The sheer ineptitude of South Australia’s energy policy needs to be seen to be believed. It’s what happens when you let a Labor government stick around for 15 years.
In the end, the lights going out at Adele’s Adelaide concert provided the final straw for Premier Jay Weatherill as he promised to make the State’s energy problem emphatically worse. All he needs is about $550 million worth of socialism, a bit of begging and some good old fashioned – ‘we’re doing it the government’s way whether you like it or not, you got that?’ – communism.
Weatherill’s ‘six point plan’ includes:
BUILDING a State Government-owned, fast start gas-fired power station that can come on when the market does not provide enough energy to keep the lights on [TMR: don’t ever forget that this was all ‘the market’s fault’!]. It is expected to cost about $360 million. No site has yet been selected. It would be 250MW, enough to deliver close to 10 percent of SA’S peak demand.
SUPPORTING construction of Australia’s biggest battery as part of a $150 million spend on a new renewable technology fund.
ENCOURAGE the construction of a new privately-owned power station using a Government bulk buy power contract.
INCENTIVISE the extraction of more gas for use in SA power stations, through a taxpayer-backed exploration fund. [TMR: gas isn’t something that you buy off the shelf. At best, the final product might start flowing from this in about 5-10 years].
GIVING the SA energy minister powers to over-ride other regulators and force power stations to fire up in times of need. [TMR: sounds very democratic].
CREATING an “energy security target”, which requires retailers to buy 36 percent of their power from baseload sources in SA.
How could this all possibly fail?
(I’ll wait while you pick yourself back up off the floor)…
The first two limbs are little more than garden variety socialism. That is:
‘Don’t worry, the government will save you (from the mess it got you in) – we just need LOTS of your money and time and things will be sweet… later. Trust us’.
The third limb is little more than limp begging for the private sector to help (with fossil fuel). It has little chance of making any real difference – particularly when you look at the fifth limb. Let’s hold that thought for a moment.
The irony in the fourth limb is overwhelming. That is, Weatherill wants to use a ‘taxpayer-backed exploration fund’ to purportedly help with energy security when private businesses could and would gladly have done the job by now IF THEY JUST HAD ENOUGH RELIABLE AND AFFORDABLE ENERGY!
Curiously, the fifth and sixth limbs involve Weatherill and SA Labor urinating on the pitch contained in their third limb – with Chavez-style communism. I’m sure businesses are just lining up to operate under such conditions.
A couple of Weatherill’s limbs are particularly entertaining – in a smash your head against the wall kind of way – and deserve some further analysis:
Elon’s retirement fund
Weatherill’s six-point action-pack includes building a fancy battery farm – which, according to Tesla’s Elon Musk, will cost about $250 per megawatt (one million watts) hour. Or was that $250 per kilowatt (one thousand watts) hour? And was that to build or operate – or both?
Given that Musk was being typically garbled in his quote, feel free to head on down to Wikipedia and have a look at some of the battery power generation costs there (about two thirds of the way down the page). Let’s be generous and say that the overall cost will be somewhere over $200 per megawatt hour.
It is at this point that I feel the need to remind everyone that batteries DO NOT GENERATE POWER – they store it. That is, the power itself needs to be sourced from somewhere else (and hasn’t the South Australian government done a simply wonderful job of doing that).
But I digress.
To give you some point of reference as to how insanely expensive mass battery storage is, let’s start with some of the most renewable friendly figures we can find as used by left-wing
idiot think tank, the Grattan Institute:
One consequence of these changes must be recognised. Whatever mix of wind, solar and gas power begins to replace our coal-dominated supply sector will cost more. Without a carbon price, electricity is generated from existing sources at less than A$50 per megawatt-hour, while wind, solar and gas all cost at least more than A$80 per megawatt-hour.
Don’t you just love it how gas has been lumped in the same cost basket as wind and solar by these morons? Needless to say, while gas might cost around $80 per megawatt hour, wind and solar obviously cost significantly more.
Now have another look at those battery costs…
You might now be wondering just how much power this battery station will be able to store. A very good question indeed. The short answer is just about enough to power an Adele concert.
No, I’m not joking:
But RenewEconomy has estimated the cost for a 100MW (not 100MWh) system and calculated the cost as $US50 milllion for a 200MWh facility, or $US100 million for a 400MWh facility, depending on whether two hours of storage was offered, or four hours was offered.
One of the biggest battery farms Telsa has built is a 20 megawatt system in Ontario, California which can discharge 80 megawatt hours of electricity to power 15,000 homes over four hours.
What a splendid way to spend anywhere up to $150 million (or more – seriously, who knows?).
Look but don’t touch gas station
Weatherill has also promised to build a new gas power station.
‘Hallelujah!’, I hear you say. ‘Finally some common sense!’. And all it took was some good old fashioned fossil fuel!
You see, the new gas plant will only be used in case of an ’emergency’. That’s right, South Australia is about to spend $360 million not to use a gas plant – which would otherwise have the capacity to power 10% of South Australia’s energy needs!
Then again, I suppose we wouldn’t want to stress the poor thing out – as it’s going have its work cut out at the next blackout.
In the meantime, we can add this lovely piece of work to the pile of the:
- Victorian government paying not to use a desalination plant;
- New South Wales government also paying not to use a desalination plant;
- South Australian government also paying not to use a desalination plant;
- Victorian government paying not to build a road;
- Western Australian government also paying not to build a road; and
- Tasmanian government also paying not to use a gas power station.
What’s a few billion dollars between friends eh?
Balancing the books
It’s time to do a financial recap. Under Weatherill’s plan:
- up to $150 million will be spent to provide battery storage to up to 15,000 homes for four hours in an emergency; and
- $360 million will be spent to not provide gas power for up to 10% of the State’s total energy needs.
Let’s all take a moment to bask in the intelligence that’s oozing everywhere from this.
Of course, the above figures all assume that Weatherill can stay within budget. Is anyone seriously considering betting the under on that one?
Grattan keeps on giving
Sometimes it really pays to go back in time and re-read some of these leftist climate change articles. The Grattan one linked above (written in August 2016 – just before South Australia’s statewide blackout in September 2016) provides the following pieces of comedy gold:
In July the average wholesale electricity price in South Australia was A$229 per megawatt-hour, compared with around A$60 in the other NEM states. The state’s spot price soared to A$8,898 on the evening of July 7. Low wind output, the darkness of night, high cold-weather electricity demand and the absence of coal plants after several shutdowns all handed strong pricing power to a few gas generators.
The price volatility attracted much alarm, although the Australian Energy Market Operator noted there were no system security or reliability issues [TMR: (!)], nor departures from normal market rules and procedures. Climate Councillor and former Origin Energy executive Andrew Stock concluded that “increasing reliance on high-priced gas is not a viable solution to reduce power prices or to tackle climate change”.
He argued that more gas power would push up prices even more, increase reliance on the state’s ageing obsolete gas-fuelled fleet and increase greenhouse emissions, including risks of fugitive methane emissions.
On the side of gas, Origin Energy chief executive Grant King pointed out: “South Australia’s electricity demand was met in full [TMR: (!!)]. The reality is that, while spot prices ran up, 99.99% of customers in South Australia did not pay one more cent for their electricity. So, from a reliability and affordability point of view, the market delivered.”
Similarly, Tristan Edis from the advisory group Green Markets noted: “In reality the wholesale electricity market as it is currently designed is doing precisely what you would want it to do to accommodate increasing amounts of renewable energy while also ensuring reliable supply of electricity.” [TMR: (!!!)]
Where do they find these people?
As for the final word, I’ll leave it to Adele: