‘Coalsheviks’ want to head renewable energy off at the pass

On Wednesday morning Ben Potter’s article in the AFR Coalition fiddles as renewables remake grid told business leaders and politicians what is actually happening before their eyes.

Over at the Oz the headline was:

      Abbott call: Pull out of Paris deal

and

      NATS DEMAND THREE COAL POWER STATIONS

So, what is going on? We’ll look at the Nats first, then Abbott, and finally, the real world. Things are coming to a crunch point which will determine how Malcolm Turnbull’s stewardship is seen by future generations.

The Nationals want coal

The Australian claims to have obtained a copy of a working document prepared by the Nationals comprising a two-page list of demands. Prominent is that “a minimum of three” coal-fired power stations be built. The Nats are proposing a $5 billion fund which would only be available to generators providing 24-hour ‘baseload’ power. To them that means coal, gas or hydro.

The fund would consist of two parts – a “grant” fund and an “equity” fund. The grant fund would be used to:

“Extend the life of existing plants or increase capacity, including emissions reduction improvements… and rapid capacity improvements such as installing new units at existing stations.”

Grants would not cover standard maintenance for existing plants.

The equity fund is aimed at delivering at least three new plants with a capacity of at least 1200 megawatts. They are looking at a government-owned corporation with the funding off-budget.

Queensland LNP member George Christensen has said he will not support anything that does not have an incentive to build ‘baseload power’. Qld LNP senator Barry O’Sullivan said he was a strong advocate of new clean coal-fired power generators.

Administratively the fund would sit within the infrastructure portfolio held by Nationals leader Michael McCormack.

Malcolm Farr calls them and backbench Liberals such as Craig Kelly, who chairs the government backbench environment and energy committee, “Coalsheviks” because they have an interest in a command economy they never thought of before.

Abbott bells the cat?

Believe it or not, Graham Lloyd, the environment editor of The Australian, wrote an opinion piece Abbott bells the cat: why are we still in climate pact?

Phillip Coorey says it was the week Abbott went from feared to isolated. Most Liberals and the Nationals want to stay clear of him and his possible leadership ambitions. They want to make the NEG work rather the blow the whole thing up. Still he may have a few rusted on supporters, such as Kevin Andrews and Eric Abetts.

Lloyd says Abbott believes that we should not follow policies that produce self-harm. He believes that with China and India unconstrained by Paris, and with the US out of it, we are likely to suffer economic harm through loss of markets and competitiveness for no good purpose. Abbott is reviving his position that climate science is “crap”.

He believes that storms are not more severe, droughts are not more prolonged, floods are not greater, and fires are not more intense than they were a century ago. According to Lloyd:

He rates degraded bushland and waterways, particulate pollution, water quality in the Third World, deforestation and urban overcrowding as higher-order priorities.

I think we can leave Tony Abbott where cartoonist David Rowe sees him:

Back in the real world

The real world Sophie Vorrath reports on the 2018 National Energy Outlook from Bloomberg New Energy Finance in an article Coal to be kaput in Australia by 2050, as renewables, batteries take over.

    In fact, according to the NEO, renewables overtake fossil fuels as the major source of energy generation in Australia as early as 2031, before supplying 92 per cent of the total in 2050.

    Renewables and storage make up 87 per cent of all new capacity additions to 2050, representing a $US138 billion ($A187 billion) investment opportunity.

    By then, the report says, utility- and small-scale PV will have surged to 75GW, and wind to 48GW, while battery storage capacity will boom to at least 27GW in 2050 – the vast majority of which (23GW) will be installed by households and businesses behind-the-meter.

Gas capacity will need also to increase from 18GW today to 23GW in 2050, “to provide reliable supply in the rare periods when the wind is not blowing and the sun is not shining.”

In the AFR Ben Potter’s article on the BNEF report begins:

    Australian can regain its former position as a cheap energy superpower suitable for industries like aluminium smelting by embracing cheap wind and solar energy backed by battery, hydro storage and gas, a new report says.

    “Renewables will become the backbone of the system and will provide reliable power for most of the time, and then batteries, pumped hydro and gas will be part of the equation to smooth out the variability of wind and solar energy and provide a backstop at times of low winds and prolonged cloud cover,” said Kobad Bhavnagri, head of Bloomberg New Energy Finance in Australia.

    “That is the way that Australia can once again become a cheap energy superpower and industries like aluminium smelting will relocate onshore.”

    Bloomberg New Energy Finance (BNEF) released its New Energy Outlook (NEO) 2018, predicting that wind, solar power and batteries will get cheaper, eclipsing coal power as a source of generation in Australia by 2035 and virtually eliminating it from the energy mix by 2050.

That was followed by a photo of Sanjeev Gupta and what he is up to.

Potter has been warning of climate risk in companies and financing, and the uninvestability of coal. For example:

Business and industry have been told.

A report by Green Energy Markets tells How Australia will get to 33% renewable electricity by 2020. For starters, in May renewables contributed 19.9 per cent of the electricity generated for the National Electricity Market (NEM) plus WA:

Actually, the latest National Electricity Audit from The Australia Institute, just out, shows renewables in the half year to June reaching nearly 19 per cent in the NEM, according to Potter. See also RenewEconomy.

Green Energy Markets found 5,542MW of renewables under construction:

    Queensland currently leads the country in terms of large-scale installations, with more than 2GW under construction, followed by Victoria, which has around 1.75GW under construction.

NSW can only muster less than half Victoria’s tally.

They found that Australia will end up with 33 per cent renewables by 2020, will likely get to 40 per cent by 2030, and has enough in the pipeline to reach 85 per cent:

In the article linked at the head of the post Potter posts this table from Green Markets showing solar, wind and biofuel projects connected since January, under construction, committed or expected to be contracted under state auctions totalling 9 GW worth $16.4 billion, according to Tristan Edis from Green Energy Markets:

The same article tells us residential and small business rooftop solar installations combined in the half year totalled about 1.275GW, almost matching last year’s full-year record haul of 1.29GW. Customers are increasingly taking electricity generation into their own hands.

Prices have also fallen, remembering that generation forms roughly 25% of household bills:

Funny that, when we are using ever more renewables.

I’ll just mention that the Queensland price spike in Q1 was found not due to gaming the system, in an investigation by the Australian Energy Regulator.

Frydenberg and Turnbull are claiming credit for the reduction in prices, citing their jawboning of the gas industry and retailers.

Jawboning retailers probably does not affect the wholesale electricity price. As to gas, I suspect the main factor is that we are using less of it as cheap renewable energy increasingly supplies the market.

Finally, there was, I thought, a stunning and noteworthy article by Giles Parkinson The changing shape of wind and solar in Australia’s grid.

Firstly, a number of projects under development are setting themselves up to become ‘baseload renewable energy projects’ by using wind, solar and some form of storage, so that they have completely instantaneous capacity to supply electricity as needed 24/7. Two such are Kennedy Energy Park and the Kidston project, both in North Queensland under the noses of some of the most rusted on ‘Coalsheviks’.

Secondly, there is a market for:

    the offering of “firming contracts” to those looking to source a significant amount of their supply from wind and solar, but wary of wholesale price risks when the sun don’t shine and the wind don’t blow.

These include “proxy revenue swaps” currently being marketed by Macquarie Capital.

The bottom line is that a significant manufacturing facility such as packaging giant Orora can strike a long-term power purchasing agreement which protects them from supply failure and price spikes.

It may be the first to use “proxy revenue swaps”, but this PPA:

    is just the latest in a spate of major corporate deals that have connected big industrial energy users like Sun Metals, the Laverton steel works, Telstra and miners and manufacturing groups in South Australia to wind and solar.

    Some, like CUB, Mars Australia, and the University of Queensland, are going the whole hog and sourcing 100 per cent of their demand with renewables – often at stunningly low prices.

PPAs are struck directly with the generators, leaving out the retailers.

With all this going so swimmingly without a signed and sealed NEG there may be one brutal moment of political opportunity to head renewables off at the pass. That moment is now, although if you just looked at what was happening on the ground you would think the present momentum unstoppable.

Malcolm Turnbull once said he would not lead a party that wasn’t as committed to action on global warming as he was. His legacy to future generations is soon to be decided.

And we can only hope that Labor politicians don’t become complicit.

45 thoughts on “‘Coalsheviks’ want to head renewable energy off at the pass”

  1. In this post I’ve concentrated on what is being said in the news pages of the AFR, which business leaders and politicians should be reading.

  2. Brian (Re: The Nationals want coal):

    Are you willing to pay $4 billion to support ‘clean’ coal-fired power plants? See the news.com.au article, dated April 3. link here. The article asks: How much will it cost? And then says:

    The Minerals Council has suggested “clean coal” power plants like a 1000 megawatt HELE (high-efficiency, low-emissions) or ultrasupercritical coal-fired power station could be built for as little as $2.2 billion.

    I suspect this is what the “Coalsheviks” are basing their figures on.

    But Ben Potter at AFR:

    He believes the cost would be more likely to mimic expenses in the United States, where the country’s only HELE plant took six years to build and cost $US1.8 billion ($AU2.3 billion) for 60 MW a decade ago, due to civil cases and regulation. This would bring the figure closer to $US3 billion ($AU3.9 billion) for a 1000 MW plant.

    Are building new coal-fired power stations a bad idea?

    Mr Wood said if building a clean coal-fired power plant was a commercially viable thing to do, private companies would be doing it today.

    The SMH had an article by Nicole Hasham, dated April 3, reporting a similar line, link here.

    In other words, new coal needs to be subsidized by taxpayers in order to compete with renewables.

  3. It appears new HELE coal plants will likely take 6 to 8 years to build and cost $3 billion per 1000 MW capacity. But there is also the recurring annual costs of fuel (ie. coal) to factor in the running costs.

    Alternatively, solar thermal “power towers” take about 3 years to build. The South Australian project Aurora with 150 MW capacity with 8 hours energy storage reportedly costing $650 million. But the “fuel” (i.e. the sun) is zero cost. Recurring operating costs are therefore minimal.

    It would be interesting to see where the project costs for solar thermal tech would possibly get to with say 6 generators built concurrently with 200 MW capacity with 17 hours storage each, dispersed over 3 sites (2 generators per site).

  4. Meanwhile, recently in India, as Tim Buckley reports:

    Ironically, on the same day the Forum put out a “fact sheet” on foreign coal markets, NTPC, the largest owner and developer of domestic coal plants in India, shelved its 4GW Pudimadaka Ultra Mega Power Plant project in the state of Andhra Pradesh.

  5. Among those who benefit from the obsession with coal-fired power, to the exclusion of all other sources of electricity, are the handful of rich dullards, the commissars of superannuation and investment funds and the political game-players. These are the obvious beneficiaries. A less obvious beneficiary is the nuclear power industry.

    It is in the long-term strategic interests – but not the immediate and tactical interests – of the nuclear power industry to support, encourage and infiltrate the enthusiasts for coal-fired power. At a time of their own choosing, the nuclear power industry could launch their campaign to save us from the evil climate-change deniers and save us from dirty, dangerous, planet-threatening coal fired power and its nasty enthusiasts, (targets that are so easy to set up, so easy to blast away when the time comes). They would give us, instead, cheap, clean, reliable, SAFE!!!, koala-friendly, planet-saving nuclear power. Devious? Of course – but business is business. Would such a well-planned, well-directed and well-funded campaign really have a high probability of success? My oath it would.

    Look out David Christensen, Matt Canavan, Tony Abbott, Josh Frydenberg and all you Libs and Nats who love coal-fired power, the Nukes might be coming after you – so beware of all donations and support, put a Geiger counter over any that come your way.

  6. Graham Bell (Re: JULY 7, 2018 AT 7:10 AM):

    At a time of their own choosing, the nuclear power industry could launch their campaign to save us from the evil climate-change deniers and save us from dirty, dangerous, planet-threatening coal fired power and its nasty enthusiasts, (targets that are so easy to set up, so easy to blast away when the time comes). They would give us, instead, cheap, clean, reliable, SAFE!!!, koala-friendly, planet-saving nuclear power. Devious? Of course – but business is business.

    Cheap? See Lazard’s Levelized Cost of Energy Analysis – Version 11.0, published Nov 2017, link here, and go to page 2, where you should see the Unsubsidized Levelized Cost of Energy Comparison. Nuclear can no longer compete on an economic basis with renewables (with energy storage included).

    Clean? Very few people want a nuclear waste storage facility near them. I witnessed the strong local opposition first-hand to a proposed low & medium level nuclear waste facility at Hill End, NSW, at a few public meetings a few years ago. From Dr Finkel’s Independent Review into the Future Security of the National Electricity Market: Blueprint for the Future, published June 2017, on page 189, for nuclear energy:

    For many countries, nuclear power provides a secure, affordable and zero emissions electricity supply.(427, 428) In Australia, the establishment of nuclear power would require broad community consultation and the development of a social and legal licence. There is a strong awareness of the potential hazards associated with nuclear power plant operation, including the potential for the release of radioactive materials. Any development will require a significant amount of time to overcome social, legal, economic and technical barriers.(429)

    Reliable? Large-scale nuclear generators are just as susceptible to high ambient temperatures as coal-fired generators – an increasing, ongoing risk with climate change.

    “Large coal thermal plant generally will not perform as well in extreme hot weather and can also have output limited by environmental constraints, for example, cooling pond temperature limits.”

    Planet-saving? There simply isn’t enough high-grade uranium (and thorium) ores available to serve the world’s energy needs. Uranium and thorium are finite, non-renewable, one-time-use, and depleting resources. They are simply not sustainable for the long-term.

    Would such a well-planned, well-directed and well-funded campaign really have a high probability of success? My oath it would.

    The overwhelming evidence I see suggests to me you are dreaming. Or are you being ironic?

  7. Sorry, forgot to add the link.

    Lazard’s Levelized Cost of Energy Analysis – Version 11.0, published Nov 2017, link here.

    Global uranium ore supply:
    See Fossil and Nuclear Fuels – the Supply Outlook, published by the Energy Watch Group, March 2013, link here, page 125, Figure 113.

  8. Also, this report on the Energy Watch Group’s website titled The disaster of the European nuclear industry, dated March 2018, makes interesting reading:

    This synopsis summarizes arguments, why a further expansion of nuclear energy should be stopped in order to avoid continuous cost explosions and billions of Euros in public debt, especially in light of significantly cheaper renewable energies.

  9. GM,

    As I read it, GB was not arguing that nuclear is cheap and clean.
    I think he was suggesting its advocates would argue those would be its advantages.

    For instance, James Lovelock advocates nuclear power.

    And Northern Australia gas natural uranium. Win win for Northern Australia Development barrackers.
    🙁

  10. Ambigulous (Re: JULY 7, 2018 AT 2:32 PM):

    As I read it, GB was not arguing that nuclear is cheap and clean.

    So, you think/perceive GB is being ironic?

    I think he was suggesting its advocates would argue those would be its advantages.

    I don’t doubt advocates would try to argue “those would be its advantages“, but the evidence just doesn’t stack-up, as I’ve indicated above.

    But I wonder whether GB is an advocate for nuclear energy, or were his comments above being ironic? The way I read it suggests he is an advocate, but I asked the question about being ironic to be sure of his intentions/meaning. I don’t think you can answer for him – only he can.

  11. Geoff M. and Ambigulous:
    No, no. I don’t think I’ve lost my marbles nor have I gone over to the dark side, (should that be the power outage side, perhaps?). Yes I was being partly ironic but also pointing out that a well-coordinated persuasion campaign would have you demanding more Thorium in your toothpaste and believing that the Easter Bunny will waft all Plutonium resides away.

    I was in the middle of draughting sensible (in my opinion ) questions and comments about our current obsessions with electricity, to the exclusion of alternatives to electricity, when I lost the whole bloody lot ….

  12. Now. Where was I?

    Electricity and electronics have become so fashionable that we do overlook all the advances in mechanics, metallurgy, architecture, meteorology, human physiology, economics and a lot of other fields.

    For example: Advances in these field mean that we can now build structures – from little cottages to huge factories and apartment blocks – with control of internal temperature and lighting built into them and near them. Enhance that with advantageous but non-traditional siting of the structure and you can have even better lighting and internal temperatures (just think about it as a 21st Century adaption of a sort of feng-shui ). The use of electricity is not abolished in such structures but it is no longer a dominant factor.

    (I had better send this now before I lose it).

  13. It is not being old-fashioned that keeps me using handsaws, brooms, pen-&-paper, books and other non-electronic devices. I do like the convenience of my electric and electronic devices but I simply do not allow them to control my life nor do I allow myself to become addicted to them. If a lot of others discovered the world of non-electric and non-electronic devices, then neither power companies nor political operators would have such a stranglehold on everything we do.

    Cheers. 🙂

  14. Agree, Graham.

    Hand tools somehow keep the user closer to the materials. Not sure how to express it, but I don’t think this is a purely mystical belief.

    Awareness of materials can be a deep knowledge that craftspersons develop. Potter with clays, glazes, kiln methods. Painters with papers, brushes, colour mixing…. Wood turner with timbers and countless special tools…. finding a piece of wood and taking it through to the finished article.

    Builder re-purposes old bridge timbers or a red gum fence post. Wonderful results that honour the grain, colours and strengths of the wood.

    Pens …. all the way to inscriptions and calligraphy.

    I hope that youngsters with their screen time, will not lose that appreciation of the physical and natural world.

    A butterfly or ant or tree or fish has more complexity and design features than we can conceive.

    A granite benchtop is mere stone and has utility. I would hope most folk could also admire its beauty.

    Boojwah to my bootstraps.
    No apologies.

  15. Australian conservatives have usually been supporters of nuclear power. Perhaps there is a fatal attraction of being able to have the means of becoming a nuclear power.
    24/7 requirements do help the case for coal vs solar PV but solar thermal with molten salt storage and back-up molten salt heater can provide 24/7 or peaking as required.
    Smoking coal is not good for the health.

  16. Ambi, there is truth in beauty, and beauty in nature. I’m out of words, so I’ll leave it to the poets.

  17. Ambigulous:
    Your words on being in touch with materials were apt, concise, clear and elegant. Well done!

    No. Not boojwah nor mystical but truly Human.

    John Davidson:
    Definitely like your”Smoking coal is not good for the health.

    It could be that some conservatives stick to coal-fired power and desire nuclear power because they seem familiar to them and are comfortable with them – even though the overall figures are starting to stack up against both forms of power generation.

  18. Canavan: No for nuclear. Resources Minister won’t back the option because of waste and expense. from today’s “Morning Bulletin”, the Rockhampton paper circulated through Central Queensland.

    Well, we shall see what we shall see ….

  19. “We are very pro-coal in the LNP. Of course we are,” Michael McCormack, the federal leader of the Nationals said when addressing the conference over the weekend.

    That was at the Qld LNP conference.

    To do her justice, I think Deb Frecklington the parliamentary leader was a bit keen on renewables, seeing a large wind farm emerge in her electorate. Giles Parkinson is right about the party:

    But still the LNP charges headlong into the past – even after dumping from its Senate ticket two of its most conservative and reactionary members – Ian “Australia was once covered in ice – of course the climate changes” MacDonald, and Barry “I will die in a ditch beside the road” before accepting emission standards for cars’ O’Sullivan.

  20. Brian (Re: JULY 9, 2018 AT 10:02 PM):

    “We are very pro-coal in the LNP. Of course we are,” Michael McCormack, the federal leader of the Nationals said when addressing the conference over the weekend.

    So, does Michael McCormack wish to lead the Nationals and his supporters into extinction?

    At Climate Code Red, dated yesterday, is a post by David Spratt headlined The straight-forward climate question Josh Frydenberg will not answer, link here, that includes (bold text my emphasis):

    An Australian Senate report released on 17 May this year, after an inquiry into the implications of climate change for Australia’s national security, found that climate change is “a current and existential national security risk”. It says an existential risk is “one that threatens the premature extinction of Earth-originating intelligent life or the permanent and drastic destruction of its potential for desirable future development”.

    The report was not opposed by the government Senators on the inquiry committee.

    Committee Membership:
    Senator Alex Gallacher, Chair ALP, SA
    Senator Linda Reynolds CSC, (from 5 February 2018)
    Deputy Chair (from 7 February 2018) LP, WA
    Senator the Hon Bridget McKenzie, (from 23 June 2017 to 5 February 2018)
    Deputy Chair (from 14 July 2017 to 20 December 2017) NATS, VIC
    Senator Chris Back, Deputy Chair (to 22 June 2017) LP, WA
    Senator David Fawcett LP, SA
    Senator Kimberley Kitching ALP, VIC
    Senator Claire Moore ALP, QLD
    Senator Rex Patrick (from 15 November 2017) CA, SA
    Senator Scott Ludlam (to 14 July 2017) AG, WA
    Senator Jacqui Lambie (from 9 August 2017 to 14 November 2017) JLN, TAS

    Substitute member:
    Senator Peter Whish-Wilson, AG, TAS substituted for Senator Rex Patrick

    David Spratt says:

    The first duty of a government is to protect the people. A government derives its legitimacy and hence its authority from the people, and so has a fiduciary duty to act in accordance with the interests of all the people with integrity, fairness and accountability. In the climate arena, this duty has been recognised in several quarters, including by Australian Prudential Regulatory Authority Executive Director Geoff Summerhayes.

    So, did Michael McCormack not get the memo from Senator Bridget McKenzie?

  21. Peter Hannam in Fairfax reports on the rapid increase in rooftop solar installations across Australia, with business exceeding domestic.

    Typical domestic setup is now 5kW.

    (The much lower price now having a large effect?)

  22. Geoff M, the ‘government’ does not seem to take much notice of senate committees, more is the pity, because they do some useful work.

    I saw the Climate Code Red thing. Good to see Adam Bandt putting some pressure on.

  23. Published yesterday, in RenewEconomy was an article by David Leitch headlined Is Rod Sims having a lend of us?, link here. David Leitch includes analysis of the ACCC report, including:

    Actual coal costs paid by NSW generators:

    The ACCC converts the coal $/t to $/MWh using their coal quality and thermal efficiency assumptions to get a NSW coal cost of $30/MWh at contract in Q1 2018 or $50/MWh using export spot price.

    This statement by Leitch caught my eye:

    On top of that we don’t think new coal mines in NSW can be built, if at all, and make money at prices less than $100/t.

    The Australia coal price chart is here for perspective.

    Then there’s this statement:

    We state, as fact, that a NSW black coal generator could not be built that would earn a return on capital at a $45/MWh electricity price.

    The scenario for replacing NSW’s 2640 MW capacity Bayswater power station with a new coal-fired power station is a cracker.

    Highly recommended for those who want to know the facts about how ludicrous is the idea of building new coal-fired power stations in Australia.

  24. On today’ ABC Insiders programme, Federal Minister for Resources, Senator Matt Canavan, was being interviewed.

    From time interval 16:46, Barry Cassidy asked:

    And when you’ve shown that it has been allowed to occur, you’ve been in office now for 5 years, how much responsibility does the government take for allowing that failure to happen?

    Listen to the response from Canavan. It seems he was initially flustered.

    Then at time interval 18:11, Barry Cassidy asks:

    And on coal-fired power stations – when Rod Sims talked about governments underwriting dispatchable power, that’s not a green-light to coal, is it?

    Part of Canavan’s response included:

    Who cares what the fuel type is? It’s the outcome that matters. I cannot believe that a Labor Party that used to be on the side of workers, and poorer people, would stand idle, while there are potential fuel types that can bring down power prices, lower carbon emissions, and secure the reliability of our system, like cleaner coal, and say no to those things. Because if you do – if we lock off those options, the message is very clear, if we don’t develop – countries that do not develop their energy resources, will be consigned to higher power prices and fewer jobs. We have abundant sources of coal. We have abundant sources of gas.

    I seems to me Canavan cares that coal (and gas) are fuel types that he thinks should be in Australia’s energy mix. Although later, panelist Katherine Murphy said she thought Canavan in the interview had wound-back the push for coal.

    Later, from about time interval 37:13, David Pope says it would be unlikely that supercritical coal would be underwritten by the market as the energy supply price could be up to $94/MWh.

    I thought Katherine Murphy was also making a lot of very good points.

    Finally, it seems some sections of the media are beginning to wake up!

  25. The Guardian article headlined Nationals leader pushes Queensland LNP to back Coalition’s energy policy, dated July 7, link here, includes:

    Energy issues, including removing subsidies for renewables, committing to build a new coal-fired power station in the north, and investigating a nuclear power future in the uranium rich state, played a big role in the convention’s policy discussions, and the room was in favour of all three.

    Then there’s this article at Vox.com headlined Scientists assessed the options for growing nuclear power. They are grim., dated July 11, link here, including:

    Nuclear proponents might reasonably respond that, yes, nuclear cannot contribute to decarbonization without substantial policy help. But decarbonization by mid-century will be impossible without substantial policy, period. No combination of technologies can scale up fast enough without help.

    But renewable energy technologies seem to be on a trajectory toward subsidy independence (though plenty of policy and regulatory barriers to advanced energy tech remain). They are falling in cost at ridiculous rates — not just wind and solar, but storage, EVs, and other grid-edge technologies as well. Policy can accelerate their progress, or impede it, but at this point it cannot stop them. They have a momentum of their own, purely on economics.

    Nuclear is in a different situation. Its current trajectory is decline; it needs lots and lots of new policy and public money to reverse that trajectory. That is a much more difficult political lift. And like the authors of the PNAS paper, I don’t have much faith that it will get done. For better or worse, renewable energy is the name of the game for the next few decades.

    It seems new coal and nuclear options in Australia will need substantial subsidies to get any foothold. Renewables are reaching “subsidy independence”.

  26. Renewables are reaching subsidy independence./blockquote>
    All commodities should be subsidy independent is my view. Otherwise there’s a propping up of inferiority.

  27. We know your view, you’ve shared it with us countless times.
    Telling us again does not advance the discussion.

  28. Jump (Re: JULY 15, 2018 AT 7:51 PM):

    All commodities should be subsidy independent is my view. Otherwise there’s a propping up of inferiority.

    So, you would be willing to abolish the PBS and pay full price for medications (for you and your family)? You’d be willing to cut-up your Medicare card and pay full price for medical procedures and services (for you and your family)? You’d insist on trucking companies paying full wack for the damage they do to public roads that’s subsidized by the community (i.e. local, state and/or federal governments) and pay for any increased freight costs that may affect goods and services? These are just a few examples.

    And how does the military fit in with your philosophy? Are you advocating abolishing the military and paying for mercenaries when Australia is threatened? Cops for hire, perhaps?

    What about basic science research and institutions? Who pays, or we just don’t bother because there’s no apparent profit or useful applications that can be seen in it just yet?

    I think your crude generalization shows no thought about the implications and consequences that would happen to the apparently comfortable world we live in here in Australia. I think it seems like a recipe for a banana republic – a much harder, harsher life for many.

  29. Brian (Re: JULY 15, 2018 AT 11:46 PM):

    Thanks for your link to Murphy’s Abbott is angry about energy but there are bigger fish to fry piece.

    Below Murphy’s piece I scrolled down the comments and came across Jamie Smith’s rant (7 Jul 2018 17:28) that includes:

    It’s on us to be informed. Blaming the media is a cop out. I blame a disengaged, public living in a country they take for granted and that is being taken taken away from us day by day by disinterest, apathy and being bedazzled by the 30 second byte or a three word slogan.

    Could the media do a better job? Of course they could. Could we as citizens do a better job? It would be hard not to.

    I think it’s extremely difficult to argue otherwise.

  30. Today, the Australian Energy Market Operator released its Integrated System Plan 2018, link here.

    Also today, at The Guardian there’s an article by Katherine Murphy headlined Renewables will replace ageing coal plants at lowest cost, Aemo says, link here, including:

    The market operator says in a forecast to be released on Tuesday that when existing coal resources retire “the modelling shows that retiring coal plants can be most economically replaced with a portfolio of utility-scale renewable generation, storage, distributed energy resources, flexible thermal capacity, and transmission”.

    While some in the government have sought to portray new coal generation as a low-cost option for consumers concerned about high power prices, Aemo’s new forecast completely debunks that argument.

    It says the lowest-cost replacement options for retiring coal plants “will be a portfolio of resources, including solar (28GW), wind (10.5 GW) and storage (17 GW and 90 GWh), complemented by 500 MW of flexible gas plant and transmission investment”.

    The energy market operator concludes that mix of generation can produce 90 terawatt hours of energy per annum, “more than offsetting the energy lost from retiring coal-fired generation”.

    Yet other sections of the media are emphasizing that coal will be required for years to come:

    News.com.au article: AEMO report will ‘please’ pro-coal MPs
    Australian Financial Review article: Prolong the life of coal-fired power stations in the National Electricity Market, says Australian Energy Market Operator
    ABC.net.au article: Energy Market Operator warns coal must remain part of the mix for next 20 years

    Interestingly, The Australian article headlined AEMO report ‘shows coal on the way out’: Greens, are taking that tack.

  31. Geoff, the plain fact is that AEMO don’t make policy on emissions. However, they’ve stuck to modelling a ‘fast change’ scenario, based on the CSIRO work.

    I think they are actually saying, don’t close coal down before you have planned replacement electricity. Their really big focus is on network planning.

    Here are some more links:

    Bandt press release – AEMO report shows only ‘6 coal-fired power stations’ will be left

    Parkinson at RenewEconomy – AEMO: Cheapest way to replace coal is solar, wind, storage

  32. Brian (Re: JULY 17, 2018 AT 11:06 PM):

    I think they are actually saying, don’t close coal down before you have planned replacement electricity. Their really big focus is on network planning.

    Yesterday, Ross Greenwood interviewed a few people concerning yesterday’s release of the AEMO’s Integrated System Plan 2018. The interview podcast with AEMO Managing Director, Audrey Zibelman is here.

    From time interval 3:55, Ross Greenwood, in his introduction, says (bold text my emphasis):

    They’ve just done their latest report. And what they say is, Australia needs to maintain its coal-fired power stations for as long as they possibly can. But there’s also a situation where the Australian Energy Market Operator is also giving some broad hint that long-term, maybe Australia’s future is more about the sustainables. Although, knowing Audrey Zibelman, the Managing Director of AEMO, she’s pretty agnostic as to how that electricity is generated.

    From time interval 7:33, Ross Greenwood asks:

    The one thing you did not say there, Audrey, was coal. Where is the future for coal in Australia?

    Audrey Zibelman replied (bold text my emphasis):

    Well, we believe very strongly that ah… with coal itself, that we have very good coal plants, that ah… should be remained as long as they can technically continue to operate, and operate in a way that’s economically feasible for them. So we like… we use a typical 50 year, which is when we expect the plants to retire, unless those coal plants have told us they’re going to retire. In our model, we don’t use these as inputs – we use them as outputs, and we take the cost of those plants, and what we’ve identified, is that part of this least-cost plan is a very sound transition. And I think the way to think about this -people can understand – we’re making a… a change in this sector and the technology, but you need to make sure it’s smooth, that it’s planned, that we can really help manage it, because the last thing we need to do, is create disruption in the energy sector, and that, to me, plays very well into the ACCC’s ah… report last week. It’s… This is not an industry that you just want to take a chance with. You really want to be thoughtful, deliberative, planned, and… and actually know the direction you’re going, and take the steps to make sure you’re getting there in the right way, because we really can’t afford to make mistakes in this industry.

    I don’t think what Ross Greenwood is saying the AEMO is saying is what Audrey Zibelman is saying – existing coal is on the way out, retired at the end of engineered operating life (50 years) – no new coal.

    I think Zibelman makes a lot of sense. Well worth a listen.

    Then listen to Minister Josh Frydenberg talking with Ross Greenwood, yesterday, podcast here.

  33. Geoff, I listened to both of those. With Frydenberg, we’ve heard it all before.

    I think Zibelman is smart and knows what she’s doing, which she does in a very professional manner.

    First up, she knows who she is working for – COAG, although a lot of pressure is coming from one member, ie the Commonwealth.

    Secondly, she knows what her job is – to operate the market, not just day to day, but to take actions to make the market fit for purpose in the future.

    She knows that it is not her job to set emissions policy.

    I’m fed up with this ‘technology neutral’ stance of the government. Frydenberg says, we can’t be pro or anti coal. We are going to have to be anti coal if we are doing our duty by future generations.

  34. Could it be that Minister Frydenberg aims to step back and let “the market” act, which in this case may arrive at financial and energy plans quite close to approaches involving rapid reductions in emissions for energy production, without explicitly stating that as his aim??? Or is that simply far too cunning to be his real purpose??

  35. Well, not really ‘stepping back’. Snowy Hydro is an elephant sitting down in the sandpit, and may dampen a possible developing industry in pumped hydro in NSW, which would provide cheaper solutions, and depress the development of other forms of large-scale storage.

    We’ll need to see the detail in the final NEG, but I’m expecting the bias will be in favour of not going beyond the low ambition of 26-28% which they want to lock in. This is preserving the place of existing coal.

  36. Brian (Re: JULY 18, 2018 AT 11:19 PM):

    I think Zibelman is smart and knows what she’s doing, which she does in a very professional manner.

    I agree, and I’m thankful that she, and her team, have the intelligence and courage to provide frank and fearless advice to the nation for a roadmap for Australia’s long-term sustainable, affordable, and reliable electricity supply for the future.

    She knows that it is not her job to set emissions policy.

    Zibelman is confined by her position, and has to work with what she and her team have available to them. The least-cost plan outlined in the AEMO’s Integrated System Plan 2018 happens to enable substantial emissions reductions, but gas is also included. As I’ve said on numerous occasions, humanity needs to leave fossil natural gas, not just to mitigate dangerous climate change, but also because of a likely looming post- ‘peak gas’ world. But perhaps that was a bridge too far for the AEMO. At least the plan says unambiguously that there’s no room for new coal plants, and ageing existing coal plants are on the way out, although not as fast as they should. But as more renewables enter the market I suspect the remaining coal plants will become less profitable, which may prompt earlier retirements – the trick is to have sufficient replacement ‘firm’ generating capacity in place when they do.

    I’m fed up with this ‘technology neutral’ stance of the government. Frydenberg says, we can’t be pro or anti coal.

    I see this as a ‘dog whistle’ for the right wing of the COALition. New coal is no longer economically competitive – if the federal government is fair dinkum about low cost, reliable electricity for Australia, then they can’t support new coal plants – business is waking-up to this.

    Dr Finkel’s Independent review into the future security of the National Electricity Market: Blueprint for the future, Energy Security Board Chair, Dr Kerry Schott’s public comments, the ACCC report released last week, and now the AEMO’s Integrated System Plan 2018, are consistent in their messages. I think the COALition ignores the evidence and recommendations provided by these ‘experts’ (appointed by the government) at their peril.

    Of course, the voting public need to wake-up to what needs to be done and vote for the candidates at the next federal and state elections that support the energy technology transition – it’s up to Australian citizens to care about their own and their family’s futures.

  37. Yes Brian

    And on this blog John D has been unkind enough to describe Snowy 2.0 as more a photo opportunity than a serious prospect. Meanwhile our land abounds in hundreds of potential pumped storage sites.

  38. Geoff M:

    Of course, the voting public need to wake-up to what needs to be done and vote for the candidates at the next federal and state elections that support the energy technology transition

    Today I heard Steve Austin on local radio interviewing a voter in the oncoming Longman byelection who resides at Woodforde, population 3,458, located 72 km NW of Brisbane and 24 km west of Caboolture, where she would have to go for serious shopping.

    Her big thing was that no-one ever comes to ask them what they want.

    No-one comes because the LNP will get their votes anyway (or ON or other crazies), and Labor wouldn’t bother because there aren’t many people there and they wouldn’t change their votes if they did come.

    What did she want from the Commonwealth government? She wanted a bus service so she wouldn’t have to drive her car to go shopping, that’s what she wanted.

    I despair about democracy sometimes.

  39. Brian (Re: JULY 19, 2018 AT 9:25 AM):

    We’ll need to see the detail in the final NEG, but I’m expecting the bias will be in favour of not going beyond the low ambition of 26-28% which they want to lock in. This is preserving the place of existing coal.

    In today’s SMH paper edition is an op-ed by John Hewson headlined Tender will allow Coalition to dig its way out of coal hole, link here. It includes:

    Perhaps the most direct and effective mechanism for the government to cut through, and demonstrate the authenticity of its claim to be “technology agnostic”, would be to announce a tender to meet its future, carefully specified, power requirements, establishing a genuine competitive process, encouraging all parties to give it their best shot.

    That’s what the South Australian government did and the result was the SolarReserve solar thermal Aurora project, outbidding every other technology offered. But I wonder whether the right wing of the COALition really want a fair competitive bidding process – it will likely show their ideology is ill-founded.

    Ambigulous (Re: JULY 19, 2018 AT 4:17 PM):

    Meanwhile our land abounds in hundreds of potential pumped storage sites.

    Er, you mean tens of thousands of potential pumped-hydro energy storage sites in Australia? 22,000, according to Professor Blakers, but Australia only needs about 20 off-river sites providing a total capacity of 20 GW of power output and about 450 GWh of energy storage to support 100% wind and solar-PV generation.

  40. Yes Geoff

    I couldn’t recall the figure. But if they are to be well spread out, each location optimised to lower construction costs and also lower transmission losses once built, we could come up with an agreed list of several hundred “better” sites.

    Then some political/financial process to begin building. And as long as the short list had engineering and environmental approval, crikey: I wouldn’t mind too much if the last stage involved good old pork barrelling!

    “If something worthwhile is done, it doesn’t matter who claims the credit”. (Or creams off a little benefit….) Just get the bl**dy things built!!

  41. So who is going to issue the tender? AEMO, undewritten by the Feds, the Commonwealth government?

    Will we see a Commonwealth takeover of a state function?

    This might make sense in NSW/Vic/SA, but people south of the Tweed don’t understand the tropics.

  42. Brian (Re: JULY 19, 2018 AT 10:56 PM):

    Her big thing was that no-one ever comes to ask them what they want.

    And probably there are few opportunities where people are asked what they want/need. It seems to me, if the issue is important enough, then people should be taking the initiative and asking the politicians what policies they have, and what they can practically do, to help them – democracy requires voter/constituent participation/engagement.

    No-one comes because the LNP will get their votes anyway (or ON or other crazies), and Labor wouldn’t bother because there aren’t many people there and they wouldn’t change their votes if they did come.

    Before relocating from Sydney, I had never experienced door-knocking from candidates in the lead-up to elections; just a few flyers in the letterbox, a few corflutes scattered around on power poles and front boundary fences, and ‘running the gauntlet’ of how-to-vote slips at the polling booths on election day. The Sydney electorates I was registered to vote in (both state and federal) were (and still are) blue ribbon Liberal, so it seems to me the incumbents didn’t work hard on the campaign trail, and the other candidates only put in a token effort, because the expectation was the incumbents would romp-it in – and they invariably did.

    The electorates that I’m registered to vote in now – Bathurst (state) and Calare (federal) – aren’t as secure for the incumbent National party members, and it seems the election candidates work that little bit harder to capture votes.

    I despair about democracy sometimes.

    I think democracy is only as strong as well-informed voter/constituent participation/engagement to keep politicians performing well. I reiterate:

    It’s up to Australian citizens to care about their own and their family’s futures.

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