Posted in electricity

Grattan Institute urges compensation for higher power bills caused by energy grid ‘gold plating’

Consumers must be compensated for higher bills caused by the excessive “gold-plating” of electricity networks and the value of energy assets should be written down, according to a report out today.

The Grattan Institute blames “poor decisions” by governments in New South Wales, Queensland and Tasmania for driving unnecessary investment in power networks, which has ultimately left consumers footing the bill.

In the Down to The Wire report, the Grattan Institute estimates consumers in those three states are being slugged between $100 and $400 more a year as investment outstripped population growth and demand.

“Consumers connected to the National Electricity Market are paying for a power grid that grew from around $50 billion in 2005 to $90 billion today,” the report said.

“The expenditure significantly outstripped growth in population, demand and even peak demand.

“There have been some improvement in reliability of supply but not enough to justify the expenditure involved.

Grattan report says consumers are footing the bill for unnecessary investment in power networks.

“Taking our recommended approach would rectify mistakes of the past and ensure a more efficient grid in the future.”

The report recommended that state governments should fix the problem and that where energy businesses are still public, their assets should be written down.

In the case of NSW with the sale of Ausgrid, the report said the State Government should provide a rebate “to compensate consumers for historic over-investment”.

The over-investment in energy infrastructure — or “poles and wires” — comes as the Federal Government pressures the energy industry to deliver relief to consumers and businesses reeling from surging energy prices.

State governments have pumped billions of dollars into electricity infrastructure to ensure reliability amid growing industry concerns that an “energy catastrophe” might force energy intensive businesses offshore.

The report warned that the over-investment in current energy technology might see some infrastructure becoming irrelevant for future needs.

“Some assets built for a previous era will become further under-utilised or ‘stranded’. Assets being planned today could suffer the same fate,” the report said.

Energy consumer groups, economists such as Ross Garnaut and Australian Competition and Consumer Commission chairman Rod Sims have previously pointed the finger at the “gold-plating” and over-investment in the power grid for contributing to surging prices.

Originally Published by ABC News, continue reading here.

Steven Marshall welcomes Elon Musk and wants to cut energy costs

Incoming South Australian Premier Steven Marshall says cutting energy costs to business and households is a major priority for his new government, with a $200 million inter-connector fund a centrepiece of his plans to deliver cheaper power.

Mr Marshall is also getting on the front foot with a proposal for a $100 million household storage battery fund, which would provide means-tested grants of around $2500 to households with solar panels that want to install home storage batteries. It would cover about 40,000 households. Getting the fund up and running is among the projects earmarked for the first 100 days of Mr Marshall’s government.

The Liberal Party aims to fast-track an interconnector between South Australia and the rest of the National Electricity Market, with the $200 million inter-connection fund designed to speed up the process of making a final decision.

The state’s transmission network provider Electranet has been working for months on different options for interconnectors. Gas explorers will be quarantined from prime farming land in the state’s south-east near the Victoria border, with Mr Marshall intending to put in place a 10-year moratorium on fracking in that region.

He said on Sunday that he would welcome further investment by big renewable energy players such as Elon Musk and Sanjeev Gupta into the state, but the most pressing goal for his Liberal government is to cut the cost of energy bills for businesses and households.

Mr Marshall said the door is open for anyone who wants to make further investments in South Australia as he seeks to re-invigorate the South Australian economy.

Asked about his approach with Mr Musk’s Tesla and Mr Gupta, the British billionaire whose SIMEC-Zen Energy is preparing to build an even larger storage battery in the state than the Tesla battery, which formed part of Jay Weatherill’s $550 million energy fix-it plan last year, Mr Marshall, said the state was open for business.

“We’ll be welcoming all people who want to invest in South Australia,” he said on Sunday.

The Liberal Party isn’t in favour of the state-owned $376 million fast-start turbines built by APR Energy late in 2017, which were also part of the Weatherill government’s energy fix-it plans, but it is unclear how that might be unravelled.

Mr Weatherill in February announced a proposed $800 million virtual power plant connecting 50,000 households over four years where they would be provided with free solar batteries and Tesla Powerall 2 batteries, but that project is dependent on finding sufficient outside investors.

Federal Energy Minister Josh Frydenberg said on Sunday the election of Mr Marshall would bring more common sense to energy policy in the state.

“South Australians have voted for a return to sensible energy policy and a more affordable, reliable energy system,” Mr Frydenberg said.

Mr Frydenberg has been a fierce critic of the aggressive pursuit of renewable energy in the state and accused Mr Weatherill last month of being like a gambler doubling down to chase his losses, after Mr Weatherill lifted the state’s renewable energy target to 75 per cent by 2025. Mr Frydenberg said it was at the expense of reliability and keeping energy prices down.

Originally Published by the Australian Financial Review, continue reading here.

In Australian first, two schools powered solely by green energy.

Two schools’ classrooms in NSW will be powered solely by renewable energy, taking them off the grid and teaching students about sustainability.

The Australian Renewable Energy Agency (ARENA) and federal government are providing $370,000 in funding to St Christopher’s Catholic Primary School in Holsworthy and Dapto High School to trial a 100 per cent renewable power and smart technology program in their new classrooms.

Known as the Hivve, the modular classrooms – which are fully air-conditioned – integrate solar photovoltaic panels and real-time energy and air quality monitoring to generate energy and control their own usage.

These classrooms will have a potential net energy generation of 7,600-kilowatts per year. Photo: Janie Barrett

According to ARENA, these classrooms will have a potential net energy generation of 7600-kilowatts per year,  producing enough to also power other classrooms.

The data from the classrooms, which will be collected from a range of meters and sensors installed in the rooms, allows the school to manage their own energy demand and usage via dashboards.

St Christopher’s Principal Tony Boyd said the school and the students are excited about the program.

“It’s an exciting prospect where schools can be a generator of electricity,” Mr Boyd told Fairfax Media.

“We hope it’s self-sustaining in its power usage and an effective learning space, more so, we hope to use it to tie-in with the kid’s science education and learning about sustainability.”

Published by The Sydney Morning Herald, continue reading here.

Is It Time We Upgrade Our Energy Network?

Australia is an exciting place to be right now – changes that previously took 25 years to happen are now happening in five years, and with a customer-led shift in the utility sector to a market in terms with transition.

In response, we must find ways to coordinate all the complexity in the market. On the generation side and on the low side, the grids are the glue behind it all. We need grid extension, transitional lines for power transfer, and examples of reinforcement of our distribution grids with a lot of the centralised generations embedded.

Increased efficiency in our conventional and renewable power plants will be another advantage, as the near future will see the accommodation of wind and photovoltaics, and energy storage.

Additionally, the role of utilities is transforming from a service to a solution company.  As utilities respond to market forces, they will increasingly need to be more agile and move from a poles-and-wires company to a service and solutions company.

Significantly, we’re also seeing digitalisation impact the market through Distributed Energy Systems (DES), a technology made up of distributed networks, embedded distribution, embedded generation, virtual power plants, microgrids, and smart metering.

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So how will we address these innovations via energy storage? The answer is that customers are now taking ownership of supply and demand. There is disruption to power generation and energy networks requiring innovation, and data- particularly data analytics will play an important role.

Ideally the government will facilitate this transformation through flexible regulation and government support, at both the state and national levels in Australia.

But Australia isn’t alone in this. A successful case study is Germany, which has been going through this change in the last 10 years: Energiewende is a new German word to describe the change in the energy landscape.

Like Australia, its energy is produced primarily in the north of the country while its solar energy is produced primarily in the south; and similarly, penetration used to be orientated towards consumption centres but today, nuclear energy is going offline step-by-step.

Consequently, there’s a rapid transition from coal to renewables. This is partly in response to the Paris climate agreement struck earlier this year and signed by 180 countries, with most states in Australia agreeing to reduce carbon emissions by 2020-2025.  It is also due to the declining global and local costs of generating electricity via wind and solar, also known as ‘grid parity or the ‘levelised cost of energy.’

The utilities are alarmed but not concerned as they begin modifying their business models to cater for the shift towards the new energy paradigm.  Consumers have also started this journey to embrace the change, with some customers even producing energy themselves and transferring excess energy to the grid.

So what will our future look like? We have come from a system with central power stations and integrated grids, and now we’re moving towards a more decentralised power generation dominated by shorter life cycles and disrupted change.

The energy industry is undergoing the same digital evolution as the telecommunications industry 10 years ago. Digitalisation is real, and it’s here and will support our transition to a sustainable energy future.

Read more.

Rushing to renewable energy targets puts sector’s reputation at risk

The last time an entire state blacked out was on the night the Beatles arrived in Sydney in 1964. So what happened in South Australia last week was rare and the repercussions could be vast.

The key question is whether that state’s heavy reliance on wind turbines might have increased the risk of a state-wide blackout. More broadly, the event will supercharge concerns over how renewable energy is being integrated into a national grid that was not designed to cope with it.

Wind presents two problems. First, it is intermittent, so all of it has to be backed up by baseload power for those days when the wind does not blow.

The second is a diabolically tricky engineering problem. For an electricity network to function, demand and supply have to be kept in the perfect harmony of 50 hertz every second of every day. If the frequency gets out of tune, the system identifies a fault that could destroy it and that trips the shutdown switch.

This electrical harmony is called synchronous supply, and thermal power is very good at delivering it to the grid.

Just under half of South Australia's energy is generated by wind and solar.

Just under half of South Australia’s energy is generated by wind and solar.

Premier Jay Weatherill said the primary cause of the state-wide outage was the storm’s destruction of transmission towers and that the National Electricity Market “did what it was supposed to do” — tripped the off switch to protect itself.

But what that switch was doing was protecting the east coast from the fluctuations of power in the west, it was not protecting South Australia.

Once the door to the east was shut, South Australia fell back on its own power supply, which, this report suggests, might by then have had a wildly fluctuating power supply and insufficient synchronous generation to keep it in check. That could explain why, region-by-region, the entire network shut itself down until the state went to black.

It might not be what happened but the report suggests this could have been the cause.

It is important to note that the Australian Energy Market Operator says the damage to the system was so catastrophic that it would have shut down no matter what the energy mix was in South Australia last week.

“Initial investigations have identified the root cause of the event is likely to be the multiple loss of 275 kilovolt (kV) power lines during severe storm activity in the state,” it said in a statement.

“These transmission lines form part of the backbone of South Australia’s power system and support supply and generation north of Adelaide,”.

But the statement adds: “The reason why a cascading failure of the remainder of the South Australia network occurred is still to be identified and is subject to further investigation.”

And that is the crucial question.

What is not in doubt is the next problem, rebooting the system. And that cannot be done with asynchronous power. To get the system online again, the energy market operator ordered the gas-fired power generator at Pelican Point to fire up, and then set about restarting the system bit by bit.

The blackout of an entire state is a major crisis. Politicians should know that you should never waste one. Renewables are the future but, today, they present serious engineering problems. To deny that is to deny the science.

Those problems can be sorted in time, but rushing to a target to parade green credentials exposes the electricity network to a serious security risk and, in the long run, risks permanent reputational damage to the renewable energy cause.

The grid is being transformed, and that transformation needs to be managed sensibly, or the entire nation might go to black.

Read more.