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February 10th 2017 print

Alan Moran

Loon in, Turn on…Blackout

The first tragedy is that Australians, who not so long ago rejoiced in cheap and reliable electricity, now pay some of the world's highest prices. The second tragedy is that the same green fantasists, ideologues and rent-seekers are bent on making things far, far worse

burning turbineSouth Australia, for the fourth time this year, offers a wake-up call to our perpetually dozing politicians and the energy experts they have hired. Ironically, the latest power crash came just two days after the chairman of the Australian Energy Market Operator (AEMO), the network control authority, announced that the wind problem was fixed and we’d not again experience a breakdown like the one in October of last year. 

At least they got the message in Western Australia, where the ALP is running like mad from its previous proud pledge to ape South Australia and get 50% renewable energy.

And the perpetrators of the demise?  Oh, how they fulminate and search for new magic wands!  In response to the crisis, Prime Minister Malcolm Turnbull, advised by Chief Scientist Alan Finkel, said there was an “urgent need for more storage of energy” and , further, that the government was “certainly looking at pumped hydro”.  Pumped storage may have a place in energy systems but it involves buying energy to pump water uphill then releasing that water to provide power at a time when it is more valuable. It detracts from, rather than adds to, the amount available. And he is looking at battery storage which if a breakthrough arrives will not be made in Australia.

Finkel, an electrical engineer with no background in electricity markets, was commissioned to report on the future security of the electricity market. His preliminary report is so ill-grounded on facts and so peppered with fanciful assumptions that a government taking the advice would further grind the economy into the ground.

Nobody can seriously doubt that the malaise confronting electricity is a result of regulatory and tax-forced injections of wind and solar into the market.  Not only, as events are proving, is this power source utterly unreliable but it costs three times as much as the coal that its subsidised provision displaces.  Nobody would buy wind and solar electricity unless they are compelled or bribed to do so.  Yet the Finkel preliminary report says the market is being driven not by this but by consumer demand and technology.  The credibility of the report is zero except to rusted-on ideologues, and the Prime Minister remains unfortunately among these.

Finkel also talks about the need for strong governance, by which he means more of the government oversight and regulatory controls that have converted an electricity market that just a decade and a half ago provided the cheapest, most competitive energy on the planet. Today that market plumbs the outer reaches of global prices. And in a series of community forums being held around the country the Finkel team is allowing the ventilation of additional claims for a more distorted market that commandeers production facilities, provides more subsidies to green power and to the less well off.

The Finkel “expert panel” even repeats the canard that Australia is a pariah because we over-emit greenhouse gases.  They are unaware that this is only because, unlike other OECD countries, we export goods that embody carbon emissions – goods like farm produce and (the fast disappearing) aluminium; in terms of consumption of products in which carbon dioxide is embodied we are the same as the rest of the world.

But the Finkel panel is not alone.

Energy Networks Australia has fabricated a plan in an assumption-ridden set forecasts conducted by CSIRO “economists” which it is alleged will bring $414 a year saving in household electricity bills by 2050, while achieving net zero carbon emissions from the electricity sector.  And we still have the recently retired head of taxpayer-funded Clean Energy Finance Corporation, Oliver Yates, calling for more papering over of a decaying electricity system’s cracks by the building of more transmission – as though this can be done for free and is not simply shifting power to the already strained areas from regions that, like Victoria after the looming Hazelwood closure, will become strained.  Needless to say, all those experts hired by the government eagerly sought the closure of what they called the dirtiest power station, an action from which the next series of crises will emerge.

There is only one solution. We must unwind the subsidies and regulatory interventions that have created the problems. Governments spend or impose regulatory costs like the renewable subsidies that amount to about $5 billion a year.  These are poisoning the economy as well as costing each household $500 per year.  We need politicians to announce that all subsidies to energy will be removed immediately and that there will no longer be any favouring of particular power sources. Only then will we see the supply system convalescing and recovering so that it once again provides the cheapest electricity in the world and all that entails for living standards.

Alan Moran is the author of the forthcoming book “Climate Change: Treaties and policies in the Trump era”   

 

Comments [25]

  1. Rob Brighton says:

    Good luck with that, the idealouges have spent 20 years getting us to these parlous conditions I doubt it is possible to turn the ship around even if there was the slightest political will to do so.

  2. en passant says:

    Alan,
    Cue Stage Left: Enter Ian MacD chanting the same mantra he always does – and insulting you.
    Any moment now …. wait for it …

    Sorry to burst this bubble you consider a solution, but:
    “We need politicians to announce that all subsidies to energy will be removed immediately and that there will no longer be any favouring of particular power sources.”

    This will have no effect as the political class (they have not evolved and are not like us) are deliberately proceeding to reduce energy availability to create rationing as it makes us dependent on the Government. There is no real difference between Liberal bad and Labor-Green worse. They simply cannot join the dots (like primary school children do) and see the end result that will occur. It is not cause and effect, but cause and consequences that eludes them. Victoria has banned fracking and restricted drilling on and offshore so gas shortages will soon be the norm.

    You cannot be a hydrocarbon energy provider at any price in Oz as the RET simply removes your profits, so it is a zero-sum for your work. That was why the gas-fired station at Pelican Point in SA had to close, because the more they supplied the more they lost $$. The owners were not a charity and opted out so that SA could reap the benefits of their green nirvana.

    The imminent closure of Hazelwood with a loss of 750 CMEFU jobs (where are the union protesters?) will cripple the grid at peak times. You think things are bad now? Well, you have not seen anything yet. It will be wonderful sitting round the wood-burning campfire every night …

    Now that SA is once again sitting in their planet-saving (do they believe that?), self-created (we don’t need no stinkin’ coal or gas-fired baseload energy …), warm (no air conditioners), candle-lit (how romantic!) darkness looking up at the stars and wondering “Are the North Koreans laughing at us? Is the Earth flat and why does the Sun not shine at night?” I think we need to do the right thing by them and set them free to show the world the way to the Green Dream. This is what it looks like:
    http://quadrant.org.au/magazine/2015/07-08/powerless-dubai/

    Give them their totally unsubsidised independence. Let the South Australians and their green acolytes taste the Green future they so desire and cut all that dirty electricity from Victoria and NSW, but rip up the roads out of SA and build a 100 foot high electrified Fence first …

    Get with it! This is the great future Oz cultists envisage.

    Many years ago I read a remark in a nondescript novel that I have related to ever since. One of the anti-heroes cries out to the rebel leader: “They have overwhelming power! How can we defeat them?” The man answers “Give them everything they want – everything and more. That is how we will win.” That contrarian and counter-intuitive view impressed me. SA should only be allowed to use wind power generated in their own and other states, but no hydrocarbon power.

    So, let’s give the Green Gods everything they want. That means cutting the electricity connector to SA. We can then study the results as we would a Petri dish culture. We can document the consequences of this (ig)Noble Corruption of real world facts.

    We should all revel in the pain of the South Australians. Praise them for their sacrifice, demand more solar and wind and give Sarah an honorary ‘Doctorate in Wind Power Advocacy’. Promote the SA model as the future we seek for all Australians and the world.

    That is how we will win our way back to the real world.

    Some will die, but consider those South Australians as necessary collateral damage to enlighten the rest of us. Do not weep for them, theirs is a sacrifice being made for all of us as they chose the renewable path to show us the future.
    Where is Jim Jones when you need a good cultist example? Fortunately, we have Ian MacD Ad Hom! Ad Hom! who does not know what he wants but will fight with all his might to get there.

    Stand by, Ian will be on line soon …

    • Jody says:

      Ian is bully-averse, and so am I. You and your luvvie acolyte Keith enjoy bullying people into your own point/s of view, except that this is the very thing you accuse others – particularly the Left – of doing. Again, these behaviours are merely “projections”. If I was Ian I’d continue to argue my case because we still have freedom of speech regardless of whether or not we agree with those views.

      • Ian MacDougall says:

        Thank you, Jody.
        Let me assure you that standover tactics don’t work with me, either physically or psychologically. In my experience those who resort to them arguably do so out of an awareness of the vulnerability of their own position/s.

        • Jody says:

          Im an advocate for free speech and will not be cowed by bullying and invective. It needs to be called out!

          • en passant says:

            Jody,
            So Ian calling me a racist was free speech and not bullying? When I pointed out my wife of 41 years was Asian he doubled down and repeated his defamation.

            When Ian calls people ‘deniers’, that is not bullying?

            When Ian rabbits on with his mantra and accuses others of being in the pay of ‘Big something’ that is not bullying.

            Go on, get stuck into him or you will look hypocritical.

  3. Bill Martin says:

    It is reported that the construction of coal powered power stations is an “univestable” proposition because of the uncertainty regarding a future carbon tax. That being the case, one vital point has to be added to the contents of the final paragraph of this article: It must be clearly and unequivocally declared jointly by the government and and all the political parties that there will NEVER be a carbon tax, an emission trading scheme or any other method of penalising the burning of fossil fuels to generate electrical power in Australia. An impossible pie-in-the-sky suggestion, I know, but without it, we are doomed.

    Unless our nation can produce a Trump-like national political leader who will openly state that the CAGW is a scam and act accordingly, we will all go down together the same ruinous road which is already being traveled by SA, soon to be followed by VIC, then every other state one after another.

    • ianl says:

      Much too late, Bill. The country is already there, no way back. In a two-party system, when both sets of politicians tacitly agree on something, the voters can do absolutely nothing. In this situation, the tacitness is deliberately sneaky and unstated. Who can ramp up the RET quickest and biggest, who can p..e the highest ?

  4. Keith Kennelly says:

    Could it be Ian might be having a voluntary brownout.

  5. Ian MacDougall says:

    There is only one solution. We must unwind the subsidies and regulatory interventions that have created the problems. Governments spend or impose regulatory costs like the renewable subsidies that amount to about $5 billion a year.

    Careful now Alan; careful. According to the link below, fossil carbon gets subsidised to the tune of $4 billion a year. I don’t think those fossilcarbonistas would want you rocking their coalboat too much.

    BUT CAUTION! The site I linked to belongs to the (choke! caaargh! splutter! hawk! spit!*****) ABC

    http://www.abc.net.au/news/2014-11-11/coal-oil-and-gas-companies-receive-4-billion-dollar-in-subsidie/5881814

    • Rob Brighton says:

      I would encourage the removal of all subsidies for all forms of energy generation. Now while one may question my source I propose that if you can quote the ABC, I can quote the mineral council.

      http://www.minerals.org.au/file_upload/files/media_releases/Electricity_production_subsidies_in_Australia_FINAL.pdf

    • Lawrie Ayres says:

      Relying on the ABC for a dispassionate appraisal of subsidies is pointless. After all the ABC science presenter believes seas will rise 100 metres by 2100.

      But let’s look at the facts; fossil fuels receive subsidies of 70 cents per MWh meanwhile your beloved renewables cream in $75 per MWh or nearly eleven times as much. I should also point out that many of the coal subsidies oft quoted by leftists include the diesel fuel rebate which is available to ALL OFF-ROAD users of diesel; farmers, fishers, loggers and other production that does not use public roads. It amounts to about 38 cents a litre and mining consumes prodigious amounts. Leftists lie and abuse data because their arguments are weak and illogical. It seems you fall in that category since you have been told numerous times of your error.

  6. ianl says:

    Geological exploration is classified as R&D, as the risk of failure is high. R&D in all enterprises has been assigned taxation levels considered commensurate with assessed risk, although the assigned rate has varied as the politics of various governments has varied. In short, the rate has been up and down like a yo-yo.

    Designated primary industries, essentially farming, fishing and mining, have been deliberately legislated worldwide for exemption from diesel fuel excise as these activities do not impact on public roads and so do not contribute to their upkeep needs. In Australia, this exemption is administered as the fuel rebate each financial year; in the UK (eg), the excise-exempt fuel is artificially dyed pink (I think) and is bought with due certification at standard fuel depots (full excise diesel for normal road use is not artificially coloured).

    But why should green propaganda recognise these facts ?

    Alan Moran’s article here is accurate enough, I suppose, but he barely acknowledges the root cause. The general populace is ignorant of science, maths and engineering; easily gullible to emotional alarm. For decades now, day after day, week after week, month after month, year after year, the MSM has pummelled it with simplistic nonsense and done this deliberately. No space at all given to experienced power grid engineers, dissenting meteorologists, Nobel physicists who had differing, credible analyses – except as vicious ad homs.

    Well, the propaganda worked. ‘Tis indeed a bleak outlook. The whole world is now watching with detached amusement and withdrawing off-shore investment funds. Btw, all the “green” jobs are in China.

    • Ian MacDougall says:

      ianl:

      For decades now, day after day, week after week, month after month, year after year, the MSM has pummelled it with simplistic nonsense and done this deliberately. No space at all given to experienced power grid engineers, dissenting meteorologists, Nobel physicists who had differing, credible analyses – except as vicious ad homs.

      It would help if you were to switched out of generalisation mode and to provide one or two specific examples.

      • denandsel@optusnet.com.au says:

        Ian, I’ll give you two ‘specific examples’. David Evans and Bill Kinninmonth were two of Bob Hawke’s initial ‘climate commissioners’, both resigned because they knew that the concept of CATASTROPHIC AGW/’Climate Change’/'unexpected weather events’/ocean ‘acidification’ [or whatever new fashionable name is invented] was a hoax. To the best of my knowledge neither has been invited to appear/be questioned on any MSM outlet, and certainly not on the ABC. There would not be 5 people in the world who know more about the climate really functions than David Evans. Go to Jo Nova’s blog and catch up with his stuff, if you’re honest and willing to learn, you’ll stop being a ‘true believer’. Check out Richard Lindzen, widely acknowledged to be the world’s most authoritative ‘climate scientist’, and he regards CATASTROPHIC AGW to be a hoax.

        • Ian MacDougall says:

          Catastrophic AGW is yet to be proven.
          Unfortunately, there is only one way possible for proving it.
          However, the current economic and climatological wisdom favour investment in renewables. The widespread need for cheap and reliable off-grid power generation is priming the renewables pump, leaving fossil carbon for much better uses than burning it for its heat.

  7. Lawrie Ayres says:

    The chief scientist is not really a scientist for he believes that in the sham climate change science and that no alternate science should be heard. A fellow who seeks to prevent scientific debate is no scientist. Many educated non-scientists also question the CC/GW hypothesis on common sense grounds and from their own experiences and observations. Unfortunately for Finkel some very well credentialled atmospheric and solar physicists question the hypothesis that fails at every turn and has yet to be disbanded as any similarly falsified hypothesis would be if done by competent scientists rather than the “C” team at climate central.

    • Ian MacDougall says:

      Lawrie:

      It’s not rocket science.
      1. Hydrogen sulphide (H2S) is a stinking gas.
      2. Its addition to a volume of air (as in a room) will cause that room to be stunk out. (Generations of schoolboys.)
      3. The more H2S, the greater the stink: until everyones’ noses refuse to smell it any more.
      3. CO2 is a heat-trappng gas (Fourier, Tyndall, Arrhenius).
      4. Its presence in any atmosphere enhances that atmosphere’s heat-trapping properties, (eg Venus).
      5. 198 scientific organisations worldwide endorse the AGW hypothesis, including the CSIRO, AAS and the Royal Society.
      6. AGW ‘sceptics’ commonly have strong links (as in -$-$-$-$-$-) to mining and/or fossil carbon.
      7. Draw your own inferences and conclusions.
      8. QED.

  8. Rayvic says:

    “SA should only be allowed to use wind power generated in their own and other states, but no hydrocarbon power.”

    Given Victoria’s apparent urgency to get rid of hydrocarbon power, that may yet become a reality, en passant.

    • en passant says:

      Rayvic,
      This is why I sold my business and moved a substantial sum overseas.

      I currently live in a large (house sized) condo with sea and mountain views – and my all-electric home costs me $50/month for power.

      However, as I do not fear The MacD’s rising sea levels I am building a beach home 10m from the beach and 1.5m above king-high tide. Foundations are in + a 1m ‘storm wall’ to protect against a ‘surge event’ that has not happened in the past 70-years (but you never know …). It does not restrict my view. Rather than a fence we are erecting a clear glass wall.

      I am currently back in Oz to dispose of some more assets and move them overseas. Poor fellow, my country, but you have chosen the path of green martyrdom that I prefer not to take, so I cannot help and I will not commiserate with you about your foolishness. You had a choice, now you can reap the consequences.