Antinuclear

Clean energy representatives were shocked by the panel’s appointment as chief advisor and modeller of ACIL Allen, a consultancy seen as close to the fossil fuel industry, and whose highly contested research formed the basis of the coal industry’s attempts to dismantle the RET in 2012.

Not only will ACIL Allen do the modelling for the RET Review panel, some of the assumptions that will form the basis of that modelling have also stunned the clean energy industry, and been branded as a farce.

This includes an apparent refusal to measure the benefits of renewable energy – including the health benefits, job benefits, and the network benefits – which the panel has dismissed as “too hard to model” and little more than a “transfer of wealth”, presumably away from the coal generators and network providers. There is concern about how it will model the reduction in wholesale prices – the main complaint from the existing fossil fuel industry.

Around 50 people who attended the RET Review panel’s modelling forum at the Mercure hotel near Sydney’s international airport were also told that the modelling will assume that there will be no carbon price out to 2030, and will not factor in any abatement targets. In other words, it is assuming there will be no carbon restrictions on the sector for another two decades.

John Grimes, the CEO of the Australian Solar Council, echoed the thoughts of many who attended the meeting and were interviewed by RenewEconomy when he said it appeared clear that the RET Review will serve only to protect the vested interests in the current electricity market.

“I’ve got to say – this is much worse than we had anticipated,” Grimes said. “This entire review process needs to be revealed for the sham that it is … we can only conclude that the RET Review process is heading to a biased and predetermined outcome.

“Instead of making customer benefits the key measure of a successful energy market, this review is set to side with big business, giving little or no weight to the benefits of solar for householders, business and the community.

“Clearly any model that fails to consider a carbon price (in any form) up to 2030, in the face of international action on climate change, is negligent and lacks any credibility. “ The RET review was already controversial because of the Abbott government’s decision to by-pass the Climate Change Authority (which dismissed the ACIL Allen modelling and the coal industry’s protestations in its 2012 review), and appoint a panel led by climate change denierand pro-nuclear advocate Dick Warburton.

He will be supported by fossil fuel lobbyist and former ABARE chief Brian Fisher, and Shirley In’t Veld, the former head of WA’s biggest coal generator, Verve Energy. The secretariat will be housed in Abbott’s own department.

Clean energy attendees said they were shocked by some of the statements – including Warburton’s apparent ignorance that the Abbott government went to the election with a “million solar rooftops” commitment, as well as assumptions by the panel that the current 41,000GWh could not physically be met.

The panel reportedly claimed that no large renewable energy projects would be able to be built for another 18 months, and no more than 1,000MW to 1,200MW of wind capacity would be possible in a single year, making it impossible to reach the current target. Both these claims were reportedly vigorously contested by the representative of the Clean Energy Council.

However, it was ACIL Allen’s appointment that confirmed the worst fears of the renewable energy industry……….

Even the Murdoch-owned Business Spectator made a spectacular demolition of ACIL Allen’s research, pointing to its previous reports that claimed that carbon pricing would eradicate the LNG industry, would force the closure of all brown coal generators by 2020, its predictions that geothermal would account for 30 per cent of the Renewable Energy Target, and how on two occasions it grossly miscalculated the uptake of rooftop solar……..

the problem that the renewable energy industry faces – incumbents and ageing engineers and business people who reject the science, simply do not understand or accept that renewable energy sources can be effective and cost competitive, and cannot imagine an energy system any different to the centralised model that has dominated for the past 100 years, and/or who are merely seeking to protect their vested interests.

The problem is that not only do they now have the ear of the current government, they have their hand on the wheels – and their foot on the brakes. http://reneweconomy.com.au/2014/farcical-start-to-tony-abbotts-renewable-energy-review-14978

This pessimism is reflected in the market for large-scale renewable energy certificates, which have slumped to $28.55, down 15 per cent from late December, and down nearly half from before the election of the Abbott government last September.

The pessimism has infected the industry since early 2013, when, despite the findings by the Climate Change Authority that the LRET should stay as is, the equivocation of the Coalition, and its presumed success in the September poll, brought the market to a halt.

According to data from Green Energy Trading – a major player in the market for renewable energy certificates, only four new projects have been “committed”  since the start of 2013. Of these, the 53MW Broken Hill and 102MW Nyngan solar power stations are mostly financed from the now defunct Solar Flagships project, with large grants from the federal and state governments; and the 20MW  Royalla solar plant in Canberra is getting a fixed tariff as part of the local government’s reverse auction program.

The only new wind farm approved in the last year – a 47MW extension to Pacific Hydro’s Portland projects – seems to have been committed because it received financing from the Clean Energy Finance Corporation, the $10 billion green bank that the Coalition wants to dismantle, despite it making a profitfor the government.

The only other new projects that are likely to be committed in the short-term are the other solar projects in the ACT, and the wind projects that will be awarded in its forthcoming auction. (It should be noted that committed projects are different to “approved” projects, which merely means they have approval to be built, but not necessarily the finance).

Those solar and wind projects, part of the ACT government’s commitment to a 90 per cent renewable energy target, do not rely on the LRET. However, the proposal for new wind farms is being vigorously opposed by conservative politicians, both state and federal, as well as the Murdoch press.

Green Energy Trading estimates that if the market for LRECS is to maintain an acceptable level of market liquidity, around 4,450 MW of new projects need to be committed in the three-year period from 2014 to 2016. That is unlikely to happen until the RET review is completed mid year, and then considered by the Abbott government.

However, if the incumbent electricity industry has its way, there will be no new projects built before 2017 at the least. This is its estimate of the impact of the LRET target being reduced to a “real” 20 per cent target, which might equate to a new fixed target of around 26,000GWh.

Numerous studies have shows that not only will this result in a sharp fall in the deployment of wind and solar, it will also mean more coal-fired generation. And a new study from French energy products giantSchneider Electric says cutting the renewables target will also mean higher prices for consumers. This came as a surprise to the large energy users that commissioned the Schneider analysis. They had anticipated the opposite finding.

Still, the renewable energy industry is finding doors closed in Canberra, with ministers and advisors promising only that projects already built will not be impacted by any changes to the RET, which will be recommended by a review headed by climate science sceptic and nuclear advocate Dick Warburton.

International groups such as First Solar and Acciona have already signalled their intention to re-assess their commitment to projects in Australia, in a likely repeat of the exodus that was caused when the current energy minister Ian Macfarlane ended the then MRET (mandatory renewable energy target) when he was last in the same job a decade ago – and that decision was taken despite an independent review recommending the MRET be expanded.

The two-part series for the conservative magazine – co-authored by Warburton along with poet and accountant Geoffrey Lehmann and Resmed founder Peter Farrell – is an eye-opening compendium of the major arguments that climate science deniers and fossil fuel lobbyists have ever thrown at climate science, against carbon pricing and against renewable energy.

The title of the two-part series was “An intelligent voter’s guide to global warming” (you can find Part 1 here and Part II here), and the authors pretended to “provide basic information often missing from the debate.” In fact, it is a collection of scientific howlers normally only found in right-wing blogs.

This, though, is the paragraph that might interest those likely to feel the impact of the decisions made by the RET review panel that Warburton now heads:

“Except for nuclear power, there are no straightforward strategies for reducing dependence on fossil fuels without large economic costs. Wind and solar generators often cannot function when needed. Wind machines operate at only about 25 per cent capacity in the UK. Even when the wind is blowing, “back-up capacity, usually gas-fired … had to be kept running, using fuel, generating steam, emitting CO2, ready to ramp up its turbines the moment sufficient supply from the wind machines stopped coming”. Two main obstacles with renewables are the difficulty of establishing transmission lines from sunny or windy places to where the power is needed and the absence of utility-scale storage technology for intermittent renewable energies. A US comparison estimated the following electricity generation costs per kilowatt hour: hydroelectric $0.03; nuclear and coal $0.04; wind power $0.08; natural gas $0.10 (other estimates for gas suggest about $0.04); solar power (construction costs only, ignoring production costs for which reliable data were unavailable) $0.22.”

And, a little later….

“The only current viable alternative to burning fossil fuels is to go nuclear. Although current known reserves of uranium are limited, it is likely that by developing new nuclear technologies and with new sources of uranium, humanity’s electricity needs could be satisfied by nuclear power for many hundreds of years or more.”

Fantastic. In the true sense of the word. One hopes that Warburton has caught up a little on the various technology costs. In the US, where his electricity generation costs are cited, nuclear is four times the price that he quotes. In fact, you would have to go back many, many years to find a time when it was just 4c/kWh.

Ditto with solar. Solar PV, including production costs (for which there is plenty of reliable data), costs around half that quoted by Warburton in the US. Some recent solar PV power purchase contracts, aided by a tax credit, have been at one-quarter of the price he quoted. Wind, according to General Electric, the largest provider of power equipment, is also around half of that quoted by Warburton, and new coal – according to investment bank Citigroup – is also four times the price quoted by Warburton. Even fracked gas is being priced out of the market by utility-scale solar. As Citigroup noted, quite bluntly: Nuclear and coal are not competitive with renewables on cost.

One also assumes that Warburton is aware that the cost of energy storage is falling, and likely to follow the pathway of solar, as Morgan Stanley has pointed out. This is one reason why grid operators in WA and Queensland are looking to reduce their poles and wires delivering centralised fossil fuels, because they cannot compete economically with solar and storage any more.

Warburton can catch up with Australian technology cost estimates at the Bureau of Resource and Energy Economics, which recently doubled its estimated costs of nuclear and dramatically reduced its estimates on the cost of solar.

One also hopes that Warburton is disabused of his idea that “fossil fuel” generation is left running, and polluting, waiting for the sun to stop shining and the wind to stop blowing. Such nonsense is only propagated by the most infamous of blogs haunted by climate science deniers, nuclear boosters and the anti-wind brigade. (Who are often the very same people).

A report by the US Department of Energy’s National Renewable Energy Laboratory puts this myth to rest. Those grids that have high renewables are actually using less fast-response peaking power than those relying almost exclusively on inflexible coal or nuclear generators………

The question that the renewables industry will be asking is this: Given that Warburton says he has investigated the climate science and declares that climate scientists do not know what they are talking about, what are the chances that he will accept the evidence from the renewable energy industry? Ideology, as we have seen with the media and the government since the September poll, is a mighty powerful editor. http://reneweconomy.com.au/2014/tony-abbotts-renewable-czar-nuclear-only-alternative-to-coal-65816