Australian government aims to get rid of Renewable Energy Target
No RET changes in overhaul
The government is aiming to exclude the renewable energy target from its looming overhaul of the nation’s power supply. .. (subscribers only)
http://www.theaustralian.com.au/business/mining-energy/no-changes-to-ret-in-looming-power-supply-overhaul/news-story/8606b86fc5bdc8343adc47c979f525fa
After Australian Energy Market Operator’s initiatives, South Australia defers energy security target
S.A. puts energy security target on back-burner after AEMO steps in http://reneweconomy.com.au/s-a-puts-energy-security-target-on-back-burner-after-aemo-steps-in-86049/ By Giles Parkinson on 11 September 2017 South Australia has abandoned plans to have its state-based energy security target in place this summer after conceding is could have little impact given the new initiatives by the Australian Energy Market Operator and the lack of competition in the local grid.
Officially, South Australia has decided to “defer” the start date of the EST until 2020, having already deferred it from a July 1 start to a January 1, 2018 start. But given the state poll in 2018, and the new initiatives taking place in the broader market, it seems unlikely to ever see the light of day.
The EST was a key component of the $550 million Energy Security Plan the S.A, government unveiled earlier this year following its dismay at the forced load shedding in February and other incidents.
But it seems likely that the only two components to have a lasting impact will be the Tesla big battery, which is due to come into service on December 1, and the 150MW solar tower and molten salt storage facility in Port Augusta, which will contract to supply the government’s own electricity needs.
The EST was to be one of the centerpieces of the plan, aiming to ensure that 50 per cent of demand was met by S.A.-based “dispatchable” generation by 2025.
The original structure of the EST was harshly criticised because it was thought it would favour gas plants over battery storage, would not reduce prices and could end up as a $3.5 billion subsidy to the gas industry.
But it appears to have been made redundant by AEMO’s decision – explained here – to require that at least three gas generators operate at all times, and more if the wind output from the state’s wind farms is more than 1200MW.
That guarantees the presence of gas-fired generation, but it also means that because three gas units are generating at the same time, and therefore sets the price, the chances of a reduction in wholesale prices are effectively removed.
The impact of the curtailment was made evident last week, when the wind output ran at a steady 1200MW for three days, with no significant fall in prices – apart from when the link to Victoria was constrained – because gas generators had to continue generating.
The S.A. government says that modelling from Frontier Economics, one of the architects of the EST, indicates that if the scheme was to lower power prices it requires the operation of a more competitive energy market.
It suggests that may not occur till 2020, when the solar tower and storage facility, and new facilities supported by the $150 million Renewable Technology Fund are built.
“Since we announced the EST a number of changes in the National Electricity Market have delivered system security outcomes similar to those the EST would seek to achieve,” energy minister Tom Koutsantonis said, noting also AGL’s decision to invest in a new gas generator and the implementation of 49 out of 50 Finkel recommendations.
What the Australian Energy Market Operator actually did advise the government
AEMO: Our advice was pretty straight forward, we need dispatchability http://reneweconomy.com.au/aemo-advice-pretty-straight-forward-need-dispatchability-13353/
“We need flexible capacity that can be switched on and off, and we need to transition to a new generation of Australia’s principal energy market institutions, and the newly-formed Energy Security Board.
“Our advice was fairly pragmatic,” Zibelman said. “We are concerned that on a 45°C day if we lose a generator (which AEMO has said is quite likely) we want reserves in the system to be able to respond.
“In our report we identified the fact that with amount of variability (from solar and wind energy and electricity usage) is changing rapidly, we need resources that can change rapidly.
“That may be different to traditional baseload resources, which do not move a lot. It doesn’t mean baseload is bad, it’s just that we need a different portfolio. (Baseload) may not be able respond in the time period we need it to respond.”
Sound like Liddell? Not really. The plant owner AGL Energy has made it clear that Liddell is old, increasingly unreliable, expensive to maintain, prone to unexpected outages and can’t be relied upon at times of peak demand, particularly as temperatures rise.
Zibelman’s comments, like the two AEMO reports it released last week, contrast starkly with the Coalition government’s contention that AEMO had insisted that rapid action was needed, and that that rapid action must mean that Liddell’s life span must be extended.
Zibelman made it absolutely clear that her preference was for fast, flexible technologies, both in supply and demand, and bother in front and behind the meter. Importantly, it had to be technology that the market operator could rely upon.
“The system is changing,” Zibelman said. “That’s not a bad thing. What we need to do is to start saying we have to think about next the generation of technologies, the next generation of markets and how to take advantage of it.”
Earlier, she noted: “The power system works best when we can operate it in accordance with the law of physics. (That means) we need to make sure we have sufficient tools to respond in a real time system.”
She noted that a focus was needed on system services such as inertia, voltage and frequency, which came as “ancillary services” to thermal generators, but now had to be sought elsewhere. This was not a reason not to evolve, just a reason to focus on how to set a market to encourage these technologies and capacities.
“Our advice was pretty straight forward,” she said: “As system has a higher level of (renewable) penetration, issues like frequency, violate and inertia needs to be addressed – not because it a bad thing, but because it was bundled previously with the big generators ….
“It’s not just having enough of these resources, it’s about having enough of these resources at the time and the place you need them. At all times AEMO needs the ability to turn something on and something off to maintain system balance,” Zibelman said.
She spoke of demand management, one of her favourite topics and preferred mechanisms in the US, but said it had been communicated badly and misunderstood – particularly the idea that the market operator would turn off the lights or the air-conditioning.
“What we are talking bout is being able to use rotating mass, use battery storage, electric vehicles, and create a more integrated system.”
She said it was clear that the Australian market was heading towards 30-40 per cent “distributed generation”, which means mostly solar and storage behind the meter. These technologies can and needed to be harnessed to ensure that they contribute to grid security.
Asked specifically about Liddell, Zibelman said choosing that as a preference would require an analysis to determine its level of dispatchability and its flexibility, and its ability to deal with reliability concerns.
“What do we want to do is to make sure we are riding the technology innovation curve in the right way…. it all has to fit. We’re thinking about what do we need, what do we have, and then what are the right mechanisms to get the best outcomes that are economically sound.”
She said it was clear that the Australian market was heading towards 30-40 per cent “distributed generation”, which means mostly solar and storage behind the meter. These technologies can and needed to be harnessed to ensure that they contribute to grid security.
Asked specifically about Liddell, Zibelman said choosing that as a preference would require an analysis to determine its level of dispatchability and its flexibility, and its ability to deal with reliability concerns.
“What do we want to do is to make sure we are riding the technology innovation curve in the right way…. it all has to fit. We’re thinking about what do we need, what do we have, and then what are the right mechanisms to get the best outcomes that are economically sound.”
13 September More REneweconomy news
RenewEconomy-
Networks ‘push back’ on more small-scale solar. But why?Culture wars: It may explain the continued efforts of some network operators to push back against the installation of more rooftop solar.
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An end to blackouts? Demand management success depends on collaborationAs national debate over energy supply reaches fever pitch, more attention is now being paid to the role of demand management, a weapon of last resort in Australia.
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Know your NEM: Corporate PPAs only movement in flat marketIn a week where energy politics took centre state over market news, the most interesting development was the signing by retailer Flow Energy of a 10-year 50MW PPA with Ararat wind farm in Victoria.
13 September REneweconomy news
RenewEconomy-
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AGL debunks Coalition myths on Liddell, saying it is unreliable and costly, and money is best invested in wind, solar, battery storage and other dispatchable generation.NSW government weighs proposal for 146MW solar farm near BathurstPhoton Energy Australia plans to develop 146MW solar farm on outskirts of Bathurst have gone before NSW Department of Planning for approval.
Five companies in running to build huge solar farm in Qld coal centreFive companies short-listed to tender for job developing up to 450MW renewable energy hub in Qld coal centre of Gladstone. -
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Big utilities about to pay price of saying no to coal and COALitionCoalition has known about bidding practices for years, but it has taken AGL’s refusal to play ball on Liddell to prompt it into action.
Whether or not Trump is sane, Australia will follow him into nuclear war
Australia is being dragged into US wars, Green Left TONY ILTIS, September 9, 2017The threat of nuclear annihilation is closer than at any time since the end of the Cold War as two heads of state use nuclear weapons as props in what looks like a fight between two adolescent boys.
On one side is a narcissistic bully, born to inherit great power and with credible reports that his personal life includes indulging in acts of sadism, whose policies in government are driven by a combination of xenophobia, ego and whim and who is threatening nuclear Armageddon if he doesn’t get his way.
On the other side is North Korean dictator Kim Jong-un.
In a situation where Russia’s belligerent President Vladimir Putin is able to play the role of a level-headed voice of sanity, some Western countries are distancing themselves from US President Donald Trump, or at least urging caution. But not Australia……
Since the 1940s, Australian governments of both parties have been keen to promote Australia as Washington’s most loyal ally, regardless of the sanity of the incumbent US president. The policy is based on the premise that if Australia unquestioningly follows the US into any war, the US, the world’s most powerful imperialist state, will look after Australian capitalists’ global interests.
This policy has led to Australian involvement in numerous wars, from Korea in the 1950s, and Vietnam in the ’60s and ’70s, to more recent conflicts in Iraq, Afghanistan and Syria. This policy has also allowed Australian mining companies to operate across the globe, from the Democratic Republic of Congo, to Romania and Chile, making huge profits at a horrific cost to the environment, workers and local communities.
The devastation wrought by the Korean War is the reason for the North Korean regime’s xenophobic paranoia. While the media generally portrays Kim Jong-un as mad, and provides no further explanation for North Korea’s nuclear program, the fact that Iran continues to suffer sanctions despite abandoning its nuclear weapons program and Iraq was invaded after getting rid of its weapons of mass destruction, points to some rationality in North Korea’s approach.
It also points to grotesque hypocrisy on the part of the West: the largest nuclear powers declaring that it is unacceptable for other countries to have nuclear weapons. North Korea was not responsible for the atomic bombing of Hiroshima and Nagasaki and it has not used the populations of any Pacific Island nations as guinea pigs in nuclear tests.
On July 8, when the UN General Assembly supported a resolution to ban nuclear weapons, Australia joined the nuclear powers in boycotting the session.
On July 21, Trump announced an escalation of the US presence in Afghanistan. Attempting to portray his policy as distinct from his predecessors’, he said the US role in Afghanistan would now be “killing terrorists” not nation building……..https://www.greenleft.org.au/content/australia-being-dragged-us-wars
Is the Federal Nuclear Waste Dump plan a TROJAN HORSE FOR AN INTERNATIONAL NUCLEAR WASTE DUMP?
NATIONAL NUCLEAR WASTE DUMP IN SA: TROJAN HORSE FOR AN INTERNATIONAL NUCLEAR WASTE DUMP?http://www.adelaide.foe.org.au/national-nuclear-waste-dump-in-sa-trojan-horse-for-an-international-nuclear-waste-dump/ 13 Nov 2015
The Federal Government has released the shortlist of six sites for the location of a national radioactive waste dump. Three of these sites are in South Australia.
Friends of the Earth Adelaide is cautious about the Federal Governments genuine commitment to a voluntary site nomination and selection process.
“The test will be how the government handles community opposition, how inclusive and transparent the site selection process will be, and how it will handle the issue of existing South Australian legislation banning the establishment of a nuclear waste dump,” said Nectaria Calan of Friends of the Earth Adelaide.
The National Radioactive Waste Management Act 2012, the Act governing the site selection process, over-rides existing state legislation prohibiting the establishment of a nuclear waste dump.
“Will the Federal Government impose a nuclear waste dump on states that have legislated against it, or communities that do not want it?” asked Ms Calan.
“The location of a waste dump cannot simply be decided through individual nominations,” said Ms Calan. “It affects the wider community, particularly those in close proximity to the site. Radioactive contamination knows no property boundaries. The principle of voluntarism extends beyond the individual where an action has wider ramifications,” continued Ms Calan.
“There is yet to be an independent inquiry into all our radioactive waste management options, so the nominations process is premature,” said Ms Calan.
Additionally, here in South Australia the Royal Commission into the Nuclear Fuel Cycle is considering the feasibility of an international nuclear waste dump.
“Will a national nuclear waste repository in SA be the trojan horse for an international high level nuclear waste dump down the track?” asked Ms Calan.
“Rather than considering existing nuclear waste in Australia as an intractable problem, the SA government and some proponents of the nuclear industry seem to consider radioactive waste a business opportunity and want to import it, astounding given that so far globally there has been no success in establishing even one facility for the long term storage of high level waste.”
“ The one deep underground repository for intermediate level waste that does exist, the Waste Isolation Pilot Plant (WIPP) in New Mexico, saw an incident in February last year where a waste barrel exploded, leading to an aboveground release of airborne radiation, after only 15 years in operation,” said Ms Calan. “According to the US Department of Energy, twenty-two workers tested positive to low-level radiation exposure.”
Friends of the Earth Adelaide has serious concerns regarding the regulatory framework that may be applied to a nuclear waste dump in South Australia, whether national or international.
“BHP Billiton, operator of the Olympic dam mine, is exempt from key regulating legislation in SA, including the Freedom of Information Act, and parts of the Radiation Protection and Control Act and the Environmental Protection Act. With such a precedent here in SA for the regulation of the nuclear industry, where is the guarantee that other nuclear projects such as a nuclear waste dump would not also be exempt from laws regulating radiation, environmental protection, and transparency?” asked Ms. Calan.
South Australia’s naval defence interests aiming for nuclear submarines, eventually?
Dan Monceaux Nuclear Fuel Cycle Watch South Australia, 8 September 2017.
Naval defence interests (including ADF, ASC, DCNS, Thales) in the Port Adelaide area are expanding their presences as Australia’s Future Submarine Program advances. DCNS was awarded the contract in April 2016. The Shortfin Barracuda Block 1A was the chosen design.
The French fleet of Barracuda class submarines is being fitted with nuclear propulsion, provided by Areva. The Australian build is expected to use diesel propulsion, but the prospect of a hybrid (some diesel propelled, some nuclear) has been speculated upon.https://www.facebook.com/groups/1021186047913052/
Giles Parkinson on Australia’s Energy Comedy Show
Nationals demand “coal target” as energy politics spirals into loony fog, REneweconomy By Giles Parkinson on 11 September 2017 It barely seems believable, but the politics of energy has just gotten worse. A week that began with a bizarre push to extend the life of a decrepit, 50-year-old power plant in the hope of keeping the lights on, finished with the Nationals demanding that no further subsidies be given to renewable energy.
Instead, they said, they should be given to last century’s technology: coal. At their annual conference on the weekend, the National voted, in effect, for a coal energy target. It wants the federal government to give out loans to support the coal industry.
Nationals leader and deputy prime minister Barnaby Joyce continued his bizarre riff about people being stuck in lifts, desperate to go to the loo, if the energy system had too much wind and solar. He seemed to think that closing Liddell in 2022 would cause the lights to go out in 2017.
Former resources minister, and Joyce’s ex chief of staff Matt Canavan, joined in, describing renewables as a “short term sugar hit” for jobs….
One sane voice at The Australian is Alan Kohler, who points out that despite the bluster of the Nationals and the conservatives within the Liberal Party, everybody knows coal-fired power stations must close if Australia is to meet the 2 degree commitment that everybody agreed to in 2015.
“The task of leadership is to prepare for that, not yearn for coal,” he writes.
“The Australian Energy Market Operator has made it clear the closures can be handled through demand management and some NEM redesign, with even more renewables and batteries, which is what’s happening anyway because that’s what businesses and investors want to invest in.
“There won’t be any new coal power stations, and the lives of existing ones won’t be extended unless the government, bizarrely and unnecessarily, pays for it.
“If that happened, it would bring about the final divorce of business and the Coalition, and the final retreat by Malcolm Turnbull into the loony fog inhabited by Donald Trump and the coal dancers on the Coalition’s right.” http://reneweconomy.com.au/nationals-demand-coal-target-energy-politics-spirals-loony-fog-37878/
Carbon capture shown to be uneconomic and impractical
Why Nuclear Energy May Not Be Our Best Alternative Option To Fossil Fuel, Forbes, 9 Sept 17 , Michael Barnard, low-carbon innovation analyst, on Quora: “… From a carbon capture and sequestration perspective, there’s exactly one sequestration project associated with a coal generation plant which is actually sequestering any reasonable amount of carbon. It’s in Saskatchewan, Canada. It was operating at 40% of targets for months and nobody noticed. It’s very expensive.
I did an assessment of all sequestration efforts in Australia over the past 19 years recently and found that they had spent $4,300 AUD per ton to sequester a vanishingly tiny fraction of Australia’s emissions.
The US CCS projects have gone vastly over forecasts and are abandoned and no new ones are projected. The UK government has stopped funding them………
Are environmentalists saying that CCS doesn’t make sense? Yes, because 20 years of work has shown that CCS related to fossil fuel generation has failed to progress, deliver to milestones or show that it is capable of providing any useful contribution. It’s just not economically or practically possible. …….https://www.forbes.com/sites/quora/2017/09/09/why-nuclear-energy-may-not-be-our-best-alternative-option-to-fossil-fuel/#25ec6e8375d0
Turnbull government grossly misuses report by Australian Energy Market Operator
The Turnbull-Frydenberg investment bank: Bullying, cronyism and 
Captain’s picks http://reneweconomy.com.au/turnbull-frydenberg-investment-bank-bullying-cronyism-captains-picks-46765/ By David Leitch on 11 September 2017 Bullying, cronyism and Captain’s picks instead of policyThere is almost universal agreement that carbon policy is or should be a Federal issue.
That is clearly something that the Federal Government should be involved in as it involves Australia’s international status and obligations. But that is the one area that the Federal Government is not touching.
Despite Finkel, despite our COP 21 obligations, the Federal Government does nothing. No electricity policy, no vehicle emission standards, no policy in other areas of the economy responsible for half of Australia’s emissions.
Gross misuse of AEMO report for political purposes
Perhaps the very worst thing, of the many to choose from, about the Liddell negotiation is the gross misuse of the AEMO report. This is only possible because the media is too busy, to put it kindly, to do its homework.
The definition of a “problem” is when forecast “Unserved Energy (blackouts)” exceeds the desired reliability standard. That is not the whole story, but if you want one metric, it’s that.
Unfortunately, AEMO didn’t draw its graph relating to NSW all that clearly. We have attempted to do better, [graph on original] using the .xls data that AEMO provides. AEMO does not forecast a problem and if more renewables are built, the standard will be easily met.
Liddell move emboldens the pro coal, pro socialization, anti private enterprise groups – i.e. the National party and right of the Liberals
Turnbull’s naked interference, partly symbolic, has emboldened the anti-climate change cheer lobby. Examples include:
Over the weekend we saw The National Party has passed a motion that is essentially anti a Clean Energy Target.
In NSW energy minister Don Harwin’s public statements about the need for more renewables, see this article and the NSW Government’s “aspirational” zero carbon policy by 2050 have been shown up in their true light by Premier Gladys Berijiklian’s statement that NSW is “not ruling out a new coal fired power station”
“Asked if the state government will pay to keep Liddell open beyond 2022, Mr Berejiklian said: “We’ve not come to any conclusions regarding that. Obviously we are interested in the federal government’s announcements.”
Ms Berejiklian lashed South Australia for going rogue and piling into renewables, despite their inability to cope with peak demands.
A third option, which many believe is the only viable alternative, is for NSW to build its own new coal-fired power station.
“I’m not going to rule it out,” the Premier said yesterday.” Source: Daily Telegraph, Sep 10
Interference in the market using Federal money instead of policy development
Despite the virtually universal endorsement of the “Finkel Report”, despite the electricity industry, including the large coal generators, and also the growing band of renewable investors and consumers, in coalition with many but not all energy consumers the Federal Govt has been unable to progress industry policy in a way that provides an investment confidence.
It has been unable to form policy consistent with our international obligations.
So what is the alternative? It’s to be populist and interfere in the market – similar to say Venezuala’s recent policy developments – or as if Turnbull had Russian Presidential powers.
It’s not as if Turnbull has a great record on micro managing public investment, you can find plenty of critics of the NBN for instance. Let’s look at some of the “Captain’s picks” that are just announced on the floor of parliament as “done deals”
Snowy 2.0: $8-$10 billion
The Federal Govt’s only historic investment in electricity was its 13% investment in Snowy Hydro. Now in order to subsidize a minimum $2 bn, and likely more, investment in pumped hydro, the Federal Govt is proposing to spend $5bn-$6bn buying the NSW Govt and Vic Govt out of Snowy.
The Federal Govt has no experience in electricity generation. Snowy is also the 4th largest retailer by customer numbers and the Federal Govt has no experience in electricity retailing.
The pumped hydro project has not gone through any competitive process for funding in the way that say CSP or nearly anything has to.
Our studies of pumped hydro show that it needs about $90 MWh differential between peak and offpeak to be profitable. How can anyone really know whether that will be on offer when this plant is built?
No private sector operator would do it now. This purchase and the subsequent investment should be open to far more public scrutiny. At least $2 bn of transmission will be needed to support the investment.
However, as large as that investment is, and as risky as it is, a case can be made that in a world of high renewables where there was lots of zero marginal cost PV in the middle of the day a pumped hydro investment could be of use.
We are not in that world today and there is no plan to get to that world in the future. Pumped hydro, like batteries, consume about 25% more electricity than they produce. If that electricity is being produced by coal there is little more that can be said.
Snowy is a gamble with taxpayer funds, Liddell is a gift of taxpayer funds to one private sector operator
Snowy 2.0 is an $8 billion plus gamble with Federal money, but subsidizing Liddell using Federal money to enrich one private sector operator as an effective massive bonus to entice them to buy and take over a coal fired station is basically disgraceful. We list some of the issues below.
All we can say though is it leaves a bad smell. If Turnbull thinks these investments are such a good idea, raise some private capital and do it yourself. Or at least get the States to do it. It is just not a Federal issue to be running State power stations and interfering in the market.
Meddling in business because you can’t do politics
The proposed Federal subsidy to one private sector operator to keep a coal fired generator open in NSW is open to criticism on many grounds. The list includes.
- It’s totally incompatible with Australia’s international COP 21 commitment to reduce emissions by 28% by 2030. How can keeping a coal station power station going from 2022-2027 or 2032 do anything other than harm that goal.
- It potentially hands say West Australian GST proceeds to one private sector operator to build a bigger position in the Australian electricity market. Kerry Packer RIP, once famously said on selling Channel 9, that you only get one Alan Bond. Trevor St Baker must be thinking you only get one Malcolm Turnbull. Turnbull and St Baker do share one thing in common. They both live in houses with lots of PV and batteries. And yet exploit everyone else to sell them coal fired electricity.
- It potentially changes the sale of Loy Yang B. According to press reports one of about 2 bidders left for LYB was Delta’s owner, Sunset Power. Press reports state Sunset was having some difficulty getting bank finance. This could play out as Sunset finding it easier to get bank finance if its backed by the Federal Government Turnbull/Fydenberg investment bank, or it could lead Sunset to say, we won’t bother with LYB and the private sector we’ll just take the Government money and run Liddell.
- Maybe the Federal Govt could buy LYB as well? If you are going to nationalize the electricity industry why stop with just Snowy and Liddell, surely you need a position in Victoria? After all there are endless free taxpayer dollars to be used.
- It will make new generation investment in NSW less likely. If the Government is prepared to do all the work and increase private sector risk why invest. High prices at present, and the expected closure of Liddell are creating a strong investment incentive in NSW.
- Ditto, it makes the job of getting the 1 GW capacity reserve built
- There is no identified need to keep Liddell open. AEMO does not forecast an energy supply issue in NSW.
In any case forecasting the post 2022 electricity market is just a guess. We all know that.- It totally hands all the cards to AGL. AGL has been a good steward of the Macgen and LYA coal assets. Its worked hard on their costs and reliability, it’s come to the party on bailing out Portland smelter and it is doing a bit, albeit not a big bit, to get some new renewables built. Its also potentially helping with gas by getting Cribb Point on the agenda.
- AGL will not want to sell Liddell to a competitor. Never mind the potential increase in competition, it will also complicated the coal position. AGL’s coal supply is set up on the assumption Liddell will close. Its and everyone else’s coal prices will be higher if Liddell stays open. How much higher, hard to say, but we think there are escalators in some of the Macgen contracts which would drive conservation of coal all else being equal.
Time for the Australian government to plan sensibly for the electricity market
Time for pragmatism, not panic, for the electricity market, http://reneweconomy.com.au/time-pragmatism-not-panic-electricity-market-65155/, By David Blowers on 11 September 2017 The Conversation
There was a familiar kneejerk reaction to last week’s announcement by the Australian Energy Market Operator (AEMO) that there are risks to our electricity supply after the scheduled closure of the Liddell coal-fired power station in New South Wales in 2022.
The sight of the Prime Minister looking for options to keep Liddell open raises the spectre of further reflexive government intervention that can’t end well.
Governments, understandably, want to make sure the lights stay on. But now is the time for perspective, not panic.
The NEM is an energy-only market. This means that generators only get revenue when they sell their electricity into the market.
All costs – including the capital costs of building the plant – need to be covered by the revenue they make when they sell electricity. Anyone who wants to build new generation capacity wants to be pretty certain that the market is going to deliver the revenue they need to cover their costs.
But right now no one is building any generation, unless it is government-backed renewables. This is despite a ripe environment for investment: high current and future prices in the wholesale market and the closure of old power stations.
The result, as AEMO pointed out last week, is potential shortfalls in generation and potential blackouts in South Australia, Victoria and NSW over the next few years.
Much of the blame for this investment hiatus can be placed on politicians and the climate change policy mess that is creating so much uncertainty for potential investors.
But the rise of wind and solar power is also causing problems. Wind and solar energy have zero marginal cost: once the facility is built, the energy produced is essentially free. And they are intermittent suppliers: they don’t produce energy unless the wind is blowing or the sun is shining.
So when wind and solar plants are operating, the wholesale price of electricity is forced down. This means there needs to be high prices – sometimes very high – when wind and solar are not operating. This price volatility makes investors nervous that they will not be able to cover the costs of building new generation.
Governments may be tempted to conclude that the market has failed. But intervention may be premature.
There are still five years until Liddell is scheduled to close. Just because a new coal-fired power station will not be built in time to fill the gap doesn’t mean the market cannot respond.
Coal was never going to be the market response, given climate change risks. But new gas-fired generators, or batteries to store electricity, could be built in this time frame.
Or the market could finally get its act together on what is called demand-response: that is, paying consumers to reduce their electricity consumption during periods of peak demand, so that less new generation is required.
There are no guarantees for government, however. The risks that the market won’t deliver the new generation that is needed are increasing. If nothing changes, Australia will need, in the words of AEMO, “a longer-term approach to retain existing investment and incentivise new investment in flexible dispatchable capability in the NEM”.
Many countries have responded to these same pressures by introducing a capacity mechanism. A capacity mechanism pays generators for being available, regardless of whether they actually sell electricity.
Payments for capacity provide extra income for generators, giving them greater assurance that they will make enough revenue to cover their costs.
Any new market-based mechanism in Australia is likely to be better than the scattergun approach of various governments in recent years.
Building Snowy 2.0, extending Liddell’s life, or providing state-based backing for new renewable generation might deliver the results needed. But the lack of coordination, planning and strategic thought that sits behind these policies means they probably won’t.
Getting it right Continue reading
South Australia’s energy security target deferred
S.A. put energy security target on back-burner after AEMO steps in, REneweconomy By Giles Parkinson on 11 September 2017 South Australia has abandoned plans to have its state-based energy security target in place this summer after conceding is could have little impact given the new initiatives by the Australian Energy Market Operator and the lack of competition in the local grid.
Officially, South Australia has decided to “defer” the start date of the EST until 2020, having already deferred it from a July 1 start to a January 1, 2018 start. But given the state poll in 2018, and the new initiatives taking place in the broader market, it seems unlikely to ever see the light of day.
The EST was a key component of the $550 million Energy Security Plan the S.A, government unveiled earlier this year following its dismay at the forced load shedding in February and other incidents.
But it seems likely that the only two components to have a lasting impact will be the Tesla big battery, which is due to come into service on December 1, and the 150MW solar tower and molten salt storage facility in Port Augusta, which will contract to supply the government’s own electricity needs……..http://reneweconomy.com.au/s-a-put-energy-security-target-on-back-burner-after-aemo-steps-in-86049/
South Australian responses to Federal Nuclear Waste Dump plan – Facebook
Paul Waldon Fight To Stop Nuclear Waste Dump In Flinders Ranges SA https://www.facebook.com/groups/344452605899556/Regina McKenzie I say No to nuclear waste dump in the Flinders Ranges or anywhere , the government says if there is a strong community movement against it , they will walk away . So why are they still hanging around Barndioota, Like blow flies on a shitty arse sheep? Honest they say one thing and do another , just a form of bullying from the Federal government, SA dont want No Nuclear Waste dump! Get over it and move on ….. We Say No!
Paul Waldon, How does your community make a small fortune gambling on nuclear waste? You start with a big fortune! The monkeys in the community happy to accept peanuts to risk contamination and death of their environment, maybe satisfied till things go wrong. But remember the culturally significant, seismically unstable, flood prone, non reducing, aquifer vulnerable, tourism missed, and peoples welfare are all issues that ANSTO, ARPANZA, and the Department of Industry, Innovation and Science have all overlooked or have NO regard for, in their wrongful pursuit to ensure their own job security.
Steve Dale They do it because they are drowning in a sea of nuclear muck of their own creation, and they want to keep creating nuclear muck for profit. They are drowning and they are desperate – and if we are not careful they will drag down everything good about South Australia with them.
NOW..
IF A CONTAINMENT FIELD THAT IS MADE `SAFE` CANNOT BE SITUATED NEAR LUCAS HEIGHTS.??..
.
WHY DOES IT NEED TO BE `OUTBACK` IF ITS SOOO SAFE..??..
WE DONT TRUST U MOB TO LEAVE IT LOW..
CMON.. U THINK WE ARE STUPID..!!..
ONCE YOU HAVE LOW-THEN U GO MEDIUM… THEN U GO HIGH AND STUFF FROM ALL OVER THE WORLD(SPENT RODS ect)
Gets sent here for REHAB.. 200,000YRS .
NOOO.. THAT MEANS NNNOOO…
Australia’s (?stupid) National Party wants: nuclear power, guns, and stop renewable energy
Nationals defend guns, nuclear and no money for renewables http://www.couriermail.com.au/news/queensland/queensland-government/nationals-defend-guns-nuclear-and-no-money-for-renewables/news-story/fccee1d11fd41d5138976df937ea4a3e, Renee Viellaris, The Courier-Mail, September 9, 2017 TESTY Nationals will today demand governments get their hands off their guns, call for nuclear energy to be adopted and freeze subsidies for renewable energy.
1 This month
PETITION – To: Prime Minister Anthony Albanese and the Australian Labor Government
Chernobyl: The Lost Tapes – A good documentary on Chernobyl on SBS available On Demand for the next 3 weeks– https://www.sbs.com.au/ondemand/tv-program/chernobyl-the-lost-tapes/235274195556
19 May – Webinar- Webinar: No Nuclear Weapons in Australia
Start: 2026-05-19 18:00:00 UTC Canberra, Melbourne, Sydney (GMT+10:00)
End: 2026-05-19 19:30:00 UTC Canberra, Melbourne, Sydney (GMT+10:00)
20 May – Webinar – The dangerous world of AUKUS, US, military occupation and suppression of dissent
National Webinar, 20th May, 2026, 6.30pm AEST. Confronting laws restricting/suppressing protest speech and action
Speakers: Former Sen. Rex Patrick, Lawyer Nick Hanna ,Arthur Rorris ,Jorgen Doyle, Sen David Shoebbridge,
Facilitator Kelley Tranter.
of the week – Australians for War Powers Reform (AWPR)
To see nuclear-related stories in greater depth and intensity
Antinuclear 