The future of energy generation and storage

[sptrawler]

As usual there would be faults on both sides.

That's why there is the Fair Work Commission.

Yes it is a bit sad really, they are the main employer in the area, a bit like cars in S.A.

 

[Smurf1976]

So far as issues of productivity are concerned, a big part of that is that Australia has developed a very risk averse culture in recent times.

Only last Friday an engineer I know who lives in Sydney called me asking if I wouldn’t mind giving my opinion about something that isn’t quite in accordance with Australian Standards.

Long story short, we discussed the theoretical side and the practical difficulties in actually complying with the Standard as well as what could go wrong if not compliant, what the consequences would be and so on.

Then I dropped the bombshell by stating “when I actually tested this at full scale......”.

And so that was it. I’ve been there and actually tested at full scale to see exactly where the stray (electrical) current would end up and with what practical consequences.

As he then went on to say, pretty much nobody would be brave enough these days to do a lab test and they sure as hell wouldn’t do a full scale one. Sure, you can make sure it doesn’t kill anyone and so on but still, there’s no chance he was going to be able to conduct such a test under any circumstances.

That broad risk aversion, even where everything is being done sensibly albeit not to the letter of what it says in a Standard somewhere, is a massive barrier to innovation and productivity in the real world.

Same concept applies right across the economy really. Everyone’s terrified of getting it wrong so just doing things the way they’ve always been done becomes the only “safe” option. Thing is, that guarantees stalling productivity whilst everyone else overtakes us.

 

[sptrawler]

So far as issues of productivity are concerned, a big part of that is that Australia has developed a very risk averse culture in recent times.

Only last Friday an engineer I know who lives in Sydney called me asking if I wouldn’t mind giving my opinion about something that isn’t quite in accordance with Australian Standards.

Long story short, we discussed the theoretical side and the practical difficulties in actually complying with the Standard as well as what could go wrong if not compliant, what the consequences would be and so on.

Then I dropped the bombshell by stating “when I actually tested this at full scale......”.

And so that was it. I’ve been there and actually tested at full scale to see exactly where the stray (electrical) current would end up and with what practical consequences.

As he then went on to say, pretty much nobody would be brave enough these days to do a lab test and they sure as hell wouldn’t do a full scale one. Sure, you can make sure it doesn’t kill anyone and so on but still, there’s no chance he was going to be able to conduct such a test under any circumstances.

That broad risk aversion, even where everything is being done sensibly albeit not to the letter of what it says in a Standard somewhere, is a massive barrier to innovation and productivity in the real world.

Same concept applies right across the economy really. Everyone’s terrified of getting it wrong so just doing things the way they’ve always been done becomes the only “safe” option. Thing is, that guarantees stalling productivity whilst everyone else overtakes us.

It is our culture at the moment, there is no bouquets, only brickbats.
Just read the comments on here, regarding a Royal commission into aged care.

We really are in a sad place at the moment, and I personally place all the responsibility, at the feet of the media.
They are in a death spiral IMO, and are using populist attention grabbing news, as a grappling hook. IMO it is at the expense of decent journalism.
I may be wrong and it is only my opinion, but I personally am repulsed at the media, they will go broke which is a shame.
But they are stifling everything, you can't do or say anything, without fear of retribution.
Not only could that be by your peers, but it could well be by the Country if the media take a dislike to your perception.
Probably drifting off thread, but it is a real problem for Australia, with regard anything be it politics, energy production, social engineering, manufacturing, teaching, any aspect of our lives.
If the journalists don't agree, $hits are trumps.

 

[Value Collector]

Being "the most productive" is over rated, having the capability counts for a lot, and anyway Denmark is pretty similar to us in terms of labour rates and living standards, so why should we not be able to compete with them ?

Give it a go, start a company, do a capital raising and if you are right you might be the next Andrew Forrest, until then its all speculation.

The guys that want to invest in building and owning a wind farm will buy the best equipment they can at a price that makes the project make sense, If its not available in Australia they will import.

It would be silly to avoid building a wind farm just because the current suppliers are located over seas.

But if you think you can compete with the foreign manufacturers, Go for it, nothing is stopping you.

 

[SirRumpole]

But if you think you can compete with the foreign manufacturers, Go for it, nothing is stopping you.

I'm saying there is a place for government(taxpayer) funding of essential services like power that has kept the system going for decades, where quality and standards are more important than doing things on the cheap and making the maximum profit before cutting out when things get tough, like closing Hazlewood.

Competition does not necessarily produce the best results, virtually as soon as power was privatised in this country, the pooh hit the propellor.

People never talked about power prices before that.

 

[Tisme]

Read and weep:

https://www.aemo.com.au/-/media/Fil...projections_Final-Public-Report-June-2017.pdf

 

[Smurf1976]

Competition does not necessarily produce the best results, virtually as soon as power was privatised in this country, the pooh hit the propellor.

People never talked about power prices before that.

What most fail to realise is that the costs subject to competition are predominantly costs which exist only because of it. As such it is simply impossible for the end result to be a reduction in prices.

Sadly very few seem able to grasp this concept.

 

[Value Collector]

I'm saying there is a place for government(taxpayer) funding of essential services like power that has kept the system going for decades, where quality and standards are more important than doing things on the cheap and making the maximum profit before cutting out when things get tough, like closing Hazlewood.

Competition does not necessarily produce the best results, virtually as soon as power was privatised in this country, the pooh hit the propellor.

People never talked about power prices before that.

Could you imagine the damage we would do to Qantas if we said they had to only use Australian made Planes?

It would be a disaster,.. of course we could mandate that only Aussie built planes were allowed to land in Australian airports, and that would force airlines to buy some Aussie planes, But ticket prices would rise, and we would make the whole system less efficient, we would all be paying more and flying less, and some Aussie manufacturer would have a nice fat cat monopoly, at our expense.

I think owning and operating a manufacturing plant making wind turbines, is a very different business to owning and operating a wind farm.

I see no issue with people who want to own and operate a wind farm (public or private), buying their equipment based on quality and price, and importing equipment.

Denmark would have some natural advantages over an Australian manufacturer due to its location.

They are situated in the middle of a huge local wind turbine market, where they can sell directly to Britain, France, Norway, Germany, Spain, Sweden etc etc, this gives them the ability to produce on a scale that Australia could never support.

95% of Denmarks contracts would be lower cost local ones, and 5% might be higher cost exports to Australia and other.

Where as if Australia wanted to match their production scale we would be the opposite.

eg. 95% of contracts would be higher cost exports, and only 5% would be lower cost local sales.

 

[SirRumpole]

Could you imagine the damage we would do to Qantas if we said they had to only use Australian made Planes?

That's a straw man argument if ever I saw one.

 

[Value Collector]

That's a straw man argument if ever I saw one.

How is it a straw man?

I am simply pointing out that forcing operators of expensive pieces of equipment to use only Australian made equipment could have quite bad effects on customers and the industry in general.

Saying to a power company that is looking to build and operate a wind farm that they can only purchase Australian made equipment, is not any different to telling qantas they can only buy Australian made planes.

How is limiting a company with a fleet of wind turbines to only purchasing Aussie turbines, any different from limiting a company with a fleet of jets to buying only Aussie jets?

The the power company and the airline will want to get the best deal on their equipment, so they can have the lowest costs possible.

 

[SirRumpole]

How is it a straw man?

Because you continue to deny that privatisation of power in Australia has made it more expensive, not less.

 

[Value Collector]

Because you continue to deny that privatisation of power in Australia has made it more expensive, not less.

That has nothing to do with where the wind turbines are made, we aren't even discussing who owns the electricity company, we are talking about where the equipment is made.
eg. Even if Qantas was still government owned, it would be stupid to avoid buying planes from Boeing and Airbus.

Even if the Electricity company were publicly owned, they would still need to source their wind turbines and the rest of their equipment from a manufacturer.

Owning and operating a fleet of generation assets, is a completely different business to running a wind turbine manufacturing operation. (in fact, even owning the turbines and operating them are often two separate businesses)

Even if the electricity network was 100% government owned, it would still make sense to buy the equipment based on quality and price, rather than where the factory sits geographically.

 

[luutzu]

I'm saying there is a place for government(taxpayer) funding of essential services like power that has kept the system going for decades, where quality and standards are more important than doing things on the cheap and making the maximum profit before cutting out when things get tough, like closing Hazlewood.

Competition does not necessarily produce the best results, virtually as soon as power was privatised in this country, the pooh hit the propellor.

People never talked about power prices before that.

Who needs competition when a wink and nod will make both duopoly rich?

 

[luutzu]

That has nothing to do with where the wind turbines are made, we aren't even discussing who owns the electricity company, we are talking about where the equipment is made.
eg. Even if Qantas was still government owned, it would be stupid to avoid buying planes from Boeing and Airbus.

Even if the Electricity company were publicly owned, they would still need to source their wind turbines and the rest of their equipment from a manufacturer.

Owning and operating a fleet of generation assets, is a completely different business to running a wind turbine manufacturing operation. (in fact, even owning the turbines and operating them are often two separate businesses)

Even if the electricity network was 100% government owned, it would still make sense to buy the equipment based on quality and price, rather than where the factory sits geographically.

Maybe a gov't owned electricity company will see a lot of sense in setting up their own manufacturing plant to support the hardware they need.

I mean, if the entire country's power system depends on your company alone... and the country owns you... it'll start to make a lot of sense to invest in a few manufacturing plant to build and innovate the stuff you need.

For one it create jobs among your plebs. Two, the freight costs is a couple shipload cheaper per project. Three, you can sell your innovation and export it to other lego nation who privatised all their manufacturing like it's a disease.

 

[SirRumpole]

Maybe a gov't owned electricity company will see a lot of sense in setting up their own manufacturing plant to support the hardware they need.

I mean, if the entire country's power system depends on your company alone... and the country owns you... it'll start to make a lot of sense to invest in a few manufacturing plant to build and innovate the stuff you need.

For one it create jobs among your plebs. Two, the freight costs is a couple shipload cheaper per project. Three, you can sell your innovation and export it to other lego nation who privatised all their manufacturing like it's a disease.

Exactly. Importing stuff from half way around the world makes little sense when we can do it here and get expertise that would spin off into other areas, like making aircraft wings perhaps.

 

[Value Collector]

Maybe a gov't owned electricity company will see a lot of sense in setting up their own manufacturing plant to support the hardware they need.

.

They would have to weigh up their options, and judge them as to separate businesses, because they are separate businesses.

Because if the government was going to invest in some government owned manufacturing enterprise, who is to say that wind turbines is the one they should choose?

No doubt the same government owned electricity company buying the wind turbines, would also be buying Millions of dollars worth of vehicles every year (as does the rest of government)

So do you just choose to build a wind turbine factory "just because", or do you continue importing the wind turbines, and instead invest the public's money to start a vehicle manufacturing business, and supply the electric company (and the rest of the government) with Australian build vehicles?

or there some other manufacturing business that the government should take on, Bulldozers??? Computers??? MRI machines???

Is the government likely to produce any of these things Better and Cheaper??? if not why do it.

 

[SirRumpole]

or there some other manufacturing business that the government should take on, Bulldozers??? Computers??? MRI machines???

Bushmasters ?

It wasn't long ago that you were touting the benefits of this Aussie made vehicle.

 

[luutzu]

They would have to weigh up their options, and judge them as to separate businesses, because they are separate businesses.

Because if the government was going to invest in some government owned manufacturing enterprise, who is to say that wind turbines is the one they should choose?

No doubt the same government owned electricity company buying the wind turbines, would also be buying Millions of dollars worth of vehicles every year (as does the rest of government)

So do you just choose to build a wind turbine factory "just because", or do you continue importing the wind turbines, and instead invest the public's money to start a vehicle manufacturing business, and supply the electric company (and the rest of the government) with Australian build vehicles?

or there some other manufacturing business that the government should take on, Bulldozers??? Computers??? MRI machines???

Is the government likely to produce any of these things Better and Cheaper??? if not why do it.

Upstream and downstream stuff right?

A large organisation with a secure market monopoly that is also gov't owned [own by the taxpayers] will find it more economical to reinvest their profit into manufacturing a large chunk of the parts they need.

Much like Henry Ford owning the steel mills, a large chunk of the Amazonian forest etc., when his Ford was very much the main game in town.

Private companies, particularly one on the smaller side of things, will find it cheaper, less risky, to just buy off the shelves. Get one project done and hope there's another not too far away.

 

[Value Collector]

Exactly. Importing stuff from half way around the world makes little sense when we can do it here and get expertise that would spin off into other areas, like making aircraft wings perhaps.

Did you know even Boeing makes its wings on the other side of the world to where they assemble their planes.

Boeing has manufacturing plants all over the world making different parts and sections of their planes and transports sections of the planes to their assembly plant to be put together.

Manufacturing is a global business.

Here is their "Dreamlifter" aircraft that transports plane sections from around the world to the assembly plant.

 

[Value Collector]

A large organisation with a secure market monopoly that is also gov't owned [own by the taxpayers] will find it more economical to reinvest their profit into manufacturing a large chunk of the parts they need.

So do you choose the wind turbines or the vehicles?