The future of energy generation and storage

[SirRumpole]

I agree that a government might choose to stick to something when it suits them but I'm not seeing that a political commitment is actually enforceable if they choose to do something else. If it is, well there's a pretty long list of past political promises that are outstanding.....

The only way to 'enforce' something is to actually build it and put the onus on succeeding governments to maintain it or pull it down.

The Sydney Opera House is still there and no government is going to pull it down even though there was considerable political opposition to it in the first place.

I doubt future Labor governments will blow up Snowy Hydro 2.0 even though they didn't particularly like it at the time.

So the foundations have to be laid at some time but all we seem to get these days is hot air.

 

[IFocus]

So far as manufacturing's concerned, the big problem is that we basically swapped manufacturing for being the world's quarry.

Australia failed to modernize / build technology then we had Coalition governments that were into ideology that the market is the best mechanism to determine our future rather than plan seriously and support the sector same as transition to renewables IMHO.

Unlike the Germans.

 

[IFocus]

By the way I keep saying we are doing well with reducing our carbon footprint, I'm pleased you also finally agree on that issue.
Also what's amazing it is on Scomos watch, who would have thought.

The states and business are doing all the work Morrison SFA, seriously look at the Nationals, no hope.

 

[sptrawler]

The states and business are doing all the work Morrison SFA, seriously look at the Nationals, no hope.

That is the first accurate thing I've read, it is the States and business doing all the heavy lifting, IMO I hope it stays that way at least it will be fit for purpose.
The Feds should only get involved with taxpayers money, where there is an obvious requirement e.g Snowy 2.0, funding interstate HV transmission etc, the States really have the overiding ownership of their power stations and system, also the States are in the best position to roll out EV charging that suits State usage.
All the Feds should be involved in IMO, is ensuring a national standard is used, that ensures the equipment for EV charging is universal and supplying funds for infrastructure that is of a Commonwealth nature.

I mean lets get real, WTF does Morrison or Taylor know about W.A's electricity system, they never even come here except if we have an AFL grand final. In all the years I worked in the power game, the only politician I saw was Hawke, when he was P.M, so how they could add anything to the power debate is absolute nonsense. ?

 

[SirRumpole]

I mean lets get real, WTF does Morrison or Taylor know about W.A's electricity system, they never even come here except if we have an AFL grand final. In all the years I worked in the power game, the only politician I saw was Hawke, when he was P.M, so how they could add anything to the power debate is absolute nonsense.

Absolutely bleeding right.

The States had a functional , low cost electricity supply system before that idiot Costello made them split it up and privatise the components.

That was the start of the end of cheap electricity for consumers.

 

[rederob]

The only way to 'enforce' something is to actually build it and put the onus on succeeding governments to maintain it or pull it down.

The Sydney Opera House is still there and no government is going to pull it down even though there was considerable political opposition to it in the first place.

I doubt future Labor governments will blow up Snowy Hydro 2.0 even though they didn't particularly like it at the time.

So the foundations have to be laid at some time but all we seem to get these days is hot air.

I bang on about policies all the time because they drive what can be done.
As @Smurf1976 pointed out, some politicians develop impractical policies or try convert so called motherhood statements - like Hawke's on poverty - into policy.
The big difference in the electricity sector is that it's very easy to convert policy into law because of existing legislation, viz. the NEL. We are not inventing the wheel, just reducing its friction.

As @sptrawler noted, Australia does well on a per capita basis on renewables. It hasn't been a hard decision for energy investors to make as the capital outlays are relatively small and they know they won't have any CO2 legacy issues affecting future pricing. The result has seen our energy operator constantly on the back foot due to an inadequate infrastructure for renewables. The inevitability of there being some form of global carbon pricing mechanism in place shows the incompetence of the Coalition over the past 8 years when it comes to the dual matters of energy policy and climate change.

 

[sptrawler]

I bang on about policies all the time because they drive what can be done.
As @Smurf1976 pointed out, some politicians develop impractical policies or try convert so called motherhood statements - like Hawke's on poverty - into policy.
The big difference in the electricity sector is that it's very easy to convert policy into law because of existing legislation, viz. the NEL. We are not inventing the wheel, just reducing its friction.

As @sptrawler noted, Australia does well on a per capita basis on renewables. It hasn't been a hard decision for energy investors to make as the capital outlays are relatively small and they know they won't have any CO2 legacy issues affecting future pricing. The result has seen our energy operator constantly on the back foot due to an inadequate infrastructure for renewables. The inevitability of there being some form of global carbon pricing mechanism in place shows the incompetence of the Coalition over the past 8 years when it comes to the dual matters of energy policy and climate change.

Now IMO you are getting closer to the real issue, the carbon price would have driven the cost of coal generation up a lot and would have forced the generators to change fuel, I doubt it would have driven them to renewables, because as I said they were really in their infancy until about 4 years ago.
The molten salt storage looked promising but hasn't proven as succesfull as first hoped, wave generation was abandoned in 2019 as it also didn't live up to expectations, so it would have been wind and solar, solar which has also only hitting it straps since about 2017, batteries have only come into their own in the past 3 or so years.
But the carbon tax would have constantly driven up the cost to burn coal, this would have required generators to change from coal to LNG or fuel oil, what that would have done to the cost of electricity to the consumer is anyones guess.

 

[Smurf1976]

The states and business are doing all the work

Agreed but that's an excellent outcome in my view.

The further the feds are kept away from it, the better since with very few exceptions they do more harm than good. They're almost always focused on politics and game playing. Keep them well away.

 

[rederob]

Now IMO you are getting closer to the real issue, the carbon price would have driven the cost of coal generation up a lot and would have forced the generators to change fuel, I doubt it would have driven them to renewables, because as I said they were really in their infancy until about 4 years ago.

Only in Australia were renewables in their infancy. Europe had turned significantly to wind well over 10 years ago, and Germany back then was the world's largest manufacturer of solar panels. The following 2 tables (per capita electricity consumption) show how the transition to renewables was occurring from 2010 to 2015:

What is most evident from the above is the take up of solar during that period which, apart from Germany, was negligible in 2010. It almost beggars belief that in 2015 German per capita solar consumption was twice that of Australia. Next is the growth of wind energy, especially noticeable for the UK.
Putting it bluntly, other parts of the world had the necessary policy levers in place to transition to renewables 10 years ago and they actually started in earnest.
What has occurred more recently and is reflected by Australia is greater renewables investment driven by the trend of consistently lower costs.
With regard to electricity generators during the carbon price era, I believe any liability via coal or gas for example was able to be offset by a carbon credit achieved through renewables. Maybe @Smurf1976 has can advise if this was happening back then as I recall that was the carrot being dangled to get renewables into the energy mix of the big electricity generators.

 

[sptrawler]

Very interesting Rob, it is also interesting Australia has more solar per capita than Germany.

With an installed photovoltaic capacity of 16.3 GW at the end of 2019, Australia has the highest per capita solar capacity at 600 watts per capita, overtaking Germany with 580 watts per capita.

The other thing of note, that helps Germany's figures, is the fact it can import its green energy from other countries, funny that. Putting it bluntly, they share their generation around, nuclear in France, U.K and Germany, Hydro in the Scandinavian countries etc.

Norway and Germany open power link boosting EU's green energy supply

Germany and Norway officially opened NordLink on Thursday, a direct power cable between the two countries that will provide Europe's largest economy with green energy at a time it is phasing out polluting coal power.

www.reuters.com

Nuclear Power in Germany - World Nuclear Association

Germany until March 2011 obtained one-quarter of its electricity from nuclear energy, using 17 reactors. Following the Fukushima accident in Japan in March 2011, eight reactors shut down immediately with the remaining reactors phased out by April 2023.

world-nuclear.org

From the article:

Nuclear Power in Germany​

(Updated March 2021)

• Germany until March 2011 obtained one-quarter of its electricity from nuclear energy, using 17 reactors. The figure is now about 10% from six reactors, while 35-40% of electricity comes from coal, the majority of that from lignite.
• A coalition government formed after the 1998 federal elections had the phasing out of nuclear energy as a feature of its policy. With a new government in 2009, the phase-out was cancelled, but then reintroduced in 2011, with eight reactors shut down immediately.
• Public opinion in Germany remains broadly opposed to nuclear power with virtually no support for building new nuclear plants.
• Germany has some of the lowest wholesale electricity prices in Europe and some of the highest retail prices, due to its energy policies. Taxes and surcharges account for more than half the domestic electricity price.
• Exports were mainly to Austria, Netherlands, Poland and Czech Republic, with net imports from France. Germany is one of the biggest importers of gas, coal and oil worldwide, and has few domestic resources apart from lignite and renewables (see later section). The preponderance of coal makes the country Europe’s biggest emitter of carbon dioxide.

Germany 24% coal generation + importing green energy from other countries, versus Australia 54% coal down from 75% a few years ago and doing it on its own.

Wish you would compare apples with apples, the negativity is palpable.

 

[SirRumpole]

Very interesting Rob, it is also interesting Australia has more solar per capita than Germany.

Hardly surpprising considering our large expanse of unused land in a dry climate with a small population compared to Germany's large population in a geographically smaller and higher rainfall country.

 

[sptrawler]

Hardly surpprising considering our large expanse of unused land in a dry climate with a small population compared to Germany's large population in a geographically smaller and higher rainfall country.

Yes wait and see the figures in about 3 years when the new solar farms are added, they will be really interesting.
The other thing of course is, Germany is one of the worlds largest solar panel and inverter manufacturers, so having a ready supply, an affluent society and a large population over quite a small area installing large amounts on rooves is relatively easy, for one subsidising your own manufacturers to supply them helped, as stimulus after the GFC.
Like I say, it really isn't comparing apples with apples IMO.
Europe is like a big interconnected grid, so they can push and shove generation around to keep it all as green as possible, we don't have that luxury we have to convert our whole system over ourselves and we have to pay for it ourselves. Also there isn't an extension cord to another country, if we stuff it up.
Unlike Europe, where Germany if it has a bad day, can import hydro power from Norway and nuclear power from France and vice versa, gas from Russia etc, the U.K is the same.
Australia doesn't have that luxury.

 

[Smurf1976]

I believe any liability via coal or gas for example was able to be offset by a carbon credit achieved through renewables. Maybe @Smurf1976 has can advise if this was happening back then

I don't recall all the details on the financial side but certainly some were doing things with renewables, efficiency schemes (eg handing out energy saving lights) and so on at that time.

Two things I do recall very well from that time are more on the technical and operational side however.

One is that it was widely taken to be temporary. That is, right from day one there was an expectation that it wasn't to be permanent and that being so, decisions were based accordingly.

The other is that it was by no means the sole cause but it did mark the tipping point of a shift in focus to a much shorter term one. That ultimately ended up causing rather a lot of drama in several states when the lights nearly went out. That's not to say the carbon tax directly caused that focus, but the change occurred at that time. Due to all the uncertainty, the focus shifted from long term to short and has remained there ever since amidst constant uncertainty.

Regardless of the detail there's a need for consistent policy that doesn't vary according to who's in government at the time. That approach of constant back and forth policy really doesn't work when we're talking about assets with a lifespan measured in decades or even longer.

 

[sptrawler]

Agreed but that's an excellent outcome in my view.

The further the feds are kept away from it, the better since with very few exceptions they do more harm than good. They're almost always focused on politics and game playing. Keep them well away.

What I like is NSW and Victoria seem to have taken it on board, that a shift to renewables and the retirement of coal has to happen sooner rather than later, even if they replace their existing coal stations it will go a long way to reducing Australia's carbon footprint.
It will be interesting to see what they present, as alternatives, to the Latrobe and the NSW generators.
West Australia and Queensland don't seem to be as vocal, regard shutting down coal, but I assume it is happening.
In W.A a 100MW battery is to be installed at the Kwinana power station site.

Synergy gives go-ahead to $155 million big battery in Kwinana

WA’s power grid will soon have a “big battery” to help manage soaring solar generation after Synergy signed a contract with Italian firm New Horizons Ahead

www.watoday.com.au

From the article:
In September, the Australian Energy Market Operator released a report which predicted the power grid in south-western WA could handle increasing amounts of solar energy until 2024, after which changes to the system would be required.

The Kwinana installation is bigger than Australia’s first large-scale grid battery in Hornsdale, South Australia, that in 2017 Tesla’s Elon Musk offered to build within 100 days or give it away for free.

 

[Smurf1976]

West Australia and Queensland don't seem to be as vocal, regard shutting down coal, but I assume it is happening.

Queensland the big problem is politics.

It's a career ending move, and has quite literally been so, for anyone senior to even suggest that it's possible.

All the rest are more pragmatic.

 

[Smurf1976]

Regardless of the long term, the short to medium term may offer some definite excitement with all of this.

Natural gas at circa $40 per GJ is just crazy. Even just six months ago anyone suggesting half that price would've been met with stunned silence but now here we are. It's off the charts sort of crazy but it's real.

Then there's coal, apparently now selling at $300 per tonne in China. That's in bulk by the train load, I don't mean $300 for a tonne of the stuff in bags and delivered to your home. Again that's a crazy price.

Then there's oil. I walk past a nearby servo most days and I see that the price of diesel is 160.9 per litre whilst 91 RON petrol is 185.9 Not yet a crisis but it's heading there, it's getting to a point where consumers will be starting to make some fuss if the price rises continue.

 

[rederob]

Regardless of the detail there's a need for consistent policy that doesn't vary according to who's in government at the time. That approach of constant back and forth policy really doesn't work when we're talking about assets with a lifespan measured in decades or even longer.

Coalition has now been in government for over 8 years.
Isn't the real problem that they don't actually have a policy, given we are not talking about it varying depending on who is in power?

The Coalition instead believe energy policy is about what consumers afford; a policy on pricing instead of a policy on production. As you note above, coal, gas and liquid fuels don't buy into that market ideology. The irony here is that the writing was on the wall many years ago that renewables were already cheaper than coal so by continuing to prop up a fossil fuel dominant electricity sector it was going to be impossible to realise the consumer price savings they would reap into the future.

AEMO, through their ongoing consultative processes with industry and regular reports, has struggled to get the Coalition to accept where the world is heading. Their latest offering sets out 5 scenarios:

I doubt too many people know this Report exists let alone have read it. It gives a really good overview of what informs where we are, and what challenges are ahead, aside from the scenarios themselves.
The quick takeaway is that Net Zero 2050 sticks out like a sore thumb. So why is that not our objective? Furthermore, when you look at the Hydrogen Superpower scenario you wonder why we don't just dive into it. It could turn our iron ore shipments into steel exports!

 

[sptrawler]

The quick takeaway is that Net Zero 2050 sticks out like a sore thumb. So why is that not our objective? Furthermore, when you look at the Hydrogen Superpower scenario you wonder why we don't just dive into it. It could turn our iron ore shipments into steel exports!

That IMO, has to happen and happen quickly.
It will be interesting to see what transpires in the next 6 months, it will make or break this Government IMO.

As you say, it is a $hit or bust situation and it won't be achieved by a softly softly approach, they are going to have to dive into it.
One thing the pandemic and the issue with China has shown, Australia continuing down the dig it and ship it path, is a road to nowhere.
I'm sure every thinking Australian has recognised that, while pondering the meaning of life, during lockdown.

Now is the obvious time to chose the H2 path, before we get too far along the journey of alternative fuels.

 

[Smurf1976]

Isn't the real problem that they don't actually have a policy

Agreed but I'll take a step back even further to a broader picture.

Australia has in broad terms lost focus on technical things.

By technical I mean basically anything that fits into that category. Electricity is technical yes but so is anything concerning medicine, structural or mechanical engineering, biology, communications, and a myriad of other things. If the people doing it are some sort of scientist, or they're people applying science such as engineers, field officers, technical tradespeople and so on well then it's in my broad "technical" category.

Over the past ~30 years right across the country we've seen it unfold. Technical people of any sort slowly but surely disappeared from leadership roles and were replaced by non-technical people. Any kind of workshop, laboratory and so on was either completely outsourced and done away with or it has been reduced to a shadow of its former self. Technical things became taken for granted and something that wasn't seen as important.

Tied into that is the demise of manufacturing which by its very nature is associated with technical people. As with the workshops and laboratories, factories just weren't seen as important anymore.

The effects of that broad shift are costing a fortune with environmental damage, economic damage, disruption to the public and business and in some cases lives lost. That's referring to it generally, not specifically limited to energy.

If we want to stop having these problems well then as a country we need to elevate technical and scientific things as a whole. That doesn't mean we need a surgeon doing the accounts at the hospital and that we ought have an electronics technician as the PM but it does mean we need to shift the focus.

Focus at present, to be blunt, is very much on *** covering. Someone non-technical gets something done by outsourcing it to a contractor or by simply buying in the product with their brand name applied to it and so far as they're concerned that ticks the box. If it goes wrong well then blame the contractor or supplier.

Actually doing it in house with their own workshops, laboratories or, heaven forbid, factory is all too hard and carries the "risk" that if it goes wrong well there's nobody else to blame. Never mind the point that it's far less likely to go wrong in the first place when you've got control of it all and skilled people making sure it all works.

Australia could easily get back to being an energy superpower but it won't happen if we don't dispense with the *** covering and instead return to focusing on real engineering, economics, environmental sciences and so on rather than this wishy washy approach.

Same with many other industries. If we want to manufacture or we want well constructed buildings and so on well then we need to change the mindset from "buy it in" and "self-certify" to one which says "we can do that" and "that needs to be inspected by someone competent and independent".

 

[rederob]

Agreed but I'll take a step back even further to a broader picture.

Australia has in broad terms lost focus on technical things.

Not that I didn't enjoy your post, but so what?

We are not getting back manufacturing any time soon, at least nothing at scale.
We can import the technical skilled people from elsewhere at any time, and that's if and when we really need them. And if quality is a concern then I agree we need independent certification, but that actually is a reinforcement of the asscovering you rail against.
The environmental damage, economic damage, disruption to the public and business you mention have very little to do with technical skills. Instead, they are failures in policy, often driven by political ideology overriding common sense and knowledge.

Voters opted for a policy vacuum in the Coalition rather than hard policies from Labor at the last election, so the care factor you want us to return to is history. (Labor pledged, for example, significant additional funding to the CSIRO.)

As for the energy superpower we could be, it's based largely on existing technology with ongoing tweaking. So just like our big moves into wind and solar, we can buy in what we need from overseas when we aren't able to make it ourselves. Frankly at the moment this is our only option anyway! Unfortunately our federal government's National Hydrogen Strategy mostly pays lip service to the idea and does little else, while the heavy lifting will be done by the Twiggy Forrests of the world, plus our States.