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The South Australia energy disaster

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Re: The South Australia energy disaster

Unread postby sparky » Sun 12 Feb 2017, 19:30:10

.
The Sydney Morning Herald is the oldest newspaper in Australia published daily since 1831.
it's economic editor is quite a good sort , this is what he has to say about the South Australia debacle

http://www.rossgittins.com/2017/02/real ... t-gas.html

in brief
"But the main thing he – and the gas industry – desperately wants to stop us noticing is that the leap in gas prices is a consequence of long-standing federal government policy and has nothing to do with the states' reluctance to let the gas producers frack all over their farmlands.

The balance of supply and demand for natural gas on our eastern seaboard was fine – and would still be today, were it not for the feds' earlier decision to allow foreign investors to build (too many) liquefaction plants near Gladstone in Queensland.

As the feds understood full well, once you can liquefy natural gas you can ship it overseas. And once you do that you've taken the relatively tiny, closed eastern Australian gas market and opened it up to the huge East Asian gas market, where prices are much higher.

"Guess what? South Australia has a new and big gas-fired generator at Pelican Point, near Adelaide, but it's been mothballed.

Why? Because the operator had a long-term contract for the supply of gas at a price set at the pre-export-parity level, and decided it was more lucrative to sell the gas into the East Asian market.

Last week Turnbull had the effrontery to argue that now gas-fired power had become uneconomic, we needed to fill the gap by subsidising new-generation "clean" coal-fired power stations.

Small problem. They're hugely expensive, only a bit less emissions-intensive than existing coal-fired stations, can't easily be turned on and off, and would supposedly still be operating 60 years later.

If there's a case for subsidising any fossil fuel-powered generators the obvious candidate is the gas-fired plants the feds' export-parity pricing policy has rendered uneconomic."
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Mon 13 Feb 2017, 05:53:53

sparky wrote:.


"Guess what? South Australia has a new and big gas-fired generator at Pelican Point, near Adelaide, but it's been mothballed.

Why? Because the operator had a long-term contract for the supply of gas at a price set at the pre-export-parity level, and decided it was more lucrative to sell the gas into the East Asian market.

It was turned on the next day to stop another black out


sparky wrote:.
If there's a case for subsidising any fossil fuel-powered generators the obvious candidate is the gas-fired plants the feds' export-parity pricing policy has rendered uneconomic."

Agree

Obviously the Coal lobby has more pull with the coalition
We are getting screwed with gas sales anyhow but thats a different story

Their only saving grace maybe????
They did mention water storage the other day which is a good idea if it doesnt kill another river system or you can find a mountain to build 2 dams in and power plant and pumping station in-between.
To be released as people come home on a hot day and turn on their aircons all at once

Regular battery storage when it gets taken up on mass will be the game changer but thats years away
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Sun 19 Feb 2017, 17:04:32

It seems battery storage is the solution and its on its way

"An Australian company says it will build solar and battery facilities in SA this year with enough storage capacity to meet the power shortfall that caused blackouts in the state 10 days ago.

David Green, a partner of Lyon Group, told The Australian Financial Review he was "very confident" his firm would install two 50 megawatt battery storage facilities in SA this year after signing an equity finance agreement with $13 billion US-based hedge fund Magnetar Capital.

Mr Green said that the facilities linked to large-scale solar generation that Lyon Group planned to build would have "easily been enough" to meet the crisis on February 8 that cut power to 90,000 homes in SA when a surge in peak electricity demand during a heatwave and problems with gas and renewables caused a shortfall of 100 megawatts a power."

http://www.afr.com/business/energy/elec ... 219-gug9i6
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Sun 19 Feb 2017, 18:39:27

Monk - The link kept jumping to an ad so not sure: is there a contract in place requiring the utility to buy a minimum volume of electricity at a set price? I can't imagine anyone laying down $13 billion without a guaranteed revenue stream providing an acceptable ROR. Such financial arrangements that have been used in Texas REQUIRED consumers to PAY ABOVE MARKET RATES for a fixed period of time. And not just higher rates but a minimum consumption. And that's typically of a "take or pay" basis: the consumers pay for a minimum amount even if they don't use all the electricity during a period of time.
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Sun 19 Feb 2017, 19:19:45

Try this but it does have a pay wall but I think you get a few free.
AFR is the major financial paper in Australia.
I would imagine there would have to be a return on investment figured in especially for a hedge fund to be involved
http://www.afr.com/business/energy/elec ... 219-gug9i6
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Sun 19 Feb 2017, 19:53:14

Thanks Monk
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Re: The South Australia energy disaster

Unread postby Zarquon » Sun 19 Feb 2017, 23:04:38

Without reading the piece: IMO the fund *manages* $13 billion. It doesn't pay $13 billion for 100 MW in capacity. Unless Bernie Madoff got out early.
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Sun 19 Feb 2017, 23:16:54

Z - Even if the charge 2X the current rate...and pay for electricity they don't use?
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Re: The South Australia energy disaster

Unread postby Zarquon » Sun 19 Feb 2017, 23:47:19

(You can still read the articles on AFR if you switch style sheets off in your browser. Works on a lot of sites.)

http://www.afr.com/news/lyon-solar-mits ... 926-groq4l

"Mitsubishi will join Lyon in the Kingfisher project, a 100MW solar plant at Roxby Downs in South Australia backed by 100MW of batteries which Lyon Solar announced earlier this month at a cost of $400 million."

You have lunch with too many billionaires. After a while it makes a billion look like pocket money I suppose.
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Mon 20 Feb 2017, 01:27:14

Zarquon wrote:(You can still read the articles on AFR if you switch style sheets off in your browser. Works on a lot of sites.)



Off topic but interesting
How do you do this on Firefox is there an addon?

I see AFR for free I dont know how if its my VPN or other blockers blocking their firewall ???
Im not complaining,(as I used to subscribe to it and then used a friends subscription)it doesnt work on lots of other pay walls though
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Re: The South Australia energy disaster

Unread postby Zarquon » Mon 20 Feb 2017, 01:35:22

"With stylesheets disabled, Firefox will not use your site's CSS, so you get a completely unformatted page. The pages will also load faster.

1. Launch Mozilla Firefox. By default, the menu toolbar is hidden.

2. Press "Alt" to temporarily view the toolbar.

3. Click "View" on the toolbar, select "Page Style" and click "No Style" in the resulting sub-menu to disable the stylesheets. The stylesheets are disabled immediately.

4. Select "Basic Page Style" from the Page Style menu to use the stylesheets again."
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Mon 20 Feb 2017, 11:41:44

Z - "After a while it makes a billion look like pocket money I suppose." In the arena of global alt energy development $1 BILLION is chump change compared to the $TRILLIONS required over the coming decades. LOL

And still one more crappy article that throws around $capex amounts and MW's generated and not a single word about the sulply contracts that IMHO must have been signed. Again who is going to loan/invest $BILLIONS on a project with no guarantee of a profit let alone an acceptable rate of return? Just like major pipeline projects: they don't happen without a sufficient "subscription base": buyers with BONDED guaranteed purchases delivering a minimum revenue stream. Have any of y'all down under seen any details of what these White Knights are going to charge for "saving" you from the dark? LOL.

I'm just a tad suspicious the companies and govt are intentionally not publishing the cost of this electricity to consumers to avoid an immediate knee jerk out rage from them. As I pointed out such arrangements WERE NOT sneaked past Texas electricity consumers who are subsidizing alt expansion here: they were given the choice and they voted in favor of higher initial rates that would provide better long term value.
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Re: The South Australia energy disaster

Unread postby Surf » Mon 20 Feb 2017, 18:17:48

[quote]the first black out was caused by too much wind , the second by not enough ./quote]

For the second blackout was not due to wind. The forecast told the utilities that they would have no wind power days before the blackout. SO no wind was expected. however when they went to the market on the day of the blackout they didn't find enough power available to meet the days needs. Pelican Point didn't offer power for sale because the plant was offline and the rules didn't allow Pelican point to participate. Overall there are enough natural gas power plants available to meet south Australias power needs. Yet for some reason much was simply not available.

In the first strong winds again were predicted again days in advance. So everyone had time to prepare. Excess wind power was expected and there was the possibility of wind caused blackouts. The grid and utilities decided to export all of the excess wind power via the interconnected with Victoria. Little blackout power was expected and it was expensive so on the day they needed the backup they purchased less than they should have. The Victoria connector was operating at capacity exporting power Wind power was operating normally with only 5 to 10% of line due to excessively strong winds.

The blackout occurred when 3 tornados (out of at least 7. hit two critical transmission line nodes. The towers collapsed and the line lines shorted out. The wind turbines were not affected by the 1st and 2nd shorts. They simply went into ride through mode and then kept generating power. However affecter the 3rd short some wind farms went off line. more wind turbines went off line on the 4th. This immediately caused the interconnected with Victoria to overload and trip off line. they simply didn't have enough backup contracted to handle the situation and the entire grid went off line.

The wind turbines went offline not due to too much wind (no tornadoes hit the wind farms or their power lines. Instead it was a software setting issue. Having 3 or 4 short circuits in a very short period of time is very unusual. The default setting in the wind farm software was to shut down the wind turbines to protect them from the shorts and to allow maintenance personnel time to investigate the issue. The grid operator said they didn't know about the software. Yet it has been an area of major discussion in the utility industry for some time. IN the US and Europe the grid operators evaluate the ride through capabilities of each power plants and typically customize the settings so avoid multiple power sources going off line at the same time. AEMO didn't do that and as a result all the wind farms were using default settings. They have since changed most of the settings so that the same problem will not occur again. The wind farms actually found no damage after the storm. All the damage was in the utility owned transmission lines and one natural gas power plant that suffered lightning damage to a generator.

There was one other mistake that day. The grid operator should have not run the interconnected at capacity. Instead they should have curtailed some of the wind output to insure the connector had reserve capacity available to handle the surge. The grid operator was over reliant on wind that day.

The rolling blackouts and the grid collapse were not caused by wind or solar power. So the questions becomes why is Australia having so many issues. The answer relates to changes made 20 years ago that have not worked well and have been causing power costs to gradually rise over that time.

Australia forced utilities to do the following:
1. No more long term contracts. Instead power is purchased the day they need it.
2. The utilities were forced to shut down or sell their power plants.
3. utilities was allowed to recover at least some of the cost for grid upgrades.

The purpose of these changes was to encourage completion which should in theory reduce power prices. The same thing was tried in california and other places.

IN australia the policy eventually encouraged independent power producers to enter the market. Many also built wind farms and solar farms. Since renewables have no fuel expense and generally lower maintenance costs they did offer the utilities lower power purchase costs.

However the side effect has been the coal and gas power plants are seeing power sales drop and their fixed labor cost stay unchanged. This has resulted in low inefficient labor intensive power plants to loose money and shut down. coal is no longer profitable. Natural gas is barely profitable. So now power producesers are now offering power at a much higher cost since they don't know when they will next be paid. In other cases they may sell the fuel to someone else and shut down the power plant. The higher costs are also now encouraging more home solar and more wind which pushes fuel usage down even faster.

In the late 90s ,many utilities were predicting the need for a lot of grid upgrades. With the cost recovery laws they started upgrading there distribution and transmission capabilities. However they were not expecting low cost wind and solar to flood the market. End result is new hardware was installed and never connected to the grid because it was no longer needed. Yet the utilities got there money and the people got larger utility bills.

When California started the same think in 2001 power cost quickly spiraled out of control dn the utilities went bankrupt. The state took over the job of buying power and quickly found the day market wasn't working (which was what the utilities were saying for months). The state decided to scrap the day use market and sign long term contract. Power prices quickly dropped and the rolling blackouts stopped. Over the following months evidence of criminal conduct was found and much of it was traced to one company, Enron. Without the illegal activity Enron couldn't make a profit and hid the losses from everyone. When the losses were discovered they went bankrupt and some people were convicted and sent to prison.

Now claifornia uses long term contracts for most power purchases with a small amount of day use power purchases. Now the natural gas power plants get a steady stream of money even if there are days when they don't generate any power and burn no gas (or very little). This is working very well with the increase in renewables and power cost are gradually dropping as more and more renewables are coming on line. In 2015 California got 27% of its power from renewables. Up from a little less than 10% in 2000. By 2030 the state wants 50% of power to come from renewables. in 2015 coal power amounted to 6% and the last utility owned nuclear power plant is scheduled to shut down in about 10 years.

Australia could reduce utility costs fore all customers and stabilize the grid by simply allowing the utilities to sign long term contracts. They don't needed the cost reimbursements for the grid upgrade that are no longer needed. Enacting a strong RPS would also help. All of that would cost the astral government nothing, reduce costumer costs, and help prevent rolling blackouts and over reliance renewables in stormy conditions.
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Mon 20 Feb 2017, 23:22:49

Surf - Thanks. Great details especially about about poor long term contract planning. Decades ago there was a small public uproar over those "take or pay" contracts not just on electricity but also NG. Some of the public felt they should all the energy they needed when the wanted but felt it was OK for suppliers to lose money when the consumers didn't need to buy. And naturally there were some politicians ready to stoke those flames of discontent for votes.
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Fri 10 Mar 2017, 01:54:26

Looks like the problem is going to be solved in 100 days or its free by Tesla at mates rates via twitter

http://www.theage.com.au/technology/tec ... uv9pj.html

Conservative government and the coal industry it represents, is not going to be happy and will have to redo their next election attack strategy .

Elon Musk: I can fix South Australia power network in 100 days or it's free

https://www.theguardian.com/technology/ ... r-its-free
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Fri 10 Mar 2017, 10:53:32

OK he's offering to install 100-300 MW of storage in that time span if he's paid $125-$375 million. Is that worth it? Also if I understood the event correctly the blackouts could have been prevented had the govt regs for electricity distribution been similar to those that ERCOT has in Texas that prevent providers from gaming the system. Seems like printing some new regs would be a lot cheaper then buying a mega battery.
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Fri 10 Mar 2017, 19:45:32

He just halved the quote.


Late on Friday local time Mr Musk offered Mr Cannon-Brookes a system for $US250 per kilowatt hour of capacity – about half the pre-discount price quoted by Tesla executives in Melbourne on Thursday.

https://twitter.com/FinancialReview/sta ... 3735412736


http://www.afr.com/technology/teslas-el ... 310-guvf1x

The whole narative from conservative government is an anti renewable climate change denying scenario.
The Progressives are going to the next election with 50% renewable target.
So the conservatives have been trying to wedge using blackouts as their leverage that too much renewables is bad.

The problem can be solved by
The gas fired power plant firing up (which it didnt)
Because Australia makes more money exporting gas than keeping it for domestic use.(poor planning)
Or another connection to the national grid which is costly
or
Storage
or
Pull a coal fired plant out of retirement and have it idling .

The way the electricity market is structured is the power companies make their profits from peak power price spikes so it is in their economic interests to create them.
Storage would kill their ability to do this.
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Re: The South Australia energy disaster

Unread postby ROCKMAN » Sat 11 Mar 2017, 10:44:27

Monkey - See what I just posted above under the wind power thread. If it makes sense to you and want to give some ammo to the opposition feel free to pass my thoughts on. Given how much open and idle sun drenched land and thousands of miles of windy and uninhabited shoreline Australia has the model I offer should work even better down under then in Texas.
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Re: The South Australia energy disaster

Unread postby sparky » Sat 11 Mar 2017, 17:59:09

.
Australia is a sun burned land all right
but the wind regime is not very regular or strong , we have weeks without much of a breeze
the exception is Bass straight and somewhat less in the great Australian bight .
However , the solar potential is truly huge , there is the storage problem of course
but as a complement to base load its potential is underused

Still , mostly due to a cheaper price of panels ,some progress is ongoing
https://en.wikipedia.org/wiki/Solar_power_in_Australia
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Re: The South Australia energy disaster

Unread postby Shaved Monkey » Sat 11 Mar 2017, 19:41:50

Theres plenty of wind .
Once they combine it with storage it will be a game changer.
The Coal industry and the current Electricity suppliers just dont want that game changed
https://www.finance.wa.gov.au/cms/uploa ... d-2008.pdf

Solar thermal with either graphite or molten silica should definitely be in the mix too.
A change of government and a price on Carbon will speed up change and both are looking likely
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