Australian (ASX) Stock Market Forum

The future of energy generation and storage

What I want to know is, is Labor's renewables plan viable without building more hydro capacity (in excess of Snowy 2.0) ? If not then they are selling a fantasy imo. Dutton is selling a fantasy about nuclear too, plugging SMR's which have not been demonstrated to work.

I can't get more unpolitical than that, both sides are selling snake oil, and we are stuffed.
Nice summary..
 
What I want to know is, is Labor's renewables plan viable without building more hydro capacity (in excess of Snowy 2.0) ? If not then they are selling a fantasy imo. Dutton is selling a fantasy about nuclear too, plugging SMR's which have not been demonstrated to work.

I can't get more unpolitical than that, both sides are selling snake oil, and we are stuffed.


About sums it up
 
What I want to know is, is Labor's renewables plan viable without building more hydro capacity (in excess of Snowy 2.0) ? If not then they are selling a fantasy imo. Dutton is selling a fantasy about nuclear too, plugging SMR's which have not been demonstrated to work.

I can't get more unpolitical than that, both sides are selling snake oil, and we are stuffed.
Nailed it.
Why can't the media ask those questions?
 
What I want to know is, is Labor's renewables plan viable without building more hydro capacity (in excess of Snowy 2.0) ? If not then they are selling a fantasy imo. Dutton is selling a fantasy about nuclear too, plugging SMR's which have not been demonstrated to work.
Aiming to be non-political in this comment:

It's one of those things where any combination that adds up will do it. In that sense it's much like, for a more familiar example, transport. It doesn't matter whether it's trains, trams, buses, ferries, private cars or people walking. What matters is that as a whole they get the job done and do so in a manner deemed appropriate (eg those walking are doing so willingly, not because of no alternative).

Here are some charts showing the output of variable renewable energy (wind and solar, not including hydro or biomass). This is just a selection to illustrate the issues, there's no need to look at each and every state here:

NEM, daily for past 12 months. Each bar is the day's total output.

1736406308911.png


Victoria, same period as above:

1736406354181.png


NSW, past 7 days. Data resolution is 5 minutes:

1736406563484.png


SA, past 7 days. Data resolution is 5 minutes:

1736406647443.png


So there's no denying VRE works, the problem is the intermittent nature of it versus society's need for reasonably consistent electricity supply.

To fill a gap of a few hours, batteries can do that easily and reasonably economically.

But take a close look at Victoria in the middle of winter. No chance we're fixing that with batteries and even at the NEM level overall, there are certainly periods of multiple consecutive days of poor yields.

The practical options to fix that are either hydro or something based on fuel combustion.

For the latter, fuel combustion, gas turbines tend to be the first choice with internal combustion the other option. One particular problem with gas is simply the cost. At close to $20/GJ for bulk LNG, and that is the current market price, that's a seriously expensive way to generate electricity given we're going to be importing the stuff. That alone is an argument against gas, there's no need to mention CO2.

But if we don't want to be burning gas, oil etc well that leaves hydro. Reasons we might want to not burn oil or gas aren't simply about the environment - there's also the finite nature of high grade resources, geopolitical risk, financial risk given price volatility, etc.

Part of the problem with hydro in Australia is we've this widespread misconception of the country having no water, and our political class has very little real knowledge there. In truth we do have viable options for hydro, it's just that our politics isn't at all favourable to their development. Those options being located in the east basically - Qld, NSW, Vic, Tas. Options elsewhere aren't zero but they're far more limited.

Noting for all this that it's not an all or nothing proposition. Nothing precludes using some gas, some hydro and some fuel oil to firm VRE and nothing precludes having some coal or some nuclear and downscaling the VRE + firming accordingly. It's not the black versus white, all or nothing thing the media and politics seem to think it is.

It's much like public transport. Just because a city has buses doesn't mean it can't also have one or more train lines and if it's by the water it can also have ferries. It's not all or nothing, a mix is entirely workable but the key with either electricity or transport is tying them all together as a working system. Constant power from a mix of generation sources. Or being able to get from one end of the city to the other by catching a bus to the train station, then boarding a train. It needs to tie together as one functional system.

That operation as a single system is at odds with modern ideology that demands manufactured competition between participants however and that's a big part of the problem. Overcome that bit, shift the competition to the construction, maintenance and ownership but not to the decisions regarding dispatch, and a lot of problems go away. :2twocents
 
Aiming to be non-political in this comment:

It's one of those things where any combination that adds up will do it. In that sense it's much like, for a more familiar example, transport. It doesn't matter whether it's trains, trams, buses, ferries, private cars or people walking. What matters is that as a whole they get the job done and do so in a manner deemed appropriate (eg those walking are doing so willingly, not because of no alternative).

Here are some charts showing the output of variable renewable energy (wind and solar, not including hydro or biomass). This is just a selection to illustrate the issues, there's no need to look at each and every state here:

NEM, daily for past 12 months. Each bar is the day's total output.

View attachment 190796

Victoria, same period as above:

View attachment 190797

NSW, past 7 days. Data resolution is 5 minutes:

View attachment 190798

SA, past 7 days. Data resolution is 5 minutes:

View attachment 190799

So there's no denying VRE works, the problem is the intermittent nature of it versus society's need for reasonably consistent electricity supply.

To fill a gap of a few hours, batteries can do that easily and reasonably economically.

But take a close look at Victoria in the middle of winter. No chance we're fixing that with batteries and even at the NEM level overall, there are certainly periods of multiple consecutive days of poor yields.

The practical options to fix that are either hydro or something based on fuel combustion.

For the latter, fuel combustion, gas turbines tend to be the first choice with internal combustion the other option. One particular problem with gas is simply the cost. At close to $20/GJ for bulk LNG, and that is the current market price, that's a seriously expensive way to generate electricity given we're going to be importing the stuff. That alone is an argument against gas, there's no need to mention CO2.

But if we don't want to be burning gas, oil etc well that leaves hydro. Reasons we might want to not burn oil or gas aren't simply about the environment - there's also the finite nature of high grade resources, geopolitical risk, financial risk given price volatility, etc.

Part of the problem with hydro in Australia is we've this widespread misconception of the country having no water, and our political class has very little real knowledge there. In truth we do have viable options for hydro, it's just that our politics isn't at all favourable to their development. Those options being located in the east basically - Qld, NSW, Vic, Tas. Options elsewhere aren't zero but they're far more limited.

Noting for all this that it's not an all or nothing proposition. Nothing precludes using some gas, some hydro and some fuel oil to firm VRE and nothing precludes having some coal or some nuclear and downscaling the VRE + firming accordingly. It's not the black versus white, all or nothing thing the media and politics seem to think it is.

It's much like public transport. Just because a city has buses doesn't mean it can't also have one or more train lines and if it's by the water it can also have ferries. It's not all or nothing, a mix is entirely workable but the key with either electricity or transport is tying them all together as a working system. Constant power from a mix of generation sources. Or being able to get from one end of the city to the other by catching a bus to the train station, then boarding a train. It needs to tie together as one functional system.

That operation as a single system is at odds with modern ideology that demands manufactured competition between participants however and that's a big part of the problem. Overcome that bit, shift the competition to the construction, maintenance and ownership but not to the decisions regarding dispatch, and a lot of problems go away. :2twocents
Well I think one of the big problems is that the Left media will give either side hell if their is any backdown on the net zero targets so the pollies can't see the pragmatic approach and push on blindly with their flawed ideolgy.
 
Last edited:
Well I think one of the big problems is that the Left media will give either side hell if their is any backdown on the net zero targets so the pollies can't see the pragmatic approach and push on blindly with their flawed ideolgy.
Nailed it again.
The electrical grid isn't about ideology, it is about maintaining and growing our economy and with it our lifestyle and our kids futures.
It's a shame politics get involved.

Both sides are talking net zero, it is just both sides are trash talking each other, rather than being sensible about the issue, a simple case of politicians putting their future ahead of Australia's future.
 
Last edited:
Something that @Smurf1976 keeps alluding to and they probably haven't even considered if we needed fuel oil to supply base load generation in the synopsis.

 
Something that @Smurf1976 keeps alluding to and they probably haven't even considered if we needed fuel oil to supply base load generation in the synopsis.
Another issue is that we use, and for the foreseeable future will continue to use, huge amounts of fuels for other purposes too.

Nationally 66% of natural gas and 97.9% of oil doesn't go into power stations but is instead used for something else. That's government statistics for 2022-23.

Where that leads is that we're going to need rather a lot of oil and gas for other uses for a long time to come. That then raises the question about geopolitical and other risks to the supply chain as well as financial risks.

Regarding the financial aspect, here's a chart of LNG prices. Source = ACCC

1736425804160.png

So a lot of volatility there, it's a very real financial risk and of course oil is also a risk as is well known. There's no option to avoid substantial imports at this point, the opportunity to do that was lost long ago, but it's still a case that the greater the level of imports, the greater the financial vulnerability across the economy.

Then there's the physical risk if supply is disrupted. Plenty of countries have learned that one the hard way in the past - among other examples it's why France went so heavily into nuclear and it's why Japan was so keen to buy thermal coal from Australia. The extremely high energy density of nuclear means fuel can be readily stockpiled, whilst in Japan's case they reasoned that Australia would likely be a more reliable fuel supplier than oil from the Middle East, plus coal's easily stored just by piling it up on the ground. Both having been hit hard by the events of the 1970's.

There's definite downsides to relying on fuel imports without even mentioning the environment. :2twocents
 
Top