JoNova

A science presenter, writer, speaker & former TV host; author of The Skeptic's Handbook (over 200,000 copies distributed & available in 15 languages).


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40 year old coal plant sold for $1m makes $100m profit and will run another 30 years

Old coal plants don’t have to die, they just need to be fixed

Vales Point, Power Station, NSW, Australia

The Vales Point Coal plant (Part B) was built in 1978. It was sold for $1 million in 2015 by the NSW government. It’s now making a bumper profit. If it gets a $750 million renovation it could keep running til 2049 when it will be 70 years old. Vales has a nameplate capacity of 1,320 MW.

On the other hand, we could follow South Australia and spend $650m and get a 150MW solar plant that only works half the time.*

When is an old coal plant on death’s door a better bet than the worlds largest solar plant? — Every hour of every day. Plus you get free fertilizer.

Profits to keep Vales Point coal-fired power station going for another 20 years

John Stensholt and Perry Williams, The Australian

The Vales Point power station near Lake Macquarie, which supplies about 4 per cent of power for the national grid, could receive a $750m injection to ensure it runs until 2049, making it the nation’s last standing coal station, with the country’s other facilities due to [...]

Engineers warn 55% renewables will add $1400 to electricity bills in Australia

Green genius: Pay $1400 a year to not stop any storms

Finally some veteran engineers checked the Labor Party 50% renewable plan and the AEMO “65% scenarios”. Unlike others, their study that did not involve magical assumptions that the cost of renewables would dramatically fall. Instead they used “actual costs” and found the price of electricity will rise “84%” and cheap coal power will be forced out of business (just like what we also found here). The engineers include Barry Murphy, former managing director and chairman of Caltex. Robert Barr, an electrical engineer and academic at University of Wollongong. If only Kevin Rudd had asked them in 2007.

Engineers warn of bill shock under green energy surge

Adam Creighton, Economics Editor, The Australian

Electricity bills will soar and gas and coal-fired power stations will close if the share of wind and solar generation increases dramat­ically, engineers have warned after analysing the nation’s ­energy supply.

It found bills were likely to soar 84 per cent, or about $1400 a year, for the typical household, if wind and solar power supplied 55 per cent of the national electricity market.

A quarter of Australian rooftops have solar, and [...]

Modern Victoria — where 5,000 volunteer knitters help the poor stay warm

Once upon a time we could afford heating.

Volunteer knitters in high demand as soaring power prices leave people cold

A national army of knitters is in desperate need of more volunteers to help them meet the growing demand for winter woollies.

Victoria returns to the Victorian era

Knitters can not keep up with demand

“Some people say it has been a colder winter — I actually don’t think so,” Ms Rogers said. I think it’s been milder than what we’ve had, it’s just the need that’s so much greater unfortunately.

“Even if people have got heating, they can’t afford to run it, so they need the warm clothes or the blankets.”

Can you knit to keep a poor Victorian warm?

UPDATE from Beowulf:

I hear Audrey Zibelman, boss of AEMO, is a dab hand with a set of needles. Here’s her favourite pattern ladies: plain one, pearl one, skip 10, repeat.

It makes a jumper full of holes that must be plugged with other materials, but it saves heaps on the cost of wool and we don’t need to breed any more sheep to make our jumpers. [...]

Dear Australia, would you rather have $8,500 or a 0.0001C cooler climate for your 130th Birthday?

Why Australia must exit the Paris Climate Agreement, The IPA report.

IPA estimates Paris Agreement to stop storms and hold back the tide may cost $8500 per Australian family

What a deal. You could have free electricity for the next four years or an imperceptible difference in the air outside the nursing home for your children’s 94th birthday.

The Americans went for the money. So did nearly everyone else.

Damian Wild at the IPA calculates that the Paris Agreement will cost patsy Australians $52 billion dollars in the next 12 years.

Paris deal spells ‘irreparable damage’: IPA report

Rachel Baxendale, The Australian

A study by the Institute of Public ­Affairs, “Why Australia must exit the Paris Climate Agreement”, estimates our Paris target of reducing emissions to 26-28 per cent on 2005 levels by 2030 will impose a $52 billion economic cost between now and 2030, equating to $8566 a family.

Paris Agreement To Cost Australia $52 Billion

“The immutable law of energy policy is this: lower emissions mean higher prices.”

“Each family in Australia will be at least $8,566 worse off under the Paris Climate Agreement, on average. This is at [...]

Let’s close coal plants so AGL can triple its profits

Last year AGL made $539 million net profit. This year, $1,600 million. What’s not to like about closing Hazelwood?

Profit statements confirm what we’ve said — closing cheap coal boosts profits for generators. No wonder AGL won’t sell Liddell for a hundred million dollars. It also shows us that the big “bubble” in electricity prices is from the doubling of wholesale electricity costs. These corporates are reaping it in far above costs. The way to cut wholesale prices is to get rid of the RET, and fix our old coal.

[ABC] Its underlying profit, which excludes one-off items and changes in value in investments and hedging positions, rose 28 per cent to $1.02 billion, at the upper end of the company’s guidance.

Even Andy Vesey admits the coal closures helped AGL:

“This increase in prices in the broader electricity market has mostly been a result of the abrupt closure of non-AGL power stations such as Hazelwood in 2017 and Northern in 2016 and higher input costs from coal and gas,” AGL chief executive Andy Vesey said.

But watch the pea. Who is trying to blame high profits on higher input costs?

Then he tosses [...]

Windpower set to destroy Victorian baseload power just as it did in South Australia

Crash Test Dummy Update: Data analysis thanks to Tom Quirk

In the South Australian experiment total wind power capacity is now far above the average state demand most hours of the day. This effectively destroys any economic case for cheap baseload power (I hear that was the aim). This fleet of unreliable generators is being supported by forced subsidies through power bills from all around Australia. Sadly, despite this rain of money falling in SA, those funds end up with renewable investors, not South Australian consumers who pay some of the highest rates in the world.

These legislated subsidies have fed so much wind power that sometimes the state produces more power than it can use. That excess power will be exported, but may or may not be actually useful at whatever time it happens. Unless it happens at peak-time, it will be eating into the efficiency of baseload providers in other states.  Like an infection, inefficiency and underutilization of infrastructure spreads…

This volatility appears to make freak wholesale price spikes more likely. Quirk calculates that one hot January day last year was so wildly expensive in South Australia it added $2/MWh to the entire years average wholesale cost. Can’t [...]

The Crash Test Dummy speeds up: our Renewable Target is 16% and rising, so are our electricity prices

The Renewables Lobby subsidy and handouts are still growing. In 2018, Australia must get 16% of all our electricity from “renewables”, up from 14.2% last year.

That’s 28,000 Gigawatt hours of magical green electrons from generators that give us nice weather as opposed to generators that cause droughts, floods, cyclones and spread crocodiles, dengue fever, cause wars and change butterflies.

Welcome to modern Australia where our grid is designed by witchcraft, run by superstition, and panders to every whim of the Giant Renewables Industry Lobby.

The noose tightens in Australia.

Renewables must supply 16% of our electricity in 2018, and even more in 2019.

Source: 2001-2030 Annual Targets and renewable power percentages, Clean Energy Regulator.

Prices are rising too: Could there be a connection here?

Even the ABC now says “Something has gone terribly wrong with our electricity prices”. Prices went off the ranch from 2007, rising much faster than the CPI. This is also the point Australia started ramping up the intermittent renewables. Before that the Snowy Hydro Scheme –the only reliable and cost effective form of renewable power — had been operating for decades. Correlation is [...]

Hydro storage is an anti-generator that destroys 20-30% of the electricity fed into it

We’re planning to spend $5,000 million on something to smooth out the bumps from unreliable generators. It is entirely unnecessary in a system where coal supplies the baseload and we have not created artificial rules forcing people to use green electrons in preference over stable and predictable ones. Most estimates of costs from wind and solar ignore the hidden costs — the destructive effect on the whole grid.

Wikipedia on Pumped Storage Hydroelectricity:

“the round-trip energy efficiency of PSH varies between 70%–80%,[4][5][6][7] with some sources claiming up to 87%.[8]

h/t Peter Rees, Michael Crawford, Ian Waters.

Even after Snowy Hydro 2.0, power will cost $90/MWh

Joe Kelly, The Australian last week:

Energy project financier David Carland — the executive director of Australian Resources Development Limited — argues that once the Snowy Hydro project is operating it will provide only partial back-up energy at a high cost.

Using Snowy Hydro’s modelling assumptions, Dr Carland’s calculations show the “levelised cost of energy” — or unit-cost of electricity over the lifetime of an asset — will deliver power significantly in excess of $90/MWh, after allowing for the cost of storage, cycle losses and the initial cost of buying energy at off-peak [...]

Energy Crisis: NSW can’t keep coal plants, or aluminium smelters running, prices hit $14,000MW/hr

It’s not even summer.

NSW has been hit by clouds and a lack of reliable coal power. Prices are soaring.  In NSW the Tomago Aluminium Smelter consumes about 10% of the state’s electricity. It has been forced to switch off three times in the last week because there was not enough reserve power on the grid.

The boss of Tomago, Mr Howell, said Australia is “at a crisis point with our energy system”. 

“This is not summer with extreme demand. This is the likely future of our energy grid as once reliable baseload generators exit the [NEM] and are mostly replaced with intermittent wind and solar projects with no practical storage to speak of,” Mr Howell said. “Our energy debate should not advocate either renewables or conventional thermal,” he said.

– SMH, Peter Hannam,

Aluminum pot lines can only sit idle for a few hours before they cool too far and the damage becomes permanent and wildly expensive as the aluminum becomes solid.

Renewables-fans blame the emergency on the unreliability of coal

See @TheAustraliaInstitute. Suddenly Australia is the only western nation on Earth with coal resources that can’t [...]

Gamechanger: Chinese Crypto Miners can get 8c cheap electricity in Australia using our coal power

Wow. Wait til word gets out. This is dynamite.

Chinese Bitcoin miners are reopening the Hunter Valley coal power station called Redbank in NSW. They have a deal that gets around our gargantuan, mismanaged grid by buying coal power direct for 8c/kWh, while Australians in the same place pay 28c/kWh.

This is exactly the nightmare the head of the Australian Energy Management Organisation (AEMO) spoke of just last week — that “big players could abandon the grid”. That’s a degenerate spiral leaving a shrinking pool of suckers to pay for the inefficient, bird-killing, blackout prone, witchdoctor grid.

Bitcoin mining’s growing demand for cheap energy revived a shuttered coal mine

Ashat Rathi, Quartz

Consumers there pay, on average, $A0.28 ($0.22) per kilowatt-hour (kWh) for electricity. But Hunter Energy, which owns Redbank, are offering the crypto miners electricity at a fraction of the cost. The “first-of-its-kind” deal, as the Age puts it, will see the crypto miners pay only A$0.08 per kWh in the day and A$0.05 per kWh at night. Hunter Energy told the Age that the price is feasible because the electricity produced at the coal power plant would go straight to the crypto miners, bypassing—and thus, presumably, [...]

Hidden Costs: how wind generation makes gas power $30/MWh more expensive

Just another hidden cost — intermittent generators are vandals on our baseload suppliers. Wind power needs gas, but gas doesn’t need the wind. When the two are paired together it makes the wind energy “reliable” but adds nearly $30/MWh to the cost of the energy from gas. Right now that cost will be added to the gas plant, but in a free market, it should be paid by the wind farm investors.

Stacy and Taylor compared the cost of running a Closed Cycle Gas plant (CC Gas) on its own or combined with a wind farm. The combination produces reliable electricity “on demand” and uses less gas to do it. The sole benefits to this odd industrial couple are a smaller gas bill and lower emissions of a fertilizing gas (CO2). All the capital and labor costs of running a gas plant are the same, but now it sits idle more often, pointlessly waiting like a spare wheel til the wind slows and gas power is needed again. About the only thing we can predict about the wind farm is that it can be relied on for almost nothing, so the gas plant must be almost as large whether or [...]

Love those 30 year old coal and nuclear plants — nothing gives cheaper electricity

The gold-plated stars of our national grid are the old coal plants we’ve built and paid off.

A US report (thanks Lance) shows how fantastically cheap and bountiful old coal and nuclear plants are. The LCOE or the Levelized Cost of Electricity includes the costs of the concrete, turbines, car parks and coal, plus the maintenance and salaries. It reveals that thirty year old, and even fifty year old coal plants, are the gift from past generations — enormous infrastructure, built and paid for, and ready to churn out bargain electrons. Or in crazy-land, ready to be blown up.

Look how long it takes to pay off the capital cost of building them (the red sector in the graph), and look how wonderfully cheap that electricity is from a 30 year old plant. Watch the pea. All those “investigative news stories” that compare the cost of building new coal to the cost of solar or wind are hiding the most brilliant and essential assets on our grid. Reopen Hazelwood now. (!)

Both sides of politics are choosing to destroy the family jewels in the hope of controlling global weather.

….

From the report by Stacy and Taylor, of the [...]

Surprise: Australia closed a cheap coal generator and electricity got 85% more expensive

Last year one of our largest coal power plants suddenly closed, with only five months warning, catching the market by surprise and taking out 5% of our cheapest generation. (This kind of improbable anti-free-market feat shows just how screwed our national market is). The Australian Energy Regulator (AER) has looked at the effect the closure of Hazelwood had on electricity prices and concluded that closing cheap brown-coal plants and replacing them with black coal and gas will make electricity prices rise. This will come as no surprise to anyone who can count to 100.

Dan Harrison at the ABC reports:

A year on from the closure of the 1600 megawatt-sized plant in the Latrobe Valley, the report from the Australian Energy Regulator found wholesale prices in Victoria were up 85 per cent on 2016.

Because electricity retailers use hedging for wholesale prices, the rise in retail prices is still feeding through. In the wash, the wholesale increase is expected to add 16% to retail prices this financial year compared to last year. After that, through some miracle, the AEMC expects prices to come back down from Exorbitant to Slightly Lower Than Exorbitant in the next two years thanks to an [...]

Electricity prices fell for forty years in Australia, then renewables came…

Electricity prices declined for forty years. Obviously that had to stop.

Here’s is the last 65 years of Australian electricity prices — indexed and adjusted for inflation. During the coal boom, Australian electricity prices declined decade after decade.  As renewables and national energy bureaucracies grew, so did the price of electricity. Must be a coincidence…

Today all the hard-won masterful efficiency gains of the fifties, sixties and seventies have effectively been reversed in full.

Indexed Real Consumer Electricity Prices, Australia, 1955-2017.

For most of the 20th Century the Australian grid was hotch potch of separate state grids and mini grids. (South Australia was only connected in 1990). In 1998 the NEM (National Energy Market) began, a feat that finally made bad management possible on a large scale. Though after decades of efficiency gains, Australians would have to wait years to see new higher “world leading” prices. For the first years of the NEM prices stayed around $30/MWh.

But sooner or later  a national system is a sitting duck for one small mind to come along and truly muck things up.

Please spread this graph far and wide.

Thanks to a Dr Michael Crawford who did the original, [...]

How much do we have to pay people to NOT use electricity – up to 30 times more?

To understand the real value of electricity, consider the price at which people will give it up. “Demand Response” is the nice euphemism for a voluntary blackout. At what point do people volunteer to go without? For most of the market, apparently, it’s more than $7500/MWh.

If I read this graph correctly, look how fast the prices rise, and how small the response is. For example, in South Australia there is only about 10MW available at less than $300/MWh? (From this AEMO report). For reference the total SA demand is around 1500MW. So 10MW is less than 1%.

(See below for the

Consider how few people are willing to turn the electricity off:

AEMO expects there to be approximately 50 MW of demand response in NSW when the price reaches $1,000/MWh.

The total size of the NSW state market is about 10,000MW. Retail electricity sells for $250 — $470MWh (and only $100/MWh in the US). Hence when the price hits two to four times the normal retail cost of electricity, only about 5% of the market say they will willingly stop using it. When the price hits $7500MWh another 2% will give it up. We can’t take [...]