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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Mystery: Australian electricity costs rise six times faster than wages – up another 12%

More bad luck for the renewables industry. Despite providing free energy from the sun and wind, electricity prices keep rising relentlessly, shockingly fast. Even doubling in wholesale costs in South Australia and Victoria.

It was supposed to be cheap to collect low-level-energy across hundreds of thousands of square kilometers. Who knew that subsidized, unreliable energy would induce volatile pricing, allow the players to game the system, create obscene spikes, drive out the cheapest providers, require expensive battery storage, more frequency control, more maintenance, just as much back up supply, $400 million dollars worth of extra diesel generators (and the rest) and extra long transmission lines? Who knew? — Probably thousands of engineers.

Spot the pattern? Every other nation with lots of renewables has expensive electricity and our forward market says there’s more price rises coming.

Australian electricity prices rising six times faster than wages are growing

Sydney Morning Herald

Electricity prices have jumped by six times the rate of the average pay rise, new figures reveal, as family wallets are increasingly squeezed by essential services such as education, utilities and fuel.

The most significant price rises were electricity, up 12.4 per cent, fuel up 10.4 [...]

Who would have thought? Nations with more renewables have more expensive electricity

The Mystery: The most resource rich nation on Earth has the highest electricity prices?!

Ask anyone and get confused: It’s poles and wires, gaming of the system by capitalist pigs, excessive taxes, privatization, and record gas prices. The CleanEnergy Council  tells us that Australia has one of the longest electricity networks in the world — we need lots of poles! And so we do. But once upon a time Australia had the cheapest electricity in the world and we still had lots of poles. Not only were miles of poles and wires, there were also capitalist pigs, excessive taxes, and privatized generators. There were wild gas price spikes too, (during which we probably just burned more coal).

Evidently, something else has changed. Something seismic that wiped out all the bids below $50/MWh. 

Perhaps it has something to do with the 2,106 turbines in 79 wind farms that on random windy days might make 4,325MW that didn’t exist in Australia in 1999 when electricity was cheap and our total national wind power was 2.3 megawatts?

Another clue might be the 1.8 million new solar PV installations, which theoretically generate 7 gigawatts of electricity at noon on cloudless days if all [...]

Peak heat: Electricity prices lifting off; industry shutting off in Australia. Hospitals switching off lights, “Code Yellow Alert”.

UPDATE: MELBOURNE hospitals are enacting emergency procedures to prepare for the potential loss of power. Hospitals are switching off non-essential electrical equipment, including some lights, to minimize energy use. This is a “Code Yellow” alert asking hospitals to check their back up generators are ready.  The Victorian Minister insists this is not about the “threat” of blackouts, but because hospitals need to be “good corporate citizens”. Pull the other one. At the very least, this is about reducing electricity bills.   h/t Chris in Hervey Bay.

See further UPDATES on “The art of blaming coal” at the bottom.

How much fun can you have? The AEMO (Australian Energy Market Operator) projects that as temperatures hit 42C in Victoria, prices are forecast to rise over 100 fold. The AEMO is furiously busy issuing market notices.

The ABC tells us it is 42C, that Portland Alumina has reduced production, but for an ‘undisclosed price’ (why can’t taxpayers know what they are paying this group, not to produce aluminium today?) Meanwhile the AEMO has put the RERT plan into action: “Under the RERT scheme, AEMO has contracted 884 megawatts of “demand side response” across Victoria, NSW and South Australia.” [...]

Summer heat — electricity prices hit cap of $14 per KWhr in SA, almost there in Victoria

Watching the AEMO dashboard as a hot summer day hits

Is this the summer crunch-time that the the National Grid managers have been fearing?

Today things are not running smoothly in the green states of Victoria and SA where prices this minute have hit $14,000 per MW hour, or $14 per KWh. These are wholesale prices. Right now heads of major industries are watching the dashboard, turning off everything they can turn off, or switching on the diesel generators, or counting hundreds of thousands or even millions being added to their bills if production cannot stop.

Demand Management schemes (a form of load shedding) will be running to reduce demand — air conditioners will be remotely switched down.

How much of the productive brain power of Vic and SA is distracted from more useful tasks today?

The AEMO has put out an Actual Lack of Reserve Notice (LOR1) saying that Victoria is 300 MW short: “The contingency capacity reserve required is 1100 MW. The minimum reserve available is 815 MW”. Another notice of a “non-credible contingency event” (a code for “something broke”) reports that a busbar, transformer, and line have tripped or opened in Victoria, unplanned.

Victoria

[...]

In Australia, even some people with jobs are struggling to pay bills and put food on the table

The Foodbank press release: Financial stress pushing millions of Australians into food insecurity

One in six or, 15% of the Australian population, apparently has experienced “uncertainty” around food in the last 12 months. For some, that’s only one episode in a year but still, in a first world country which is a major food exporter, it’s not a sign of wealth and good times. If the survey is to be believed, fully 9% of Australians are experiencing a food shortage every month or even more often. Surprisingly, half of those experiencing food uncertainty have jobs –  working serfs. Foodbank blames it on living costs — like rent and power bills.

A nation in decline: A ten percent increase in people seeking food relief across the nation

One thing is sure “bill shock” is hurting people, and it’s getting worse:

Foodbank provides food for over 652,000 people a month, however, the front-line charities report that demand for food relief has increased by 10% in the last year and they are forced to turn away 65,000 people every month due to lack of food.

How much does renewable energy contribute? Hard to say — all the factors are confounded and [...]

Australian govt may dump renewables subsidies, testing, 1,2,3…

Minister Josh Frydenberg has just implied Australia might drop ongoing endless renewables subsidies (and thus dump the Finkel chief-”scientist” plan). He didn’t say that in so many words, but hinted at it, and will now wait to see how the idea goes down.

Soak in this reasoning — renewables are becoming so cost competitive they don’t need subsidies. He’s calling their bluff.  It’s like the announcement to sack climate scientists because “the science is settled”. Let’s take them at their word and follow that propaganda to its logical end:

The key message from Josh Frydenberg is that subsidies for renewable energy are coming to an end.

There is no Clean Energy Target in sight in Frydenberg’s plan for a new policy by the end of this year. The phrase does not get a single mention in his new speech on the way ahead.

In a key argument, the Energy Minister argues that the cost of building wind and solar power has more than halved in recent years.

He does not rule out more subsidies explicitly, but the clear suggestion is that renewable energy generators are now at a point where they can [...]

High electricity prices in Australia blamed for sharp economic slowdown

Electricity prices jumped in July. Now, retail sales are falling as wallets run out of money. When Greens, Labor, Conservatives said we need insurance, only skeptics pointed out the price.

Commonwealth Bank economist, Gareth Aird, calls the fall a “shocker”.

Shoppers stay away as power costs bite

–Adam Creighton, The Australian

In a sign sluggish wages and higher power prices are starting to bite, the new financial year has seen the biggest fall in retail sales since 2009…

The Australian dollar fell back towards US78c yesterday after the Australian Bureau of Statistics revealed retail sales had fallen 0.6 per cent between July and August, defying economists’ expectations they would rise modestly.

“Households are facing several headwinds, including record low wage growth, record levels of debt, slowing house price growth, and, importantly, sharply higher energy bills,” said ANZ economist Jo Masters. The drop in retail sales by a cumulative 0.8 percentage points over the two months to August, the biggest two-month decline since 2009, comes as consumers receive their first round of power bills after prices went up more than 20 per cent since July.”

Who would have thought? The country is forced [...]

Our electricity crisis is “the cost of virtue signalling”

Let’s get “certainty” — dump the RET.

Chris Kenny in The Weekend Australian puts almost all the pieces together.  This is self-sacrificial, pointless, and the RET is the problem because the subsidies allow renewables to drive out true baseload generation. The so-called hunt for “certainty” is a hunt for high prices because no one will speak the obvious “Dump the Renewable Energy Target”.

Dumping green folly will secure energy future, reboot economy

We are an energy-rich nation. Last year we exported 388 million tonnes of coal (valued at $35 billion) to supply affordable and ­reliable energy to countries such as Japan, China, South Korea and India. Our liquefied natural gas exports are doubling from 30 million tonnes a couple of years ago to almost 80 million tonnes (valued at $42bn) by 2019.

Australia also remains one of the largest exporters of uranium…

While we happily export our energy advantage, we have deliberately sacrificed it at home.

Turnbull — doing exactly the wrong thing after Trump won:

Astonishingly, less than a day after Donald Trump won the US election promising to abandon Paris, Malcolm Turnbull announced Australia’s ratification. The Prime Minister thumbed his [...]

Electricity “Bill Shock” in Australia is so bad it will push up inflation figures

Who knew it would cost a lot to change the climate?

It’s crisis time in Australia. Electricity bills have doubled, and the fallout is just starting to feed through to consumers. Not only does electricity cost more, but so will nearly everything else. Large businesses, economists, and miners are warning that Australians will be paying so much more it will push our inflation figures up.

Major packaging and brick makers, supermarkets, soft-drink bottlers and poultry producers said yesterday the bill shock would chip away further at profit margins and could push up consumer ­prices…

Economists, including Nat­ional Australia Bank chief economist Alan Oster, warned the power bill shock was expected to show up in national inflation figures as early as next month.

He predicted headline inflation would increase 0.6 per cent for the July-to-September quarter, purely from energy price rises.

Paul McArdle from WattClarity makes the point that for most of the last 16 years our electricity prices didn’t even rise with inflation. In this graph, since the start of the NEM (National Electricity Market) in 1998 the spot price of electricity was about $30 per MWh, barring major drought, carbon tax and the [...]

Victoria plans to reduce electricity prices by copying state with most expensive supply in the world

In a genius move, Victoria, which has “soaring” electricity prices, now announces plan to copy South Australia where people pay more for electricity than anywhere:

The Andrews government this morning unveiled a new renewable energy target with a commitment to power up to 25 per cent of the state from renewables by 2020 and 40 per cent by 2025.

The government has backed the construction of two large scale solar farms in regional Victoria which will provide another 140MW to the state’s supply, and has set up a reverse energy auction system to bring forward an additional 650MW to the state’s supply.

Meanwhile the trams will run on sunshine.

Legislation creates savings, how?

Victorian households will allegedly each save around $30 annually on power bills under the new plan, while medium sized businesses have been projected to save up to $2400 a year under the legislation which will be introduced to parliament today.

It’s almost like Victoria plans to make electricity from legislation (hey, it’s renewable, and will never run out). By making electricity shockingly expensive, Government ministers can talk of “savings”, even though prices will be far higher than the average price [...]