The future of energy generation and storage

[Smurf1976]

The call for urgency is getting louder, as we thought it might, two weeks is a long time in politics.

The change of a major failure in the next few weeks is significant, AEMO's official threat notice remains valid.

From there well quite a few are trying to position themselves as "right" in much the same way as people make public calls that the stock market has topped or predicting landslide wins in elections and so on. Get it right then you can write a book and retire.

Ultimately though, well we're at the point where imported fuel to run gas turbines (the existing fleet) basically is the only option left. Diesel or LNG, take your pick, both have definite downsides.

Last week gave a reprieve with the weather but last few days Victoria's back to guzzling through the gas.

Daily output from Victorian gas and hydro for the past 30 days. Orange is gas, blue is hydro:

On that chart it's pretty clear that hydro and gas are doing the same thing. More gas capacity is an alternative to hydro and more hydro capacity is an alternative to gas, they're both doing part of the same job which is filling the gaps in the rest. Hence they move up and down together. After a few days' reprieve, storage is again being drawn down heavily.

 

[SirRumpole]

An economist's analysis of solar power, is it backed up by engineers?

It doesn't include the cost of firming, except a vague reference to batteries increasing in efficiency and reducing in price.

When it comes to power, solar could leave nuclear and everything else in the shade — here's why

Energy experts — and even Greenpeace — underestimated solar power's rapid global growth. Now many believe solar is set to become the world's biggest power source within the next decade. But it is falling prices — rather than environmental benefits — that might be driving that change.

www.abc.net.au

 

[sptrawler]

An economist's analysis of solar power, is it backed up by engineers?

It doesn't include the cost of firming, except a vague reference to batteries increasing in efficiency and reducing in price.

When it comes to power, solar could leave nuclear and everything else in the shade — here's why

Energy experts — and even Greenpeace — underestimated solar power's rapid global growth. Now many believe solar is set to become the world's biggest power source within the next decade. But it is falling prices — rather than environmental benefits — that might be driving that change.

www.abc.net.au

Yes it's a nice warm feel good article about how cheap renewables are, which is true, but it doesn't address the actual reason why companies aren't putting it in fast enough.

Someone should ask, ok if its so brilliant and so cheap and makes so much sense, why isn't it just getting thrown in as fast it can be built?
Bet they don't like trying to answer that one.

Like we say, way too many vested interests, way too little honesty and way too much cherry picking of what they want to say.

From your article:

Australia's energy market operator says record generation from grid-scale renewables and rooftop solar is pushing down wholesale electricity prices.

Then from AFR this:

Power prices to surge amid sluggish rollout of clean energy: UBS

Wholesale power prices could be almost 50 per cent higher than last year, the investment bank’s analysts warn, as renewables project development has stalled.

www.afr.com

Analysts at UBS now expect prices to peak at $104 per megawatt hour by 2029, 20 per cent higher than this year’s forecast and almost 50 per cent more than 2023.


Way too many mixed messages IMO.

 

[SirRumpole]

Way too many mixed messages IMO

Well, we know that the ABC is Left leaning and the AFR is Right leaning, so the truth maybe somewhere in between.

 

[sptrawler]

Well, we know that the ABC is Left leaning and the AFR is Right leaning, so the truth maybe somewhere in between.

I think I have noticed the ABC has started getting a bit more balanced, when presenting issues recently, rather than taking a stance, they seem to be more presenting the issue.
It may have just been the articles I was reading, but they appeared to be fairly neutral in the presentation.
It will be great if it's actually happening, because the ABC used to be the goto channel for news, current affairs and documentaries IMO.
Now I get my news and current affairs on the internet and ASF.

 

[IFocus]

Canberra must intervene radically in failed gas market​

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid.

As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been this way for months:

This should take the following form:

• a $6Gj export levy should be placed on all eastern gas exporters;
• “use it or lose it” laws must be passed to guarantee no production boycotts.

This guarantees local supply will be abundant and cheap, as well as collecting appropriate taxation for the Australian people for their resources.

Canberra must intervene radically in failed gas market

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid. As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been...

www.macrobusiness.com.au

 

[sptrawler]

Canberra must intervene radically in failed gas market​

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid.

As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been this way for months:

This should take the following form:

• a $6Gj export levy should be placed on all eastern gas exporters;
• “use it or lose it” laws must be passed to guarantee no production boycotts.

This guarantees local supply will be abundant and cheap, as well as collecting appropriate taxation for the Australian people for their resources.



View attachment 179887

Canberra must intervene radically in failed gas market

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid. As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been...

www.macrobusiness.com.au

@Smurf1976 may have some background on that?

Just did a bit of googling:
This is the problem when politics eventually clashes with reality, Victoria has had a moratorium on gas exploration for the last 10 years, now they are gagging for it and Queensland sold all theirs.
Another case of karma and politically driven ideology, it's a shame we don't learn from our mistakes, unintended consequences of listening to FW's rather than experts.

Australia exports gas. Are we going to import it too?

Experts say time has run out to develop new sources of supply to avert crippling shortages on the east coast.

www.theage.com.au

Australia is likely to become a gas importer despite being a major global exporter of the fossil fuel, with experts declaring time has run out to develop new sources of supply to avert crippling shortages.

Homes and businesses in Victoria and NSW have been put on high alert for gas shortfalls this winter and the Australian Energy Market Operator last month warned the east coast gas market could be in yearly deficits by 2028 unless new supply came online.

Experts now say the only feasible solution is for the southern states to build one or more import terminals so gas can be shipped in from Queensland, Western Australia or overseas.
“We’ve run out of time,” Rick Wilkinson, the chief executive of Australian energy consultancy EnergyQuest, said.

While Australia is one of the top exporters of liquefied gas, massive volumes of production from Queensland’s gas fields are locked into long-term export contracts to LNG buyers in Japan, Korea and China, and gas produced in WA cannot be transported to the eastern states.

The southern states’ gas shortfall is driven by dwindling supply from fields in Bass Strait, which have historically provided up to two-thirds of their demand.

State governments have rolled out schemes to drive down gas usage, ban gas hook-ups in new homes and encourage people to switch to electric appliances. But the market operator said gas use was not falling fast enough to avoid shortfalls.

A new gas field cannot be built in time and the existing pipeline from Queensland’s vast gas fields is already running at capacity amid elevated demand for heating and power this winter.

Wilkinson said an LNG import terminal was the best option in terms of supply and price. Gas bound for export is super-chilled, poured into ships and sent overseas.

“A single LNG import terminal can supply more gas than the entire Queensland-to-southern pipeline, which is already stretched to capacity during peak demand,” Wilkinson said.

“In terms of price forecast, you’re looking at the likelihood of access to cargoes that would be at a competitive price point for domestic buyers.”
Mining billionaire Andrew Forrest’s privately owned Squadron Energy is building what could become Australia’s first LNG import terminal in Port Kembla on the NSW South Coast.

Another option is Viva Energy’s proposal to begin importing LNG at the site of the Geelong oil refinery in Victoria.
The first gas was initially planned to arrive by this winter, but a final investment decision on the project has since been delayed due to a drawn-out environmental approval process and requests from the state government for more information on its potential local impacts.

However, environmental groups oppose gas imports. They argue governments have ample time to speed up switching households from gas to electric appliances. Meanwhile, local gas producers say more should be done to tap new supplies around the country to boost energy security.

“Utilising our resources and utilising storage can hopefully get us to the point where it diminishes the requirement or excludes the requirement for import terminals,” Brett Woods, the chief executive of gas producer Beach Energy, said.

Woods also warned importing gas could increase local prices for manufacturers that relied on gas for energy or as a feedstock by lifting their exposure to the volatile global commodity market, putting local jobs at risk.

He is calling for governments to focus on opening new gas fields and building more storage facilities ahead of imports.
“I think the challenge with any import terminal is that the price of the international gas that comes into our market will re-base the energy prices on the east coast to a higher level.”

Squadron Energy chief executive Rob Wheals said on Tuesday its Port Kembla terminal was 96 per cent complete. However, it has yet to sign supply deals with local buyers needed to start importing gas.

“Construction of Squadron Energy’s Port Kembla energy terminal is nearing completion and offers a clear solution to the gas supply challenges we are already facing, all while avoiding the need for new gas fields, which would lock in carbon emissions for the long term,” Wheals said.

 

[Smurf1976]

Canberra must intervene radically in failed gas market​

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid.

As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been this way for months:

This should take the following form:

• a $6Gj export levy should be placed on all eastern gas exporters;
• “use it or lose it” laws must be passed to guarantee no production boycotts.

This guarantees local supply will be abundant and cheap, as well as collecting appropriate taxation for the Australian people for their resources.



View attachment 179887

Canberra must intervene radically in failed gas market

The Australian gas market has failed. Regulation of the failure has also failed. Radical intervention is now necessary to stabilise the Australian energy grid. As things stand today, the gas spot market is trading at $16Gj, miles above the supposed Code of Conduct price cap of $12Gj. It has been...

www.macrobusiness.com.au

The problem is about peak delivery rates and seasonal consumption in the south eastern states, that is the NEM-Queensland. It's not about total gas consumption, or any consumption in Queensland including exports.

To work technically as a solution it needs pipelines to go with it from Queensland to NSW and Victoria, and it also needs gas storage facilities (underground) built due to the fairly inflexible nature of the CSG fields - they're far better as a base load source than an intermittent one.

That could of course be built but point is it has to first be built and it's big $ to do so. It's factually incorrect to say it's just a matter of stopping the export of LNG and that's it, that fixes it.

That's not to say I'm overly keen on the export of LNG, in my view it's a shocking waste of the resource and will ultimately be regretted in a big way when Qld and WA in due course face shortfalls (and that's closer than most seem to realise.....), but in a technical sense just stopping it is not a solution to the issue in the south-eastern states right now.

Actual solutions, in random order:

More gas infrastructure to bring gas from Queensland to the south-east combined with reduced LNG production and export.

Gas from another source eg build LNG import terminals in NSW, Vic, SA and ship gas to them.

Use something other than gas to firm wind and solar electricity, eg use diesel or hydro, thus reducing peak gas demand.

Encourage electrification of consumer loads, in particular encourage a shift from gas to off-peak electric water heating (including both heat pumps and resistive) and encourage a shift from gas to reverse cycle air-conditioning for space heating.

Use a means of electricity generation that doesn't require firming. Eg use nuclear or coal.

Or some combination thereof and for the record that's my preferred solution, a combination of approaches simply because that seems to make the most sense overall. Not "no gas" but "less gas" with an assortment of other things.

The only political comment I'll make is to say that's the reason I dislike "think tanks". Either the Australia Institute really doesn't understand the issue or they're pretending not to for whatever reason. Either way it's a reason why in my view "think tanks" in general are much like certain consultants - hired to justify someone's decision, not to inform it.

I don't think I'm boasting in saying I understood the gas issue extremely well in the 1990's. Not boasting because plenty of others understood it too indeed the information was publicly available. Now consider all the politics surrounding it since that time and it's really quite amazing and not in a good way. We should've been well on the way to being off it by now in the south-eastern states, instead it's actually been encouraged for household use, actually forced in some areas, and there's been more gas-fired generation built as well. Indeed all presently operating gas-fired generation in NSW was built within the last 30 years, and over 95% of it within the past 15 years if plant presently under construction is included. So the political failure on gas isn't a minor oversight, it's a monumental blunder.

 

[Smurf1976]

However, environmental groups oppose gas imports. They argue governments have ample time to speed up switching households from gas to electric appliances.

In principle I 100% absolutely agree.

But what happened in 2009?

Well COAG decided to do the opposite, encouraging a shift from electricity to gas for water heating.

15 years later and we've got serious problems made worse by that decision. A lack of electrical load to absorb solar at midday, and a shortage of gas.

I shake my head when it comes to politics. Simple as that.

 

[basilio]

Well, we know that the ABC is Left leaning and the AFR is Right leaning, so the truth maybe somewhere in between.

Yeah... Nuh.

The ABC didn't write the story. It was published in The Conversation . The writer is an economics editor for the conversation website.

The critical part of the story is the exponential rise in PV power in past few years and the rapid decrease in costs. Yes firming is an additional cost but again that is also falling.

Overall the heading says it all.

When it comes to power, solar is about to leave nuclear and everything else in the shade

Energy experts – and even Greenpeace – underestimated solar power’s rapid global growth. As this chart shows, solar’s now set to become the world’s biggest power source within the next decade.

theconversation.com

 

[basilio]

This story echoes the observations made by Smurf et al that a strong, holistic, engineering approach is essential to rebuild our energy systems. A high quality public service approach.

Achieving net zero with renewables or nuclear means rebuilding the hollowed-out public service after decades of cuts

Public ownership is back in vogue, after the Coalition promised publicly owned nuclear plants in a decade. The problem is, the public service has been hollowed out.

theconversation.com

Whatever technological choices we make, it is clear our days of relying on the private sector to provide vital infrastructure are coming to an end. The question now is whether the public sector can recover to take the lead.

 

[Smurf1976]

More warnings, now even the normally conservative ACCC is starting to panic:

East coast gas crisis to hit sooner than expected: ACCC

The competition watchdog says major new supplies needed by 2027 to stop homes and businesses running short.

www.theage.com.au

East coast gas crisis to hit sooner than expected: ACCC​

So how's it going with storage in the short term? Here's a couple of charts for Iona (Vic) and Newcastle (NSW):

What happens during the remainder of this winter and into spring really depends on:

1. The performance of gas production. That is volumes from the ground processed into usable gas.

2. Weather and demand for gas as heating fuel.

3. Weather and the performance of wind and solar electricity generation plus inflows to run of river hydro.

4. Reliability of coal-fired generation.

5. Transmission. Any failure of gas transmission potentially isolates source(s) from consumers whilst any failure of major electrical transmission typically requires running more gas and/or hydro as the workaround depending on what's failed.

Put those all together and at this stage it's uncertain whether there's a problem this winter or not but the risk is definitely real. Heavy storage drawdowns occurred, then a reprieve due to weather (higher wind generation in particular), but now we're seeing renewed heavy drawdowns.

The performance of existing coal plant is also not going overly well with 5 units taken off over the past 3 days across the 3 eastern mainland states. It's not a disaster but it's not great either. To be expected given the age of plant and in some cases less than ideal maintenance and operation.

 

[Smurf1976]

Providing backup power to a phone tower has much the same issues as energy storage in general. For short durations batteries are the easy and effective solution but for anything longer term a different approach is required.

Technically the same could be done for the grid. Economically however hydrogen fuel cells aren't cheap.

Green hydrogen to power mobile tower in Gippsland next time a storm cuts electricity

Energys Australia will source green hydrogen from Victoria for the fuel cells, which allow communities to stay connected for 72 hours even when the power is out.

www.abc.net.au

 

[sptrawler]

That's not to say I'm overly keen on the export of LNG, in my view it's a shocking waste of the resource and will ultimately be regretted in a big way when Qld and WA in due course face shortfalls (and that's closer than most seem to realise.....), but in a technical sense just stopping it is not a solution to the issue in the south-eastern states right now.

That is the issue people aren't accepting, for some obscure reason the ill informed feel that the gas will just go on forever, it wont and that is the problem.

The one thing for sure is our demand for energy will increase over time, the way we are looking at the moment, our ability to supply it will become more and more problematic.

 

[moXJO]

Interesting to see Africa is building nuclear reactors. I saw Russia was setting up about 7. One in mali. I know mali is currently taxing the hell out of mines to get royalties. But they are leaning heavily to Chinese and Russian miners/contractors. Aussies getting burnt.

 

[sptrawler]

It sounds like we aren't the only one's struggling

‘We don’t see a pathway’ to coal phaseout, says US utility

Also in today’s newsletter, a new report casts doubt on clean hydrogen’s role in the power sector

www.ft.com

 

[Smurf1976]

That is the issue people aren't accepting, for some obscure reason the ill informed feel that the gas will just go on forever, it wont and that is the problem.

Noting that's now 2.5 years old data.

The really alarming bit however is the rate of present use. 2021-22 production by state as follows:

WA = 3732.3 PJ
NT = 112.3 PJ
Queensland = 1541.0 PJ
Victoria = 546.3 PJ
SA = 140.0 PJ
NSW = 4.1 PJ

In the absence of major new discoveries, those production rates just aren't sustainable. Bearing in mind it's the increase that's the issue there. Going back to 2009-10 and it's very different:

WA = 1313.9 PJ
NT = 20.5 PJ
Queensland = 299.4 PJ
Victoria = 363.4 PJ
SA = 58.5 PJ
NSW = 6.3 PJ

So it's the increase in the rate of extraction of this finite resource that's guzzling through it at an alarming rate. Take a close look at the map and do the maths....

Just don't take the "proposed" pipelines too seriously. They're someone's wish list more than they're serious, actual proposals.

 

[sptrawler]

More indications that the nuclear announcement has accelerated the truth telling, at least the debate is getting to the real issues at last.

It's about time, but again this is only about decarbonising the existing grid, not about removing or abating emissions in the other areas of the economy.

But it is a step in the right direction IMO, get the conversation on track and honest, not the convoluted half truths that have been rolled out previously.

Next step in the truth telling will be, how much more electrical generation will be required to de carbonise the remainder of the economy and where will the gas come from to do that?
Which will then lead to the question,"how the hell do we get rid of the gas emissions", it's a long and winding road that's for sure.

Unfortunately politics causes us to take the most tortuous path, rather than the direct path, be that hydro, nuclear, or a combination of both.
Eventually someone is actually going to ask the question, "WHAT REPLACES THE GAS" ?

Or do we just wait, until we don't have any capacity left and no goto solution in place?
Meanwhile by the time we get to that stage, what state will the economy be in?
You would think an astute reporter would be onto this, or maybe they are, but aren't interested in presenting it, who knows these days.

The dirty secret of Australia’s green energy transition

Renewable energy, storage and transmission lines will get Australia most of the way to banishing coal from the grid. But not the whole way, officials warn.

www.theage.com.au

From the article:
Renewable energy, storage and transmission lines will get Australia most of the way to banishing coal from the grid. But not the whole way, officials warn.

As things currently stand, officials believe Australia has little choice but to urgently lift investment in a whole new generation of gas-powered turbines, like Tallawarra B. These turbines will have an infrequent but important role in backing up renewables and keeping the lights on at times of critical need.

According to AEMO and executives at utility giants AGL, Origin Energy and EnergyAustralia, it’s for this reason that gas – a fuel less polluting than coal but still a source of harmful emissions – must remain in the mix for now. While the overall use of gas-fired power is not likely to grow in the future, they say, new infrastructure, including flexible, open-cycle gas-powered turbines, must be added to bolster the grid’s access to rare but enormous injections of electricity when needed.

However, for gas to play that small but significant role, there are high hurdles to overcome. The first is the scale of the build-out required: AEMO’s modelling suggests that Australia needs an extra 13 gigawatts of back-up gas generation to ensure the grid will remain resilient under power supply squeezes and extreme weather.

Assuming each plant can generate about 0.5 gigawatts, approximately 26 plants would be needed. And if recent experience is anything to go by, this will be no small ask:
Energy Australia’s Tallawarra B is the only peaking plant added to the NSW grid in the past decade, while just one more remains under construction at Kurri Kurri.

At the same time, domestic gas supplies are running perilously low and are forecast to diminish further as legacy gas fields in Bass Strait rapidly dry up without new production to replace them.

Australia is a major exporter of liquefied natural gas, but massive volumes of production in Queensland are locked into overseas export deals, and west coast supplies cannot be sent east because there are no pipelines or gas-import terminals.

“So how do you get the gas to those plants that are only going to run 5 per cent of the time?” asks Wood. “Where is it coming from?”

 

[SirRumpole]

Australia is a major exporter of liquefied natural gas, but massive volumes of production in Queensland are locked into overseas export deals, and west coast supplies cannot be sent east because there are no pipelines or gas-import terminals.

How does gas from here to Japan or Korea ?

 

[sptrawler]

How does gas from here to Japan or Korea ?

Getting it there isn't the issue, having it in the first place is a problem and secondly as smurf pointed out we don't have as much as people think.