- JoNova - https://joannenova.com.au -

The planned electricity shortages begin and duped Australians say “thanks”

Once upon a time Australians were rich enough to afford electricity on demand

Now obedient Australian’s are impressed with getting tiny refund for having voluntary mini-kinda-blackout.

Presumably, people are either desperate or already so trained in paying unnecessarily exorbitant electricity bills that they are grateful just to get a tiny fraction of their electricity payments back as an incentive for switching off when it suits those managing our inadequate infrastructure.

Demand response is a sales term for a voluntarily “doing without”. The ABC describes it as a wonderful new market force held back by selfish corporate greed (wouldn’t you know it?). The ABC doesn’t mention that electricity used to cost much less before we artificially forced renewables onto the grid and drove out the cheap reliable baseload generators or make the remaining ones less efficient and more expensive. But who remembers 1995?  Were ABC researchers even born then?

It’s like 50 years of history doesn’t exist:

Electricity prices in Australia

Another graph the ABC won’t show on TV

Behind-the-scenes battle over future of Australia’s energy market

It’s called demand response – it allows customers to save thousands of dollars by switching their appliances to lower electricity use at peak times.

These payments are funded by taxpayers:

LIZ HOBDAY: But Bethany James and Michael Basson are trying to save power and money by taking part in a big experiment that’s part-funded by Australia’s clean energy agency.

Cheers to the Big Experiment. We’re paying for electricity twice, through the meter and through our taxes. We pay when we use it and pay when we don’t use it too.

It’s called demand response.

They’re trying to cut their energy use at times when electricity demand is high – not just reducing their bills, but even getting paid.

MICHAEL BASSON: We’re been offered a $10 discount, or $10 credit on the account, for each time we’ve met our goal.

BETHANY JAMES: I think it’s quite doable, and I think that it’s good for the environment, helps out the grid.

I think it’s a really positive thing to do.

 Obedient serfs rejoice!

How tiny is “tiny”? This small:

LIZ HOBDAY: Last year [Oxford cold storage’s] electricity bills went up by almost $4 million.

But reducing their power use for short periods with demand response has taken about 10 per cent off those bills.

GABOR HILTON: I think it’s fantastic. It helps to stabilise the grid and it also helps the bottom line.

So demand response is portrayed as a smart development, not as what it is — a desperate band-aid measure to compensate for a grid that’s struggling to keep up with a demand that is lower than it was ten years ago. Failing.

Lies by omission

DAN CASS, THE AUSTRALIA INSTITUTE: Few people realise, we pay a lot for electricity during the heatwaves of summer.

Generally, wholesale energy is about $100 a megawatt hour. During summer it, goes up to $14,500 a megawatt hour, and we all pay for that.

Dan Cass doesn’t say that for years  wholesale electricity were only $30 a megawatt hour. And it’s obvious why, renewables indirectly make electricity MORE expensive, wind generation makes gas power $30/MWh pricier,  and solar power at $70 per megawatt hour is still twice the price of brown coal.

And having more spinning reserve meant fewer electricity spikes. More renewables means higher prices, both as an average quarterly cost, and in the spikes.

Bottom line

There’s nothing wrong with efficiency improvements in a free market. But this is an inflated fixed fake market, and there are better cheaper options. This is not about a productivity gain.  Demand response wouldn’t have worked in 1995 because electricity was so cheap people wouldn’t have bothered.

Demand response (voluntary planned lack of electricity) is better than real unplanned blackouts, but it’s a sign of the decline, not a big step forward. It also adds a layer of complexity, reporting, and bureaucratic stranglehold on a market getting further from free market efficiency every day.

As an aside I see that this inadequate, one sided and poorly researched page expires 2,738 years from today.

9.7 out of 10 based on 87 ratings