Is this a dream or just a hallucination?

It seems that someone just said that it is too expensive to go for reliable power. We should aim for cheaper power. Can someone explain this?

Australia should focus on lowering energy costs rather than guaranteeing reliability, Australian Competition & Consumer Commission chairman Rod Sims said yesterday, as he declared high ­energy prices to be the biggest crisis facing the nation.

Mr Sims said Australia should not “overdo” its focus on ensuring the reliability of energy supply, because of the high cost implications.

Does this guy have any idea of the cost of blackouts? Can someone recall the cost of a blackout in an Aluminium smelter in SA? This is the story from Alcoa in Victoria, maybe that is what I was thinking about.

“To have no risk of a blackout is too expensive,” Simms said.

The Alcoa story.

Alcoa said on Friday it will immediately begin work to restart production of the lost capacity, a process that would take around six months, with A$30 million ($23 million) provided by the federal government. Once work is completed, the smelter will be restored to the 85 percent capacity it was operating at prior to December 2016, Alcoa said. The government’s financial aid is dependent on the smelter remaining an operational until at least until 2021 and output remaining at least 90 percent of pre-blackout levels.

This is the Tesla story which comes up on the computer but not on my phone.

Update. Jo Nova on the joy of electric cars and the push for big spending on infrastructure to support them. Only $3Bill what the heck, scarcely more than petty cash in the accounts for the NBN and the NDIS.

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36 Responses to Is this a dream or just a hallucination?

  1. You hit the nail on the head. his bloke simply has NO IDEA!

  2. flyingduk

    I spent $6000 on ensuring my own electricity supply with an autostart, whole house generator. I will not forget this when voting time comes around.

  3. Up The Workers!

    Dim Sims – I’d fry him if I had the power.

  4. pbw

    It’s part and parcel of the mythology of renewables. Renewable energy is FREE! The sun! The waves! The geothermal heat! Therefore, if electricity prices are rising, it’s because those out-dated expensive sources of energy–like coal– are demanding more and more money.

    Obviously, the solution to rising electricity prices is more renewables, faster.

  5. Rob MW

    Can someone explain this?


    An expert in picking straight-jacket locks maybe able to help.

  6. egg_

    A Utility cannot guarantee regular energy supply in an OECD Country?
    We aren’t beholden to the Greens somehow, are we?

  7. This Sims character does not understand economics, technology and costs.
    The cheapest and most reliable power source in the world at present is Nuclear. In Finland a nuclear power station has been running for 30 years and has been variously upgraded ( by removing bottlenecks, running turbines at higher speed etc ) to double the capacity. It has been certified to operate for another 30 years. The South Koreans are now making modular Nuclear power stations and installing 4 in UAE (I think 2 are now running) in a time frame of under three years. In Australia coal fired power stations are the most reliable and cheapest particularly those in Queensland (expect maybe the AGL run stations in NSW and Vic but Liddell can easily be uprated at low cost by someone that has expertise such as South Koreans)
    Sims needs to be sacked.

  8. David Bidstrup

    We had it all once and the idiots have thrown it all away.

  9. Kneel

    Can someone explain this?

    Easy peasy.
    If we go down this path NOW, then any subsequent blackouts will be purely and simply blamed on the plebs not paying the “true cost” of a reliable grid. See? It’s all YOUR fault – you want cheap electricity, we can do that. You want reliable electricity, we can do that. Pick one.
    Of course, we wouldn’t need to pick one if we didn’t have to line the pockets of the “subsidy farmers” (ie, parasites) – if we had continued down the path of using coal here instead of sending it all to China for them to burn, we could easily have both (as we did have).

    So simply, they can see the writing on the wall and are looking around desperately for someone else to blame when the inevitable happens and the grid collapses in a quivering heap. If they can reduce consumer prices and get it into your head that the “cost” is to reliability of supply, then can easily shift the blame.

  10. BM

    Australia should focus on lowering energy costs rather than guaranteeing renewability, Australian Anti-Competition & Anti-Consumer Commission chairman Rod Sims said yesterday, as he declared high ­energy prices to be the biggest politically manufactured crisis facing the nation.

    Mr Sims said Australia should not “overdo” its focus on ensuring the renewbility of energy supply, because of the high cost implications.

    “To have no risk of climate change is too expensive,” he said.

    Fixed it for you, Mr Sims!

  11. Meanwhile, the Greens are touting “Renewable energy generated more electricity than brown coal during Australia’s summer for the first time in 2017-18, according to a new report by Green Energy Markets.”*

    Well yes, that will happen when you close down the brown coal power plants. Renewable energy still produces only a fraction of Australia’s electricity needs.

    *Fail to mention that black coal produces 80%+ of Australia’s electricity.

  12. MPH

    Funnily enough you can have both cheap power and reliability, as we did for quite a few decades. It’s not exactly complex engineering.

  13. duncanm

    Rod Sims is one of the ‘experts’ we’d have running the joint if it was up to Prof. Cat Neuterer.

  14. Dr Faustus

    “To have no risk of a blackout is too expensive,” he said.

    This is quite true and it always has been.

    Back in the very olden days – prior to about 2014 – the coal-fired fleet kept Australia going pretty reliably. In fact very few people even considered the prospect of undersupply at all. Sure there were blackouts, but these were usually fairly local distribution issues – lightning strikes, transformer failures, power line damage, and so on.

    However, there was never ‘no risk‘ of supply failure leading to blackout. Just a ‘very low risk’ that nobody in consumer land ever really noticed.

    That was achieved at a modest cost by investing in sufficient dispatchable generation, made possible by using technology which delivered a high degree of supply reliability.

    It might have been possible to advance this status to ‘nearly no technical risk under any reasonable scenario‘ – but nobody thought it worthwhile spending a couple of billion dollars on another mid-merit station to sit chugging away somewhere in the Hunter Valley, or SE Queensland just to cover the 20 minute startup for the gas turbine peakers.

    Not so with windmills.

    Sims is talking about the risk of a self inflicted wound.

  15. Habib

    Pity we don’t have enough reliable current to operate a local version of Old Sparky, it would be most mirthful irony to fry the litany of window-lickers who have put us in this parlous position with doubly evil power generated by incinerating extra carbony coal.

  16. egg_

    Rod Sims is one of the ‘experts’ we’d have running the joint if it was up to Prof. Cat Neuterer.

    Somehow, the elites would be OK I’d wager.

  17. egg_

    Good ol’ “cheap” unreliable 18th Century tech, eh?
    Who’d’ve thunk it?

  18. Engineer of souls

    It’s fairly simple. Reliable power requires substantial backup. In the case of aluminium it will be a very large unit or two. That costs a lot.
    Queensland once experimented with allowing price rather than reliability to be the priority. Widespread blackouts in summer proved unpopular.
    By the way sa has no aluminium because it’s brver had cheap power.

  19. IRFM

    In the back blocks of Nevada they already practice what Mr Sims preaches. Blackouts for days at a time. They also go one step further. The dialysis machines have no back up power – the reason is that emergency generators have a high carbon foot print. You can’t have better progressive credentials than that.

  20. The BigBlueCat

    I have no concerns regarding renewables per se – my concerns are reliability and cost. Before renewables were the fashion, we had coal-fired power stations that were both reliable and cheap. Now we have a mix, and lo-and-behold our power prices have gone up, and reliability has gone down.

    Renewables should make the cost of power production cheaper assuming the capital cost is on par with more traditional forms of generation (and why wouldn’t they be? Oh, I know, “reasons”.). But I’m thinking that the coal-fired power stations are pretty much fully depreciated, while the renewables are at the start of their depreciation cost (and if reducing balance method rather than straight line is used even more cost is applied in the early stages).

    What I am really concerned about is how the thrust towards renewables here results in money leaving our government and heading overseas because somehow Australia is a bad guy when it comes to CO2 emissions (aka plant food). Australia contributes less than 4% to global emissions, yet our political elite insist we play a leading role in reducing global emissions. I still wonder how we are to do that, even if we were 100% renewables.

    Having been an employee of Alcoa (once upon a time) I do know that energy costs are a major component of the cost of aluminium produced – back in the day it was 25% – must be something like 45-50% now. Aluminium production is a very carbon-intensive industry – the carbon anodes and cathodes used in the Hall process come to mind. But it’s the cost of power and its reliable supply that will determine the fate of aluminium production in this country, and that directly relates to government energy policy.

    It’s fair to think that the freezing of the smelting pots is the result of the failure of government to require reliable power production/supply over their view of saving the planet (something we absolutely cannot do alone, if indeed reducing CO2 emissions actually does that – I have my doubts). Therefore it’s also fair that the government pays a cost of restitution. Aluminium production isn’t a protected species – certainly manufacturing generally isn’t – but in this case it’s right that they pay Alcoa for energy policy failure. I don’t think it’s right to insist upon the rest.

    As to Simms and the ACCC – grow a brain (individually and collectively), please! Reliability AND low cost are the issues, especially if we turn the clock back even 10 years when we had both! He needs to look after the interests of consumers and competitions, not backing the interests of vested parties.

  21. Confused Old Misfit

    It never ceases to amaze me the people like Sims are allowed out unsupervised. I am even more amazed and not a little disappointed to find out that there are people, supposedly sentient adult people, that nod sagely in agreement with him.

  22. Can someone explain this?

    Sure. Audit Sims, Turnbull, their near & dear and all the other carpetbaggers to expose their grab of millions. It’s the money, it was always the money and it will always be the money.

  23. stackja

    Australian Competition and Consumer Commission
    From Wikipedia, the free encyclopedia

    Attorney-General in the Whitlam Labor Government Lionel Murphy solicited the advice and help of the eminent economist and business commentator, Professor Ted Wheelwright. In April 1973 Wheelwright produced a report for Murphy which became the blueprint of the coming legislation.

  24. Squirrel

    “Does this guy have any idea of the cost of blackouts?”

    And not just for industry – we now have a significant proportion of our population (with much more to come) in high-rise dog-boxes which simply couldn’t function without reliable power, particularly in summer when residents would almost literally cook, assuming they could climb the many flights of stairs to their “Manhattan-style apartment with European appliances” and find somewhere to park their cars when the underground parking is inaccessible because there’s no power to open the security grille.

    I assume the renewables crusaders are too young to remember frequent blackouts (in the days before “gold plating” and when strategic cuts to the power supply were a favoured industrial tactic) or too blinded by ideology and, in some cases, rent-seeking opportunities.

    The current talk about prioritising price over reliability is a shameful admission of failure.

  25. egg_

    It’s the money, it was always the money and it will always be the money.

    Get rich whilst appeasing the Greens?
    Seems Flummery has been on a winner for a while now.

  26. Funnily enough, we DID have 24/7 cheap, reliable electricity enough for our needs – but that was before “catastrophic anthropogenic global warming” was invented, and successive governments started fiddling around with carbon taxes, trading schemes, RETs, national electricity grid “managers”, “renewables” subsidies, and a resulting economic climate that prices reliable coal-fired electricity generation out of reach.

    If this intellectual pygmy is head of the ACCC …………

    Frankly, polite words fail me. The nearest description I can get to is unprintable.

  27. Rafe

    BigBlueCat we contribute a bit over 1% of the worlds emissions.
    Not that CO2 aka plantfood matters vis a vis warming.
    There are many levels of insanity in this situation.
    I want to live to 100 and see how it plays out.

  28. egg_

    I want to live to 100 and see how it plays out.

    Odd how at the turn of the Century, Science was touting Chaos Theory and Man’s arrogance in thinking he could affect the planet, to hypothetical man made depletion of the Ozone Layer morphing into Global Climate – much to do with Al Gore, the original Ozone Man:

    In the 1992 campaign against Bill Clinton, George H. W. Bush mocked Gore as “ozone man” and claimed, “This guy is so far out in the environmental extreme we’ll be up to our necks in owls and outta work for every American.

    Gore’s evangelical style has a lot to do with this unfolding disaster.

  29. Dr Fred Lenin

    Power was readily available. Cheap and plentiful before this alleged climate change scam was invented ,the clever theiving fascist bastards invented it to rip the people off , they bought polliemuppets and it was game on . It will die a death like the Great Financial Crisis caused by the same greedy grasping fascists ,and pollie idiots like krud and swan , not one of these criminals has been punished,so the climate scammers feel safe no matter what happens . Make crimes like that High Treason punishable by death and confiscation of All Family Assets .

  30. hzhousewife

    I want to live to 100 and see how it plays out.

    Me too, I find the outside world hilarious these days.
    My father often quoted the saying “all the world is queer save thee and me, and even thee’s a little queer”. Notwithstanding that the use of the word queer is nowadays different, the more things change, the more things stay the same!

  31. Art Vandelay

    Rod Sims was appointed Chairman of the Australian Competition and Consumer Commission in August 2011 for a five year term and reappointed for a further three years in August 2016.

    Don’t forget that Sims was initially a Gillard government appointee but was then reappointed by the stupid f*cking Liberals in 2016.

  32. JB of Sydney/Shanghai

    While our useless politicians pretend to try and save the World with windmills, solar panels and batteries, much of the rest of the World is happily powering along, often with Australian coal and gas, naturally giving not a rats backside to what a nation of 25,000,000 does.

    I often visit the Yangtze River Delta area. It’s centred on Shanghai, (population around 30,000,000, and altogether has about 115,000,000 people.
    Most of the population live in units which are, naturally, air conditioned. , and the whole area has vast amounts of industry. Car sales are three time that of the USA,

    China is by far the largest manufacturer of vehicles in the World. Are they doing that with windmills and batteries?

    Does any rational person think that what Australia does makes any difference whatsoever to the rest of the World?
    We are being conned. Bigtime.

  33. FYA Tesla Model 3 production numbers, calculated weekly based on registered VINs and deliveries, via Bloomberg.

    Tesla Model 3 weekly production

  34. Gerry

    Maybe the young Sims man recognises that the airheads running our electricity markets only think of batteries when they discuss reliability ……maybe it’s his way of getting the conversation back to coal without saying the “c” word ….you see, even saying the “c” word increases CO2 levels ..

  35. Old Irrelevant me

    Does this guy have any idea of the cost of blackouts? Can someone recall the cost of a blackout in an Aluminium smelter in SA? This is the story from Alcoa in Victoria, maybe that is what I was thinking about.
    Maybe this one

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