nuclear would be much more effective and cheaper as well.

  4. Reblogged this on uwerolandgross.

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