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October 19th 2017 print

Dr Michael Crawford

Dear Minister Frydenberg…

This complex 'green energy' mess you refuse to correct is costing Australians a wholly unnecessary $30Bn to $50Bn a year.  Yes, you read that right: tens of billions of dollars squandered to pleasure rent-seekers and destroy thousands of jobs-- your political career among them

rube goldbergI understand you have devised an ingenious plan to rectify the current government-directed destruction of our once reliable and affordable power system.  According to media reports, your scheme will require electricity retailers to do essentially what they are currently doing, while the “renewable” rorters do what they are currently doing, and electricity distributors continue to do what they are currently doing.

Despite the fact that everyone will be continuing as at present (except of course that we will now pay for more bureaucrats to oversee this plan, and for some more bandaids), I understand that you and the Prime Minister are confident electricity prices will fall in maybe ten years time, by a paltry amount, and the lights will stay on because you have willed it so.

Could you please clarify whether your advisers got the script for this plan from Monty Python or from Blackadder?  Attribution should go to the right source.

I understand the crux of your ingenious scheme is that retailers will be obliged to purchase at least 1MW of electricity from baseload sources for each 1MW of unreliable (i.e. wind and solar) electricity they purchase.  What exactly do you think they are doing at present?

Dr Finkel’s report was grossly misleading in multiple ways.  However, he did provide some basic facts pertinent to your plan.  On p. 87 of his report, he noted that “In FY2016, 76 per cent of electricity produced in the NEM came from coal-fired generators.”

So the ratio of electricity from coal-fired baseload sources to all other sources was 3:1 in 2016 – and those other sources included gas and legacy hydro.  Dr Finkel’s projections (Figure 3.8 in his report) are for the ratio of baseload to intermittent sources to be 3:1 in 2020 and 1.5:1 in 2030 under his  “Clean Energy Target”, and 2:1 in 2030 under current arrangements.

Consequently, your mandated 1MW:1MW requirement would make no difference to the behaviour of wholesale purchasers of electricity in the immediate future and, indeed, for decades.  Consequently it will not deter the “renewable energy” rorters from building more unreliable, intermittent power stations, causing increased variability across the grid and more expensive power which your government forces electricity consumers to purchase.

Your ingenious plan demonstrates a complete lack of understanding of how the introduction of intermittent power generation has created system unreliability and doubled real electricity prices in Australia, and how it will continue to do so. In short:

  • Intermittent wind and solar is highly expensive electricity, requiring the combination of high wholesale prices plus LRET subsidies (paid by consumers) of a roughly similar amount, to make them viable.
  • Because of the subsidies and the nature of the NEM, subsidised generators are able to always place their output into the grid, at the expense of baseload generators, with the latter then being turned into intermittent generators – not because of any deficiency on their part but because they keep getting shut out of the grid on an intermittent and unpredictable basis.
  • Since they are thus prevented from operating at full capacity, baseload generators then also require high prices per MWH in order to be viable, and those necessary prices increase as the intermittency forced on them increases.
  • Given that the proportion of intermittent generators is continuing to increase under your policy, and thus also the intermittency forced onto baseload generators, and given Australian government is driven by irrational ideology, no independent party will invest in new baseload plant or in the refurbishment of existing plant.
  • Wind and solar generators are not just intermittent, they also fail to provide the frequency control and other functions essential to a widespread grid and which are an intrinsic part of baseload generators.  Thus the increasing proportion of intermittent generators also adds increasing instability to the grid.
  • Because of the multiplicity of intermittent generators mushrooming around the country, much more transmission infrastructure is required.  Each of those generators requires an expensive substation to convert its output into a form suitable for the grid, plus new transmission links.  The cost of this comes out of the pockets of electricity consumers.
  • Many members of the public have responded to your high electricity prices (and in many cases encouraged by government subsidies) by placing solar panels on their roofs.  Most of them remain connected to the grid because they also want electricity at night (adequate battery storage is very expensive) which cannot come from solar farms, and only sometimes will it come from wind farms, so you need additional investment (either legacy baseload or new gas-fired installations) to back up those private investments.  All that investment has to be paid for by end-users.  In addition, local distribution networks have consequent less demand on them, so their owners are requiring increased per household connection charges to meet their costs.
  • You and previous governments have produced a Rube Goldberg structure of government agencies to oversee the NEM, which have destroyed affordable and reliable electricity, and whose failure is rewarded with expansion.  In addition, you have duplicated at the national level government officials that once existed only at state level.  Electricity consumers and taxpayers pay for this mess.
  •  The financial sector has got in the act offering hedging instruments so various parties can cope with the financial uncertainty caused by this system, uncertainty we never had before the NEM and intermittent power.  The financial sector employs people and capital to provide those hedging instruments.  That is a real cost which again ultimately comes out of the pockets of electricity consumers.
  • Where once electricity in each state was produced by a state government responsible to its electorate, it is now produced by an unscrupulous oligopoly whose members use every tactic they can to game the fake market Australian governments have created and thereby add further costs to consumers in order to pad the profits of their largely foreign owners.

As I pointed out in an earlier letter to you, this complex mess over which you are presiding and which you refuse to correct is costing the Australian community an excess and wholly unnecessary cost of between $30Bn and $50Bn per annum.  Yes, that is measured in tens of billions of dollars each year.  It is increasing each year and it is destroying tens of thousands of jobs.

Despite that knowledge, while presiding over a system where real consumer electricity prices are now twice what they were before your NEM started, you insult the Australian people by claiming you’ll deliver them a reduction of less than 5% in maybe a decade’s time, when you will be long gone from office.  In other words you are telling them the country will have to suffer unaffordable power prices now and for decades – because you and the Prime Minister are too gutless or incompetent to fix it.

And all of this is done supposedly to limit the beneficial trace-gas carbon dioxide, despite your Chief Scientist having testified to the Senate that totally abolishing Australia’s emissions of carbon dioxide would make virtually no difference to the world’s climate.

More of the detail behind these points is explained in my letter to you re AEMO’s recent misleading advice to you and in my open letter to Dr Finkel, of which you also have a copy.

I pointed out previously what is now being commonly recognised.  There is only one way to restore affordable, secure electricity to Australia and its citizens.  It has two parts:

  •     Abolish now all subsidies for particular forms of electricity supply.  That means the RET-based subsidies for wind and solar in particular but also the various other forms like preferential funding for intermittent power generators.
  •     Offer long-term government contracts for low cost dispatchable electricity supply which is also able to provide the other characteristics needed for stable supply (e.g. frequency control) sufficient to meet Australia’s electricity requirements with the safety margin we once enjoyed.

If you do not understand that, you are too clueless to be worth feeding.  If you do understand it, then the policies you are following are outright treachery against Australia and its people – and all the Liberal and National members who support this treachery are also culpable.

Sincerely,

Dr Michael Crawford,
Board member, The Waubra Foundation

Comments [12]

  1. ianl says:

    Well summarised, Michael, and accurate. Just as your previous expositions, though, this will be filed as waste paper by the self-described elite and completely ignored by the gate-keeping MSM. Vanity must remain intact and unruffled.

    I have only one suggestion for a perhaps slightly sharper line. For power generation by wind, replace “intermittent” with “spasmodic”. The word intermittent has a euphemistic, almost benign, aspect to it; spasmodic (noun: spasmodicity) is altogether a better, sharper cut-through description. For power generation from sunbeams, replace “intermittent” with “periodic” as the earth’s 24 hour rotation is not random. The period involved is not a constant 12 hours across the globe either, of course: it obviously varies through both latitude and cloud persistence. As our propagandising, leftoid friends have shown us for decades, choice of language, spin, matters.

    Along the same language plane, the gradual subversion of “green” to mean exactly the opposite as originally intended is quite an amazing journey. Rather than untouched, pristine forest wilderness photosynthesising away and excreting O2, it now means the suppression of CO2 from the atmosphere – photosynthesis using its’ evolved catalysing green chlorophyll is now to be denied one of its’ essential ingredients. Most plants, algae, cyanobacteria and the marine species of these have lost the appeal of their “greenness”; burning them en-masse in power stations and home fireplaces is now renewable virtue. In addition, a bounty has been put on their critical sustenance – a “price on carbon” indeed.

    • Michael Crawford says:

      Thank you ian

      Your suggested terms are an insightful improvement which I will henceforth adopt. Spasmodic is spot on.

      And no CO2, no life on earth — unless of course our politicians imagine we can get by by eating dirt.

      It is clear that our politicians and their advisors on these matters know as much about science as they do about ethics.

  2. Ian MacDougall says:

    I understand you have devised an ingenious plan to rectify the current government-directed destruction of our once reliable and affordable power system.

    But ‘affordable’ in what time frame? Anyone can mortgage their grandchildrens’ future in order to live high off the hog in the present.

    This feat is most easily achieved psychologically if we join the Ostrich School first, and spend a lot of energy convincing ourselves that there is no problem to speak of anyway.

    • Doubting Thomas says:

      I have to give credit where it’s due, Ian Mac. It’s been a while now since you used the word “deniers”. Well done. Thank you.

      • Ian MacDougall says:

        “A rose by any other name…”
        -The Bard

        • Keith Kennelly says:

          That’s because Ian has become a denier about the significant reversal of the trend of rising sea levels.

          He now talks about saw teeth and ignores the last 3 years are not a saw tooth but are a downward trend. The NASA date he ignored is indisputable.

          No wonder Ian the Denier won’t now use the word denier.

    • Michael Crawford says:

      Ian

      You throw around vague statements largely devoid of meaning and offer no actual data or reasoned argument.

      From 1955 to 1980, real electricity prices in Australia fell progressively by about 45%. Not sure whether you imagine Australians then were living “high off the hog”. Perhaps you were. My working class family certainly wasn’t, but we benefited as electricity became more affordable.

      Real electricity prices kicked up a bit in the early eighties during the very high inflation, very high interest rate period and then began to decline again until the point when the NEM was created. From about 2005, real electricity prices started to rise, escalating particularly after 2007. There was an especially rapid rise during the Gillard “carbon tax” period, and a fall after Abbott abolished that tax. Then the rise resumed, until now we have real electricity prices twice what they were in 2000 and twice what they were in 1980.

      Since you are concerned about someone mortgaging their grandchildren’s future, you might turn your mind to the consequences of our society each year paying $30-50Bn in excess prices for electricity (compared to 1980 rates) and the consequences that has for one’s grandchildren.

      In 2004, Commonwealth Government debt was around $55Bn. It stayed around that level until 2008. Then it doubled in the following year and then rose continuously by close to $50Bn a year, to 420Bn in 2016. That is certainly mortgaging the future of one’s grandchildren.

      I haven’t researched any direct connection with our energy woes, though it is intriguing that the boom and subsequent rise is highly correlated with the increase in real electricity prices. Perhaps they both are manifestations of the magical thinking which around that time came to infest our politicians, officialdom and much of what was once Australia’s intelligentsia.

    • en passant says:

      MacBot,
      There is no problem to speak of anyway.

      It is all in the voices of the Archangel Gabriel and your cattle that infest your head.

      Oh, can I remind you that you have NEVAAAA told us the CO2 ppm destination you seek, have failed to tell the world the ideal temperature of Nirvana and have NEVAAA provided any empirical evidence we are doomed. Fake websites do not count.

  3. RobK says:

    Bravo to you Dr Crawford.

  4. Lawrie Ayres says:

    It is time to make our so called representatives aware that their days are numbered whilst ever they persist with the climate change fraud.

    • en passant says:

      We need to drain the Oz swamp and consign the ‘professional’ politicians (of all parties) to the dustbin of history. This is why I will be voting for a so-called ‘minor party’ and placing the Liberal, Labor, Green goons somewhere below the Sex Party, the Anarchists and every independent.

  5. Keith Kennelly says:

    We now have an emissions trading scheme we once rejected and believed a Libreal led coalition would never endorse let alone introduce.

    Even shifty Shorten agrees with the new libreal policy.

    That’s like Rudd and Turnbull agreeing on an emissions trading scheme.

    And this fake PM tries to lie to us about what he supports.

    Get rid of the fake liar and restore someone who actually believes in the things he says.