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Output from Australia’s coal-fired generators falls 10 per cent

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The combination of falling demand, the rising threat of rooftop solar and the introduction of the carbon price have combined to reduce the output of Australia’s coal-fired power stations by 10 per cent.

Data provided by Pitt & Sherry’s montly Carbon Emissions Index (Cedex) says that the combined output for the Australia’s coal fired generation in the month of July was 1.4 terrawatt hours – 10 per cent below the level of the same month a year ago. And for the first time, the output of coal generation was lower in each of the four key states in the National Electricity Market – NSW, Queensland, Victoria and South Australia. (Victoria’s output was reduced by a mine failure at Yallourn, while the two largest coal fired stations in SA are now off-line).

The report said it is the largest monthly decrease in coal fired generation over the whole period covered by CEDEX, with the exception of two months at the end of 2010. The decrease in coal fired generation was larger than the decrease in total demand, and the difference was made up by increases in both gas and hydro generation. This in turn led to a much greater fall in emissions from Australia’s power sector.

“Demand for electricity supplied by NEM generators continued to fall, and the fall from June to July was steeper than seen in most, but not all, of the last eighteen months,” the report said. “This is not surprising. Business consumers (billed monthly) are only now receiving their first bills with a full billing period at the higher price, while residential consumers (billed quarterly) have some weeks still to wait for bills which have a majority of consumption at the higher price.

We asked Dr Hugh Saddler, who helped compile the report, if one swallow made a summer. “I wouldn’t want to make a guess on that,” he said. The report noted that brown coal generators retain their cost advantage over black coal generators in NSW and Queensland – hence their lower decline – because the latter are being squeezed by lower demand and higher fuel costs. The main threat to brown coal generation, as RenewEconomy has pointed out on many occasions, is not so much the carbon price, but falling demand and the growth in renewables, both large scale wind energy and rooftop solar.

Here are the key graphs:

 

 

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  • http://www.linkedin.com/in/paulmcardle Paul McArdle

    Thanks Giles,

    It seems the Pitts and Sherry people have been thinking along the same lines as us – for a look at how output from all the different fuel types have changed, see this recent analysis on WattClarity:
    http://www.wattclarity.com.au/2012/08/trends-in-power-station-output-by-fuel-type/

    I’m not sure I follow your reasoning about singling out brown coal plant as threatened by falling demand and increased renewables. As the Pitts and Sherry analysis has shown, it’s black coal fired plant that’s threatened to a greater degree by these factors (because of the higher short-run marginal cost).

    It would also be important for your readers to note that degree to which the various factors have contributed to the declining production from coal plant – refer to the WattClarity post above to see that:
    (a) Average wind production from metered stations has increased to 681MW in 2012 YTD from 0MW in 2004. We could add in perhaps 200MW average for solar PV output in 2012, as discussed in comments on your previous post here:
    http://reneweconomy.com.au/2012/where-did-all-the-energy-demand-peaks-go-95116
    Hence total renewable contribution something around 900MW average over the year.
    (b) Average production from black coal stations has fallen 1302MW over the same period. We need to add back in what the “Business as usual” demand might have grown to in 2012 from 2006 absent this demand curtailment (perhaps 2000MW-3000MW) to have an apples to apples comparison. This is always an imprecise art as it’s based on assessing what might have been.

    In terms of “what’s impacted black coal-fired production since 2006?” we see that:
    (a) 900MW or so average contribution from renewables
    (b) Perhaps 3300MW-4300MW in total (hence renewable contribution perhaps 20-27%).
    (c) Some contribution from increased gas-fired production, as noted in the post linked above.
    (d) Declining demand having a very significant impact (60-70%)

    Does this help?

    Paul

  • David Rossiter

    Thanks Paul (and Giles) (and Pitt and Sherry – Hugh – too)

    Just a minor point Paul when talking of “900MW or so average contribution from renewables” in your last paragraph I take that to mean in energy terms the equivalent of 900MW running constantly 24/7 all year???

    Regards
    David

    • http://www.linkedin.com/in/paulmcardle Paul McArdle

      Yes, that is what I meant, David.