Antinuclear

Renewable energy in Australia threatening the profits of fossil fuel industries

Electricity industry is in for a big shock  by: Giles Parkinson  The Australian  May 25, 2012   Data from the European electricity market shows how 25GW of solar PV has changed the nature of the German electricity market. The data compares how the market looked in 2008, against how it looked on a sunny day on March 12 this year.

“……..It is just a snapshot, but it is being repeated often enough that generators in Germany, Italy and elsewhere in Europe are calling for the rollout of solar to be capped to protect their earnings.
Several gas-fired plants in Germany have either been closed or marked for closure, and the largest electricity companies, E.ON and RWE, have made it clear they cannot keep these plants open, and are refusing to build new ones, without further help. So the German government has come up with a new mechanism called “capacity factors”. The details are yet to be worked out, but essentially it represents a payment to ensure that the gas-fired plants are available to balance the growing number of solar PV and offshore and onshore wind plants in the German grid, and to provide capacity as nuclear and then coal-fired power stations are removed.
It would seem inevitable that Australia will have to follow the same path. The brown coal generators are already feeling the pinch from lower wholesale prices of electricity caused by moderating demand and by the large wind capacity in South Australia. They have succeeded once in persuading the Victorian government to reduce the ambitions of its state-based renewable energy target, and are now seeking to do so again at the federal level. Already, the federal government has provided two payment mechanisms for the closure for some of the most polluting plants, and compensation to ensure that others stay open despite the impact of the carbon price (which ostensibly is designed to force their closure).
The government also has an energy security mechanism that can provide emergency financing to any generators finding themselves in trouble. Capacity payments, incentives to ensure that “peaking” generators that are flexible enough to provide energy when a coal-fired generator is offline, renewables are not functioning, or in times of peak demand, may well become part of the landscape…..

May 25, 2012 - Posted by Christina Macpherson | AUSTRALIA - NATIONAL, energy