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 […]

Australia, Denmark, Germany vie to win Highest Global Electricity Cost! (It’s the Nobel Price Prize?)

It’s not even close: If South Australia seceded it would have the highest electricity price of any nation on Earth.

Australian Households pay highest power prices in the World, AFR.

South Australian households are paying the highest prices in the world at 47.13¢ per kilowatt hour, more than Germany, Denmark and Italy which heavily tax energy, after the huge increases on July 1, Carbon + Energy Markets’ MarkIntell data service says.

When the eastern states’ National Electricity Market was formed in the late 1990s, Australia had the lowest retail prices in the world along with the United States and Canada, CME director Bruce Mountain said.

The Markintell report graph:

Hmm — odd coincidence of Price with Wind Energy Penetration:

Wind energy is “free” but countries with the most wind power are also the most likely to get to the top of the Prize Pool for exorbitant electricity. Wind energy penetration is highest in Denmark (1st), Portugul (8th), Ireland (6th), Spain (11th), Germany (3rd). Conversely, renewable energy penetration is low in places at the tail end of the price curve like Luxemburg 6%, Estonia 15%, Hungary 7%, Lithuania 15.5%. In the low mid price […]

No wind or solar powered aluminium smelter anywhere in the world? Could be a message in that.

Matt Howell, the CEO of Tomago Aluminium Smelter, told a few home truths on ABC radio Monday.

To paraphrase in my own words:

1. Aluminium Smelters gobble electrons for breakfast. His smelter uses 10% of the entire electricity supply of the most populous state in Australia (NSW).

2. If power goes out without warning for more than three hours, the smelter pot lines freeze, permanently. The company goes to the wall.

3. The largest battery in the world would keep their smelter going for all of 8 minutes. There is a good reason there are no solar or wind powered aluminium smelters anywhere in the world.

4. The government can ‘t let the market solve anything whilst it is simultaneously destroying the free market by propping up the market failures at the same time.

5. Electricity pricing has suddenly got very ugly. Their electricity bill may now be subject to price spikes where it could cost them $4 million just to keep one pot line running during that spike. It is as if suddenly gas stations only sold $400 per Litre petrol. (Which would be $1800/per gallon). What he doesn’t […]

Australians paying $600 per household to subsidize wind and solar

Australia is a wonderful living experiment for nations worldwide of how a people with more energy resources per capita than anywhere else in the world can sabotage a perfectly good electricity grid in the hope of appeasing the Weather Gods.

At the request of Senator Malcolm Roberts, Alan Moran slices up our “Chief Scientists” report (known as the Finkel Review) and gives us some home truths. Electricity costs have doubled in Australia, Finkel’s plan would take what isn’t working, and do more of it — in the process pretty much destroying one fifth of our manufacturing base, costing us thousands of jobs, and adding almost $588-$768 per household annually to energy bills. Let’s ask Australian voters if they want cheap coal power or if they’d rather spend $600 a year to make the weather unmeasureably nicer in 2100? Why don’t we have a plebescite on that?

In other basic truths Moran points out that while Finkel seems to think new coal fired plants are uneconomic, everyone else is building them around the world. Old plants don’t have to be blown up on their 50th Birthday either. They can be maintained instead, like lots of other perfectly good 50 year old […]

Electricity cost train-wreck arrives in Australia

Something very “seismic” has happened to our electricity prices.

Paul McArdle of WattClarity goes through each state looking at quarterly trends and prices, and remarks that things are going “off the chart”. We had some electricity crises in Australia in the last 12 months, and 2016 was a significantly more expensive than all previous years bar the major drought year of 2007. But ominously, prices haven’t come down in what should be a “normal” quarter. In Tasmania there was a crisis last year when dams ran dry, and the undersea Bass cable broke. But this quarter, prices are only $3.20/MWh lower than the crisis levels of Q2 2016 despite water in dams and a working cable to Victoria. Something has gone seriously wrong with our electrical grid and market. In both Victoria and South Australia prices are higher on average than any previous April-June quarter in the 19 year history of the National Electricity Market. In Queensland and New South Wales, prices are at the “second highest”.

McArdle goes to some length to explain that this is not “one factor”, which seems obvious and fair — Its the combination of the closure of Hazelwood and Port Augusta coal generators; the […]

SA will take top prize for Most Expensive Electricity from Denmark on July 1

South Australia has the largest uranium deposit in the world, which it digs up to sell to other countries to make electricity. It also has lots of sun and wind and empty space. If any state can make solar and wind power work, surely it’s there.

And renewables are working for SA, working to put it in top place for Global Electricity Bills.

South Australia power prices to rise to highest in the world on Saturday, energy expert warns

South Australia will overtake Denmark as having the world’s most expensive electricity when the country’s major energy retailers jack up their prices this Saturday.

AGL, EnergyAustralia and Origin Energy will all increase their electricity prices from July 1, adding hundreds of dollars to annual household bills. Residential customers will see an average rise of 18 per cent under AGL, 19.9 per cent from EnergyAustralia, 16.1 per cent with Origin Energy. Bruce Mountain, the head of a private energy consultancy firm, said the increases would see South Australia take the lead on world power prices — but for all the wrong reasons.

“After taxes, the [typical] household in South Australia will be paying slightly more than […]

Shocking electricity price rises coming in Australia: Not a failure of energy policy but a complete “success”

The numbers are breathtaking. On the east coast of Australia (which means most households in the nation) they are looking at 15 – 20% increases next month on electricity bills which are already at bleeding point.

Get a grip on these numbers:

Charis Chang, News.com —

POWER prices are set to rocket after three major retailers announced increases of up to 20 per cent and $600 a year for the average customer in some states.

Origin, EnergyAustralia and AGL have all announced price increases for electricity and gas starting from July 1.

Small businesses may be the hardest hit, especially Origin customers in South Australia, which will see prices rise by a whopping $1453 a year when increases to gas and electricity bills are combined.

The biggest increase for residential customers will be for AGL customers in ACT, who will pay an extra $579 a year for a combined electricity and gas rise.

In NSW, residential EnergyAustralia customers will see electricity prices increase by up to 19.6 per cent. Origin Energy customers will get a 16.1 per cent rise.

The price hikes will take effect […]

Stupid Nation: Australians crave cheap energy, yet think “low cost” renewables need support

It’s like an Easter Island moment for an advanced economy: somehow “cheap” energy can’t compete in a free market without government subsidy. A Nation of Serfs have forgotten what a free market is. Will cheap desirable stuff sell itself, or not?

The contradictions mount. Electricity and gas prices are hitting escape velocity:

The wholesale electricity spot prices was about $35 a megawatt hour during 2011, rose to $58 after the carbon tax was introduced and is now about $130 as gas prices push up energy generator costs.

Not surprisingly 70% of Australians want cheaper, more reliable electricity. Only one person in four would rather cut emissions than cut the bill. Yet the agitprop telling people that renewables are “cheap” has been so pervasive that fully 38% of Australians think the government should raise the renewable energy target, and 23% think it should stay the same. It follows that around 4 in 10 Australians apparently hold the bizarre idea that wind and solar are cheap and yet in need of government support, as if there are no investors willing to put money into supplying something that 100% of people want at a price cheaper than what they currently pay. […]

Finkel report destroys baseload coal power economics

Demand enough renewables and you might as well ban coal

There’s a lesson Australia needs to learn from South Australia. When intermittent renewables reach a certain percentage of daily average supply they make baseload power unfeasible. The situation develops into an impossible dead end that can only be solved with container-ships of cash.

The intermittent supply of wind and solar is the immoveable problem. It eats into the daily chart of the cheapest stable electricity supply — which is coal fired. Coal can’t be ramped in and out in minutes. It is a creature that runs best non-stop, efficiently, smoothly, at a high capacity factor (meaning it works best when it is producing around 90% of it’s design limit continuously).

Tom Quirk points out that sometime after these intermittent renewables hit 30% of the average daily supply, as they have in South Australia — locally sourced coal power becomes uneconomic. There are times during the daily cycle when renewables are providing almost all the demand. There is little demand left for the massive coal turbines to supply, so they spin on pointlessly, but costs remain, and profits are zero.

In […]

Finkel: Turn the whole country into South Australia by 2030 — 42% “renewable”

In one of the most massaged spin-doctor sales messages in Australian history, the Finkel Report is here to “take the politics out” and solve our energy instability and out-of-control prices. But it’s actually an aggressive green-left weather-control program where cost and stability are secondary to the unspoken but main aim which is to slow storms in 2100. If Finkel were really aiming for stability and price control he’d let the free market run, get the government out of our electricity grid and look at the evidence that shows that solar-panels and wind farms don’t, won’t and can’t work as global air-conditioners for us or our grandchildren.

Australians, read this line and weep:

“Modelling for the Review estimates that by 2030, 42 per cent of electricity demand will be met by renewable generation.”

This is where South Australia is currently at, but it has a lifeline to coal power in Victoria whenever it needs it. What happens when the whole National Grid needs a lifeline? Pull out your wallet…

How much does an undersea cable to New Zealand cost? It’s only 2,000km.

For the same price we might be able to afford a new ultra-supercritical coal plant and catch […]

If SA gets any more free energy everyone will go broke

A funny thing happens when governments put “free energy” into an electricity grid. Wind turbines force down wholesale prices, but everyone’s electricity bill goes up.

Those cheap green electrons look so seductive, but the advertising hides the effect that intermittent, unstable electricity has on the whole system.

Armada Funds Management manages $400m dollars worth of South Australian shops. Look at the price shock these small business managers are dealing with, like $1200 a month, and only one employee:

Power spike hits South Australian shopping centres

The Australian, Jan 18:

Chris Monaghan, Armada’s managing director [said]…costs for purchasing electricity for shopping centres in South Australia had increased by 87 per cent during peak times last year and 101 per cent in off-peak periods. Costs would increase again this year a further 57 per cent at peak periods and 15 per cent off-peak.

The total extra cost to landlords could run into hundreds of thousands of dollars.

Nino Pilaia, who has been running Meats-N-More Carvery & Spuds … His business was among those ­affected by power blackouts last year and ever-increasing energy costs. “For this little place here of about 30sq m, it is […]