Grasping at straws in the march to energy disaster

As I pointed out in my previous post, republished here, the Australian government is using all its abundant intelligence resources to argue that Trump will not follow up on his strictures regarding the global warming scam.  Julie Bishop is unfortunately proving herself to be simply a vacuous fashionista in saying that the US will stick to the Paris Agreement because “like Australia” it can easily meet its goals.

Wishful thinking invariably is proven false and Trump is poised to sign executive orders to shrink the role climate change plays in decisions ranging from appliance standards to pipeline approvals in addition to those relieving coal plants from Obama’s measures blocking coal leasing and throttling greenhouse gas emissions.

Trump is also to dismantle the EPA’s fuel economy measures that impacted particularly adversely on domestic US manufacturers’ car offerings which tend to be larger than imports.

And we have had the ludicrous sally of our green wet PM into the battery saga where he is tweeted his one-on-one discussions with Elon Musk, a political entrepreneur who has pocketed $5 billion in subsidies from US citizens and is now seeking to roast the hapless South Australians.  A paper by Quirk and Miskelly estimates the cost in Tesla batteries alone of providing the same reliability for wind/solar that is achieved with fossil fuels would be $180 billion, twice the state’s annual income.  And though cheaper solutions might be available at one third of this price, the power itself remains three times that of its fossil fuel alternative.

The nation must surely have a death wish.  Half sensible politicians like Matt Canavan, Josh Frydenberg and Mathias Cormann retreat to the rationalisation that we have made a policy and we cannot simply change it week by week.  So we keep with the present policy, the economic destruction of which is so palpably obvious that the PM is now promising an expansion of the Snowy four years into the future (what is wrong with dusting off the Tas Hydro schemes killed by ALP green fervour in the Hawke ascendency?)

The present policy will bring a further 50 per cent expansion of the economy-busting renewables, a further deterioration of our international competitiveness and the departure of those industries (involving energy intensity) that are ideally suited to  our asset base.  The schadenfreude from seeing it  has backfired on one of its main instigators, BHP, offers scant solace.

Will nobody rid us of this troublesome priest?

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38 Responses to Grasping at straws in the march to energy disaster

  1. Suburban Boy

    It’s not clear from the article who is meant by the “troublesome priest”. If it refers to Elon Musk then a better label would be “monorail spruiker”.

  2. PB

    All so stupid that you are left with intentional destruction as the next-best explanation. Are we heading that fast down the rabbit hole?

  3. Myrddin Seren

    Glitch on the Quirk & Miskelly link.

    Think it might be covered by this one at JoNova

    South Australia – a Renewable State?

    The nation must surely have a death wish.

    The nation as a whole ? – I doubt it. Huge numbers of people want to move here for good reason – most because they like the place the way it is.

    Doubtless money is greasing part of this lemming-like plunge – huge amounts of OPM at play in renewballs.

    Relentless activists; the CAGW hypothesis as a foundational tenet of anyone who is within the tribal Left; and a Political Class largely devoid of ideas and capability being lead around by the Sir Humphrey Malcontents.

    The former would not matter if the Political Class were not so bad on the whole.

    Ben Pile is mostly active on Twitter these days. He used to post some good essays at his Climate Resistance blog that the wholesale embracing of the CAGW narrative by the Political Classes was in part due to their increasing unmooring and disconnection from society and desperate need to be seen ( by themselves ) to be controlling events when their capacity to really influence a number of things had moved on.

  4. teddy bear

    You could simply call this Turnbulls $2 billion battery storage for renewable power, so he has amazingly managed to outdo the idiot in SA not only by massively increasing the amount to be spent on “battery” storage but also unlike the SA premier he hasn’t actually promised any new capacity.

    To be able to outdo the SA premier on energy policy is truly a mark of greatness.

  5. Yohan

    The entire political/media left is now spinning furiously that all our energy problems are due to privatization. They are pushing this meme everywhere.

  6. Nerblnob

    What Yohan said. And every leftish or “neutral” Australian i know has swallowed this whopper whole.

  7. Mellen

    According to the current thinking Global warming is the reason we need all this renewable energy like wind, solar and hydro. But global warming also means longer, deeper and more frequent droughts according to its spruikers like Flannery. I’ve seen Blowering dam all but empty for years due to drought so there wasn’t much water to pump.
    There is something really screwy with the whole philosophy but who am I to question it.

    But hey 2 billion dollars into the southeast economy bring it on!

  8. Baldrick

    Add to this Michael Trumble’s Talbingo Hydro plan.

    It’s going to dwarf the NBN as Australia’s largest white elephant.

  9. Mark M

    Here is a short list of elites …
    Adani: Chappell brothers call for mine to be abandoned, warn cricketing ties could suffer.
    Other signatories include authors Richard Flanagan and Tim Winton, Telstra chair John Mullen, investment banker Mark Burrows and former Australian of the Year Professor Fiona Stanley.

    The letter cites public opposition, risks to miners’ health, climate change and potential impact on the Great Barrier Reef as reasons not to proceed.

  10. sabena

    We all knew the threat the ALP was to prosperity.
    Under Turnbull, the Liberals are no different.
    If Turnbull remains,he will do the party so much damage that it may not be able to recover-think of a loss of Kim Campbell proportions(Canada 1993).The conservatives split and did not regroup until 2003 and then won government in 2004

  11. stackja

    MT does not know anything. MT wanted Carbon tax in 2009.

  12. OldOzzie

    repost form Tuesday’s Forum

    #2326848, posted on March 15, 2017 at 11:06 am

    Time to give Credit to South Australian Premier Jay Weatherill for something Liberals should have done years ago, and should do now in NSW, but unfortunately NSW Liberals are too Dumb

    South Australia’s royalty plan a gas game-changer

    South Australia’s decision to offer farmers a direct share of the royalties that would be generated by expansion of the state’s rich onshore oil and gas bounty should resound nationally as the most important single initiative in a new energy plan that is otherwise surprisingly rational and generally positive.

    Sure the plan arrived replete with a self-serving narrative that blames the faceless energy bureaucrats in Sydney and Melbourne for South Australia’s energy frailty while utterly failing to acknowledge the national network instability caused by the state’s excessive dependence on renewable power.

    But Tuesday opened to fears that the South Australians were about to force retrospective gas reservation on its Cooper Basin producers, a move that would risk further market destabilisation, raise questions of sovereign risk for a state excessively dependent on a diminishing cohort of direct investors and also ramped up the pressure on one of the state’s few home-grown industrial champions, Santos.

    So the fact that Tuesday’s bellicose political rhetoric from South Australian Premier Jay Weatherill was not preceded by anything like the market interference that had been anticipated was a serious positive.

    There is nothing wrong either in the idea that the state should build itself a new peaking gas power station, or that it should demand that gas developers who accept state funding at any point in their progress should deliver gas to South Australia as a priority.

    How the government’s plans to deliver itself new powers to direct the way the power industry supplies the state fit with South Australia’s national market obligations and with its existing commercial generators, well, time will tell.

    But nothing in the package stands as nationally significant as the decision to offer farmers a direct financial incentive to further embrace oil and gas development on their properties. This is a first in Australia and it is the sort of direct incentive that the National Party’s federal leadership has been banging on about for some time.

    The petroleum industry will be just as welcoming, not least because South Australia, for the moment at least, is offering farmers a share of the state’s existing royalty.

    Petroleum extractors in South Australia pay a royalty equivalent to 10 per cent of well head sales value. So this plan will see farmers earn the equivalent of 1 per cent of the value of sales from future wells on their properties.

    It is indicatively ironic that it is a South Australian Labor government that is the first to get the message on pastoral inclusion. Whatever we think about the state’s self-indulgent renewable energy policy, when it comes to the extractive industries, there are few states that get the regulatory and fiscal regimes as right as South Australia.

    And, given the troublesome gas market outlook published on Tuesday by management consultants McKinsey & Company, South Australia’s clear-sightedness is a very good thing indeed.

    The way McKinsey sees it, Australia’s east coast gas demand has peaked with the arrival of three suddenly very controversial liquid natural gas projects but the nation faces a $50 billion investment task just to maintain the current delicately poised supply and demand balance through to 2030.

    The proponents of the Queensland’s three gas chillers expect to spend about $40 billion over the next 15 years on rolling out the coal seam gas wells that will be needed to feed their machines.

    But, McKinsey estimates that the gas industry needs to spend a further $10 billion on new production if it is to get anywhere close to filling a supply shortfall caused by the natural decline of the nation’s original oil and gas wellsprings, the Exxon operated Bass Strait fields and the Santos operated Cooper Basin.

    If timing is everything in business then McKinsey has proved why it ranks among the best in the consultancy game. The key data points offered in its analysis describe with numerical simplicity the nature of the gas supply side task ahead.

    East coast demand is about 2155 petajoules of gas. McKinsey sees that to remain flat or to drift slightly lower between now and 2030. McKinsey assesses that the market is fully supplied.

    But McKinsey warns that, without that additional $10 billion of currently unfilled investment, the market will enter a shortage from 2020 and that by 2030 the shortfall will be equivalent to 21 per cent of total demand.

    McKinsey captures with clinical directness the nature of the contest between suppliers and contract customers over the availability of gas and the tenor and price of future contracted supplies.

    “Historically, east Australia has benefited from lower gas prices than most other areas of the developed world,” McKinsey observes. It finds that, over the five years until 2013, the average price of gas in Victorias was $3.30 a gigajoule. Over that same period gas customers in the US paid an average $5.20/GJ, in Europe $9.70/GJ and in Japan a massive $18.60/GJ.

    Australia’s new reality is more daunting.

    “Conventional gas supply capacity is in steep decline and higher cost unconventional supply sources represent an increasing share of future supply capacity,” McKinsey says. The next wave of supply will demand a cost of between $5 and $8/GJ and the wave after that will cost even more.

    The challenge we have right now is that, for reasons mostly outside of the control of the gas producers, the price signal has not triggered the supply-side response that it should. There are a host of reasons for that and most of them, it has to be said, are linked in some way or other to Santos.

    Of the three Gladstone LNG projects, Santos operates the one that most relies on third-party producers for its gas feedstock. Each of the Gladstone operators runs two production trains. Santos should have stuck to one. Indeed, it would have done better to consolidate its ambitions with one of the other operators.

    Origin’s project is more than self-sufficient and Shell’s BG-built project largely supplies itself. But the disappointing productivity of some Santos coal seam fields has left it short of gas. So it buys gas from Origin’s Queensland fields and its third party gas vacuuming stretches all the way to Bass Strait.

    The other corner of Santos’ problems lies in northern NSW. The original plan was that Santos would be introducing material quantities of new gas from its Narrabri coal seam gas project by the end of this year. The original plan was that the project would quickly ramp up to better than 150PJ of annual production, equivalent to 50 per cent total NSW demand. But nothing went to the original plan.

    But the project and the APA pipeline needed to support it remain effectively stillborn, having only just entered an environmental approval process that everyone knows will be a fierce contest.

    High on the list of reasons why Santos has struggled at Narrabri is that the local farmers see risk but no reward from engagement with the coal seam gas sector. And that is why South Australia’s proposed royalty initiative is so important.

  13. Leo G

    Electricity grids were feasible because of the reliability of coal-fired generators. According to another paper by Andrew Miskelly and Tom Quirk, the 90% reliability point of all South Australian windfarms in 2010 was only 6%. The situation was worse in Victoria. Those windfarm generators, supplemented by gas-fired generators, can’t provide a reliable electricity grid.
    However, our state and federal governments remain committed to progressively reducing the reliability of the electricity grid which serves most of the Australian population. At the same time those governments are acting to accelerate population and population densities in our major cities, making them more reliant on the grid.
    Low duty cycle gas generators combined with renewables cannot provide the surety that our governments are promising. They are accepting the advice of liars.

  14. egg_

    They are accepting the advice of liars.

    Where are the Govt Technocrats vetting said information – cowed by the CAGW Industry?

  15. Aussieute

    Via Corey

    This week the monorail salesman from The Simpsons paid a visit to South Australia. Only this time he was selling giant uneconomic batteries instead of shooting people through vacuum-tubes.

    His name is Elon Musk and he runs businesses that depend on huge taxpayer subsidies to function. In fact the three businesses he runs have received around $5 billion in US government largesse.

    Now he’s set his sights on the Aussie taxpayer and our hapless leaders are falling over themselves to tweet and chat with him.

    Why wouldn’t they? After all, he was in Iron Man and the lefties love him so imagine the levels of green cred a pollie can generate just from chilling with Elon.

    But hanging with Elon is very expensive for any government. In fact it’s a textbook example of crony capitalism and everything that’s wrong with it.

    Let’s consider his main business: Tesla cars.

    As a startup in 2008, Tesla needed around $500 million. Elon Musk lent the company $38 million at a 10% interest rate and got another $465 million from the US government at a 3% interest rate. Musk also got stock options that generated a $1.4 billion profit while the government eventually tipped in another $4.5 billion to finance Tesla’s operations.

    Tesla still loses money, doesn’t meet its production commitments and every car is subsidised by thousands of taxpayer dollars.

    Musk went on to create two more companies, SpaceX which will provide future services related to satellite launches. SpaceX customers have prepaid so technically it makes money albeit from payments for services not provided.

    Solar Cities is his other company which makes and leases solar panels to home owners. It loses money.

    All three companies get concessional government loans and thanks to intra-company loans, they are only going concerns because of the inflated value of the Tesla stock price (and government subsidies).

    Now Musk has promised to solve the political crisis in South Australia caused by a lack of electricity.

    Unfortunately Musk’s numbers and promises don’t stack up but the SA and federal governments are already taking the bait.

    After years of peddling fanciful green dreams and endorsing windmills and solar panels as the answer to our growing energy needs, they are close to admitting defeat.

    SA Premier Weatherill yesterday commissioned a new gas power plant and ‘battery storage’. While the proposed power plant isn’t big enough, if it does run out of juice I calculate that Musk’s batteries will provide several minutes’ worth of power before needing a recharge!

    All up, State Labor’s plan costs taxpayers $550 million, which is a half billion dollar admission of government failure. However, as a shameless political fix I expect it will propel Labor to their 20th continuous year in office.

    The South Australian government will be seen to be doing something whilst the SA opposition have been enjoying too many long lunches during their 16 years in opposition. They too fell for the hysteria and hype of renewable energy and refused to stand up for the interests of South Australians.

    It was a gross failure of leadership for the SA Liberals and it will likely cost them the next election.

    However, despite the cunning of Labor’s new announcement, it will not solve the SA energy emergency. It is too little and much too late.
    The only thing that will solve South Australia’s and the nation’s energy woes is to stop the subsidies and let the most cost-efficient and effective baseload power be generated.

    It means we must stop the irrational ideological campaign against using our bountiful resources and ensure that we value add to our beautiful black coal deposits.

    If we are digging it up for export then surely we can use it ourselves to generate the cheapest, most reliable electricity in the world. That would do more to kick-start our economy and strengthen our manufacturing industry than anything else.

    An aside would be that taxpayers would also be able to leave the lights on when they need them the most.

  16. Sparkx

    Eggsactly Egg. It is ridiculous that our grid is managed by bureaucrats who know SFA about electricity production and distribution. We need a few sensible engineers on board.

  17. Mark A

    retreat to the rationalisation that we have made a policy and we cannot simply change it week by week.

    So, if they make wrong turn on the road, they would keep on traveling in the wrong direction in the hope of still finishing up at the right destination?

    Utter stupidity.

  18. Dr Fred Lenin

    When ruddbulls liberal lites get massacred in the next election ,and their “careers ” are in ruins ,the former liberal party will be beyond saving ,it is totally infiltrated by green leftists ,down to branch level . Its the old scum alinsky trick ,destroy the opposition by infiltration . The green union alp will take office and continue the destruction of Australian nationhood ,in the cause of u.n.communist unelected government . Never mind elections they will be a thing of the past as we are stuffed like the EU . North Korea will be the go ,at least they have elections where the government gets 196 per cent of the vote ,and that’s without the dead voting like the US democrats and our alp . Amazing figures ain’t they ,sounds like Elon musk don’t it .

  19. mh

    SA transformer fire almost caused second statewide power blackout, AEMO says

    SA Premier Joke Weather-Dill said:

    “Two of the largest generators went off in South Australia. Thank God the wind was blowing because wind power kept the lights on in South Australia”.

  20. “Will nobody rid us of this troublesome priest?”

    More to the point – Will no one rid us of this troublesome green “religion”?

  21. Leo G

    The PM has announced a $2 billion ‘fix’ for the emerging power crisis- an expansion of emergency hydro storage for the for the eastern Australian grid.
    The reason it is needed is the unreliability of renewables as replacements for old coal-fired generators as they reach retirement.
    The Snowy Hydro expansion provides the equivalent of 2GW for one week each year. A conventional 2GW coal-fired generator would cost about the same but could provide that power every week of the year.
    But we are not permitted conventional coal-fired generators. The on-going, global, hysterical fear of carbon dioxide won’t permit the proper solution.
    We are allowed to consider- and only for cost comparison purposes- impractical versions of coal utilisation like ultra-supercritical coal, at four times the cost.
    It’s sad that the best the PM can propose is a new Opera House for the Snowy Mountains.

  22. duncanm

    We need a few sensible engineers on board.

    too f’n right.

    A 5min back of the envelope calculation, such as this tells you you’ll need to more than triple the current wind generation capacity and have 2.1M tonnes (yes 2 x 10^9 kg) of LiIon batteries to go full renewable (aka. full retard) in SA.

    Never go full retard.

  23. classical_hero

    The problem is caused by government intervention so the solution is more government intervention. You know what the definition of stupidity is?

  24. classical_hero

    The fact that biomass is considered “renewable” is a fraud. Just like ecodiesel. It’s amazing how ideology trumps reason.

  25. stackja

    Dam the Snowy! Full speed ahead! Next dam Franklin!

  26. .

    How is biomass NOT renewable?

  27. the sting

    How much electricity will it take to pump this Snowy River water back up the mountain so it can be reused ?

  28. Eddster

    I worked on the Snowy many years ago. My recollection is that it was used purely for peak hour boosting, not baseload

  29. .

    stackja is right. We ought to dam Needle’s Gap and the Murray Gorge, too.

  30. NewChum

    But we are not permitted conventional coal-fired generators. The on-going, global, hysterical fear of carbon dioxide won’t permit the proper solution.

    Only for us. The Chinese are free to build as many as they want. So they can buy our minerals, add the value to them and ship them back, then use their accumulated capital to buy up real estate in Sydney and Melbourne.

    It’s magic C02. Because it gets emitted in China and not here it doesn’t cause any problems.

    Insanity doesn’t even begin to get near to the idiocy on display.

  31. NewChum

    There are a host of reasons for that and most of them, it has to be said, are linked in some way or other to Santos.

    I wonder if the continual view of the minerals industry as a goose ripe for plucking, coupled with anti-gas hysteria has anything to do with it. Allow law fare and nimby activism to stop any minerals project anywhere, and you eventually end up with a shortage of minerals?

    Santos might have some low grade wells, but that is not the reason for the shortage.

  32. Bruce of Newcastle

    How much electricity will it take to pump this Snowy River water back up the mountain so it can be reused ?

    Round trip efficiency seems to be about 75%ish.
    So solar and wind pump it uphill and they get 75% back on the way back down again.
    Which means the solar and wind electricity will now be a third more expensive plus the capital and operating cost of the pumped-storage. Expect you electricity bills to reflect this madness.
    Oh and I forgot. The wind and solar energy is coming from far away, so you can subtract another ~10% in getting to the Snowy, then another ~10% getting the regenerated electricity back to the customers. Insane.

  33. NewChum

    So solar and wind pump it uphill and they get 75% back on the way back down again.
    Which means the solar and wind electricity will now be a third more expensive plus the capital and operating cost of the pumped-storage.

    Surely it is twice as bad as that because you need 2x the wind generators to generate the power to push the water uphill in the first place? Otherwise you are taking wind power out of the grid to pump the water, and all you are achieving is moving the timeframe of when you use the wind power.

    And whatever happened to ‘environmental flows’? Surely pumping the same water up and down leaves less to go down the river?

    To think all this idiocy can be solved with a couple of supercritical power stations.

    Or at least a set of new politicians.

  34. Leo G

    And whatever happened to ‘environmental flows’? Surely pumping the same water up and down leaves less to go down the river?

    What water? Tantangara Reservoir was to be used to supply potable water to Canberra. I wouldn’t be surprised to find that this plan is a cynical reconfiguring of the scheme to improve Canberra’s water supply.

  35. john constantine

    Or, umm, you could simply let evaporation lift the water up to the top of the Snowy storages and place it high up the gravity potential by the free rainfall pump.

    As is stands, government eternally vandalised the Snowy River Scheme to buy an abc Rural Independant Stalinist vote. The unused water drops into the ocean and now we spend billions physically pumping water uphill to duplicate the work rainfall used to do for free.

    And xhorten is genuinely worse.

  36. .

    Leo G
    #2328449, posted on March 16, 2017 at 7:33 pm
    And whatever happened to ‘environmental flows’? Surely pumping the same water up and down leaves less to go down the river?

    What water? Tantangara Reservoir was to be used to supply potable water to Canberra. I wouldn’t be surprised to find that this plan is a cynical reconfiguring of the scheme to improve Canberra’s water supply.

    Hello Sugarloaf Pipeline.

  37. Goanna

    Hello Sugarloaf Pipeline.

    You’d have given them their Great Dividing Range pipeline if they’d thrown in a nuclear power plant at Yea.

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