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Melbourne and Sydney normally have 10 to 15 very hot days each year
where the wind does not blow. If we have a “normal” summer in 2017-18
in our two largest cities it is absolutely certain we will have
blackouts covering 10 to 15 days.
Under present circumstances there
simply will not be enough power to cover the peak summer demand.
And that assumes the ageing generators and power distributing networks
operate without breakdowns. Because we start with an overall power
shortage, the impact of any major equipment/transmission breakdowns
will be severe.
Then we go to gas.
The looming gas shortage in the 2017 winter can be overcome with
relatively minor actions. Much more drastic action will be required in
the following years. The Commonwealth government has made a start on
tackling the gas disaster.
But households and industry face a doubling of power and substantial
rises in gas prices in the next 12 to 18 months. Currently the biggest
force in higher power prices is the increased price of gas. The Bass
Strait and Cooper basin producers are now selling their gas to the
Gladstone LNG exporters, who contracted to sell overseas more gas than
they can produce. The Santos consortium is the key gas “shorter”.
Those power and gas price increases (leaving aside the likelihood of
blackouts) will transform the economics of vast numbers of
employment-creating Australian businesses and households.
Prices of goods and services will have to rise and households with
large mortgages will direct more of their limited discretionary funds
towards paying their ballooning energy prices. That’s the grim picture
facing the nation of Australia. The power industry consists of a large
number of commercial bodies. A number of top engineers have
co-operated to make the above calculations. A number of politicians
have been told the grim truth. I have been chosen to tell the nation
via my journalism.
The NSW and Victorian state politicians who deny that we face this
situation are either lying or have not been told. Because Labor
politicians in Victoria and South Australia and the Coalition in NSW
caused this crisis, they know that voters in their next elections will
be severe if there are widespread blackouts.
But it’s always possible that NSW and Victoria may be saved from
blackouts if we have a mild, windy summer. And the politicians who
know the truth also hope that any “normal” summer which creates
blackouts also comes with equipment failures. That way they can then
blame equipment failures for the blackouts, rather than the shortage
of electricity that they created.
I have also been entrusted with communicating the measures we can take
to substantially lessen the problem. Today I set out the problem and
tomorrow I will disclose what we can do about it, but I warn there is
no magic bullet. I doubt whether we have governments of sufficient
calibre or power in our states and Canberra. We may need blackouts to
force the politicians to face the truth and take the required action.
But at least they will know what has to be done. At this stage I don’t
think the parliaments or departmental public servants have any idea
what to do.
My earlier series on energy was generated from the same sources, and
that intensified the community debate as others joined in. There are
links to previous commentaries attached.
The current problem is typified by what is happening in Victoria,
where the government proudly announced that it was erecting some 5500
megawatts of renewable power generation (mostly, but not entirely,
wind) to at least in part offset the closure of Hazelwood.
Green groups gave them great praise but the community, generally, also
felt good.
I believe, but am not certain, that they have since been told the
horrible truth: that to make that generation effective about $1
billion must be spent on the transmission network, because the current
network is structured around transmitting power from the Latrobe
Valley, not from the wind farm locations.
The politicians are still erecting wind farms but not the transmission
requirements, and they have very limited back-up generation plans for
when wind does not blow. Victoria is blundering into the same mistake
that South Australia made by erecting large amounts of wind power
without sufficient reliable back-up for non-windy days, and with a
network that was not equipped for it.
The back-up and transmission investments alter the economics of wind
and solar. The South Australian blackouts were made much worse by
equipment failures. Victoria has not learned from South Australia, and
NSW is already well down the same track and considering going further.
Queensland has announced it is planning major investments in
renewables.
I must emphasise there is a strong community desire to
invest in renewables, but when you undertake such a program you must
also invest the large amounts required in the transmission network and
in back-up facilities. To the credit of the South Australians, they
have learned their lesson, albeit the hard way. They will erect major
diesel power generators and batteries and hope that is sufficient for
the 2017-18 summer.
They are also planning a new gas-fired station.
Neither Victoria nor NSW have done that because they realise such
decisions will require even greater increases in power prices to pay
for extra facilities.
Power prices will probably have to be increased by the same amount
again — an effective trebling.
The Commonwealth must gain credit for starting to tackle the gas
problem and for announcing the Snowy-pumped hydro scheme. And
Opposition Leader Bill Shorten should be given credit for his work in
emphasising that significant action is required on gas.
But it is not easy for Labor or Coalition politicians. Victoria and
NSW have both blocked major fracking and non-fracking gas developments
which would have gone a long way to solving the gas-supply problems.
The state Coalition and Labor politicians seek Green votes by erecting
wind farms and stopping gas. But the gas is required to back up the
renewables when the wind does not blow and when there are gaps in
solar generation.
If there are blackouts, they will lose the votes of all the community.
Avoiding blackouts requires massive expenditure, which must be
recouped by charging even more for power. Again, electoral suicide.
Our politicians have never faced such a situation. That’s why at state
level, at best, they tell half-truths and sometimes simply tell lies.
where the wind does not blow. If we have a “normal” summer in 2017-18
in our two largest cities it is absolutely certain we will have
blackouts covering 10 to 15 days.
Under present circumstances there
simply will not be enough power to cover the peak summer demand.
And that assumes the ageing generators and power distributing networks
operate without breakdowns. Because we start with an overall power
shortage, the impact of any major equipment/transmission breakdowns
will be severe.
Then we go to gas.
The looming gas shortage in the 2017 winter can be overcome with
relatively minor actions. Much more drastic action will be required in
the following years. The Commonwealth government has made a start on
tackling the gas disaster.
But households and industry face a doubling of power and substantial
rises in gas prices in the next 12 to 18 months. Currently the biggest
force in higher power prices is the increased price of gas. The Bass
Strait and Cooper basin producers are now selling their gas to the
Gladstone LNG exporters, who contracted to sell overseas more gas than
they can produce. The Santos consortium is the key gas “shorter”.
Those power and gas price increases (leaving aside the likelihood of
blackouts) will transform the economics of vast numbers of
employment-creating Australian businesses and households.
Prices of goods and services will have to rise and households with
large mortgages will direct more of their limited discretionary funds
towards paying their ballooning energy prices. That’s the grim picture
facing the nation of Australia. The power industry consists of a large
number of commercial bodies. A number of top engineers have
co-operated to make the above calculations. A number of politicians
have been told the grim truth. I have been chosen to tell the nation
via my journalism.
The NSW and Victorian state politicians who deny that we face this
situation are either lying or have not been told. Because Labor
politicians in Victoria and South Australia and the Coalition in NSW
caused this crisis, they know that voters in their next elections will
be severe if there are widespread blackouts.
But it’s always possible that NSW and Victoria may be saved from
blackouts if we have a mild, windy summer. And the politicians who
know the truth also hope that any “normal” summer which creates
blackouts also comes with equipment failures. That way they can then
blame equipment failures for the blackouts, rather than the shortage
of electricity that they created.
I have also been entrusted with communicating the measures we can take
to substantially lessen the problem. Today I set out the problem and
tomorrow I will disclose what we can do about it, but I warn there is
no magic bullet. I doubt whether we have governments of sufficient
calibre or power in our states and Canberra. We may need blackouts to
force the politicians to face the truth and take the required action.
But at least they will know what has to be done. At this stage I don’t
think the parliaments or departmental public servants have any idea
what to do.
My earlier series on energy was generated from the same sources, and
that intensified the community debate as others joined in. There are
links to previous commentaries attached.
The current problem is typified by what is happening in Victoria,
where the government proudly announced that it was erecting some 5500
megawatts of renewable power generation (mostly, but not entirely,
wind) to at least in part offset the closure of Hazelwood.
Green groups gave them great praise but the community, generally, also
felt good.
I believe, but am not certain, that they have since been told the
horrible truth: that to make that generation effective about $1
billion must be spent on the transmission network, because the current
network is structured around transmitting power from the Latrobe
Valley, not from the wind farm locations.
The politicians are still erecting wind farms but not the transmission
requirements, and they have very limited back-up generation plans for
when wind does not blow. Victoria is blundering into the same mistake
that South Australia made by erecting large amounts of wind power
without sufficient reliable back-up for non-windy days, and with a
network that was not equipped for it.
The back-up and transmission investments alter the economics of wind
and solar. The South Australian blackouts were made much worse by
equipment failures. Victoria has not learned from South Australia, and
NSW is already well down the same track and considering going further.
Queensland has announced it is planning major investments in
renewables.
I must emphasise there is a strong community desire to
invest in renewables, but when you undertake such a program you must
also invest the large amounts required in the transmission network and
in back-up facilities. To the credit of the South Australians, they
have learned their lesson, albeit the hard way. They will erect major
diesel power generators and batteries and hope that is sufficient for
the 2017-18 summer.
They are also planning a new gas-fired station.
Neither Victoria nor NSW have done that because they realise such
decisions will require even greater increases in power prices to pay
for extra facilities.
Power prices will probably have to be increased by the same amount
again — an effective trebling.
The Commonwealth must gain credit for starting to tackle the gas
problem and for announcing the Snowy-pumped hydro scheme. And
Opposition Leader Bill Shorten should be given credit for his work in
emphasising that significant action is required on gas.
But it is not easy for Labor or Coalition politicians. Victoria and
NSW have both blocked major fracking and non-fracking gas developments
which would have gone a long way to solving the gas-supply problems.
The state Coalition and Labor politicians seek Green votes by erecting
wind farms and stopping gas. But the gas is required to back up the
renewables when the wind does not blow and when there are gaps in
solar generation.
If there are blackouts, they will lose the votes of all the community.
Avoiding blackouts requires massive expenditure, which must be
recouped by charging even more for power. Again, electoral suicide.
Our politicians have never faced such a situation. That’s why at state
level, at best, they tell half-truths and sometimes simply tell lies.