Energy costs and renewable penetration


This is a topic I tried to avoid in general discussion due to the passion displayed by a sector of our society. However, as we move at an increasing pace toward to a point of no return, it is becoming of serious concern. As our infrastructure moves away from reliable dispatchable energy such a coal, gas and nuclear into generation capacity that either has to be stored or is very intermittent, our industry sectors become more unproductive due to the high cost of power and production reliability due to blackouts or brownouts.

We forget that while pumped hydro and battery backup are being touted as the panacea for the reliability issue, they are still only a power storage mechanism, and once the battery is dry, what do we get absolute economic catastrophe. While there are not a lot of people who have experienced the problem of battery storage with intermittent power generation, I have (while my experience is not from renewables, but diesel generation), and when the batteries are dead, all activity ceases, this included cooking, refrigeration, electric lights and any activity after dark.

I know that we have the technology to reduce the probability of power failures by massively increasing battery storage, building renewable generation capacity that far exceeds existing demand across Australia to meet the regional generation deficiencies and to build a massive and expensive transmission capability to link these very dispersed generation islands. I acknowledge that once the generation infrastructure has been built, the cost of generation is minimal. However, from where I sit, the cost of the excessive capacity, transmission system, battery backup and the impact on the environment, the cost is excessive.

There are individuals who have researched and studies the cost to achieve this; the message is not being received by groups of people who have electoral clout and not really understand the massive exposure on cost of generation and reliability. In addition to this, there are other issues:

  • What we do with infrastructure once it reaches its use by date, and from what I have read, wind towers reach use by date from between 20 to 25 years and solar panels 10 to 15 years or less.
  • What will be the impact on the environment, both animals, birds and bats
  • If as is suggested, we need to cover Australia with solar panels the equivalent to the state of Voctoria, how will that impact on our very efficient food production and manufacturing sector, and
  • With all the additional kilometres of power line, will it increase the number summer wildfires (as we know power lines are responsible for a percentage of bushfires

Another question I have is about the current warming levels that is driving the renewable debate. As an agriculturalist, I have been an avid student of climate history, so if warming and CO2 is so bad, then why in past history there has not been the same concern, as levels of both CO2 and temperature have been considerably higher.

For example, around 1500, to 2000 years ago, Greenland was a green land as it grew grain crops of the Nordic communities, and the Romans had temperate crops near the Scottish Border. From this point the earth gradually cooled to the little ice age from around 1300 to about 1800. Since then, the earth has been warming.

The question that I have for our policy makers and passionate proponents of renewable, why are we heading down this path, as countries such as China, India and other developing countries are continuing to build coal fired power stations and emit ever increasing levels of CO2. We need to answer these questions before we reach a point of no return, and a change of direction becomes financially and economically excessive.

I think we should always debate these issues with maturity, and as a resource economist, I know that our fossil fuel energy supply is finite and we will have to transition out of these sources some time in the future, but the question I have is “why are we heading down this path when our competitors are in fact increasing CO2 emissions”

Have a great weekend

  • It’s interesting to be in UK first where with 8 nuclear power stations and a new one being built, amazing time lapse video, that their gas and electricity costs have soared. Travel around UK, Wales and Scotland, then Austria and Portugal, wind towers are ubiquitous. Seeing the construction in Western Scotland in old shipyards and importing the towers in our ports in Gladstone, Newcastle and Port Kembla, towers are bought and investments here continue apace.

    I was with Bywater in the UK for our 1996 merger. They had been involved for some years in the “Business Transformations” of various water utilities. Australia was perusing such based upon this ‘international best practices’. Sounds very familiar to the Petrobras Brazil Board and Executives words that culminated in their off shore drilling platform sinking! Anyway, the possible “root causes” of the diverse narratives for and against renewables and coal/gas lay in what the NSW Energy Minister explained about extending Erraring NSW Coal Fired Powered Station, the State’s largest. It’s privately owned and so commercial imperatives drove their Board to determine its closure. If as the Minister explained, years well before this dilemma, one could say, “Wicked Problem”, the plans and investments could have been made as it would be in State hands.

    One UK perspective is now relevant to this discussion. Incidentally, a Kit Oung UK has helped the UK in Energy Bills and Acts to redress their energy policies. See you 3rd week September John. ““

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