Consumers Carry Colossal Cost of Getting Wind & Solar From Nowhere to Somewhere

The grand wind and solar transition comes with a staggering pricetag, not least the $trillions required to connect far-flung wind turbines and solar panels to increasingly distant markets. Building a secondary network of high voltage transmission lines and interconnectors to carry the power occasionally generated by wind turbines and solar panels, spread far and wide, is yet another of those costs which the wind industry and its zealot promoters sweep under the carpet.

In Australia, the increasingly remote locations chosen for wind and solar generators require serious upgrades to transmission infrastructure, adding hundreds of $millions to transmission costs, that would have otherwise been avoided, had we simply stuck with conventional generators and not squandered $60,000,000,000 in subsidies to intermittent wind and solar. As any first-year physics student will tell you, transmitting electricity over distances results in a mathematically predictable loss of the power transmitted, over any given distance. The greater the distance, the greater the absolute loss.

But that is not what ought to concern Australian power consumers. Rather, it’s the fact that they will end up carrying the colossal cost of building the infrastructure, in the first place; a cost that the wind and sun cult, which includes the Commonwealth Scientific and Industrial Research Organisation (CSIRO) readily ignore,  because they don’t bear it, consumers do.

A once proud and worthy scientific research organization, CSIRO has become little more than a propaganda outfit, pushing hopelessly intermittent wind and solar as the only answer to a changing climate. CSIRO has peddled a rabid anti-carbon dioxide gas stance for almost 20 years – of course, it only frets about CO2 generated by human activity, not the naturally occuring kind. Given its anti-human-generated CO2 rhetoric, the fact its so-called scientists actively advocate against nuclear power says it all, really.

A while back, in an effort to promote the wind and sun cult’s cause, CSIRO put together a report – called GenCost – purportedly detailing a cost comparison between our current predominantly coal-fired grid and a mythical future grid powered only by wind and solar, gas and a little hydro.

Turns out, its GenCost report is based on a series of half-truths, heroic assumptions and flat-out lies. Starting with the fact that it ignores the hundred-billion-dollar cost of building banks of mythical mega-batteries, the (otherwise unnecessary) transmission infrastructure required to bring occasionally generated wind and solar power from remote locations, as well as the grand (but unlikely to ever be completed) Snowy 2.0 pumped hydro project and – yet to be built – large capacity open cycle gas turbine peaking plants.

To call it ‘lying by omission’, is an understatement of some magnitude, as the team from Jo Nova explains below.

Don’t look now: Accounting trick destroys national economy
Jo Nova Blog
Jo Nova
28 July 2028

How to hide $100b storage, transmission lines, battery costs in a dodgy accounting trick.

The cost for our whole national $100 billion dollar energy transition apparently rests on a CSIRO report that assumes we’ve already spent the infrastructure money “therefore” future costs after 2030 are almost nothing. It’s like a Nigerian email scam… except that it has fooled our Minister for Energy.

You have been selected to win a new national electricity grid, just give us your economy…

Chris Bowen, said Minister, thinks wind and solar will reduce the cost of electricity, despite them doing the opposite so far.

Communication pollution, media, the CSIRO GenCost report says that renewables are cheap if we pretend we have already spent the money on the transmissions lines, the pumped storage, the “firming” of the grid. It’s like a used car salesman that says the second hand electric car will be cheap to run while hiding the twenty grand you have to spend on a new battery before it can move out the door…

There is a circular reasoning here that says we assume it’s worth spending bezillions now because renewables will be cheap after we have spent bezillions. But that’s only true if we assume the bezillions are a sunk cost we’ve already spent. See how this scam works? The bill never comes in. Somewhere someone lost $100 billion dollars and no one at our once hallowed Commonwealth Scientific and Industrial Research Organisation (CSIRO) even noticed. It’s like living in an Escher puzzle where you walk up the endless stairs to renewable heaven but never get there.

Why our energy transition needs a price tag
The  Australian
Claire Lehmann
28 July 2023

Writing in the Fresh Economic Thinking publication, Aidan Morrison points out that the CSIRO’s claim that renewables are the “cheapest” form of energy rests almost entirely on a misapplication of the “sunk cost” assumption.

In many situations, it makes sense to account for sunk costs. But the concept should always apply to money spent in the past, not in the future. By definition, costs that have not been incurred yet are avoidable, and are not yet sunk

“By use of a bizarre ‘sunk-cost’ assumption in their modelling, CSIRO cleaves the cost of infrastructure built prior to 2030 (when we would supposedly already have reached over 50 per cent renewable penetration) from any solar and wind generators built thereafter that might depend on that infrastructure,” Morrison writes in Fresh Economic Thinking. The CSIRO lists the projects that are written off as sunk: “Snowy 2.0 and the battery of the nation pumped hydro projects … various transmission expansion projects … New South Wales gas peaking plants at Kurri Kurri and Illawarra … The NSW target for an additional 2GW of at least eight hours duration storage is assumed to be met by 2030.” In response to this list, Morrison quips: “I’m losing count of the billions.”

“Every economist, politician, and policymaker relying on this report simply must hear about this,”
The Australian

“Business as usual” for the CSIRO is a plan where billions of dollars was already deployed and the projects are finished (and we have even paid them off too).

Assume renewables are cheap, assume infrastructure is free, isn’t this fun?
This is the quote from the CSIRO where they blithely magic all the infrastructure into existence “for free”, just in case anyone wonders whether they really could do something so absurd.

“Snowy 2.0 and battery of the nation pumped hydro projects are assumed to be constructed before 2030 in the BAU as well as various transmission expansion projects already flagged by the ISP process to be necessary before 2030. New South Wales (NSW) gas peaking plants at Kurri Kurri and Illawarra are assumed to have been constructed. The NSW target for an additional 2 GW of at least 8 hours duration storage is also assumed to be met by 2030.”

Aiden Morrison is scathing, staggered, aghast — the CSIRO is assuming all the infrastructure was a private investment and therefore we don’t have to pay:

The ‘sunk cost’ trickery that makes renewables seem cheaper than they are 
Fresh Economic Thinking
Aiden Morrison
23 July 2023

How CSIRO justifies the exclusions: “Sunk Cost”

…But wait, this deception is so brazen and transparent, surely someone else would have raised this in an earlier draft or something? Oh, but they have. CSIRO devotes several pages to exactly such an objection. (Page 94, Appendix D, Section 2.3)

What the authors of CSIRO’s GenCost said in response, is simply staggering. Every economist, politician, and policymaker relying on this report simply must hear about this. They explicitly and clearly defend the idea that all the prior investment must be treated as ‘sunk’. They’re adamant that these investments are like risky private investments and therefore there must be a penalty for bad investments made by people who didn’t adequately study what would most likely be required in the future.

Perhaps most incredibly, they explicitly make this claim:

The market does not owe the owner a reasonable return on their investment.

In reality all these monster infrastructure builds were only justified in the first place on the basis that they will enable lots of future unreliable solar and wind power, and the costs will be added to what we call the “regulated asset base” which guarantees a return to the investors and is quietly added to electricity bills.

The whole renewables case is a crooked card game from scientific start to economic end.
Jo Nova Blog