The Government’s desperate measures to shore up an electricity system that it says is hunky dory

Energy Minister Angus Taylor has welcomed and claimed credit for wholesale electricity prices halving during the current year.  Unsaid is that the final price has not shifted much – and that’s because all the subsidy-reliant wind and solar create other costs (new transmission, frequency control, lack of “system strength”) which electricity consumers need to cover.  These aside, the pattern is that each major coal plant closure, caused by subsidised renewables depressing wholesale prices, brings a surge in prices and a new plateau which has already taken Australia from the world’s cheapest to among the dearest electricity supply jurisdictions.

Turning a blind eye to this, Minister Taylor declares, “We are winning the trifecta — affordable, reliable and sustainable electricity” with new wind/solar installations equivalent to four new coal generators.  Such boosterism sits oddly with the desperate measures being employed to shore up the system, measures that include a new EnergyAustralia gas plant in NSW supported by a 20 per cent subsidy, another one by Snowy Hydro underwritten by the Commonwealth and rules that prevent generators from closing even when they are losing money.

They also are inconsistent with the Energy Security Board’s (ESB) 2025 Options Paper.  This recognises that, unless we address the cracks that have been created in the drive to replace reliable coal with unreliable wind/solar, a disaster is imminent. Though the ESB fails to acknowledge that renewables need subsidies to compete, it does realise that replacing coal by wind/solar means ever-more subsidies, interventions, directions and creation of markets to allow a stable supply that is automatic in a fossil fuel or nuclear-based supply system.

I address these issues in a piece in The Spectator, which charitably concludes,

“Angus Taylor is imprisoned by subsidy seekers and agenda-driven politicians at home and abroad who misunderstand the economics of electricity.  He likely sees no choice other than to continue existing policies and hope we can muddle through.  Perhaps we will avoid a catastrophic failure of the electricity supply system but this will only be at the expense of far higher costs with damaging implications for households and the competitiveness of agricultural and manufacturing industries.”

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30 Responses to The Government’s desperate measures to shore up an electricity system that it says is hunky dory

  1. RobK says:

    There’s also a rapidly, ever-evolving swag of regulations that desperately struggles to keep up with developments. Often rules are contorted. It’s a big expensive experiment that is moulded in politics not in engineering innovation primarily.

  2. wal1957 says:

    The sooner another 1 or 2 coal fired plants close down the better!
    Then and only then will the reality hit home that unreliables can not reliably supply electricity 24/7, 365 days a year.
    I would love for any politician to tell me face to face that unreliables have lowered my electricity costs. Lying a-oles!

  3. FlyingPigs says:

    Further proof that an education at a University is a guarantee of idiocy?

  4. Russell says:

    Alan, someone really needs to ask Minister Taylor if he has solar panels on his own properties. I bet he has and he really thinks prices are going down because he is getting a fat subsidy for his juice from a serious flaw in the tariff system to fairly distribute network-use charges. Solar prosumers don’t pay appropriate network-use charges that make up nearly half of all non-solar residential consumers bills. This comes about from the accumulation metering and Retailers scaling up actual energy use to recover network-use. Prosumers have reduced accumulated energy and so don’t pay their share of network-use which must be paid by non-solar consumers. But they need the network for exports when the sun is shining to make their “profit”. So poorer consumers pay richer consumers network bills.
    It is very similar to electric vehicles not paying their share of road tax because they do not buy fuel which is used to raise this vital tax. And we know what that has now caused – a tax on EV kilometers.

  5. FlyingPigs says:

    Russell says:
    May 6, 2021 at 11:37 pm

    Solar subsidies are theft.

  6. H B Bear says:

    Sounds like a subsidy/support death spiral as State and Federal governments paper over the cracks of market and engineering reality.

    As soon as excess coal generating capacity on the NEM (in Queensland predominantly) is absorbed it is game over. Slowdown in the Population Ponzi growth rates might have bought them some more time. La Niña too.

    Keep an eye on the summer peak.

  7. H B Bear says:

    Or whatever the cool, wet summer is called.

  8. H B Bear says:

    The Federal government could do with one old, stale white guy still with a dick with a vague understanding of engineering. Angus Taylor ain’t him.

    A couple of blackouts might sharpen people’s thinking.

    Then start praying. A couple of virgins down the nearest volcano might help. Does Australia even have a working volcano today?

  9. 132andBush says:

    Alan,
    Thank you again.
    Batting for common sense is a pretty lonely job.

  10. rugbyskier says:

    Then start praying. A couple of virgins down the nearest volcano might help. Does Australia even have a working volcano today?

    Yes, but it’s a bit of a hike to get to it.

  11. Herodotus says:

    We aren’t going to “muddle through”, we are in a downward spiral which will end badly.
    It’s political and media failure writ large.

  12. Nighthawk the Elder says:

    Remove the subsidies on unreliables. They’ve had 30 years plus now to establish themselves and should be treated as mature technologies. They also no longer need additional support to be accepted by the markets. Their spruikers, including those in governments of all persuasions, have successfully demonised fossil fuel to the extent no one will finance these reliable technologies. They have also managed to see off viable alternatives like nuclear or even hydro. The unrealiables now have preferential treatment in the energy space, so don’t need any financial support from taxpayers.

    Let’s see how wonderful they are then.

  13. alans says:

    what the Feds don’t or won’t understand is that the States divested themselves of the responsibility to generate and distribute base load electricity because it was too much of an electorate liability. When the shit hits the fan, who is going to cop the fall out? Certainly not the renewables carpetbaggers thats for sure.

  14. Texas Jack says:

    Might be time to back David Gillespie for Leader of the Nationals. It seems he’s taking more than a passing interest in your work, Alan.

    Nuclear friends find their voice – The co-chairs of a new bipartisan parliamentary group promoting nuclear industries will try to convince Labor of the economic and scientific benefits of embracing nuclear energy.

    Dr Gillespie is one of the co-chairs.

    Anyone got any idea if Gen-IV or these modular reactors people talk about will get up and running (before we have bird-mincers literally everywhere)??

  15. Figures says:

    Nothing will ever change until the Right realises that it can’t win by persuasion – let alone appeasement.

    The Right should always give every leftist what they want (ie what they say they want).

    Every leftist should have their electricity supply from the grid cut off. Nobody can complain anymore about things like rule of law or constitutions preventing these sort of government actions (we know from the past 14 months that governments can do whatever they like). So make leftists pay.

    Leftists only say they believe what they believe because they get virtue signalling points from doing so. Even Monty and numbers aren’t actually stupid enough to truly believe any of the nonsense they spout.

    So if you make them pay the true costs for every piece of nonsense they spout then they will all shut up and we will never hear a single leftist speak another word ever again.

    As Jesse Kelly puts it – libertarianism is the goal but that’s not the process to get there. The process to get there is anti-communism.

  16. Bushkid says:

    Rant commences:

    I’M SICK AND TIRED OF BEING LIED TO BY THESE BASTARDS – ABOUT EVERYTHING!

    Rant ends.

    That is all.

  17. Beertruk says:

    “We are winning the trifecta — affordable, reliable and sustainable electricity” with new wind/solar installations equivalent to four new coal generators.

    Bushkid says:
    May 7, 2021 at 8:30 am
    Rant commences:

    I’M SICK AND TIRED OF BEING LIED TO BY THESE BASTARDS – ABOUT EVERYTHING!

    Rant ends.

    That is all.

    Amen.

  18. DaveR says:

    The time for “charitable comments” is over. By not telling the whole, accurate, blunt truth, the snake-oil salesmen which includes the deceptive Taylor, continue on their merry way of …….deceiving Australians……. about the true economic structure of their power system.

    This deception is even more dangerous because we require reliable, national power supplies as we enter into the risk of conflict in the South Pacific region.

    Are we only going to be able to defend our country when the sun shines and the wind blows?

  19. Barry says:

    Ahhh Figures,
    they are that stupid. The reason is they never mastered primary school arithmetic.
    They do not even realise that if you have batteries on the grid, just when you have used them you need to recharge them and whatever generation capacity is working is flat out supplying the load.

    It is time to shout it out loud; Wind and solar is far too expensive to be used for 100% 365 days a year. By the time you duplicate the system so that it runs off a number of wind systems you find you have to duplicate the system somewhere between 5 and 12 times to get 100% reliability. The larger the grid physically the smaller the duplication.

  20. DaveR says:

    but this will only be at the expense of far higher costs with damaging implications for households and the competitiveness of agricultural and manufacturing industries

    Say goodbye to the aluminium industry. Will Australia end up importing all of its refined metals and fabricated products – eg like tubular steel?

  21. Spurgeon Monkfish III says:

    Angus Taylor is a worse than useless ignorant incoherent imbecile. Watching and listening to him attempting to explain or justify any of this treasonous stupidity is an exercise in excruciating self harm.

    And yes Bushkid, I’m sick and tired of the bastards lying to us about everything as well.

  22. Craig says:

    Dickhead Taylor is kicking the can down the road. He’ll be long gone and cosying up to his 17.5% superannuation and other gold encrusted junkets he will enjoy once politics is finished. Spineless piece of trash serving the One World Government Agenda 21 policies.

  23. Figures says:

    Ahhh Figures, they are that stupid.

    A definite possibility but that’s ok. We’ll see how far leftists get in spreading their misery when they aren’t allowed any kind of electricity and their food all gets stolen from them by the “refugees” that they are forced to live with.

  24. Russell says:

    If the money being spent on unreliable energy was spent on replacing overhead wires with underground wires, something useful for future generations would actually be delivered. Imagine, every major city in OZ goes underground power wires to:
    1. Remove the ugly eyesore from our streets
    2. Reduce traffic hazards from poles and save real lives
    3. Generate infrastructure work to help revive the economy.

    Energy Minister Taylor is a midget just following the thuggy CC crowd.

  25. Botswana O'Hooligan says:

    The whole scheme is a layer of sugar on a poisoned pill and it’s impossible to stop people from swallowing it for those with solar panels are paying peanuts for electricity. Our electricity bill for our old selection was around $500, on the new selection that came with a 3Kw solar array, it’s $60. Mind you, the new selection is near new and has all the modern malcom turnbull lights, but those malcolm turnbulls don’t shave $440 from the bill, the people without solar arrays and who live in flats or cannot afford solar panels are doing it with subsidies.

  26. Matthew says:

    Ahhh more lies by another ill-informed so called journalist, I bet he has absolutely no idea what subsidies, grants etc are even available to the power industry (both renewable and fossils).
    The simple fact is that renewables are around half the price of coal and gas, and once you add storage still are cheaper, these prices will continue to fall, he also completely ignores factors like fossil fuel plants increasing their prices to compensate for lost income, in most states renewables haven’t yet reached a high enough volume to affect prices, only SA has had a significant change and that’s only been for the past 6-8 months or so (not enough to filter through to the retail), additionally for every $1 cheaper power production is it would only result in around $0.30 reduction in retail price (assuming energy companies don’t just keep the profit).

  27. OldOzzie says:

    China’s Greenhouse Gas Emissions Exceeded the Developed World for the First Time in 2019

    Global greenhouse gas emissions estimates for 2019

    Based on our newly updated preliminary estimates for 2019, global emissions—including emissions of all six Kyoto gases, inclusive of land-use and forests and international bunkers—reached 52 gigatons of CO2-equivalent in 2019, a 11.4% increase over the past decade. China alone contributed over 27% of total global emissions, far exceeding the US—the second highest emitter—which contributed 11% of the global total (Figure 1). For the first time, India edged out the EU-27 for third place, coming in at 6.6% of global emissions.

    China’s emissions exceeded emissions from developed countries

    In 2019, China’s GHG emissions passed the 14 gigaton threshold for the first time, reaching 14,093 million metric tons of CO2 equivalent (MMt CO2e) (Figure 2). This represents a more than tripling of 1990 levels, and a 25% increase over the past decade. As a result, China’s share of the 2019 global emissions total of 52 gigatons rose to 27%.[1]

    In 2019, China’s emissions not only eclipsed that of the US—the world’s second-largest emitter at 11% of the global total—but also, for the first time, surpassed the emissions of all developed countries combined (Figure 2). When added together, GHG emissions from all members of the Organization for Economic Cooperation and Development (OECD), as well as all 27 EU member states, reached 14,057 MMt CO2e in 2019, about 36 MMt CO2e short of China’s total.

  28. Shane says:

    We do have it bad, but in Canada which is our close competitor in Virtue signalling events, their PM Justin Castro has a chance now to really walk his talk by going along with the Michigan Gov who is shutting down an oil pipeline bringing oil into a major Canadian state, Ontario. And there is a general election looming up in Canada in the near future…..what a pity they are going into spring rather than winter.

    Pure Schadenfreude

    https://nationalpost.com/opinion/rex-murphy-hows-trudeau-going-to-get-out-of-this-line-5-pickle

    ”The threat that by May 12, Gov. Whitmer will shut down Line 5 to Ontario, is so beautiful an issue it should be hanging in an art gallery.

    For what have we to look at? We have two leaders, Greener than shamrocks, Prime Minister Justin Trudeau and Gov. Whitmer, who see themselves plucked by the goddess of destiny herself, as human ambulances rushing to save the Earth from global warming. Who colour their dreams with visions of every oil and gas project in the world evaporating, and a flood of solar panels and a wilderness of windmills covering the planet.
    Every solemn word from the mouth of Gov. Whitmer echoes with perfection the rhetoric and environmental concerns of PM Trudeau, and his iron-bound conviction that global warming is the approach of Armageddon. He and she are twins on this topic. You could not place the tiniest film of gold leaf, a single hair, between her deepest urgings on climate change and those of Mr. Trudeau.

    Both hold their convictions on global warming with a fervour truly religious. Hear Gov. Whitmer on why she must shut down Line 5: that the possibility of a spill invokes “the state’s solemn duty to protect the Great Lakes under the public trust doctrine.”
    Enbridge Inc.’s Line 5 is an oil lifeline that affects millions of consumers and businesses on both side of the U.S-Canada border.
    What happens if Enbridge’s Line 5 is shut down?

    However for Trudeau this pipeline is a perplexity. For you see Line 5, is not a pipeline OUT of export-blockaded Alberta, heading to the U.S. and hoping for a better market.

    Line 5 is a pipeline INTO Ontario, and — as Robert Frost was good enough to supply the phrase — that “has made all the difference.” To oppose shutting it down, as he electorally is obliged to do, he must like the windcock on the church steeple, swing around 180 degrees.
    It simply cannot be that on his watch the natural energy needs of the “greatest” province are impaired. He must with the same vigour he applies to stopping oil from getting out of Alberta now man all stations to make sure oil keeps going into Ontario.

    There will be no soothing words about how the manufacturers of Ontario can learn to “transition,” take up coding, or study the construction of windmill arms. Those lullabies are only for oil workers. There will be no talk of a green new deal for Ontario (it has had one already, which in fact was a nightmare).

    There will be no soothing words about how the manufacturers of Ontario can learn to ‘transition’

    To fight for a 68-year-old oil and gas pipeline he must abjure all his rhetoric on global warming, perhaps put Minister McKenna in a state of shock, and even embarrass Joe Biden — killer of Keystone XL.

    Trudeau will have to expose himself to the wrath of the environmentalists, compared to which the Biblical whirlwind is but a summer breeze or the flapping of a single hummingbird’s wings.

    I think it was Isaiah, or maybe it was one of the lesser prophets, who wrote of one of the old kings, words which now describe the PM’s dilemma: “For Lo, he is in a pickle, and Lo again, it is a wondrous great pickle indeed.”

  29. Nob says:

    Why Aren’t Falling Renewables Costs Cutting European Energy Market Prices?

    The answer is that we’re not giving renewables enough free money, apparently.

    Cheaper wind and solar aren’t lowering wholesale prices. New market constructs may be needed to realize their potential.

    It’s a mystery:

    vexing problem for the energy transition in Europe. While renewables’ levelized cost of energy (LCOE) is going down and the proportion of renewables on many grids is growing, the prices in wholesale electricity markets don’t seem to be getting any cheaper.

    We must ignore the real answer because it’s from “the anti-renewables playbook” (aka commonsense consumer advocates, those dastardly devils!):

    A further explanation, familiar from the anti-renewables playbook, is that the variable output of wind and solar plants has to be balanced by the frequent, rapid ramping up and down of fossil-fuel generators, which adds to electricity costs and carbon emissions.

    Read the whole thing and understand , in their own words, the lengths that Wind and Solar Fanatics are going to in order to rob the taxpayers.

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