This is not a practical solution.Long term energy storage
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EVs Are Essential Grid-Scale Storage
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Two things about this one really.
First is simply conservative operation within technical limits. I say that since the Tasmanian system has, using inflow data back to 1916, been 100% reliable if operated within its firm capacity rating. That it has on occasions failed in practice being ultimately a failure of humans rather than engineering.
4 incidents during the 1950's and 60's simply due to very rapid demand growth, consistently running at 10% per annum compounding, and construction struggling to keep up due to shortages of materials and labour. The system as it existed at the time was pushed hard, mostly coped but did fall flat on four separate occasions.
2007 simply because system load surpassed sustainable capacity in late 1997 and continued rising with no easy fix at the time for political reasons. By the time a fix was implemented, it was too late to recover storages before a serious drought turned up.
2016 simply because "just in time" prevailed over "just in case" as a management strategy, that being a fundamental aspect of how the market runs these days in all states.
Regarding the latter, well the companies get paid to generate, they're not paid to hold reserves "just in case", so that creates a conflict between the technical aspects of operation and the financial aspects of running a business. Bearing in mind that in Tas as well as Snowy, hydro might be government owned but it's run as a "private" business in practice and required to make a profit. That's where it all went wrong, I know the story all too well. It was a failure of humans, it wasn't a failure of maths and science.
In the medium term though, what I'd do is very much a mix.
Nationally there's already a considerable fleet of fuel burning plant of various descriptions that could be used for deep firming. Long term that might not be acceptable on environmental grounds but it's there right now, it exists, and we're in no place to be getting rid of things that are perfectly useable.
So any hydro or hydrogen projects won't be the only things around anytime soon. They'll be part of the means of deep firming but by no means the only means and that does provide a very simple solution operationally.
Take the existing gas turbines etc and where possible add a second fuel, and don't use the same second fuel for all of them. So that is add diesel or add propane or whatever but the idea is we get an overall fleet with considerable fuel flexibility. That mitigates both physical supply and price risks.
From there it's straightforward to simply list them all on the basis of operational cost at any given time from cheapest to most expensive. That'll shift as relative fuel prices shift but it's not rocket science, it only needs a couple of people employed to keep on top of that.
So we have a list that, at any time, is cheapest through most costly to run and which as part of that includes any constraints - eg being able to run only 5 hours per day on gas, then having to switch to diesel, etc (and yes that's a real, actual constraint that exists at an existing facility).
For the hydro or other storage, it's then a case of not using actual cost, since that's effectively zero, but simply deciding where they need to be placed in that list. That is, if more water's available then place them toward the cheaper end, if less water's available then move them toward the more expensive end. Doing that scientifically based on forecast weather, current water levels, expected utilisation at any given point in the list (more about that in a moment) and so on.
Now here's the clever bit....
Since on most occasions when there's any need for it at all, only a portion of the deep firming fleet will actually be used. Only under the most extreme conditions will all of it run at once. That being so, that toward the cheaper end will do the vast majority of the work in practice and that makes the management of it reliable.
Eg real world example, Koombooloomba Dam in Qld, the Kareeya hydro scheme, is presently 87.2% full and that's despite heavy use in recent times. So it would sit at the very cheapest end of the list.
On the other hand Lake Echo in Tas is 44.1% full. Unless the BOM's forecasting a flood, it would thus be placed more toward the expensive end of the list. That's a human task, preparing forecasts and deciding where it needs to be put, and reviewing that on an ongoing basis - if the rain starts pouring down then move it accordingly on the list.
Noting that all wind and solar always goes in before any of the firming, it's always the first priority to be used.
From there, actually operating it is actually simpler than it sounds because we already have something known as the NEM Dispatch Engine (NEMDE). To be clear that's software running on a computer, not a physical engine of any sort, but that's extremely well proven to work - it's been in use for over 25 years now.
What NEMDE can and does do, is take into account all the constraints. Eg it takes into account transmission power limits and stability limits and so on. So it'll follow the preferred order subject to compliance with all the other requirements. Eg it won't try to run the whole country from Queensland, it knows not to try that because the transmission ratings will be a constraint.
And yes it copes just fine with outages, there's already a team of people who simply put those in as needed and it works around that.
How that differs from the present is it's a shift from financial to physical. At present the basis is prices, which are simply numbers essentially made up by traders chasing profit, and that drives physical dispatch. That's how we end up with lakes drawn right down and so on, it's financial trading that's determining what's running at any given time and what's not.
Versus the alternative approach is basing it on real, actual costs and with a "team of stereotypical geeks" deciding where to put the hydro or other storage based on weather forecasts, known outages of plant and so on. A lot of number crunching but it's about the physical, it's not chasing profit. Pay said geeks for their skills and expertise, not based on how quickly they can drain a dam.
So that is, separate the financial from the physical. Pay (for example) Snowy to provide and maintain the assets and use those assets as required for the overall operation of the system. Don't pay them only when they let water out and incentivise them to do so unnecessarily. Remove that incentive to run storage down and replace it with a strictly science-based approach.
As a practical example of this working, Origin Energy owns the Quarantine generating site in Adelaide. All up there's 5 gas turbines at the site, all using the same gas, sending electricity out on the same lines and owned by the same company. So whilst Origin will certainly compete financially against other companies, and that may lead to irrational outcomes, they're not going to compete within those 5 turbines at that one site.
That's relevant because they're not all the same. 2 x 29 MW are the most fuel efficient, the single 128 MW unit is the second most efficient, and the 2 x 24 MW are the least efficient. Which gives rise to the following output over the past 12 months:
The 2 x 29MW units comprise 24.8% of capacity at the site but generated 74.8% of total output.
The 128MW unit is 54.7% of capacity and generated 23.5% of total output.
The 2 x 24MW are 20.5% of capacity and generated 1.7% of output.
That's a classic example of what happens when it's done that way. The lowest cost plant gets run hardest, the highest cost plant is used only at the extremes. Bearing in mind this is a peaking plant so it's a good example, it's a plant that would be retained long term for deep firming purposes. Capacity factor on the 29MW units was 18.0%, for the 128MW it was 2.6%, for the 24MW machines it was just 0.5% over the past 12 months.
Apply that same logic across the whole fleet and, so long as it's based on real actual costs and a proper, scientific approach to deciding where to put the hydro in, then I've zero concerns about it working. I'd be willing to place a very large bet on that, as an approach it's a well proven concept.
The key is basing it on real engineering criteria, separating that from someone trying to make money out of it. That doesn't mean nationalisation, it just means changing how the market works. Get paid to provide the facilities, rather than being paid only when they run which incentivises draining them out.
. So when should Matt Kean get in touch with you Smurf ? That looks about as good an analysis of how to approach the vexed problem of creating effective firming supplies as could be done.
It’s no joke – our nation needs a serious discussion about energy
Labor MP Andrew Leigh has posted a meme of a three-eyed Blinky Bill suggesting the Coalition’s nuclear plan is environmentally dangerous. The Opposition said this undermines AUKUS. Picture: Instagram
Once upon a time, Andrew Leigh was a professor of economics at the Australian National University. He holds a doctorate from Harvard. These days, he is an assistant minister for bibs and bobs in the federal Labor government.
To fill in his day, he is wont to put out “witty” posts on social media, including one with a picture of a three-eyed Blinky Bill, declaring this is what we have to look forward to if nuclear plants are built in Australia. (We already have a nuclear reactor at Lucas Heights, but facts don’t worry Leigh these days.)
Nothing like a bit of plagiarism from an old episode of The Simpsons is his attitude. That will show the supporters of nuclear energy a thing or two. Perhaps he should send it to the heads of government of all 32 countries around the world with nuclear plants, including some of our good friends in the US, the UK, France, Canada and Japan.
It is extraordinarily disappointing that someone of Leigh’s calibre would sink to this depth. We mightn’t expect much more from the Victorian Premier, Jacinta Allan, nor the hapless Victorian Climate Change Minister, Lily D’Ambrosio. What D’Ambrosio lacks in competence, she more than makes up for by pushing unfounded scare campaigns.
While the Prime Minister thinks we should all lighten up about these puerile examples of humour, the reality is the opposite. Our energy situation is so dire (and getting worse) that we must have an informed, thorough discussion of the issues and the options that are available.
With the wind failing to move the turbines – a not uncommon event in June – and with a shortage of gas, particularly in Victoria, it is clear the Australian Energy Market Operator is concerned. Wholesale electricity prices are skyrocketing. It is estimated that Victoria has already used up its normal winter gas supply in the first three weeks of the month.
Any good debate starts with an agreed statement of facts from which both the affirmative and negative sides can argue. It is one reason why it is entirely reasonable to expect the Coalition to provide a detailed assessment of the costs of its proposal to build seven nuclear reactors.
The good news is that there is a tonne of overseas data to establish some accurate costings, including from some of the recent successful builds in Korea and the UAE. There is not much point trawling up some older instances where costs massively blew out and there were substantial delays, such as the UK’s Hinkley Point C. This project was poorly conceived with a French design and Chinese financing. Apart from an offtake guarantee at a minimum strike price, there were no government funds provided to the project. Numerous changes were made during the course of construction and the various UK heads of government were never supportive, particularly former prime minister Theresa May.
Similarly, the much delayed and costly American plant in Georgia was hampered by a nuclear regulatory authority that was essentially anti-nuclear. The regulatory costs alone were over the top. But with industry now heading to that state, there is already talk of building another.
The Coalition has made the sensible decision that there will be one design only (for the larger-scale plants) so the economies of scale and scope can be captured. The French have mastered this approach now – President Emmanuel Macron has announced eight new plants – and other countries now accept this as best practice.
The figure for a one-gigawatt plant is likely to be about $8bn to $10bn. The plants will be modularised, which provides additional flexibility. There will be some need to upgrade transmission lines but the costs will not be substantial.
No doubt, the Coalition will release more details on costings so voters can make a sober assessment of the case for nuclear energy. It is a complicated exercise to predict the impact on electricity prices because of the required assumptions about the energy mix as well as demand. At least, we should expect numbers under different scenarios.
But as they say, everything is relative. And the federal government is not being upfront about the costs of its energy strategy, particularly in relation to the new subsidies on offer to renewable energy and the cost of the additional transmission lines.
Using the excuse of commercial-in-confidence simply doesn’t cut it; taxpayers need to know the range of dollars they are up for. Treasury should be insisting on the same.
But let me dwell on the cost of transmission. Recall that Chris Bowen, the Climate Change and Energy Minister, has stated that an additional 10,000km of transmission lines will be required by 2030, and 28,000km in total by 2050. Without this additional transmission, there is no way the proposed renewable energy projects can be connected to the grid.
The Rewiring the Nation fund has allocated $20bn to subsidise the rollout of the additional transmission lines, with a total figure of $100bn cited as the all-up cost. This is now looking like a massive underestimate with huge cost blowouts already apparent as well as slow progress.
This is the case with Hume Link, Energy Connect, VNI West and the Marinus Link. Hume Link, for instance, is 250 per cent over the original budgeted cost. Energy Connect between South Australia and New South Wales is expected to cost $2.3bn, up from the original figure of $1.5bn. The Marinus Link has been cut in half because of the cost increases.
With the blowout in transmission costs, it is entirely possible that there could be a 10-fold increase in the value of the base against which regulated returns are calculated. This would add significantly to electricity prices of itself, an effect not replicated with nuclear.
One of the key issues is the games that the investors in the transmission lines play to ensure their project becomes a regulated asset, thereby guaranteeing an agreed rate of return, paid by consumers. The incentive is to low-ball the cost of a project in order to pass the cost-benefit test undertaken by the regulator.
There is also a further complication of the disastrous Snowy 2.0 project requiring additional transmission (both Hume Link and VNI West) but with Snowy Hydro unprepared to foot any of the bill. Lest Snowy 2.0 become a stranded asset, regulators have been under pressure to give the tick of approval to transmission projects that should probably not go ahead.
I say let’s bring on the debate about the cost of different energy strategies. But this will require transparency on all sides. It won’t be enough for the government to simply whinge about the lack of costing detail on nuclear; it will require accurate apples-to-apples comparison with the government’s plans.
Which one ? There were two links in my post.
Relying on evs as storage.
Can you link to that article please ?
Thanks my overlook.
That is just a ludicrous statement, that doesn't deserve a response
Both parties are talking of using gas as a transition fuel, you must be hyperventilating on something
I've actually run coal, gas, heavy fuel oil and diesel power stations and actually had to pass tertiary qualifications to do so, therefore I do know what can and can't replace coal, what have you run apart from union meetings?
O.K how many Snowy 2.0 sized pumped storage facilities require building before 2040? You seem to be right on top of the issues.
Listening to the loonies fall out of the trees is just painful.
Nailed it right there, there is no one fix for anything.So what went wrong? Why has it stalled?
Well the problem is firming. To make the project viable financially, they don't need an intermittent electricity supply but rather, a constant one. It was the inability to secure firming at an acceptable price that tripped the whole thing up. Financially that didn't simply put a dent in profit but it made the whole thing totally unviable so that's it, no-go unless someone can resolve that.
Now I'm going to have to be intentionally vague here. Suffice to say I'm aware of the price the various hydrogen companies are looking for in order to attain financial viability but I'm not sure how public that's intended to be. That being so, I'm not going to state a figure here but I'll say that it's a long way below the costs of nuclear and it's a long way below the cost of gas. Neither are financially viable for hydrogen production and that's largely also true for any kind of smelting, refining, bulk processing etc. They all need low cost electricity in order to compete internationally.
Only way they'll work is with heavy taxpayer subsidies and suffice to say business generally isn't keen on that since, not unreasonably, they assume some future government will probably walk away from paying that subsidy at some point which leaves them with a rather expensive industrial facility that's uneconomic to continue operating. Plus it makes the business a political target when someone realises where their tax $ are going and for obvious reasons most businesses prefer to not be in that situation.
As an example of the economics of all this, I'll use aluminium and specifically the smelter at Bell Bay, Tasmania.
Production ~185,000 tonnes a year give or take a few %.
Aluminium spot price at present is USD 2450 per tonne so that's AUD 3650 per tonne x 185,000 = $675 million a year.
Electricity consumption of this smelter is about 3100 GWh per annum.
Without disclosing any actual prices, I'll say that depending on the industry in question the limit for commercial viability is generally in the range $55 - $90 per MWh.
At $55 this smelter would spend $170 million a year on electricity, 25% of total revenue.
At $90 they'd spend $279 million on electricity, 41% of total revenue.
Now add in the cost of the alumina being smelted, anode material, labour, other utilities eg water, transport and shipping, and that the investors of course want to make a profit on the whole operation and the situation's fairly clear. A high electricity price simply dooms any such industry to guaranteed failure, it puts them out of business and sends production to some other country.
Noting there that there's nothing particularly inefficient about the Bell Bay smelter. It's not the best one on the planet that's true, but it's by no means the worst either and the best will only be using a few % less energy for what is an inherently energy-intensive process. Nothing the company could reasonably do would mitigate high energy prices.
Which brings the next obvious problem. If Australia can't sustain some sort of large scale industry then we have a brutal reality to face - we're trying to sell as much coal as we can until that changes. The ability to sustain heavy industry etc is crucial to an overall move away from fossil fuels - a point that, to my surprise, even the Greens have publicly acknowledged is true. My surprise since big industrial things guzzling up huge amounts of energy aren't exactly core Greens philosophy, but credit where it's due for acknowledging the reality we face.
Therein lies the cold hard reality of the situation. From a purely technical perspective a lot of things can work. Heck we can go 100% solar and battery if the only criteria is that it works. Doing it in a manner that produces energy at an internationally competitive price however, well that's drastically harder and requires a seriously sharp focus.
It's not a new situation though. Victoria, Tasmania and SA all realised they had this exact problem after WW2 and all set about solving it using creative approaches. SA never quite got there due to scale and resources although it came pretty close but Vic and Tas both nailed it and they did it with much the same overall approach despite having very different resources neither of which are high grade. Key things being scale of economy, genuine innovation in engineering, raising system load factor as high as possible and ruthless assessment of all the options available. Plus in Tasmania's case doing pretty much everything "in house" considerably cut the cost of construction.
A similar mindset is needed if there's to be any chance of fixing it this time. Just looking for "silver bullet" solutions copied from somewhere else isn't going to work. No matter how well Australia does nuclear, we're not going to be the Americans on cost using a US reactor design built by a US company. Same with France or anywhere else, they're not going to come here and enable us to beat them at their own game.
What's needed is pragmatism, focus, technical competency and so on. Not politics and ideology.
fortescue.com
An issue with the Coalition's proposal is it's not really clear what, exactly, the answer to that is.
In my view what we have there is a classic example of what happens when non-technical people start drawing straight lines on charts or on maps without understanding the real world practical implications.
That's it yes.
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