Turnbull’s Energy Economics

In The Australian yesterday came this story of Malcolm Turnbull giving Einstein (or whoever really came up with his insanity quote) the middle digit:

Power firms told to cut prices

The nation’s electricity industry chiefs will be hauled in by Malcolm Turnbull for the second time in three weeks following an audit that rcevealed more than a million households are still paying the highest price rates ­imposed by energy retailers.

With the government seeking to regain the political initiative this week by switching the focus back to a key cost-of-living issue, the Prime Minister will ramp up pressure on the eight biggest electricity retailers to ensure all households are offered access to cheaper pricing deals.

The Australian has learned that an audit by the Australian Competition & Consumer Commission, provided to the government, has estimated that roughly one million households, or more than 10 per cent of all dwellings, were locked into the highest electricity rates, which were often up to 27 per cent more than the average cheaper plans.

In a meeting scheduled for Wednesday in Sydney, Mr Turnbull will require them to outline how they will help more families get on to a better deal and what measures they have put in place to make it easier for customers to switch providers.

Talk about yelling at a broken leg to heal quicker.

If this is the best Turnbull and his team can come up with to regain their lost votes, then they’re well and truly finished… and we won’t be far behind.

Without showing even the slightest understanding of why Australia’s electricity market is the way it is, Turnbull also announced that he is set to continue with his plan to quite literally push dung up a hill:

In an attempt to reset the ­agenda and break free from the political crisis surrounding the government over citizenship, Mr Turnbull will today return to the Snowy Hydro Scheme where he will announce the fast-tracking of a $29 million feasibility study* for the $2 billion Snowy 2.0 scheme to expand pumped hydro by 50 per cent and provide an extra 2000 megawatts of power to the National Electricity Market.

The scheme, announced in March, is expected to create about 4500 jobs.

[TMR: You hear that people of the LaTrobe Valley – 4,500 jobs!!! Your prayers have been answered. Go get those jobs. Bling bling! ]

This is not a joke: Turnbull really wants to take energy out of the grid, pump it up a hill, watch less of it trickle back down:

Pumped hydro is a low-emissions way of creating electricity which can provide back-up for the National Electricity Market.

It’s unlikely to provide base-load power but it will help stabilise the grid as older coal-fired power stations are retired from the NEM and provide a back-up for intermittent renewable energy such as wind and solar.

[TMR: I love it how something can ‘create electricity’ but not produce any base-load power – wheeeeee!]

… and then complain with a straight face when the price of electricity goes up.

To put this in perspective, consider which of the following options would make you more angry:

  • Turnbull comes up to you, takes $100 out of your wallet, sets it on fire in front of you and walks off laughing.
  • Turnbull takes the same amount of money from you for the sole purpose of taking energy out of the grid.

The answer, of course, is that the second option should make you a lot more angry – because at least the first option would result in a net energy gain and no upward effect on electricity prices (i.e. the exact opposite to the first option).

Now, I know this may sound like a trick question, but try to take a guess at what might happen if you encourage energy producers to produce expensive and unreliable energy?

How about I give you and Malcolm some thinking time…

1459480155213

That’s right!

They’ll produce expensive and unreliable energy and charge consumers for the privilege:

real-electricity-prices-

 

How many more examples like Tasmania and South Australia are we going to need to see before the penny drops?

Lastly, I’m also starting to suspect that Turnbull hasn’t heard of the bell-shaped curve. Just what percentage of households does he think should be paying the highest rate for electricity? And, most critically, even if he could socialise our ‘energy market’ and get everybody on to the ‘cheapest rate’ – what does he think would happen to that ‘cheapest’ rate? (No, the answer isn’t: power companies will cheerfully take the hit because they believe in social contracts and justice).

And just how many of the 10% of households currently paying the highest rate for their electricity are actually doing it tough anyway? Does anybody know? Is anyone going to ask Turnbull and hold him to account?


(*) PS: do you reckon there’s a Snowys chance in hell that this $29 million ‘feasibility’ study – which has followed Turnbull’s $2 billion announcement (seriously, just stop and process that) – will say the bleeding obvious: that hydro electricity relies on a nuisance called gravity and can only work if you have enough rainfall to fill a dam?

It’s ok, I don’t think so either.

 

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67 Responses to Turnbull’s Energy Economics

  1. Jannie

    We are overseas at the moment and have closed up the house, emptied the fridge and switched off all appliances that we can. But we have just got our Synergy bill and noted that our Daily Supply Charge rate in WA increased on 1 July from 48 cents per day to 84 cents per day. We pay as much for our power in our rented house as we do for our empty house in Perth.

  2. Craig

    If I was an energy owner, I would be telling turdbull to fuck off and he can buy me out and nationalise the damn thing.

  3. Yohan

    I wonder how the daily supply charge compares to other countries. We pay very high price per KW, the worlds highest, but I bet our daily supply (gold plated infrastructure) charge is far higher as well.

    It almost not worth being on dual fuel, when you have to pay a second daily supply charge for gas.

  4. Bruce of Newcastle

    Power firms told to cut prices

    I was disturbed when reading that yesterday. He has to know that wholesale electricity prices have roughly tripled since Hazelwood was shut. He is a banker. Surely he understands that you cannot just tell a company to lower their prices when that would bankrupt themselves?

    Well I hope the voters boot him so far out of office that even with Captain Cook he won’t find the way back again. He has raped our country for no reason.

  5. RobK

    Initially I was open to Mal’s suggestion but now have my reservations after hearing there’s twenty something kilometers of tunnel involved yet he is spending on a serious feasibility study. I also note the German experience with their existing pumped schemes that were economic with dispatchable power but not with intermittents.
    Der Spiegel. The
    The Storage Conundrum

    The Cossebaude reservoir is Dresden’s largest and most popular open-air pool. On summer days, up to 8,000 sunbathers lounge on its sandy beach or cool off in the 10,000-square-meter (2.5-acre) lake.

    Cossebaude is also part of the enormous Niederwartha pumped storage hydroelectric plant. At night or on weekends, when there is plenty of available power, lake water is pumped electrically through big pipes into a second reservoir 140 meters above the main reservoir. At noon, when electricity is scarce, the water is released from the higher-elevation reservoir, spinning giant turbines as it descends. The system generates electricity when the cost is high and consumes it when the cost is low. Plant operator Vattenfall makes its profit on the difference. When the plant was connected to the grid in November 1929, it was considered the technology of the future.

    Now the power plant, along with the recreational lake attached to it, could soon be gone. The company plans to shut down the energy storage facility within the next two years. This is bad news for Dresden’s swimmers, but it’s especially detrimental to Germany’s energy transition, which depends on backup power plants like the Niederwartha facility.

    When the sun isn’t shining and the wind isn’t blowing, gas-fired power plants and pumped storage stations are supposed to fill the gap. A key formula behind the Energiewende is that the more green energy is produced, the more reserves are needed to avert bottlenecks.

    This is true in theory, but not in practice. On the contrary, an ironic result of the green energy expansion is that many of the reliable pumped storage stations could be forced out of the market. There are roughly 20 of these power plants in Germany, with Vattenfall being the most important operator. The plants were very profitable for utilities for decades, but now the business has become highly unreliable. Dresden is a case in point.

    When it’s sunny and people are most likely to head to the lake, solar power is abundant and electricity prices drop. This means the pumped storage station earns less money, so the power plant is shut off. In 2009, for example, the turbines in Niederwartha were in operation for 2,784 hours. Last year, Vattenfall ran the facility for only 277 hours. “Price peaks that last only a few hours aren’t enough to utilize the plant to full capacity,” says Gunnar Groebler, head of Vattenfall’s German hydro division.

    No Incentives for Storage

    Not surprisingly, the company invests very little in its pumped storage plants today. In Niederwartha, the buildings are filled with the musty smell of earlier floods, the paint is peeling from the walls and the reservoir leaks.
    RTWT

  6. Entropy

    Rob!: it takes more energy to pump water up hill than you would ever get out of it when you let it run downhill again. End of story. The only way such a scenario would turn a profit is to be really set up for subsidy farming.

  7. Entropy

    He has raped our country for no reason

    Those arseholes have gang raped us.

  8. John Constantine

    There is water that already is delivered to the top of the Snowy scheme by the free rainfall pump.

    This is dumped unused out to sea.

    A bankrupt nation then is told it must bribe the cfmeu to build deal plants to be rented to the State by cronies, then pump desal water over the Great dividing range in the crony cfmeu north south pipeline, then pump it to the top of the Snowies with solar panels.

    To get free green energy.

    The looting class have gone so hard into looting overdrive that it is a sign they feel their Ponzi scheme is close to crashing the prole economy.

    Sell another level of the Ponzi pyramid, comrades.

  9. cui bono

    The concept is emblematic of Turnbull himself – significant promotion and high expectations followed by disappointment and high on-going costs.

  10. Baldrick

    Of course the government could take action themselves on power prices, in the short term, by removing the GST, but they won’t.

  11. RobK

    Baldrick,
    If the government removed the CET/RET the price would fall.

  12. While the ‘feasibility’ study is under way, Malcolm announces they are already tunnelling through to fast track his latest thought bubble. Am I mistaken in thinking he is doing things arse about? Why bother with the study then. Remove this idiot who can’t see the woods for the trees because he has his head jammed firmly up his whazoo. Join the Australia Conservatives.

  13. Baldrick

    Baldrick,
    If the government removed the CET/RET the price would fall.

    I agree, for a longer term fix.

  14. Baldrick

    Apparently it’s okay for the government to make money on power prices, but not the retailers.
    Go figure.

  15. Robber Baron

    PHON just needs to have two policies and they will sweep to power.

    1. Ban Muslim immigration.

    2. Build coal power stations.

    Prime Minister Hanson, welcome to country!

  16. John Constantine

    Did their turnfailure ring billy shorten for his policy ideas on electricity, or is he low enough to steal them unattributed?.

  17. duncanm

    He is a banker. Surely he understands that you cannot just tell a company to lower their prices when that would bankrupt themselves?

    He was a successful businessman, surely he understands..

    He is a master negotiator, surely he can …

    I’m of the firm belief that he is none of those things he purports to be.

  18. Rohan

    But PHON wants to implement the modern incarnation of Hanson “simple tax”. 2% on every transaction. Well be paying up to what, 20-25% tax equivalent on goods and services when the compound taxation kicks in.

    Australian Conservatives area better choice.

  19. duncanm

    If the government removed the CET/RET the price would fall.

    not according to the dimwits at Fairfax.

    Deeper carbon cuts for power sector would cut prices, analysis shows

  20. jonesy

    CET/RET and that bloody NEM! The market is nothing but insurance for brainless lefties to run schemes of folly to appease inner suburb lefties in SA, Tassie and now Victoria! Chop up the extension lead and allow the voteherd in these states to realise good and hard the real effect of running green energy policies that rely on intermittent power.

  21. RobK

    Duncanm,
    not according to the dimwits at Fairfax.

    They recon a 45% RET will see electricity at under $40/MWh. Yet now they need support. The ACF are not much into engineering.

  22. jonesy

    ….and Trumbull hasn’t got a clue how to run a rowboat let alone a country. Rule by decree…way to go! That went out in feudal Europe. It’s just like a Monty Python sketch….If you dont drop your evil scheme to make money from making electricity…I will lecture you a second time…Really?…get the comfie cushions and tea at elevenses’!

  23. bushwalker

    The only way pumped hydro makes sense in the current decarbonising environment is if renewable power sources do the pumping. Being intermittent, they are perfectly matched to pumping into a large reservoir. However I suspect that that would destroy the economics of the plan.

  24. H B Bear

    There he stands Lord Waffleworth of Point Piper, Potential Greatness radiating from his leather jacket, as he commands the windmills to turn and the price to fall. Meanwhile the water laps at his ankles as the Snowy continues to flow downhill.

  25. jonesy

    OT, the transaction tax also catches all that money going offshore into multinational tax free bank accounts. No income tax, no gst and the transaction tax. Hmmm if I spend I get taxed…what will I do???

  26. Mark M

    Perhaps it is a devious plan by Truffles to just keep the power on in Canberra.
    It will be working o/t just keeping the light on the hill on!

  27. RobK

    Bushwalker,
    The thing that is not immediately obvious is that pumped storage with baseload can cycle on predictable loads to maximise the storage discharge. With intermittents you never know for sure when you are going to get the energy to recharge so it becomes difficult to know when the best time is to produce electricity, there is no guarantees that there will be cheap electricity to recharge when you run dry. To counter this you can try to build a lot more renewballs to improve your odds, this will cause a glut regularly (causing producer hardships and bailouts)but won’t remove the shortfall entirely unless you have massively expensive storage capacity and renewballs capacity…manyfold of that required for a predictable baseload cycle of events.

  28. struth

    The level of business confidence in Australia must be staggering!

    Investment must be booming.

    Here we have a socialist government blaming power companies and banks and business of all sorts for it’s own meddling failures.

    As socialists always do.
    And from a government that is supposed to be pro business.
    Deciding what salaries private companies can remunerate executives while the salaries of public servants are out of control.
    We have the highest paid pollies on earth.
    Our public servants ARE the one percent they go on about.
    Except there’s more than one percent.

    Get out quick.
    I suggest a piece on people’s choices for migration.

    Watching the television and the great gusto with which the MSM love to see our enemies as the evil capitalist businesses and now the complete lying about our history, we are done.

    We didn’t get a Trump in time, and we don’t deserve one.

    Hivisastan deserves all it gets.
    And boy, are we gonna get it.

  29. John Constantine

    The outcome of allowing the Stalinists to de-industrialise victoria as well as south australia, is that taking victorias population out of the productive economy and putting them into a services economy funded by hot chinese money buying houses and mass importation of welfare herds to be federally funded through borrowings, this will sink the entire country.

  30. Entropy

    jonesy
    #2483012, posted on August 30, 2017 at 7:48 am
    CET/RET and that bloody NEM! The market is nothing but insurance for brainless lefties to run schemes of folly to appease inner suburb lefties in SA, Tassie and now Victoria! Chop up the extension lead and allow the voteherd in these states to realise good and hard the real effect of running green energy policies that rely on intermittent power.

    Tempting. Real tempting. Problem is there is the temptation to make the most of the golden opportunity to charge lots to power the southern states’ stupidity.

  31. Entropy

    Jonesy , your tax policy is summed up as “somebody else other than me would end up paying more tax”. Ponzi fantasises never work out.

  32. Rabz

    In a just world, every politician that had any involvement in the destruction of the energy grid in this country (which is awash with plentiful energy sources) would be swinging from the nearest telegraph pole. Which would at least mean the latter was being put to good use.

  33. Rabz

    Of course the government could take action themselves on power prices, in the short term, by removing the GST, but they won’t.

    remove the CET/RET the price would fall.

    Remove all subsidies for unreliables as well. Although ideally, they should be removed from the grid full frigging stop. Then build some more coal fired power stations.

    If you did those things, costs for consumers would plummet.

    But no, the Green Windbag of Wentworth, being the smartest narcissist tosser in the room, always knows better.

  34. pbw

    There’s a case study connected with the Wivenhoe dam in the Brisbane Valley (or near enough). A small dam was built 100 metres above Wivenhoe and a pair of generators/pumps installed in the connecting pipes.

    The point is to use off-peak, cheap baseload power to fill the storage dam, then run it down through the generators during periods of peak demand. If the differential between off-peak and peak prices is big enough for long enough, the investment is worthwhile.

  35. John L

    Perpetual motion is the motion of bodies that continues indefinitely. A perpetual motion machine is a hypothetical machine that can do work indefinitely without an energy source. This kind of machine is impossible, as it would violate the first or second law of thermodynamics.[2][3][4]

    Malcolm is the lawyer, he is used to violating the law.

  36. incoherent rambler

    Remove all subsidies for unreliables as well. Although ideally, they should be removed from the grid full frigging stop. Then build some more coal fired power stations.

    Remove ALL energy taxes and ALL energy subsidies.

    In other words, get rid of the malf1ddling and energy becomes cheap. Again.

  37. Mother Lode

    I wouldn’t trust Trumble to run his nose if he was locked outside in his underpants in a blizzard – the politician from Bizarro-world would complain of the heat and take his underpants off and use them to fan himself until he was frozen solid.

    Can we strap him to the smiley face at Luna Park and send another crane out on the Harbour? Surely we could make it look like an accident.

    We could even go through the motions of loss and build a statue of him next to the one of Bill Shorten – the piece of shit bookends for the litany of crap this parliament is.

  38. RobK

    A coal fired power station has storage in the form of a small mountain of coal at the feed-in conveyor. A nuclear plant…it’s like a Duracell on steroids.

  39. OneWorldGovernment

    Why are we not having a plebiscite about removing dumb fuck politicians and bureaucrats?

    Bureaucrats of all stripes, including Judges, Commissioners, et al, should be subject to real world dismissal.

  40. H B Bear

    A number of commenters seem to be labouring under the misapprehension that Lord Waffleworth is constrained by the laws of physics.

  41. H B Bear

    We are overseas at the moment and have closed up the house, emptied the fridge and switched off all appliances that we can. But we have just got our Synergy bill and noted that our Daily Supply Charge rate in WA increased on 1 July from 48 cents per day to 84 cents per day. We pay as much for our power in our rented house as we do for our empty house in Perth.

    Janine – let’s not pretend that the near doubling of the supply charge in WA is anything other than a tax increase after so-called Lieboral Emperor Barney sent state debt to $19bn and left an annual deficit of around $1.5bn for Sneakers. The poles and wires on the ground are more or less identical.

  42. incoherent rambler

    A number of commenters seem to be labouring under the misapprehension that Lord Waffleworth is constrained by the laws of physics.

    Both enthalpy and entropy are hunting for Trumble.

  43. The Fifth Bike Rider of the Apocalypse

    He is a banker.

    The word you want sounds similar but is spelt slightly differently.
    Otherwise, a very perceptive comment Bruce.

  44. Mother Lode

    Both enthalpy and entropy are hunting for Trumble.

    Can we apply enthalpy to the soles of his feet? With a blowtorch?

    Stupid git would probably think you were talking about empathy and turn up with that silly leather jacket on with one shoulder padded so it looks like he has tilted his head.

  45. manalive

    THE ANDREWS government will build two new solar plants to power Melbourne’s tram network … (James Dowling, Herald Sun August 23, 2017).

    There would be ~500 trams operating in Melbourne at peak time (around sunrise and sunset in winter), each with 4X100KW motors needing I assume a total 200MW of power.
    Dopey Dan apparently thinks that a couple of solar ‘parks’ with a total nameplate capacity of 140 MW and an actual capacity factor of ~ 15% are adequate replacements for the closure of a 1,600 MW base-load coal plant.
    My theory is that law and arts graduates, who make up most of our politicians, struggle to appreciate scale, they read numbers but they must have no idea what the symbols represent — unless it’s their salaries of course.

  46. Diogenes

    Malcolm is the lawyer, he is used to violating the law.

    Didn’t he say the laws of Australia trump the laws of physics ?

    Join my campaign to repeal The Laws of Thermodynamics & Gravity.

  47. struth

    University insulates a thousand times better than it educates.

    The dumb coming out of Australia’s universities cannot be dismissed lightly.

  48. Mother Lode

    The word you want sounds similar but is spelt slightly differently.

    I mentioned him being put out in a blizzard. Well, perhaps he had a cold when he said what he was and the ‘W’ sounded like a ‘B’.

  49. Roger

    Didn’t he say the laws of Australia trump the laws of physics ? Join my campaign to repeal The Laws of Thermodynamics & Gravity.

    I christen thee Maladroit Blight Sisyphus Trumble.

  50. Diogenes

    The word you want sounds similar but is spelt slightly differently.

    When I lived in Brizzie , I often saw a flash car with the rego plate “BANKER” speed past me on the SE Freeway. I nearly had a prang coming home one day as somebody had obviously spent a lot of time scratching at the number plate protector so that the B was totally obscured by a scratched out W, as I was laughing so hard.

  51. Botswana O'Hooligan

    If the genius of a prime minister thinks that using electricity to pump water back uphill to generate electricity is the “go” why doesn’t his government issue every household with a rain water tank on stilts and do away with power solar, gas, and coal generated electricity completely thus ensuring that he and he alone is the World genius he thinks he is.

  52. I’ve said it before and I’ll say it again, Malcolm Turnbull’s son is heavily into renewable energy businesses.

  53. cohenite

    EROEI is a fundamental principle of nature. Any animal which expends more energy hunting food than the energy it derives from the food will starve quickly.

    Australia is doing this now with its electricity. Renewables all have EROEIs of < 1; they cannot make themselves. Turnbull is a grotesque fool but he is better than tits and the greens.

  54. incoherent rambler

    I think you have the explanation Mr. Humbug.

    And roonables need ever increasing amounts of government money to survive.
    Add to the list of peoples with money in roonables –

    Union super
    Vanguard
    Various ABC employees

  55. But no, the Green Windbag of Wentworth, being the smartest narcissist tosser in the room, always knows better.

    EROEI is a fundamental principle of nature. Any animal which expends more energy hunting food than the energy it derives from the food will starve quickly.

    Australia is doing this now with its electricity. Renewables all have EROEIs of < 1; they cannot make themselves. Turnbull is a grotesque fool but he is better than tits and the greens.

    A number of commenters seem to be labouring under the misapprehension that Lord Waffleworth is constrained by the laws of physics.

    Just three examples of why Catallxy is the best place around. I just love the wit, humour and the succinct way commenters can sum up a situation. Sometimes, gallows humour is the only kind left to us.

  56. Rohan

    manalive
    #2483139, posted on August 30, 2017 at 10:04 am
    THE ANDREWS government will build two new solar plants to power Melbourne’s tram network … (James Dowling, Herald Sun August 23, 2017).

    There would be ~500 trams operating in Melbourne at peak time (around sunrise and sunset in winter), each with 4X100KW motors needing I assume a total 200MW of power.
    Dopey Dan apparently thinks that a couple of solar ‘parks’ with a total nameplate capacity of 140 MW and an actual capacity factor of ~ 15% are adequate replacements for the closure of a 1,600 MW base-load coal plant.

    I remember listening to a radio interview a few years back with some green nutjob who wanted generators fitted as brakes on all trams and train in Victoriastan to save electricity. While he was there someone who works for public transport rang and told him that they’re already fitted and have been for ages.

    So that’s fantastic news for Dan the CFMEU Man. When that when the sky clouds over or the sun goes down, they can resort to powering the PT network entirely off their own brakes. You know it makes sense.

  57. John L

    EROEI Calculations for Solar PV Are Misleading
    (Posted on December 21, 2016 by Gail Tverberg)
    The Energy Returned on Energy Invested (EROEI) concept is very frequently used in energy studies. In fact, many readers seem to think, “Of course, EROEI is what we should be looking at when comparing different types of energy. What else is important?” Unfortunately, the closer to the discussions of researchers a person gets, the more problems a person discovers. People who work with EROEI regularly say, “EROEI is a tool, but it is a blunt tool. An EROEI of 100 is good compared to an EROEI of 10. For small differences, it is not so clear.”

    Read the rest of the article here:

    https://ourfiniteworld.com/2016/12/21/eroei-calculations-for-solar-pv-are-misleading/

  58. Howard Hill

    I remember listening to a radio interview a few years back with some green nutjob who wanted generators fitted as brakes on all trams and train in Victoriastan to save electricity. While he was there someone who works for public transport rang and told him that they’re already fitted and have been for ages.

    Don’t let the lightbulb see this or he’ll be ordering all trams and trains to be pushed uphill so they can generate free electricity as they roll down again.

  59. max

    Every decent man is ashamed of the government he lives under.

    A good politician is quite as unthinkable as an honest burglar.

    “A professional politician is a professionally dishonorable man.  In order to get anywhere near high office he has to make so many compromises and submit to so many humiliations that he becomes indistinguishable from a streetwalker.”
    Henry Louis (H.L.) Mencken

  60. John Constantine

    Metal smelters cannot be run on intermittent ruinables, therefore when Stalinist’s move to full ruinables, that is the end of building ruinable electricity generators out of metal.

    Still be able to make windmills out of wood, if a skilled carpenter can fit the joins without nails.

    Using stone handtools.

  61. rickw

    The Consumer Priced Index Chart for Electricity Prices shows on important thing, annotated with commencement of “NEM”.

    GOVERNMENTS PROVEN ABILITY TO COMPLETELY FUCK ANYTHING IT BECOMES INVOLVED WITH.

  62. cohenite

    John L

    #2483309, posted on August 30, 2017 at 1:04 pm

    EROEI Calculations for Solar PV Are Misleading
    (Posted on December 21, 2016 by Gail Tverberg)

    Excellent analysis. The other way of expressing it is renewables can’t make themselves.

  63. Waz

    I agree with the sentiments in the article and I’m the first to promote Ultra Critical Coal Fired power stations, however I think marcus is misguided in the detail of his criticism. As far as Snowy II goes it does make sense in terms of a renewables policy if that’s where it ends up. The idea is that you have a massive excess of installed intermittent wind and solar capacity and that the excess power at various times is used to pump water uphill and then is used for power generation when there is no or insufficient renewable power being generated so that overall the grid ends up with a caseload supply. In fact the Snowy scheme has been doing that since inception, Snowy II is just a ramp up of that using more efficient technology whereby the water turbines can both pump and generate. In theory as an engineering exercise it has some efficiency attractions. Whether the base load all-in cost result (wind + PV + pumped hydro) is cheaper than coal is the real question we should be asking. Hopefully some honest and clever engineers will work that out and tell us.

  64. Neil

    The idea is that you have a massive excess of installed intermittent wind and solar capacity and that the excess power at various times is used to pump water uphill

    That is not how it works. The concept uses coal generated electricity during off-peak times to pump water uphill and then flow it down the hill during peak times to generate hydro electricity. It works if the difference in price charged between off-peak and peak electricity is great enough

    https://en.wikipedia.org/wiki/Pumped-storage_hydroelectricity

    Although the losses of the pumping process makes the plant a net consumer of energy overall, the system increases revenue by selling more electricity during periods of peak demand, when electricity prices are highest.

  65. Waz

    <blockquoteThat is not how it works. The concept uses coal generated electricity during off-peak times to pump water uphill and then flow it down the hill during peak times to generate hydro electricity. It works if the difference in price charged between off-peak and peak electricity is great enough

    That is certainly how it works at present with Snowy Hydro and other pumped hydros around the world; the object being to utilise cheap off peak base load coal fired power and sell high-priced peak hydro power during peak demand. However I'm pretty sure that is not the object of Snowy II. It is specifically designed to provide backup to renewables as per the Finkle recs that all future renewables must provide their own backup. Whether it's economic is another question.

  66. OldOzzie

    ‘Power prices: the sequel’ still fails to generate heat – JUDITH SLOAN

    It’s like watching the sequel of a bad movie. The title of the first movie was: Pretending to do something about power prices.

    Let’s face it, we are all sick of hearing about Snowy 2.0. It will cost billions, it’s years away and probably will proceed whether or not the business case stacks up — and recall the business case could never be made in the past. The only reason it may stack up now is because the price of electricity is so high and likely to remain so.

    But Malcolm Turnbull clearly can’t get enough of the photo opportunities, complete with high-vis vest. There is even a Facebook entry, shouting that the project will create 5000 jobs, enough storage to power 500,000 homes and deliver reliable, affordable energy.

    Unsurprisingly, the project’s cost is not mentioned, nor when it will be finished. The strategy is clearly to rinse and repeat.

    The Turnbull government sat on its hands as 1600 megawatts of capacity — almost a quarter of Victoria’s baseload — was removed essentially overnight.

    The government sets the rules, and central to these rules has been the renewable energy target that is in effect a carbon tax of $80 per megawatt hour — in turn driving low-cost, coal-fired power plants out of business.

    But is the government interested in ditching or pausing the RET? Not on your nelly.

    And if it listens to the rent-seekers in the industry and environmental activists, it will consider implementing the daughter of the RET, the clean energy target. The renewable energy sector will not give up on its drip-feed of subsidies without a huge misinformation campaign.

    Just as we were told the RET would lead to lower wholesale electricity prices — they have more than doubled — we are now told a modified CET (with more renewable energy in the mix) will push wholesale prices down, to as low as $60/MWh. (They are now above $100.) Pigs might fly.

    We know that the higher proportion of renewable energy used to generate electricity, the higher the price of electricity. Having more solar and wind in eastern Australian will raise prices. There are few gains from heterogeneity as a result of more installations because of common weather patterns. The generators, transmission and distribution companies and retailers don’t care. They will argue for a CET because it suits them.

    It’s just a pity for struggling households and businesses. And it will be the end of large energy-intensive industry in this country (relocated to other countries) and its large number of high-paying jobs. There should be no problem achieving our ludicrous Paris emissions reduction commitment because these firms account for almost half the power generated.

    If Turnbull is ready to commit billions to Snowy 2.0, why can’t he commit a few hundred million dollars to spur the construction of some high-efficiency, low-emissions baseload coal-fired stations? They are being built in large numbers overseas. If it’s good enough for them, it should be good enough for us. But no more sequels to bad movies.

  67. Megan

    If Turnbull is ready to commit billions to Snowy 2.0, why can’t he commit a few hundred million dollars to spur the construction of some high-efficiency, low-emissions baseload coal-fired stations?

    Baa Humbug provided the answer to that question upthread.

    I’ve said it before and I’ll say it again, Malcolm Turnbull’s son is heavily into renewable energy businesses

    The Ursurper of Wentworth has excelled himself. He is far and away worse than RGR. He is like so many other morons in business – the old boy’s club gets him one position after another, each better than the last until he actually believes he’s brilliant. Every other soul in the business equipped with actively firing neutrons know he’s an idiot but are forced to work with his impaired decision making and malevolent revenge on anyone who tries to oppose him.
    He has reached the peak – PM and the Everest of Useless.

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