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The future of energy generation and storage

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SirRumpole said:
Who said people expect it for 'free' ?

.
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Actually lots of people around the world expect it for free.

There was a huge uproar in Nevada in recent years when the Utility companies wanted to start charging solar cell owners a service charge, and reduce the rate they get paid for the excess production to the whole sale rate.

Solar Owners in Nevada want to pay no service charge (even though they rely on the infrastructure just as much as every one else), and the want full retail rate credit for any excess power they send to the grid, e.g. they want to get paid the retail rate for their excess production.

So yes, that would mean the solar users become a drag on the system, and are getting subsidised by non solar users.

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The fairest out come is for all connected grid uses to pay a service charge, and then pay a fair retail rate for usage.

People adding power into the grid, should then be paid a wholesale rate for the electricity they supply.

This system would mean all the investors in infrastructure (including solar owners), and customers and retailers are all being treated fairly.

 
Value Collector said:
The fairest out come is for all connected grid uses to pay a service charge, and then pay a fair retail rate for usage.
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It all depends on the definition of "fair" doesn't it ?

Lets face it, a privatised power system is contrary to the national interest.

The national interest says reward customers for reducing consumption and therefore saving on infrastructure costs, and privatisation means penalising everyone for a reduction in demand for power in order to maintain profits.

Privatising an essential service doesn't work , it's blatantly obvious in this case.
 
SirRumpole said:
It all depends on the definition of "fair" doesn't it ?

Lets face it, a privatised power system is contrary to the national interest.

The national interest says reward customers for reducing consumption and therefore saving on infrastructure costs, and privatisation means penalising everyone for a reduction in demand for power in order to maintain profits.
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customers do get lower usage charges if they reduce consumption or invest in solar.

Also, Profit margins are regulated by the government, So the providers aren't making excessive margins on their invested capital, as I said it's normally around 8 - 12%, most of the time at the lower end of that range.


Privatising an essential service doesn't work , it's blatantly obvious in this case.
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Did you know that the Utility owned by Warren Buffet's Berkshire Hathway, provides power cheaper than neighbouring states where the utilities are government owned?
 
Value Collector said:
Did you know that the Utility owned by Warren Buffet's Berkshire Hathway, provides power cheaper than neighbouring states where the utilities are government owned?
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I didn't, but the USA is not Australia, the markets are totally different, same sized country much bigger population in the US, I don't think that the US is comparable to Australia.

Secondly Buffet is not as profit motivated as some. He also lives in the country unlike the foreign investors in Australia's grid eg Enegie that just shut down Hazlewood.
 
We tried this caper of higher network service charges in Tasmania back in the mid-1990's and it didn't go well.

The arrangement was 96 cents per day fixed charge with unit consumption at 6.6 cents / kWh for general supply, 5.5 cents for heating (24/7 flat rate), 4.4 cents off-peak plus typically a 10% discount on the off-peak for those who could be bothered filling out the form.

Suffice to say it was a public relations disaster. Big time. Second only to the Gordon-below-Franklin dam in terms of things the Hydro has come up with that have provoked a degree of upset from the general community.

And so the Liberal government lost its majority at the next election and formed the only Liberal-Green government we've ever had.

Then the prices oversight commission was formed to review prices.

Then the whole system was scrapped and went back to lower fixed charges and higher unit rates. The industry responded in the only way that made sense with an extremely aggressive sales campaign to drive load up as high as possible thus keeping the unit price per kWh down despite having to recover fixed costs as part of it.

It made a lot of sense and was based on some very sound logic, foreseeing a future where literally anyone could generate power and access the network, but politically it became impossible and down here at least there are still quite a few bitter memories of that experience to this day.

It's an oddity really. People pay relatively large amounts, say $100 per month, in fixed fees for a smartphone and don't seem to have a problem with that. Few if any are paying per call and per unit of data without some sort of fixed charge. And yet ask people to pay just a third of that as a fixed charge for electricity and a war starts.

I'm very sure that every electricity retailer in the country was watching closely what happened in Tas back in the 1990's and were glad they weren't the ones who tried it. Telstra wanted to do it with fixed home phones too but lost their nerve.

Electricity pricing is a problematic issue from a broader social perspective as well as the economic and environmental issues. That point is reinforced once you realise just how many bills are paid late or on some sort of payment plan. It's not 5% and it's not 10% - in some areas it's far higher than that (as in 50% or thereabouts). With the steep price rises in most mainland states that situation isn't going to improve.

Anyway, things aren't too bad here in Tassie:

For King and Flinders Islands electricity prices will increase 1.5% on 1 July.

For the rest of the state the following changes on 1 July:

Tariff 31 (general light & power) = fixed supply charge up 0.3%, energy charge per kWh down 0.6%

Tariff 41 (24 hours supply for heating and hot water) = fixed metering charge down 3.4%, energy charge per kWh up 7.0%

Tariff 61 (off-peak with afternoon boost period) = fixed metering charge down 5.8%, energy charge per kWh up 7.0%

Tariff 62 (off-peak night period only) = fixed metering charge down 10.0%, energy charge per kWh up 7.0%

Feed-in Tariff for small scale solar, hydro, wind etc systems = energy payment per kWh up 33.8%

There will be some print media advertising regarding the new prices over the next few days. :)
 
Value Collector said:
customers do get lower usage charges if they reduce consumption or invest in solar.
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No they don't. The overall price jumps in line with govt policy to offset the lost revenue to renewables contributing to lower demand.

The policy is to protect the private power companies profitability and investment, while poorly keeping price increases in check from gouging.

So the more renewables and battery storage causing falling demand, we can expect the prices of power bills to sky rocket, which will drive the demand for renewables and domestic storage even higher ...it's currently a loop with govt regulation putting the brakes on in to maintain a healthy private sector margin; if it was a control loop, the setpoint would be the margin, demand the variable and the output the price , but price is being manipulated rendering the loop unstable and volatile.
 
Smurf1976 said:
We tried this caper of higher network service charges in Tasmania back in the mid-1990's and it didn't go well.



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If there is no fixed charged for solar users, then the only way to get them to pay their fair share of the grid expenses is to lower the credit they receive for the KW/h they feed back into the grid, to 1cent or 2 cents, and charge them the full rate for the KW/h they draw back at night.

Personally I would rather pay a fixed access fee of some where between 50cents and $1 per day, and earn 6 -12 cents credit for every kw/h I sent back.

People that say a $1 per day access fee will cause people to go off grid just don't understand the costs of going of grid, and the negatives involved with being off grid.
 
Value Collector said:
If there is no fixed charged for solar users,
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There is a fixed charge, the point is are you going to reward people for taking a load off the grid, or punish everyone by raising charges because solar users are reducing demand thereby saving the expense of building extra infrastructure ?

This seems to be a case of reverse capitalism. Less demand should result in lower prices as the retailers try to sell more product, but in the case of electricity they have everyone by the balls and they know it so they can raise charges at their whim.

The system is broken, which is why Finkel recommended more regulation.
 
SirRumpole said:
There is a fixed charge, the point is are you going to reward people for taking a load off the grid, or punish everyone by raising charges because solar users are reducing demand thereby saving the expense of building extra infrastructure ?

This seems to be a case of reverse capitalism. Less demand should result in lower prices as the retailers try to sell more product, but in the case of electricity they have everyone by the balls and they know it so they can raise charges at their whim.

The system is broken, which is why Finkel recommended more regulation.
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It's not about "rewarding people that take load off" or "punishing people that put load on"

It's about realising that we all rely on the grid (even solar users), and the cost of the grid needs to be fairly spread amongst all users, those people without solar should not be subsidising those with.

The system isn't broken, pricing structures just need to be adjusted, we can't do without the grid, even when we are 100% renewable, we will still have to be moving around energy, between producers and users at various times throuout the day.

There isn't less demand for the grid, solar users still use the grid 24 hours a day, all day every day they are either putting energy in or taking it out, it's their battery,
 
As smurph said a long time ago, but as usual no one understands, the cost of generation hasn't changed much, if at all.
If anything, the cost of generation has fallen, fuel is cheaper.
 
sptrawler said:
As smurph said a long time ago, but as usual no one understands, the cost of generation hasn't changed much, if at all.
If anything, the cost of generation has fallen, fuel is cheaper.
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In Tasmania the reality is that Hydro gets 24.6% of what households spend on electricity (or 27.1% if you base it on the GST-exclusive price).

It's broadly similar nationally. Networks are where your money is going and the share of network and retail costs as a % of the average power bill has increased over the years.

20 years ago generation was about 40%.
 
Smurf1976 said:
In Tasmania the reality is that Hydro gets 24.6% of what households spend on electricity (or 27.1% if you base it on the GST-exclusive price).

It's broadly similar nationally. Networks are where your money is going and the share of network and retail costs as a % of the average power bill has increased over the years.

20 years ago generation was about 40%.
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I think the projections for SA and Tas are different to the rest of Oz.

Something to remember is that generation is:

Federally supervised reduction of emissions 28% pf 2005 by 2030
Federally supervised retirement of in excess of 12% of incumbent coal powered capacity
Federally imposed target of 33,000GWh renewables by 2020 (LRET ans SRES)
Known to charge more dollars because of retention of inefficient (end of economic life) generators. than would have been for new entry builds.
 
sptrawler said:
As smurph said a long time ago, but as usual no one understands, the cost of generation hasn't changed much, if at all.
If anything, the cost of generation has fallen, fuel is cheaper.
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I am not talking about generation, I am just talking about accessing the grid, e.g. The poles and wires that allow the transport / trading of energy to happen, solar users rely on it, and should pay to access it
 
Value Collector said:
I am not talking about generation, I am just talking about accessing the grid, e.g. The poles and wires that allow the transport / trading of energy to happen, solar users rely on it, and should pay to access it
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Distribution network charges are around 38% of residential bills and being a monopoly (see economics 3001 "natural monopoly") the recovery rate is reviewed every 5 years by the AER, so the idea of disassociated frequent laissez faire changes to poles and wire charges seems a bit far fetched.

However West Oz being what it is and the NT are open to manipulation.
 

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