Australian Coal Power Will Be Quickly Killed By Low Cost Renewables

Coal being pushed out by wind and solar power

Low Cost Renewables Will Soon Drive Coal Power Out Of The Market

Last month the entire country sweltered under an oppressive heatwave — except the half known as Western Australia.  As air conditioner power consumption soared on the 25th, 40% of Victoria’s coal generators failed followed by rolling blackouts. When faced with this incontrovertible evidence of coal’s unreliability, the government dedicated itself to the rapid phaseout of coal under its “affordable, reliable 24/7 power” program.

Sorry, only kidding.  What they actually did was offer to pay the debts of new coal power stations that go bust.

While the Coalition is content to fiddle while the world burns, the good news is the days of coal generation are numbered.  Despite what many politicians seem to believe1, the work of countless dedicated people around the world shows the cost of new renewable energy generation is less than the cost of new coal generation.  This includes enough storage or dispatchable2 generation to meet demand more reliably than coal.  When an old coal power station is shut down it won’t be replaced with new coal generation simply because the alternatives are cheaper.

This is wonderful because it means most of the world’s remaining coal deposits will be left in the ground. But existing coal power stations will live on, spewing greenhouse gases and damaging health, for as long as it’s profitable.  To drive them out of business, electricity from new renewables will have to be cheaper than electricity from old coal.   

Thankfully this has already happened.  Rooftop solar, by directly reducing consumers’ reliance on grid electricity, out-competes coal power.  It was a contributing factor in Alinta Energy making the business decision to shut down South Australia’s last coal-guzzler, the Northern Power Station

To rapidly push the nation’s remaining coal stations out of the market, large scale solar and wind farms must produce electricity at a lower cost than coal.  When this might happen? Well, according to my estimates large scale renewables are on the cusp of being cheaper than black coal generators right now. 

This won’t make Australia’s coal generators disappear overnight. It will take time to build the required renewable capacity and ensure there’s enough available dispatchable power to meet demand.  But it does look like coal power will be driven out of Australia far sooner than most expect.  

Coal Is A Free Rider

The only reason new renewables aren’t already cheaper than coal power is because coal free rides by not paying for its health or environmental costs.  I hope that soon, Australia’s leaders — or some new leaders who aren’t quite as thick — will make coal pay for at least some of the harm it causes.  

New Coal Power Is Not Competitive

Coal power stations are expensive to build.  They are huge piles of steel and concrete.  And not just random piles but very carefully arranged piles.  Sure, there’s more room for error than when building nuclear piles, but they’re still not something that can be slapped together by amateurs.  Only the decision on whether they should pay for the harm they cause is left up to amateurs.

Australia’s last coal power station came online 11 years ago.  Since then the cost of building new coal power stations has only increased.  Part of this is because expertise in building modern supercritical3 coal plants comes from overseas, with China having the most skill in this area.  But mostly it’s because financiers no longer see coal power as a reliable investment.  Instead they see it as a venture with a high risk of forced closure before it’s even paid off thanks to:

  • health concerns
  • environmental concerns
  • the rapidly falling cost of renewable energy. 

Because of the risk they demand a high interest rate, which means it is now cheaper to finance solar power and wind projects than coal.

Wholesale Electricity Prices Are Up

Generators get paid the wholesale cost of electricity.  This doesn’t include the costs of long distance transmission, local distribution, or retailing and so is a lot less than what you’re charged on electricity bills.  It has trended upwards over the past few years as the cluttered looking graph below shows:

Average wholesale electricity prices

The graph shows the average wholesale electricity price for National Electricity Market (NEM) states. I’m afraid Western Australia and the Northern Territory apparently aren’t part of the nation.

There are two big reasons why wholesale electricity prices are up:

  • The price of natural gas in the Eastern states has almost tripled over the past few years thanks to natural gas exports pushing its price towards international levels.  While gas only provides 6.5% of our electricity use,4 because it often sets wholesale prices it has an out sized effect on them.
  • Australia’s oversupply of generating capacity has ended thanks to the closure of 13 coal power stations since 2012, which has removed 6,501 megawatts of capacity.

Of the 13 coal power station closures 11 were in the NEM and totaled 6,021 megawatts.  The table below, kindly provided by Simon Holmes a (hovering dash) Court, shows the closures, including two in Western Australia:

Coal power station closures in Australia

The shutdowns have cut coal generating capacity in the NEM by 21%.5  For Australia as a whole it has declined by 22%.  At this rate in 27 years there will be no coal capacity left.  Fortunately, as the cost of renewable electricity falls, the rate of coal closures will increase.

The Cost Of Coal Power Is Increasing

While coal power station closures and the high price of natural gas has increased the average wholesale price of electricity, I have noticed that even when demand is low and coal power is setting the price, it has been higher that I’d expect. This makes me think the cost of generating electricity from coal has increased. 

An obvious explanation for this would be that as Australian coal power stations age it costs more to maintain them and keep them operating.  It’s also possible that as long term, low-price contracts came to an end some coal power stations have been forced to pay more for coal, making them less willing to underbid the competition.

One thing that did increase the cost of coal generation in Victoria was the state government raising mining royalties to levels similar to other states.  This increased the cost of their brown coal generation by around 0.2 cents per kilowatt-hour. 

Estimating The Per Kilowatt-Hour Cost Of Coal Generation

Fortunately, it’s not too difficult to roughly estimate the cost of generating electricity from coal.  I’m only going to consider the cost for power stations using black coal for two reasons:

  1.  Black coal power stations are 79% of the NEM’s coal capacity and provide 76% of electricity generated from coal in the NEM.
  2. Victoria’s brown coal power stations have a low cost of generation because brown coal is dirt cheap and that’s just depressing.

Rather than start with one of Australia’s old, clapped out6 black coal power stations, I will begin with the newest and most advanced coal generator in the NEM — the 750 megawatt Kogan Creek Power Station in Queensland.

Kogan Creek Power Station

The newest coal generator in Australia is the 416 megawatt Bluewaters Power Station in Western Australia, which came online in 2009.  But the Kogan Creek Power Station built two years earlier is a more advanced and efficient design.  It has the following characteristics:

  • It began operation in 2007
  • Its original cost was $1.2 billion, which comes to $1.58 billion in today’s money.
  • In today’s money its cost per kilowatt of capacity was $2,110
  • Its efficiency at turning thermal energy from burning coal into electrical energy is 40%.
  • In the 2016-17 financial year its capacity factor — the percentage of time it operated — was 82.33%.
  • In 2016-2017 it produced 54,000 gigawatt-hours of electricity.
  • It has a workforce of 75.
  • Despite being the newest coal power station in eastern Australia and having a high capacity factor, it has broken down a lot.

Kogan Creek Labour Costs: 0.12 cents per kWh

Kogan Creek has a workforce of 75, which is one person per 10 megawatts of capacity.  This is almost half the workers per megawatt of the 43 year old Gladstone Power Station, which has one for every 5.25 megawatts.

If the workers receive the average Australian pay of $83,000 a year7 then the total payroll for a year will come to $6,225,000.  If we divide this by the number of kilowatt-hours produced in the 2016-2017 financial year the labour cost per kilowatt-hour will come to 0.12 cents.

Upper Management Costs: 0.02 cents per kWh

In addition to workers there are also the costs of upper management.  CS Energy, the owner of Kogan Creek, spent a total of $3,420,746 paying the CEO and six other senior executives in 2015-2016 financial year:

Kogan Creek power station salaries

(Image: 2016/17 CS Energy Statement of Corporate Intent)

However, CS Energy owns 4 power stations and I’m not sure how I should divide this amount between them.  Because Kogan creek provides around one-third of their generating assets total output I’ll assume Kogan Creek’s share is one-third of the cost of upper management, or $1,140,000.  This will add 0.02 cents to the cost per kilowatt-hour.

Fuel Cost: 3.45 cents per kWh

The cost of Australian black coal loaded onto a ship at a coal export terminal is $143 a tonne at the moment:

Australian thermal coal monthly price

(Image: Index Mundi)

Because Kogan Creek is 40% efficient and the energy content of Australian black coal is given as 6,667 kilocalories per kilogram — or 27.9 megajoules per kilogram in units that aren’t stupid — it’s easy to work out that 326 grams of coal are required to generate one kilowatt-hour of electricity.  At a cost of $143 a tonne that’s 4.66 cents worth of coal.

But it’s not quite that simple.  This graph from the AEMO suggests there is a relationship between the export price of coal and the prices bid by coal generators, but it’s definitely not clear cut:

International black coal prices

What power stations pay for coal is often determined by long term contracts.  However, the actual cost to burn it should reflect its export price.  If a power station is only paying $40 per tonne for coal thanks to a long term contract with a coal mine, but an exporter is willing to pay them $90 a tonne to send it to South Korea, then that $90 is what they are giving up by deciding to burn it and so that’s what it’s effectively costing them.8

Transport Costs

For coal to be exported it has to be taken to a coal export terminal and this is only practical if there is a rail line within a reasonable distance.  While some mines, such as the Meandu Mine that supplies Tarong Power Station, are a fair distance from tracks with steel backs making their coal difficult to transport, the Kogan Creek mine is close to a rail line.

The nearest coal export terminal is roughly 300 kilometers away in Brisbane.  The cost of transporting one tonne of coal in Queensland is likely to be under 3 cents per kilometer.  Assuming it cost 3 cents gives a transport cost of $9 per tonne of coal taken to Brisbane for export.

The Average Cost Of Coal

The export price for coal is high at the moment and so it’s probably not reasonable to base my estimate of the fuel cost on it because it could be considerably lower in a month’s time.  Instead I’ll use the average export price over the past 10 years.  After adjusting for inflation it comes to around $116 per tonne.  After subtracting the estimated $9 cost of rail transport the effective cost of coal for the Kogan Creek Power Station would be around $107 a tonne.  This would make the fuel cost to generate one kilowatt-hour 3.45 cents.

Kogan Creek Capital Expenditures: 0.48 cents per kWh

Capital expenditure is money spent maintaining land, buildings, and equipment.  It includes replacing items when needed.  According to the owners of Kogan Creek Power Station, CS Energy, they spent $13 million on capital expenditures in the 2016-2017 financial year.  They also spent $700,000 on overhauls:

Kogan Creek power station capital expenditure

(Image: 2016/17 CS Energy Statement of Corporate Intent)

Looking at the three coal power stations owned by CS Energy — Callide B, Callide C, and Kogan Creek — a total of $24.5 million went towards capital expenditures but $37.3 million, over 52% more, was spent on overhauls.  This suggests on average the yearly cost of overhauls may be considerably greater than capital expenditures.  I don’t have good information on this, so I’ll simply assume the average yearly cost of overhauls is the same as the capital expenditure of $13 million for a total of $26 million.  This adds 0.48 cents per kilowatt-hour to the cost of generating electricity.

Total Cost Per Kilowatt-Hour For Kogan Creek Power Station: 4.1 cents per kWh

My estimates for the four components of Kogan Creek’s cost per kilowatt-hour are:

  • Labour 0.12 cents
  • Upper management 0.02 cents
  • Fuel 3.45 cents
  • Capital expenditures 0.48 cents

They come to a total of 4.07 cents.  Since this is just a rough estimate without the accuracy that two decimal places suggests, I’ll round it off to 4.1 cents per kilowatt-hour.  This means in order to be worthwhile to keep operating the power station will have to earn an average of at least 4.1 cents per kilowatt-hour generated.

Gladstone Power Station

Kogan Creek is the lowest cost black coal generator in the NEM, so the average black coal power station will be more expensive to run.  The largest generator in Queensland is the 43 year old black coal Gladstone Power Station.  Some details are:

  • It requires 17% more coal per kilowatt-hour generated than Kogan Creek.
  • It has 90% more workers per kilowatt of capacity.
  • It appears to be supplied by Callide mine, which is only 120 km from the Gladstone coal export terminal.
  • While its design is simpler than Kogan Creek, its age is likely to contribute to high capital expenditure.

Because it is owned by so many companies I am simply going to assume its cost of upper management is the same as for Kogan Creek per kilowatt-hour.  Also, despite its advanced age, I will assume its capital expenditure is almost identical to Kogan Creek and estimate it at 0.5 cents per kilowatt-hour.  I’ve set its capital expenditure at a low level because when it becomes clear to management it will be unprofitable in the not too distant future  they will skimp on maintenance.

After crunching the numbers, my estimates for the various components of the per kilowatt-hour cost for Gladstone Power Station are:

  • Labour 0.23 cents
  • Upper management 0.02 cents
  • Fuel 4.24 cents
  • Capital expenditures 0.5 cents

Adding these together gives 4.99 cents, which I’ll round to 5 cents per kilowatt-hour.

Coal Power Is Doomed – It’s Too Expensive

If older coal power stations have to make an average of at least 5 cents per kilowatt-hour to remain profitable they are in trouble. A Bloomberg report gives the cost of electricity from new solar farms in Australia as starting from 5.2 cents per kilowatt-hour and 5.6 cents for new wind power.

Of course, a cheerful report doesn’t do any bloody good if it doesn’t reflect reality.  Fortunately, we know it’s pretty accurate because the Stockyard Hill wind farm is under construction and will provide electricity for under 5.5 cents per kilowatt-hour.  New solar farms should be providing electricity at a similar price before long.  Even Origin Energy, which owns over 5.7 gigawatts of fossil fuel generating capacity including 2.88 gigawatts of coal power, says new renewables are cheaper than existing coal capacity

If solar and wind farms can make a profit at a point where older, less efficient, black coal power stations become unprofitable then these old power stations will shut down permanently rather than operate at a loss.  Each time an old coal power plant closes it will boost the wholesale price of electricity, but this will only encourage the construction of more renewable capacity that will lower prices again. 

A high penetration of renewable energy is particularly dangerous for the economics of existing coal because they are inflexible and can’t easily shut down when prices are too low.  For example, thanks to high wind output, the wholesale price of electricity in South Australia dropped to 1.255 cents per kilowatt-hour early Tuesday morning:

SA electricity price and demand - February 12

(Image: AEMO)

And later in the day, thanks to a combination of good wind and solar output and the inability to export more clean energy to Victoria, South Australia’s wholesale electricity prices went negative around lunch time:

SA electricity price and demand - 13 February

Victoria’s brown coal generators are very cheap to run because brown coal has no export value, but regular periods of low electricity prices, caused by renewables, will make them unprofitable.  They are also very old so we can hope they fall apart soon.  But in a way that doesn’t hurt anyone.  Exploding pipes, ruptured boilers, and fatal fires aren’t much fun.

The Cost Of Reliably Meeting Demand

Because the output of solar and wind generation is variable it requires sources of dispatchable power to reliably meet demand. 

Australia has an electricity market, so if you believe in market forces strongly enough then these sources of dispatchable power should just magically appear by themselves.  Or, if you want to be a little less abstract, people will build them because they will be profitable. 

But if you think the required dispatchable power should be included in the cost of renewable energy that’s fine.  Just remember these costs also need to be applied to unreliable coal power.  Dispatchable sources of power other than coal were required long before there were any solar panels or wind turbines in Australia. 

But the good news is renewables plus dispatchable power are still cheaper than fossil fuels.

More Coal Closures Are Coming

The next large power station scheduled to close is the 2,051 megawatt black coal Liddell Power Station in 2022.  By that time rooftop solar power capacity should have increased by over 50% and new solar and wind farms should be able to supply electricity below 5 cents per kilowatt-hour.

Shutting down a large power station like Liddell should bump up wholesale electricity prices giving other coal generators a temporary respite, but it won’t last long.  Lower wholesale electricity prices resulting from more low cost renewables will force coal power to operate at a loss resulting in coal power closures snowballing. 

At the moment with wholesale electricity prices averaging around 9 cents, coal generators are making large profits. But soon their average return will fall below their cost of generation. Then coal power stations will fall one after the other. And as renewable capacity continues to grow, each closure will be less effective at temporarily improving the profitability of the surviving dirty generators.

While I expect the cost of coal to fall as demand reduces, the cost of renewable energy will also fall. Once the penetration of solar and wind is high enough, coal power will become unprofitable even if the export value of coal is zero.

Coal power stations will shut down and nothing can be done to prevent it.  While large power stations technically have to give three years notice before closing down it won’t do any good if they can make the power station fall apart just by not doing adequate maintenance.  You may as well pass a law requiring ocean liners that smash against icebergs refrain from sinking for three days.

Hopefully, we won’t have to wait years for the oncoming obsolescence of coal power to become apparent.  If the government priced in even a fraction of the harm coal causes we could start planning a rapid phaseout immediately.  In a country that cares about the health of its citizens and the future of the planet, coal power is an anachronism. 

 

Footnotes

  1. They couldn’t possibly be lying because that would be naughty.
  2. Dispatchable power can be turned on and off as needed.  It includes but is not limited to:  Battery storage, hydro electricity, pumped hydro, thermal storage, gas generation, and hooking Finn’s bicycle up to a generator.
  3. I have to admit I’m not just critical when it comes to the subject of building new coal power stations, I’m supercritical of the whole idea.
  4. Last year natural gas provided 6.8% of Australia’s grid generation but after adjusting for rooftop solar power’s output it supplies around 6.5% of our total electricity consumption.
  5. Current NEM coal capacity is  22,674 megawatts.
  6. The origin of the term “clapped out” is disturbing if what I’ve read is true.  Apparently when hunted hares stop to catch their breath they stand on their hind paws and their heaving as they gasp for air makes them look as though they are they are clapping.
  7. I have used the average of $83,000, which is bumped up by highly paid successful capitalist pigs and not the median amount a typical full time worker earns of around $66,000 that is dragged down by a large number of unsuccessful capitalist pigs.  I have done this because I assume, on average, power station workers earn above the median.  If you’re a power station worker and I’m wrong about this, please insist on pay increases until I’m right.
  8. This is often referred to as opportunity cost.  Or maybe it isn’t.  I’m gambling on you not having access to the internet and being unable to look it up.
About Ronald Brakels

Many years ago now, Ronald Brakels was born in Toowoomba. He first rose to international prominence when his township took up a collection to send him to Japan, which was the furthest they could manage with the money they raised. He became passionately interested in environmental matters upon his return to Australia when the local Mayor met him at the airport and explained it was far too dangerous for him to return to Toowoomba on account of climate change and mutant attack goats. Ronald then moved to a property in the Adelaide Hills where he now lives with his horse, Tonto 23.

Comments

  1. ARTHUR PALMER says:

    How many coal fired plants there are in the world today. ?
    The EU has 468 plants building 27 more for a total of 495
    Turkey has 56 plants building 93 more total 149
    South Africa has 79 building 24 more total 103
    India has 589 building 446 more total 1036
    Philippines has 19 building 60 more total 79
    South Korea has 58 building 26 more total 84
    Japan has 90 building 45 more total 135
    AND CHINA has 2363 building 1171 total 3534

    Is this correct? Cheers Arthur

    • Even if the numbers are for units rather than coal plants those numbers seem very high.
      Coalswarm.org is a good place to check on coal burners.

    • Ronald Brakels says:

      Hi Arthur

      Fortunately that’s not correct. The number of coal power stations being built is too many, but it’s not that many.

      If you want to get an idea of what is happening with coal consumption it is best to look at world production figures since basically everything that is mined gets burned. Coal extraction peaked in 2014 at a little over 8 billion tonnes and in 2017 it was around 7.5 billion tonnes. A 6% decrease. While production doesn’t appear to have declined in 2018, the downward trend will accelerate thanks to the low and falling cost of renewable energy.

      • Ian Thompson says:

        Hi Ronald – re- Arthur’s comments

        Yes, but I guess that stations that are currently under construction are not burning any coal — yet!
        Also, some builds may be to replace existing stations about to be decommissioned – these will likely be more efficient, requiring less coal to produce the same power output.

        But – again a great and thought-provoking article. The only thing I’d say, is that the poor reliability of coal stations you highlight, is probably more a consequence of poor federal energy policy statements resulting in station operators cutting back on timely maintenance, rather than any intrinsic unreliability of coal power – after all, electricity has been produced by coal for eons, all over the World, and with a little redundancy the failure rates have been quite low as far as I am concerned (we haven’t had significant blackouts for many, many years – except the odd occurrence of trees being blown across major transmission lines ).

        Also – you acknowledged some time ago that we often have to deal with excessively high line voltages. I have measured this, to find we have to pay for increased parasitic and standby power at these higher voltages (30 watts on my TV and amplifier alone) – and this extra power dissipation causes higher temperatures in electronic equipment, plugpacks, CFL & LED lighting, etc., resulting in decreased lifespans (we’d typically get <500 hours use out of a CFL, rather than the 8,000 hrs advertised – making them well uneconomic). Plus, inverter throttling decreases our potential FiT returns.
        I believe these higher voltages are a direct result of rooftop PV – simply because a network designed for voltage drops down the line, will not handle distributed injection of power very well. In the reversed flow of power during periods of high solar production, the voltage drops work in the opposite direction – the "end-of-the-line" becomes high voltage, rather than low.
        I've heard people criticise Vic and NSW for higher power prices caused by "gold plating" of their network – but I believe increasing the capacity of a network (lowering its impedance, by using increased copper cross-sections) is necessary to prevent these excessive voltage swings – and this should be at least partly considered an "externality" cost of rooftop PV (the others being due to increase airconditioner installs and use, and to suburban "infill" – replacing a single dwelling with a triplex, allowing for improved insulation properties, will probably near double the power requirements – maybe more.

        • Ronald Brakels says:

          Over voltage events occur at night, so the problem is more involved than just distributed solar.

          • Ian Thompson says:

            Hi Ron

            Interesting…!

            So, I believe high voltages at night must be because the Utility sets the Sub-station transformer tapping high enough – to ensure all the people running their heavy airconditioner loads at the “end-of-the-line” don’t go below the required minimum voltage (to avoid the extreme currents drawn with brown-out). Then. when all these loads are shut down, the voltages near the sub-station become excessively high. Even out Utility Engineer agreed with this cause – Kirchhoff’s circuit laws are not rocket science.

            From my own observation – the highest voltages at our house CONSISTENTLY occurd on one phase late morning, and on another phase early-mid afternoon – unless the sky is cloudy, when this does not happen.
            In our case, the excessive voltages were very clearly correlated with solar PV production – and I do not for as moment believe we are an isolated case.

            But I agree the details are involved. However – whatever the specifics – as renewables permeate, they will have to pick up the tab for network maintenance – and I still believe upgrades as well.

    • If Arthur’s figures are correct or even nearly correct then us worrying about how soon we can close Liddell and others to replace with windmills and rooftop solar are obviously neither here nor there from a world pollution perspective.
      Makes no difference if they are cutting edge clean or not owing to their sheer number and still growing.
      If this is the modus operandi of the rest of the world for the around 40 yr life of these stations then sorry I am only interested in who can supply me here with the cheapest power whatever it’s source.
      Would be nice if it was clean for our local benefit but I now don’t care.

    • Planned coal power capacity in pre-construction status has declined from 1,090GW in 2015 to 364GW in July 2018.

      See
      https://reneweconomy.com.au/peak-coal-getting-closer-latest-figures-show-26919/

      Those coal power plants built will be stranded assets.

  2. Does that reprobate in Canberra still have the piece of (suitably sealed with clear paint) Coal on his desk?

    Hopefully not for long: Elections coming! (Not soon enough I feel)

  3. What wonderful news. That means the taxpayer can immediately stop paying those wind and solar subsidies

    • Ronald Brakels says:

      It certainly would be more logical to make coal pay for for its externalities — its health costs and the cost of removing the CO2 it emits from the atmosphere and sequestering it — than it is to subsidize renewables. Making coal pay for its externalities is likely to add at least 7 cents per kilowatt-hour to the cost of coal power.

  4. Bob Johnson says:

    If only it was that easy. Solar and wind will never provide reliable (ie 24/7) power. If we don’t use coal or gas then there will have to be some massive storage. Forget batteries- good for short term grid stabilization and avoid those ridiculous spot prices. The only real option at the moment is pumped hydro. In QLD we have Splityard Creek which doesn’t do much (cheaper to burn coal) and the Kidston project which should be finished in 3 years or so. Both are quite small in the scheme of things- 500MW , 5,000MWh and 250MW, 2,000MWh respectively. So how about building some more? Many people don’t like dams especially when the higher resovoir would most likely have to be built in the great dividing range. You only have to look at the furore over the Traveston Grossing Dam 10 years or so ago. Snowy 2 horrendously expensive and lots of other problems. Everyone wants a simple cheap solution- sorry, there isn’t one.

    • Ronald Brakels says:

      A simple cheap solution? Well, there’s a stack of second hand gas turbines at Hallet Cove Power Station. That sort of thing is pretty cheap.

  5. 75 employees.
    I think many of them would be control room staff so I think your $83K figure would be well and truly blown out of the water.

    Throw in shift loadings and $150K for a control room operator wouldn’t be far off. I’m guessing a few mechanical and electrical engineers too.

    They probably contract out maintenance and riggers with such a small workforce.

    • Ronald Brakels says:

      I expect you’re right about that. But I would prefer my estimate be too low rather than too high. It’ll give some room for the price of coal to fall.

  6. We have gone from the cheapest electricity in the world with almost all coal generation, to some of the most expensive in the world, in a country rich with natural resources.
    And the loss of coal mining royalties would be a very big loss, thankfully many other countries still want cheap electricity, so the demand will stay strong.

  7. Whilst you mention that coal is unreliable, it does have the ability to provide power 24/7. So if you build x amount of them, statistics dictate that most will be operating at any point in a 24 hour period even if some are not.

    Solar can’t operate over a 24 hour period and hence needs some type of storage to allow it to do so. Wind can operate 24/7, however you rely on the weather so it’s not like a switch you can turn off and on.

    I’d be interested to see your cost analysis when adding on the cost of storage to make solar and/or wind available to offer supply 24/7 like coal can. I don’t see this as a far comparison without it

    • Please note that the rising and falling of the tides could easily provide power only limited by distribution technology on a 24/7 basis….. and regulated according to need by a simple stop-cock. As mentioned long ago The Rip on Port Phillip Bay could be utilised to advantage ; ditto Westernport Bay~ and in the North we have tides of nearly FORTY foot! –> Imagine installing turbines HERE!

      https://www.google.com/search?q=highest+tides+in+australia&rlz=1C1CHBD_en-GBAU831AU831&oq=highest+tides+in+australi&aqs=chrome.0.69i59j69i57j0.11043j0j7&sourceid=chrome&ie=UTF-8

      • That’s a great idea Jackson, but what happens with then tide turns?

        Is there any renewable solution that provides constant 24/7 reliable power without batteries or some type of storage mechanism? If there isn’t, then the power has to be stored or transferred in the case of hydro etc. That cost should be taken into account when comparing.

        • Come on Kev! That’s the beauty of it! I’ll bet any competent engineer could come with a simple way of running the turbines in reverse. ie. power being generated whilst the bay (read dam) is being filled and more generated as the full dam rushes back to sea as the tide falls.
          ………as long, of course, we don’t destroy the moon by mining it for briquettes or uranium 😉

          • Ian Thompson says:

            Come on Kackson – Kev’s talking about the period when the tide is neither coming in, nor running out.

            As far as I am aware – ALL tidal systems run the turbines both ways – but separate, expensive stored hydro is needed unless you have other generators available to “fill the gaps”

          • Ian ~ I see no reply button on your comment, so:-
            The tide is ALWAYS coming in or running out ~ SOMEWHERE.
            When ‘slack water’ is experienced in one location the tides are running elsewhere.
            I’ve never gone to the bother of looking it up, but might hazard the guess that when the tides are slack in the north-west they’re running in/around Bass Strait.
            All that gets down to the distribution network.

            Moreover, I suspect there’s some way of filling, say, a bay with a greater VOLUME than the turbines actually require ~ albeit at the ‘regular’ height. Therefore at slack tide outside of the bay/dam there’d still be water retained in the bay ~ at a height greater than that ‘outside’.

            All this stuff is very variable given that tides/etc. aren’t run by clockwork.
            But the reality is that the sun and the moon cause tidal ‘bulges’ as the orbits continue, and a bulge on one side MUST have a corresponding ‘dip’ (?) opposite that.
            I’m no engineer, but I can demonstrate that if I tilt a bucket of water one side is deeper (therefore has more volume of water than the other. Tilt it the other way and the numbers are reversed. The only ‘slack water’ is the moment when the bucket is perfectly upright.

            It’s a complicated subject given all he variables, but worth a look.

          • Erik Christiansen says:

            Not only do all tidal power systems generate power coming and going, and not only is tidal rise and fall a wave which follows the moon and its antipodes continuously, but it is a simple matter to feed some of the generated power to pumped hydro to provide infill during slack water, twice per day. So, yes, with either chemical batteries or the aforementioned gravity battery, tidal power _is_ 24/7/999999999999 renewable, powered by green cheese.

            As for the coal apologists delusional fallacies about Latrobe Valley air, many of the frail, elderly, and breathing impaired evacuated a couple of years ago because of the high levels of toxic carbon monoxide, smoke, and ash which covered cars and washing. The state health officers were roundly criticised for downplaying the health risks during the many month long episode. BUT, I will grant that the air is much cleaner now that the power station and mine have closed down. It will take time to close down the rest, not least because it will take time to build renewable replacement generation and cleaner safer workplaces. Our grandchildren will not believe the grotty Dickensian anacronism that was power generation in the early 21st century. And by then, the Luddites will have followed the planet-burners into oblivion.

          • Ian Thompson says:

            Hi Jackson

            I think there are two issues here.

            1. Turbines need some “head” across them, in order for the flow to generate power (P=HxQ, so no head, or no flow, equals no power). To turn the head from one direction, to the other, requires maybe a few hours, twice a day (typically).
            2. Your concept of transmission lines sufficient to effectively connect, say Bass Strait to the North West to cover the “gaps”, at a sufficiently high power rating, will likely cost more than the turbines – and they are not cheap.

            I’m not saying that the concept is impossible – just that better minds than mine will have already looked at tidal power options – but all I’m aware of are very small capacity research prototypes.

            BTW, I had wondered if your name had a typo in it…!

  8. Erik Christiansen says:

    Er, how can the price of electricity go negative? Even paying for someone to take wind energy makes no sense as there’s wear & tear and depreciation. Feathering the props ought to balance whizziness against load, keeping the revs in range for free.

    Out on the farm we don’t shoot hares. They have no burrows, and I figure it’s tough enough being a herbivore with no more shelter than a couple of tufts of grass. There’s not much opportunity cost in letting the hares graze – the kangaroos and wombats get the rest of what there is. (We’re destocked.)

    • Ronald Brakels says:

      Electricity prices go negative when there is too much power being fed into the grid. Negative prices help in two ways. First, they encourage large users of electricity to draw more power. Since they being paid to use electricity they have an incentive to do so. Second, it provides a monetary incentive for generators to supply less power.

  9. Well,
    I have read some wonderful responses to Ronalds article. Trouble is that you seem to not realise that we cannot keep punting pollution into the atmosphere.
    Coal & Gas are only temporary solutions (as has been shown by the unreliability of coal power this summer: the heat caused failures.
    The answer is to have distributed generation. This was modelled years ago (Sorry cannot remember the reference, but it was a university research) that said it was possible to go 100% renewable with current technology, & that was about 8 years ago. Technology has moved on, but unfortunately our pollies have gone backwards. The reality is that if the wind is not blowing in one area, it is blowing in another. Same with Solar: clouds are not everywhere at once.
    Yes, there will need to be storage projects that are not batteries (but batteries supply reliable short term power, & grid stability: check the use of the Tesla battery in South Australia). Pumped Hydro is the easiest current solution, & we do not need huge centralised solutions:”a number of smaller projects would reduce transmission losses, & give some protection against dry times.
    There are also technologies being developed now: Ammonia which can be used in turbines (generated by excess solar & wind generation), Wave harvesting (good prospects & reliable consistent Base load power!). English scientists are also investigating pressurising the sandstone substrate, which apparently is a viable form of storing energy.
    So, if you go back to last centuries Ho-Hum coal & Gas powered generation, you will likely have difficulty with pollution (ie carbon, & the other pollutants currently ignored). If we move forward & develop many different forms of storage & generation, we can utilise renewable energy, still have a modern lifestyle as well as making the planet more liveable.
    Now to transportation: We need to greatly increase our renewable generation. This power can be used to power transportation of the future. By moving our vehicles, farm equipment, & manufacturing processes to renewable base, we can greatly reduce our importation of fossil fuels. None (to my knowledge) of this fuel is processed in Australia, so a huge saving to our balance of payments is available. (Farms can generate their own power, & sell excess to the grid: a win-win solution).
    Australia is already developing exporting renewable energy to SE Asia (from a tiny 70Km x 40Km Solar/Wind farm on the Pilbara.) We can develop more projects like this so we can export power as Ammonia, which can be used in fertiliser, as well as burnt in existing technology power plants.

    I feel all we need is a progressive Federal Government that carefully assists the transition. I feel the first step is to gradually wind back Fossil fuel subsidies, & assist the adoption of Renewable power to Industry, Transport & Building infrastructure. Charging infrastructure is required, that initially will require some government assistance. This is needed to stop the range anxiety particularly in rural areas.

    So, Lets just get into it!

    Remember you gets who you vote for (in the coming election). Ask the candidates who is progressive enough to move in the direction required, then keep them honest!

    (Rant completed)

    • Ian Thompson says:

      Hi Doug

      With all due respect – I disagree with your 2nd sentence. I believe we all agree we can’t keep “punting” pollution into the atmosphere. The issues are a matter of transition, timing, and cost. As Ronald states, Market Forces should cause a natural transition – if externality costs are correctly factored into the equation – which they are not at the moment because COAL is not penalised for the health inpacts, and Renewables have market-distorting subsidies instead.

      Again with respect, all your ideas are wonderful like a lot of others – but most have not been proven economically viable yet – just ideas – otherwise they would be in serious service, not just demonstration prototypes (if that).

      Ronald once mentioned that the impact of Australia “sinking beneath the waves” would be 3% – in terms of CO2 contribution (pollution). Having travelled the World and seen jus how BIG the World is, my ears pricked up at this – I suspect he was talking about the total contribution – rather than just that from fossil fuel burning only, as figures I’ve found suggest significantly less than half this figure. The scale of our impact is small.

      My biggest concern is that Australia’s high energy costs are preventing us from being competitive – in terms of exporting products to the World. We seem to be “selling the farm”. By this I mean, we are mining iron ore and selling it overseas, exporting hugh amounts of coal and natural gas overseas – for others to burn and pollute the atmosphere – and even exporting uranium for others to use. None of these are renewable and sustainable – so what do we do once our reserves (eventually) run out. How is this reducing our (small) CO2 footprint in any significant way?
      We also sell meat and grain overseas – but I guess this could be considered “carbon neutral”, as other humans eat this and exhale CO2 that will be captured in the next crop (so long as we have fertilizer and water – and that becomes questionable). But there is a time delay here – as population increases, so does the production of CO2 exhalation.

      So why are we sitting in our ivory towers, getting subsidised to install renewables, buying solar panels from China (probably using our finite reserves of aluminium and copper ore to make frames and cables), but producing no nett benefit to use except a (temporary) confortable lifestyle.

      No – we need cheap energy at high power NOW – not in some hazy rose-tinted future – and I believe this will just have to come – at least in the relatively short term as we transition to renewables – from things like Nuclear, Natural Gas, and perhaps even COAL (that we hold back from exported burning, so no change in nett CO2 production) – although I don’t like this latter option.
      We CANNOT transition overnight.

      • What, do you siggest building nuclear overnight? When? Where?

        • Ian Thompson says:

          Come on, CU – do your research…! There were about 99 commercial Nuclear reactors in the USA a few years back (covering nearly 60% of of their emission-free generation) – this in a country about the size of Australia, but with about 10 times the population – I feel sure we should be able to find space to fit 10 or so (density of 1:100)!

          I cannot believe you would suggest we keep using coal power until a transition to fully renewables has been implemented – with all the minesite and public health-related fatalities that would entail – after all, that would be simply feeble-minded.

          Surely you are not suggesting that renewables implementation can be achieved overnight – after all, solar PV has had MASSIVE inducements for about 10 years ago (starting with a 60 c/kwh FiT in Victoria, 46 c/kwh in WA, then in my case a 50% rebate on cost) – and renewables still have a long way to go before implementation? We have to be realistic about this – the SAS had a great acronym 7P’s & ALOHA – Prior Planning & Preparation Prevents a P*ss Poor Performance & A Lot Of Heart Ache – I think it very important we plan for the transition, not just spout a lot of “thought bubbles” – something successive Governments haven’t proven very good at.

          Do you seriously think the UK authorities who authorised – and are still going ahead with – the building of Hinkley Point C nuclear power station, and of other countries also with many plants under construction (China, India, UAE, Russia, Korea – the list goes on), ALL have less understanding of the issues than you?

          Sure – I agree the lead time on all of these is great – which possibly only indicates our Government(s) should have made the decision much earlier. Hinkley C is starting above-ground work mid-2019, with production sheduled for 2025 – do you think we will have 100% retired coal by then – my investigations suggest we might only have achieved 50%?
          http://theconversation.com/at-its-current-rate-australia-is-on-track-for-50-renewable-electricity-in-2025-102903

          Let me say – you might want to be a little careful about the figures promoted by the Renewables apologists – they like to quote Installed Power, or Number of Panels – because these look like big numbers – whereas to avoid being misleading, they really should be quoting Energy. For example, my PV system has a nominal INSTALLED capacity of 6.24 kW, but only a 5 kW inverter – with 8,760 hours in a year, you might mistakenly think this corresponds to 6.24 x 8760 = 43.8 MWh/year, whereas my production measures at only 10 MWh/year (~23% of the “inferred” figures) – and our zone location and configuration is pretty good, so others proably achieve less.

          Also beware the “Henney Penny / Chicken Little” dogma and mantras of the greenies and far left – you know “Nuclear takes too long, its too dangerous”.
          I simply feel we cannot simply “sit on out todds” hoping for some magical technical solution to show up – we should not be throwing out Nuclear hands-down, unless adequate analysis is done.

          Having said all that – my calculations suggest the actual cost to produce rooftop Solar PV over a 20 year lifespan – if that can be achieved – is about 5c/kwh (this ignores repairs, maintenance, inverter or panel replacement, any needed storage, and any contribution to infrastructure) – so not bad, but not great either.
          I think our priorities should be, at least, to allow our technical and financial experts to investigate all forms of technology that are known and proven to work – be they hydro, tidal, solar, wind, natural gas, or nuclear. These have all proven viable at various locations around the World – and the challenge is to see how they “fit” into Austraila’s geology, etc. For example, there a great Tidal locations in the NW of WA – but great expenses to build there, and to build the necessary transmission lines to centres of population – these costs may make this technical option uneconomic. Same for Hydro – especially in WA.
          Let us not simply speculate and hope a “new” technology becomes feasible in time – we need something NOW – or else Coal is simply going to soldier on (or, State-wide blackouts?)

          • I would have like to have seen the debate on Nuclear Power to know what the emerging technologies are but it would be impossible to find a site in Australia to build one.

          • I have done my reasearch, that is why I was supprised that PV and wind power can’t be built rapidly enough but you suggest that nucelar can be.

            And
            “Do you seriously think the UK authorities who authorised – and are still going ahead with – the building of Hinkley Point C nuclear power station, and of other countries also with many plants under construction (China, India, UAE, Russia, Korea – the list goes on), ALL have less understanding of the issues than you?”

            Well, yes

          • Ian,
            I am one of the Greenies you berate. But I also think you might be putting your head in the sand.
            The reality of Nuclear in Australia is that it would take years to plan & implement, & cost MUCH more than other competing technologies. It also would not pass the massive demonstrations that would happen…
            You are entirely wrong about the economics of moving power from WA. There is a huge wind/solar project happening now in the Pilbara. It will sell power to SE Asia: Malaysia & Singapore. So if the investors there see it as viable, it must be.
            Rooftop solar will only be one of the generating systems, & it did need some incentives to get the system moving. Of course, in retrospect, the subsidies were too high, which is why I have advocated caution in the future. We do need to wind back Fossil fuel subsidies to create the level play field though.(albeit remove these subsidies slowly or the farmers will complain!)
            If we want to be sustainable, there is a need to look at the total energy picture: Assist retrofitting buildings to be more efficient, & move away from Gas heating. Increase insulation to reduce heat gain/loss, assist industry to use new technologies to reduce fossil fuel use, reduce fossil fuel use in Agriculture & transport. This is all possible with current technology.

        • Ian Thompson says:

          Hi Mike

          It seems CU is a World Expert in all things nuclear – and has decided that this technology should not even be considered as a starter when trying to work out how we transition to renewables – my “BS” antenna makes me think he may have absolutely no idea how long this is all going to take – and how much longer we will be forced to burn coal as a consequence, if we don’t plan for the future. Maybe he is Gen Y, seeking instant gratification…

          Look – I’m not sold on Nuclear – but I do think it has to be considered. CU is the Expert, but at least I have studied Nuclear Engineering, as part of a Thermodynamics course many, many years ago – and so know at least something about the technology. Established nuclear power plants (after the Capital costs have been recovered – these plants have a very long life) have operating costs as low as 3 US cents/kWh LCOE – now, that is attractive. South Korea has been building Pressurised Water Reactors (older technology) continuously over the last 30 years – and has a LCOE (Levelised Cost Of Energy) about half that of the USA and UK, who are only are only just restarting their new-build programs.

          Would you believe the fatality rate per terrawatt-hour of electricity produced is 161 deaths for coal, 1.4 for Hydro, and 0.04 for nuclear.
          Solar is 2 orders of magnitude higher, at 0.4 deaths per terrawatt-hour of electricity produced, and wind somewhat less at 0.15. These figures include the impacts of Chernobyl – which was a simple and cheap design to co-produce weapons-grade plutonium, and Three Mile Island, and Fukushima.

          Knowledge and designs have improved over the years, with Gen III+ reactors at near-term deployment and offering improved economics, and Gen IV reactors intended from 2030, that are highly economical, have reactors that are intrinsically safe (e.g. non-pressurised, do not need off-site power, etc.), produce minimal waste (by being able to “burn” existing waste, and make their own fuel out what would have been previously waste), and are proliferation resistant (not suitable for making weapons-grade plutonium).

          The Sodium Fast Reactors are being commercialised at the present time. Molten Salt Reactors allow the steam (Brayton) cycle to achieve 45% thermal-power efficiency, up quite a bit compared with the 33% of older plant. The USA, Russia, South Africa, Japan, and the UK have all built experimental High Temperature Gas Reactors – and China in March 2018 was close to completing two High-Temperature Reactor – Pebble Modules. It is envisaged that new HTR-PM units will replace current coal plants – to drive the same superheated steam cycle to quickly reduce China’s pollution problems.

          Bang go our future coal exports to China – they will go Nuclear instead…!

          Some manufacturers of the new breed of reactors, are miniaturising them and making them modular – they will be build in a factory – with all the scalable benefits this will provide – and some are sized to suit the power requirements of a moderately sized town. Great for WA’s dispersed population centres.

          I think I would agree – it is extremely unlikely that a site will be found in SA – but I do suspect WA may be more receptive – great for minesites, etc.
          But who knows – Doug suggests we may have to deal with rolling blackouts – which I feel are going to prove simply unacceptable to business (or, they are going to have to install diesel generators as back-up, and pass on the costs to the consumer), in order that they can continue to work, and perishables are not all spoiled. In the fullness of time, we amy find that alternative techologies are suddenly not so unacceptable.

          • @ Ian Thompson,

            I was around already in early 60:ties when Thorium reactors and even fusion reactors where “just around the corner”. They are still “just around the corner.

            We will see within 10 years how much RE is built and how many new nuclear reactors there are.

            Good luck with my “BS” antenna.

          • Ian,
            I never said anything about rolling blackouts. But they could be an issue if the system is not designed correctly.
            I am a firm believer in distributed generation & storage. Distributed generation & Storage (G&S) are likely to be more secure because there are so many more to either attack, or to fail. Any Industrial syatem is open to hacking now, so distributed G&S is less likely to fail even on statistical grounds. Ditto failures due to climate conditions,
            As far as Nuclear reactors go, I do worry about the prospect of Terrorism (& I am not usually concerned with terrorists!). There is also the issue of waste. Australia has a huge problem in the Lucas Heights which was quite remote when built, is now surrounded by housing. This creates a potential safety issue.
            Nuclear is discussed in this article:

            As I have stated before, I feel there is a need for an open mind, & the most important thing is to actually start moving towards a sustainable future, that is as non-polluting as possible to ensure the future viability of our world.
            Hopefully, the government YOU elect (in May?) will assist in this process. The Australian economy will thank them for it!

        • Ian Thompson says:

          Doug – I did not intend to “berate” all greenies – but certainly some. Was just trying to make a cautionary note about some extremely misleading or plain outright fake statements that I have read. I did start out my career tutoring and lecturing at UWA after I got back from National Service – but only for a couple of years, so don’t consider myself an academic either – but I have worked as an R&D engineer for many, many years – several working in the USA – and have managed multi-million dollar projects, so I know something of planning.

          I’m not sure that I’m ENTIRELY wrong about the proposed $20 billion Pilbara project – after all, Port Hedland is much closer to Jakarta, than it is to Melbourne – less than half the distance in fact (the discussion was about Tidal – our NW to Bas Strait…!). Again, things can be misleading – the total generation capacity will be 9 GW – which if it were Coal or Nuclear would suggest an annual generation of maybe 67 TWh/year (allowing for only 85% availabilty – nuclear is normally greater than this). Yet the actual will only be 33 TWH/yr, if all goes well – about 50% – but still of course a lot of energy. 9% of that will be lost in transmission to Asia. So, 30 nett TWh/yr for a cost of $20 billion – about $0.67cents / kWh of true capacity – you’d hope everything would last for at least 20-25 years or more to make this truly competitive (I haven’t added anything back for wind turbine gearbox servicing, etc.). There is an expected 700 MW variability in power output during the day – so they may have to also add very large batteries to keep the “juice” flowing to Asia and the Pilbara – or else use the excess to make hydrogen for sale to Asia (as they say they intend).
          Construction might start in 2023 – and may form part of some projections that we will are on target to reach 50% renewables by 2025 (although – a lot of this power is going to Asia).

          So – good – but my original discussion was about Tidal Power – which I suspect is “dead-in-the-water” for any near-term implementation – although I accept your observation that shipping PV and Wind across borders is not too expensive. But just remember that NSW generated twice the annual power of the $20 billion Pilbara proposal in 2013 (declining a little since) – and the transmission losses might double – so you might have to spend more than $40 billion extra in each state, to have the “what if” capacity to feed an adjacent state if it were to become becalmed and heavily overcast (or dark).

          Just saying…

    • Graham Revill says:

      You make a point that seems to escape many people. We do not have a choice between fossil and renewables. We have a choice of which method of avoiding climate change is available to keep us going until we master fusion power. The end result of this might be a huge increase in storage in advanced cheap (heavy is not a problem) batteries, pumped hydro, solid masses storing potential energy generated by gravity, tidal, wave, compressed air.
      We might even find out we can’t do it. Fossil fuels are not an alternative so we then control demand. Still not enough? Then we have to restrict electricity use. The best science we have available at the moment says fossil fuels are not an option if we want a world with 14 billion people.
      We might have blackouts. Many countries are familiar with this its just the spoiled brats in the “developed” World who think that aircon to 16 degrees is essential. It’s a luxury that we all enjoy if its available. Maybe we all sleep in smaller cool rooms rather than cool the whole house. Maybe we have to back-off from a lot of “essential luxuries.”
      Maybe as a good democracy we will just continue voting for any party who promises to put off the end to luxury until the end of their current term. Democracies are all ruled by the biggest liars.

      If you want a market based system then you might not be happy with a system that maximises the profit of a few companies that own the system. If you want best for the community then you had better be prepared to suffer some central decision making and subsidy.

  10. Where’s the Queensland 5700 Mw base load coming from tonight?

    • Ronald Brakels says:

      At the moment the 6,414 megawatts being consumed in Queensland is 5,712 megawatts coal, 506 megawatts gas, 153 megawatts hydro, and 43 megawatts “other”:

      https://reneweconomy.com.au/nem-watch/

      OLD Baseload demand will occur at around 3:30 am and is predicted to be around 5,770 megawatts and will mostly be supplied by coal power.

      • Sorry,
        We all realise that Coal supplies most of our power now. This will be the reality for some time yet. However, it is unlikely that NEW Coal or gas plants would be built now. We will be in for some hiccups over the next few years, but the reality is that power from renewables is cheaper to build & run.
        There was a time about 120 years ago, where horses were used. One of the issues with horses was horse excrement. ICE vehicles quickly replaced horses (but horses were still used for a long time, such as the Ice cart I remember in Mentone in the 1950s). The pollution caused by fossil powered power cannot be continued or we are doomed. When I went to China in the 1980ś it was a clean place, air wise. It is now really polluted, & the Chinese govt is trying to clean it up. (This is why you see so many wearing surgical masks).
        Please do not apologise or promote the continuation of Fossil power. That time has passed, but unfortunately, powerful people who are frightened of stranded assets are promoting its continuation. (Remember to think who you vote for!). There will be time for transition, but we need to start moving towards a more sustainable future. In 50 years our children will look back & wonder why we were so slow implementing change.
        There are more jobs in Sustainable energy than in Fossil fueled generation. There will be some retraining required for Australian workers, but that is manageable. Infrastructure building uses much the same skills whether the new infrastructure is Sustainable energy, or Fossil powered.

        Water is at present Australia´s most precious asset. Even though we have had record floods in some areas, the Murray-Darling is in crisis. Mining exacerbates the water issue. Adani it seems have been given an unlimited access to water. Why? Its time to develop other forms of energy export based on sustainability. Or Grandchildren will thank us for it.

        • Ian Thompson says:

          Hi Doug

          You state “but the reality is that power from renewables is cheaper to build & run.”. Can you please show me the basis of this?

          You say “We will be in for some hiccups over the next few years” – my investigation suggest we might possibly reach 50% renewables by 2025, and it has taken us 10 years to get to where we are today – how long do you define “a few years”, how long to 100%? Do you feel we should continue to burn coal, until our 100% target is reached? Don’t you think some transition planning is in order? Won’t this require the use of some temporary, interim, available, possibly non-renewable power sources? If not gas, then what would you propose?

          In your previous post, you state “clouds are not everywhere at once”, same for wind – yet I know wind and weather patterns are often State-wide – are you suggesting we build such a massively expensive transmission system, and massive over-capacity of all generation sources – such that during times when a particular State is becalmed and possibly also without wind – however seldom that might happen – that they can import their entire power requirements from across th border?

          Sorry Doug – I can’t cop it – I believe we have to plan a little better than that.

          • Ian,
            I am not an academic, so do not have the figures to hand. However it is stated very often that Renewables are now cheaper to build & run, so I believe the experts. Also you must consider the sheer cost of building a new non-renewable plant. There are all the infrastructure costs, then the ongoing fuel costs.
            Personally, I feel that the costs will drive he market. The more costly plants will be pensioned off quickly, & investment will be made to supply the required power, be it private or public. There is also the need to allow for electric vehicles which WILL very quickly replace fossil powered vehicles (due to the market forces: fossil powered vehicles will become more expensive as development costs are amortized over fewer vehicles, & EVs will become cheaper because more are being sold, so the economies of scale will reduce their cost. In fact (except at present in Australia) EVs are now apparently cheaper in the TCO than ICE vehicles. So, there will be a need to upgrade the electric infrastructure to carry the extra load. I have read studies (but no links, sorry) that have stated that the actual generation will not greatly need to increase due to EVs, but the peak power might due to fast charging trucks for instance.
            My feeling is that the increased power requirement will be met by farmers having power generation on farm. This technology is already available, & the high fuel cost will drive agriculture (& mining already) to use sustainable power. Excess generation from farms can then feed the grid. (btw I see farmers having robotised tractors much smaller than current machinery, but if for instance 4 tractors replace one big one, you can interleave the charging, & the units can work 24/7 because you will not require a driver. This technology is already in train. (But why no development in Australia??)
            Back to the possibilities: Once we have excess solar & wind generation (which will happen, & as long as the connection infrastructure is there, it is quick to build a solar farm for instance.) , so we can store the excess in ways to use the power quickly (as gas turbines are used at present). My feeling is that Ammonia can be one form of storage. Ammonia is a very versatile gas: it can make fertiliser, as well as be burnt directly (in turbines & generators using current technology albeit with modifications) or can be easily cracked into hydrogen. (Hydrogen is difficult to store, whereas Ammonia is easy) This is a CSIRO development.
            So, my crystal ball says we need numerous smaller power generation facilities, with some form of storage for peak power requirements. All achievable, but we need the Government to assist, or at least get out of the way! The stasis of the generation under the current government is debilitating for the industry. That alone has caused power prices to peak. Having the more distributed generation will reduce the transmission losses.
            So, my crystal ball again, If we were to generate Hydrogen with excess power in smaller installations, then convert it to Ammonia, this can be used as a source of power, but if there is an excess, it can be sold (a win-win). There would be no need to transport fuels, except for the excess, so reducing costs.
            So let the market decide but gradually reduce Fossil fuel subsidies that currently distort the market. Not too quickly because farmers will need to adapt to new technology (the Nationals voters…) but give some carefully placed subsidies to assist with the change, but not enough to cause the greedy to rort the system (as happened with the insulation fiasco)
            So, build the generation & storage using market drivers which will use a mixture of existing & new techniques, let the expensive options gradually die out but most importantly, design any system upgrades to be flexible to adapt to the needs of the market in the future. Look to Europe because Europe is already well down this path.
            As an aside, it is even really difficult for a farmer in Australia to get approval to build a bio-digester. This needs to change so innovation can drive the market.
            btw, if we let the current govt sign a contract for a coal-burning plant, we will be saddled with that cost & pollution for perhaps 30-50 years. I do feel we need to exit coal in 15 years, 20 at the maximum (ditto gas…) That is about the life expectancy of the plant in Queensland, so it is realistic.

            regards, Doug

            regards, Doug

      • The 153 Mw hydro is limited as Kareeya and Barron are seasonal depending on rain to be run at MCR. As for gas I dont know how much you can expand that as a lot of gas comes from fracking and that technology is both new and the long term effects are unknown. Besides we have sold most of our gas overseas. Gas is a finite quantity and should only be used in combined cycle plants on a continuous basis and the open cycle plants only for emergency.
        We are now back to pump storage but as I have said before this is very expensive to build and the private sector will want a lot greater return than that available for solar.
        Large spinning generators with their kinetic energy provide system stability which is not available with solar nor wind but is via large expensive batteries strategically placed around the country.
        We will have interesting times ahead.

        • The economics of batteries are good: The Tesla battery has paid for itself in 12 months, has reduced the peak cost of power, & stabilised the grid. Cost, compared to a new Fossil powered generator is tiny, & the batteries can be spread to better stabilise the grid. (Many small batteries, compared to one, centralised fossilised coal power station.

          • I’m only going on this document that give an horrendous cost of batteries. As for SA paying off the $90M battery that is fine as no way can you run a system like that. Use it today as the price is high and tomorrow there is less cheap renewable’s to recharge is so you wait until the price is right then you refill it. And in the meantime you can hook into the neighbors network or run an extremely wasteful gas power station.

            https://arena.gov.au/assets/2018/10/Comparison-Of-Dispatchable-Renewable-Electricity-Options-ITP-et-al-for-ARENA-2018.pdf

          • Rod turned off his reply button so I will answer it here…

            The Batteries currently being deployed are really used for peak shifting &/or frequency control. The charge cost matters less then. Usually the batteries will be charging & discharging for the control. There will also be times when the batteries reduces the peaks, which can reduce the system losses with distributed batteries. The batteries will be bulk charged when the system has excess power available. (eg in summer, the batteries will discharge probably late in the afternoon, then recharge overnight when demand is low.) The cost to charge matters less when the peaks during the day at maximum demand, with all the big generators playing the market, so the battery power sale cost is high. Even still the Tesla battery has made a big effect in SA peak power costs over the last 12months + that it has been installed.
            The long term storage will be a mixture of batteries, perhaps capacitors, pumped hydro, energy storage in renewable transformable storage (such as Ammonia, Biomass, Phase change heat storage in salts, etc.)
            The main thing is to start the long term process of retiring fossil fuel power. Saying X is expensive now is not an argument, because there is an option Y that would be achievable. As Technology offers more low cost solutions, the market will move to those options.
            In the future there will be many different generation & storage models. Our grid will be powered by this combination. It will always be a reality that the most expensive options will become uneconomic, so become obsolete.

  11. Much as I’m an advocate for alternative power (especially 24/7 productive tidal energy), I take exception to the brainless mantras being chucked around without regard for the facts.

    Fact……Despite coal generation/gross ‘pollution’ for several centuries (since the Iindustrial Revolution) the billions of people in today’s world enjoy a MUCH higher standard of health and vastly longer life-times than was the case before coal-fired power generation.

    (And coincidentally it could be noted that ‘domestic violence’ and the divorce-rate has gone through the roof since ‘the man of the house’ has become ‘girlified’. )

    Fact…….In the 20-odd years I lived in the LaTrobe Valley ~ the home of Victoria’s massive coal-fired power-production facilities, which incidentally sent power to other states, the air quality was consistently better/much better than that of Melbourne.

    Fact……By far the greatest source of environmental pollution/destruction isn’t coal it’s the unrestrained ~ and strongly-advocated by the god-of- your-choice overproduction of homo-sapiens, on a scale that makes viagra-chomping rabbits look like sissies.

    Though I personally would like to see the end of smoke-belching chimneys

    • @Jack

      I learned quickly to ignore any post where the opinions of the scribe a prefaced with FACT.

      If you must use the word at least provide a reference. And please nothing from Jo Nova or Stop these things, where it appears you spend a LOT of your free time.

      • RodM ….
        Is THAT a Fact??

        But to set your mind at ease:- Sorry, I’ve never even heard of the references you cite. (But YOU obviously have.)
        The ‘Fact’ is that I lived in the LaTrobe Valley for nearly 20 years and kept abreast of the published (monthly) figures because I have long-standing emphysema and heart/arterial consequences of that. Apart from periodic medical tests, I can assure you that, Factually, I have more trouble with anything breathing-related here in Melbourne that in LaTrobe. ( eg. the distance I’m able to walk without stopping to catch my breath.)

        Moreover, the FACTS relating to the life-spans and pollution-caused illnesses in different times and places is easily established anywhere.

        As a species we’re living on ‘average’ almost twice as long as we were pre-Industrial Revolution (see Google et al.) ~ and this is particularly so in industrialised countries (eg. Great Britain) ~ the home of coal-mines and coal-fired industry. And the stats tell us that urban- dwellers outlive rural residents ~ in general terms. (And on a lighter note one could point out that the most populous nations also burn the most coal these days: India and China.)

        Lung-cancer rates have not fallen dramatically ~ but the stats all conclude that is due to the huge increase in smoking ~ specifically the chemicals in processed tobacco. Coal-fired pollution doesn’t get a mention.

        I need to go and do other things, but if you need authoritative ‘references’ I suggest you spend a couple of hours in Google ~ and then tell me I’m wrong.

        • All I’m hearing is anecdotes and excuses.

          You are the one making the spurious cliams.
          Back up your “facts” with references or leave the word fact out of your posts.

  12. I do not totally disagree with you. But do you really think we can continue burning our grandchildren´s resources? Mining will always be necessary. We always need raw materials. Coal will be used to make steel (as a form of carbon in the process, unless we invent a way to use CO2!!) All resources are finite, & we always mine the cheapest & easiest to access. We really are wasting coal by mining it now. In the future, new technologies will extract resources much more safely, for both the miners & the planet.
    I totally agree with you about population: The population of the world has ballooned in my lifetime. However, we cannot put the genie back in the bottle, so now there is a need to live cleaner so we do not make life really unsustainable. W do not want to go backwards, so there is a need to make sustainable, low polluting energy in a way that does not deplete resources. This is achievable, even with current technology. If you look Solar panels have gone from about 12% efficiency, to a current best of about 22%, with 20% being common. This is in 25 odd years. Technology will innovate to fill in the required gaps: batteries will get cheaper, with more sustainable methods & sources of manufacture, & developments in power plants such as wave technology will happen. WE have I guess 25 years to transition out of Fossil power.
    Another factor that has not been mentioned is the ´gaming´ of the energy market this summer in Australia. Smaller, distributed power generation (that will not have monopolised ownership as at present) will reduce power cost even if we do not go to 5min sale on the NEM market. This is because there will be no huge generators that can perform ´maintenance´ during periods of high power usage, & even if it happened, smaller generators will not have the same effect on the market.
    (Perhaps Ronald could do an article on how numerous smaller generators will help the Wholesale cost in peak times…)

  13. Hi Doug.
    Lotsa points made and I won’t try responding to all of them. However:-

    The idea of saving “our grandchildren’s resources” is a non-sequitur, since you’re actually suggesting coal-burning is a good thing so long as we leave enough for others. Let’s also not nuke each other so that our grandkids have more weapons to play with. In any case, it’s a whole different question from the efficiency/availability/pollution one.

    But resources ARE finite, and the various methodologies/efficiencies/possibilities/etc. are more than anything akin to the band playing ‘Nearer My God To Thee’ as the Titanic slides under the waves.

    The ‘ballooning population’ IS the problem (and at the root of almost EVERY major problem in the world today), but fortunately it IS, absolutely, possible to ‘put the Genie back in the bottle’ ~ the Chinese showed us how in recent years: Make reproduction socially unacceptable and legally restrict it until the Evolutionary wheel turns a little further and the Natural Selection cycles of four billion-year rebalance themselves…… with or without our species. As always, the Natural Order WILL assert its rule in due course. (?Perhaps breed kids who need less food so that we can carry more of them? :))
    As it stands now our species could be seen by a pragmatic observer as a vigorous, overwhelming, unnatural resource-consuming cancerous growth ~ perhaps the result of a single bad mutation ~ which will sooner rather than later destroy the body in which it grows: Earth. (and take everything else with it!)
    It’s well and truly time to pick up the scalpel!

  14. Thanks for the article with comments which generated more light than reading the biased Fairfax and News Corp papers though amazingly the ABC on Landline did a program on the big issue of upgrading all the transmission lines to take all the renewables energy which are generally in far flung places but sadly ended it with a sandwich lady saying wind turbines were better than the smoke coming out of coal fired power stations (I think its steam but I’m happy to be corrected). But a good discussion which must mean its far from certain that renewables can do the job today but will at some point in the future. When that point will be is unclear but the planning must include all sources and its not an overnight switch (pardon the pun). How about a dam or 2???

    • Stacks nowdays are clean of visible emission due to, precipitators and bag filters however the NOX is visible where it meets the air.

      The bulk of emissions visible are water vapour.

  15. Hi
    One thing not discussed is the need to shed load.
    I am a volunteer energy coach with Enova Energy (a Community owned electricity reseller on NC, NSW). I recently did an audit on a big domestic user: domestic water pressure pump, Aerated Septic system & Halogen lights. I advised them how to save about 5mw+ per year. (Gravity feed water with solar powered transfer pump, change aerator pump on septic, change about 25 Halogen lamps to LED)
    My assessment is most domestic users can easily reduce bills & load, but usually require help to achieve it. If this went across the market, there is a huge saving on generation available. (In the last 6 years, our house has reduced by about 10KwH/day. We use about 30 Kw/h per day for 7 people, including 10Kw/h/day for our electric (Imiev) car!)
    So not only do we need to increase generation & storage, there is a need to reduce load. This could also be assisted.

  16. Ian Thompson says:

    Hi Doug

    My apologies – I read in one of the blogs that stated “there will likely be a number of hiccups during transition” – or the like – and “rolling black-outs” – and inadvertently attributed this to you. But you did state “Renewables are now cheaper to build & run” – and I found this statement potentially misleading. I recall Ronald stating Solar PV was “nearly there”, which is not the same thing. I think it depends very much on your definitions – if you are relying on and not considering the massive rebates, then the statement is clearly false. If, however you consider the rebate a “proxy” for a carbon tax on coal, then perhaps some renewables are cheaper than coal – however being cheaper than coal burdened with a carbon tax, does not immediately ensure that renewables are then also cheaper than other alternatives. You also suggested farmers have 4 autonomous battery tractors, instead of one large diesel tractor. We need to think this through – if we say 2 tractors are charging, while 2 are in use, does this mean the farmer also has to buy two combine harvesters, two seed drills, two cultivators, and build twice as many sheds to house these? Seems to be an extraordinary expensive way to go – maybe cheaper to simply buy his product from overseas. And, making his existing, big diesel tractor autonomous also would save him some labour cost.

  17. Ian Thompson says:

    Mike, CU, Doug

    Some of the “reply” buttons have gone – I suspect due to the depth of the “nesting” of responses – so I’d like to make a comment here.

    Firstly, I am also a renewables apologist – and always have been – and that has been for a long, long time. Just not a “devout”, “touch the forelock” full-blown greenie – more a pragmatist.

    CU apears to think PV and Wind can alone save the day – but I don’t think this is at all the most cost-effective way forward. If he has considered this at all, I suspect CU thinks Hydro and Tidal can be achieved overnight – whereas the Snowy Mountain Scheme took 25 years to build, but then only once proposals, designs, funding, and approval to start had been achieved. There are only a few tidal power stations in the World, all of relatively low power – Australia had only reached the stage (Sept 2017) of part-funding a $5.85M Project to start assessing and mapping tidal energy resources in Australia. So don’t hold your breath on this one.

    My greatest concern, is that without forward planning, people of CU ilk will commit Australia to be forced to keep using “unreliable” dirty coal power for many, many more years than it needs to. I don’t want us to go that way.

    I am not a nuclear advocate – but do think we need to consider nuclear within the “mix” of generating options – at least for the medium-term – rather than bury our collective heads in the sand and hope for a miracle. I agree with CU that the lead times are long, and that Gen IV technology might not be available in time – a pity, since these designs offer “proliferation resistance” – that is, the industry is cognisant of the issue, and the designs do not generate weapons plutonium. As of February 2019, there are ~ 450 nuclear power reactors operating in 30 countries, provided 2506 billion kWh of electricity in 2017, which was 10% of the World’s electricity. China has 11 nuclear reactors under construction, India 7, Russia 6, South Korea 5, UAE 4, then any number of countries with 2 and 1 – total ~ 53, as far as I can see not including numerous plants having their reactor generation capacity uprated significantly. Many existing plant have had their operating lifetime approved to be extended from 40, to 60 years.
    Biofuel has a fatality rate, measured in deaths per terrawatt-hour of electricity produced, about 300 times that of nuclear – Hydro about 35 times. Tidal is not mentioned, perhaps because so little is in use anywhere in the world.

    By the way – I think describing Coal Power as “unreliable” is disingenuous – and brings general renewable apologists into disrepute. Saying it all broke down when the weather got hot is a spurious statement – even the most modern of transport aircraft have occassional turbine problems causing delayed departures, takeoff aborts, or return to origin outcomes – and they usually have 2 or 3 complete “spare” engines to get them home. Conspiracy theorists saying they choose to do maintenance at peak times is also probably fake – yes, I’ve read it here – if a ship’s engineer noticed a bearing running hot whilst running at full power, they will inevitably advise the Captain to reduce power, or even stop to effect repairs.
    Obviously – if Coal stations do not have spare capacity – even when all rooftop PV and Wind is running at full tilt – then a mechanical or electrical fault may force them to shut down that unit for repair – with no hope of using a “spare”. This is more likely to occur if the Coal station is nearing the end of it’s life (or beyond), and maintenance is not being optimised due to concerns about over-capitalising a possible near-future stranded asset – a situation that has been brought about, perhaps by us.

    I mention these things – as it does our credibility as a group of (at least partially) like-minded renewable apologists – no good at all to “bend” the truth to suit our own agenda – others can see through this tactic.
    Let’s try to keep this professional, please.

    Finally – the reason I write about Planning – is that I don’t want us to get to a point perhaps 10 or 20 years from now – only to find our productivity and profitability as a Nation is being being compromised by either the extremely high cost of energy due to the need to spend massive amounts on batteries – or we are being held to ransom – or for whatever other reason – and we suddenly wish we had properly planned for the future, but it is now too late to implement anything. This might force us to take coal stations out of mothballs – what a simply stupid possible outcome!

    So I say again, let’s consider only immediately feasible options to cover ourselves for the near-future – even if we include non-renewable (but no, or low emissions technologies) – and do sufficient analysis and planning to try for an optimum mix, both during transition, and beyond. To not include nuclear within this mix, is, to me, extremely short-sighted. Our Chief Scientist acknowledges this. If nuclear does not get a guernsey, so be it – at least then, we have hopefully identified the best way forward.

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