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Gas or solar towers? Will South Australia blink in push to clean energy?

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As South Australia prepares to wave goodbye to its last local coal-fired generator, a key decision in the next few weeks may indicate how serious it is about engineering a shift to high-penetration renewable energy and becoming a leader in low-carbon generation.

The government is holding an auction to supply all its (the government’s) electricity needs from “clean energy”, and it has come under intense pressure from fossil fuel interests to reinforce the position of existing gas generators rather than look to next generation renewable and storage technologies.

gemasolar sunny

The auction of up to 481GWh of capacity was to be pitched to zero carbon renewable energy technologies such as wind or solar, and possibly in combination with storage.

But at the last minute, under pressure from the fossil fuel industry, the design of the auction was changed to allow gas-fired and hybrid generation, hence the use of the term “low carbon”.

That choice mystified many in the renewable energy industry and made some question how serious the government was about the transition to a renewables-based grid.

On the key parameters facing the South Australia government – prices, jobs, and a low carbon economy, gas does not appear to stack up to technologies such as solar tower and storage.

Later this year, the state will source more than 50 per cent of its electricity needs from locally sourced wind and solar, the highest penetration in developed economies of fluctuating but predictable renewable energy sources.

The government has flagged the possibility it could look to a long-term goal of 100 per cent renewable, or close to it. It will be essential if it is to meet its target of zero emissions by 2050.

That makes the next step a crucial one.

A proposal from Engie, the owner of the world’s dirtiest power station, Hazelwood in Victoria, and the 479MW Pelican Point gas plant in South Australia, has been getting a lot of air play in mainstream media. Pelican Point is looking for a contract to revitalise some of its mothballed capacity.

You have to ask, what is the point of giving the mandate to gas generation, which averages around 0.4t of CO2 equivalent for every megawatt hour produced, given that South Australia’s average emissions are barely more than gas on average anyway, at around 0.6t/MWh, and will fall further once Northern is returned? It will not significantly reduce emissions, if at all.

The other two key points of South Australia’s ambition is to keep a cap on electricity prices, and to provide jobs. And it wants to be at the centre of new technologies, to underpin a new industry for a state about to lose its car manufacturing capacity.

All of this – jobs, prices, new industries – appears to make solar towers with molten storage a no-brainer.

First, on the subject of jobs: Port Augusta will suffer from the loss of Leigh Creek and the closure of the Northern coal power plant. A solar tower and storage plant will offer some 1,000 jobs in construction, and possibly more than 50 once it is up and running.

Second, on the need for storage: As the Australian Energy Market Operator made clear in its report last week, the South Australian market is not facing any increased disruption from the departure of Northern. But over time it does need to source local, dispatchable generation that can meet changes in demand and provide ancillary services – and generate more competition in a market that will be dominated by two players, AGL and Engie.

Simply using the auction to reinforce the position of an existing player in a two-player market appears to defy logic.

Thirdly, on the matter of costs: On the face of it, solar tower and storage can appear expensive. But that is to ignore the value of storage and what it is competing against.

Mike Sandiford, an energy expert from the University of Melbourne, has done an interesting analysis that underlines the case and the opportunity for solar tower and storage, one of many technologies under the banner of concentrated solar power, or CSP.

To boil it all down to a few paragraphs, Sandiford points out that CSP will essentially be competing with gas, which has been used to balance variations in demand, and more recently supply. South Australia, because of its relatively small industrial base, has the highest variations in demand in the country.

This means the marginal price of generation has often been set by gas. On average, he notes, there are around six hours a day where the wholesale price is pushed up by gas to $100/MWh – and three hours, on average, where it goes to around $140/MWh.

That is within the ball-park of new solar tower and storage technologies which are being built in north and southern Africa, and in north and southern America. A large CSP plant recently bid less than $US100/MWh in an auction for overnight power in Chile.

On top of this, a solar tower and storage plant could tap into renewable energy certificates (currently at around $80/MWh) and also capacity contracts of around $10/MWh.

That would suggest that such a plant could actually source revenues of around $200/MWh, which is about what the cost estimate of the technology was from Alinta, the owner of the Northern coal generator, before it’s much criticised decision to walk away from the idea.

But the price of solar towers and storage is well below Alinta’s estimate – and, for the record, below the price of nuclear, as the royal commission conceded last week.

SolarReserve’s first-of-a-kind Crescent Dunes project is producing power at a cost of $US135/MWh, with a Department of Energy loan, and its second project at Redstone in South Africa is being built at a cost of $US122/MWh, without subsidies.

The Chile plant bid by Abengoa was looking at less than $US100/MWh, presumably in combination with solar PV.

Here are a few graphs that illustrate why CSP – or solar tower and storage – might be more attractive in South Australia than any other state.

Screen Shot 2016-02-22 at 12.29.00 pmThe first shows the average “best” (read, most expensive) six hours of wholesale pricing each day over a 10-year period. South Australia (in blue squares) is just ahead of Queensland.

Screen Shot 2016-02-22 at 12.29.39 pmThe second graph shows just how much more expensive – and more reliant on gas – South Australia was a decade ago when there was little wind or no solar.

Screen Shot 2016-02-22 at 12.29.52 pmThe next graph shows the last year, when the considerable amounts of wind and solar reduced volatility and average prices. South Australia is cheaper than Queensland, which relies heavily on gas and has just 12MW of wind generation.

Sandiford says, however, that with the withdrawal of Northern, then price volatility might return to decade-old levels. Others say this will particularly be the case because of the concentration of market power in just a few generators.

While Sandiford says that CSP (solar tower and storage) could not compete on LCOE (levellised cost of energy) with solar PV or wind at this stage, the government may favour this when valuing the storage capabilities, and its ability to provide ancillary services, including frequency and voltage (broadly known as FCAS), and provide competition.

This is important. The Australian Energy Regulator has already highlighted the problems – and related cost surges – of relying on too few sources of FCAS.

If a solar and storage developer does have a strong offer – and it seems that Solar Reserve, which expressed interest in Port Augusta with Alinta and through the ACT solar auction, does – it would seem extraordinary that the SA government did not seize the opportunity.

If it did, it could extend and broaden its renewable energy mix, add storage, increase jobs, lead in technology development, and provide price competition to the existing fossil fuel generators.


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  • Beat Odermatt

    I understand the the Port Augusta solar tower proposal had major environmental hurdles. The damage to bird life in the area would have become a great obstacle. The site, close to Spencer Gulf, is in t path of much bird life. Leigh Creek, for example would have been a far better location, with an existing under utilised high voltage power lines to the coast. Wind and rooftop solar in combination with batteries and pumped storage may be a far better solution than building a massively expensive solar tower based on fairly unproven technologies.

    • Chris Fraser

      Perhaps the local government authority could lease the land for a peppercorn, reducing a cost hurdle. Somebody has to be first with CSP in Australia.

      • Beat Odermatt

        I understand that the land in Port Augusta and Leigh Creek are actually owned by the Government of South Australia, but leased to Alinta Energy. CSP need a bit more time to become economical. We have to consider environmental harm to birds as both location are close to either to the Spencer Gulf and Flinders Ranges or both.

        • solarguy

          It’s cheaper than coal now, why wait.

          • Beat Odermatt

            There are cheaper options, such as an extended rooftop solar programme with more battery storage.

          • solarguy

            Do you think the average wage earner has the capacity to shell out for enough batteries to last a week or more of inclement weather. Your talking really big bucks. Even with oversized PV, which is cheaper, most won’t have the roof space.
            And realize the big cities need big solar plants out of the metro zone.

          • Beat Odermatt

            It may be a start with Government and LGC buildings having rooftop solar and batteries. It will save them a lot of money in the long run. We have all the utilities which may have an interest to “soak” up cheap abundant solar energy to store it in batteries to make it available during peak times. There are hundreds of solution better than trying to build expensive bird killing monsters. The beauty with rooftop solar and batteries are that generations occurs where it is needed, in the suburbs and towns with very little transmission loss. Every household can cut its current electricity need by about 30% by tossing out old desktop computers and plasma TV’s and replacing old globes with LED’s. It takes time and money, but bird killing solar plants are not given away remain unproven.

          • nakedChimp

            Again with the bird killing, you posted this now three times, don’t you think it would be nice to back this up with 2-3 links to some studies?

          • Beat Odermatt

            Ok, what evidence have you that birds can withstand a temperature of hundreds of degrees? Some things are common sense and there is no evidence that birds would survive such intensive heat. The mirrors are prone to attract birds as the may mistake them for water. Australia has international obligations to protect migratory birds and such a plant may be in breach of international treaties.

          • nakedChimp

            And more of the same, do you have any links for us to check up on your claims or not?

            From personal experience (I’m not a bird though) I can tell ya, if it get’s hot I try to get out of that place, usually returning from where I came.
            The tower will be alight and bright and radiate a lot of infrared – marking itself as a very hot place to any animal in the vicinity.
            Birds seem to be pretty good at avoiding fires, don’t you agree?

            As for the water = mirror theory, any links for that either?
            I know that the local birds here can detect mirroring surfaces (windows, bright outside, dark inside) and dont fly into them during normal conditions.
            Last week we had some daytime with dark clouds overcast, which reduced reflections in our windows to make them not appear as mirrors.
            A poor forest kingfisher didn’t know/recognize that and sailed into one of them – I had him in my hand for 15 minutes and gave him some water with honey to get him back on track. So my personal experience tells me that they won’t mistake aligned mirrors for water, they will be able to not crash into them.

            And even if this turns out to be a problem, just detect any big swarm of birds (radar, etc) and readjust the mirrors for the time they are in the vicinity.. a CST plant can handle this gracefully I bet.

            Again, please bring links.

          • Beat Odermatt

            Ok, show me a single EIS done in Australia to support such claims! It would be nice if some of you are actually using your names instead of hiding like cowards behind avatars.

          • Colin Nicholson

            All you need to do is google off shore oil and migratory birds and you will get a heap of hits and nobody really has a handle on that phenomena. Will CSP have a unique effect as the off shore oil rigs do? Well people argued that the flame plume on oil rigs wouldn’t interfere with migrations and got it wrong. But if there is heat generating any sort of updraft, you can bet the soaring birds will be stacked up above it … including wedgies.

          • Beat Odermatt

            You are proposing such a project. It is up to the proponents to provide an EIS and not the other way round.

          • Mary Grikas

            Great news: Biologists have confirmed Crescent Dunes Solar one of safest power projects for birds. See http://bit.ly/1HcUFOT. Also see http://spectrum.ieee.org/energywise/green-tech/solar/reassessing-bird-deaths-from-solar-power-towers

            One of the fundamental goals for SolarReserve is minimizing the environmental impacts of its projects at every stage– from site selection and construction, to full operational use. In order to ensure minimal risks to avian wildlife, SolarReserve successfully implemented innovative operational procedures that have proven the Crescent Dunes Solar Energy Facility to be one of the safest forms of electricity generation, especially for avian safety. Monitoring over the last 12 months by a team of independent environmental consultants has resulted in an average of less than five bird fatalities per month – dramatically less than other forms of electricity generation, including natural gas, nuclear, coal and wind energy. Importantly, the company is sharing these safety methods with the solar tower industry so that we can protect wildlife while moving forward with this revolutionary technology.

          • Beat Odermatt

            We are talking about Port Augusta and the Spencer Gulf area, which is rich of birdlife. Australia has international treaty obligations to protect migratory birds. Birds are attracted to anything which is water or looks like water. In Roxby Downs they had great problems in trying to keep migratory birds away from tailing dams. A 12 month monitoring programme is just not good enough and proper scientific experiments at the proposed locations have to be undertaken. We don’t want to give the fossil fuel industry all the ammunition to harm renewable energy.
            If it is a coal mine in Queensland or a solar plant in Port Augusta, wildlife and migratory birds need to be protected. There are already far safer, more economical and fairer ways of using more solar power, but building a massive bird fryer may not be the right answer.

          • Gary Rowbottom

            Great to hear Mary. Facts on this issue are what is needed. I am no bird expert, but the location in mind for the Port Augusta project would seem to be a good location as far as avoiding bird interaction with a CST plant goes.

          • Beat Odermatt

            Sadly, it is NOT a good location. It is close to the coast.

          • solarguy

            To right, Mary. As I always knew.

          • Beat Odermatt

            Show me a single EIS in Australia to support their claim!

          • Gary Rowbottom

            Battery storage is not cheap – I think you would find the molten salt storage is a cheaper storage than batteries, and there are more suitable sites for CST north of,Port Augusta as danielspencer says.

          • danielspencer

            The SolarReserve proposal that went to the ACT government wasn’t on the Alinta site but north of Port Augusta is my understanding

          • Beat Odermatt

            Show me the costing!

    • solarguy

      The so often lied about harm to bird’s is a furphy, that the FF Industry came up with.
      We need big solar (CST & Wind) so when households run out of battery power, they can be supplied. Gotta come from somewhere.

      • Beat Odermatt

        No, we do not need BIG solar, but well distributed solar across Australia. We can use batteries and pumped storage. These will not kill birds. We need more renewable energy but we do not need something which will give the fossil fuel industry a stick to hit us with. They will use dead bird the same way the people smuggling industry is using injured babies to push their cause.

        • Suburbable

          Big solar is an excellent tool for transitioning to RE. It builds on existing infrastructure such as existing generators and is, then, in the mindset of the current rule makers.

          • Beat Odermatt

            Yes, we need a lot more solar and a lot more wind energy, but we do not need technologies which harm birdlife.

      • Beat Odermatt

        Households can supply a lot more power to charge batteries. We do not need to give subsidies to overseas firms. The money would be better spent across Australia in suburbs and towns.

    • bird-killing solar plants? wtf? Check out our story on Gemesolar, which has been running a plant like this for 5 years. Bird life has actually increased during this time.
      http://reneweconomy.com.au/2016/70398

      • Beat Odermatt

        Yes, the intense heat from the “energy stream” originating from the mirrors to the receiving towers can kill birds if they come into close vicinity. I am concerned that hundreds of millions are spent and that a plant would be closed because of environmental reasons. Birdlife around Port Augusta is very rich and cannot be compared to anything in Europe.

      • Beat Odermatt

        Yes, Australia has also international treaty obligations in regards to migratory bird. It is up to the proponents of such a solar plant to provide evidence this international treat is not broken. They would have also provide evidence that Australian laws in regards to bio-diversity are complied with. The fact that the plant is providing renewable energy does not allow it from doing environmental harm. It could take well over 5 years to provide such evidence and it would be an very costly experiment.
        May I quote: “Workers at the Ivanpah solar power plant call these birds “streamers,” as they ignite in midair and plummet to the ground trailing smoke. Federal wildlife investigators said there was, on average, one streamer every two minutes — or hundreds of thousands of incinerated birds per year. Another expert estimated that the number is nearer 28,000 per year. BrightSource’s own estimate is around 1,000 roasted birds per year. BrightSource is reportedly looking to build an even-larger power plant, which wildlife officials say could be “four times as dangerous” to birds. BrightSource has offered $1.8 million in compensation for the expected bird deaths. There are photos online of the cooked birds if you’re interested, but I won’t share them here; they just look like sad, singed birds.”

        • Tom

          Brightsource changed the way their heliostats position when solar flux is higher than the boiler is rated. They previously focused on one spot, now it is a ring which is much less intense. You will be pleased to hear that bird deaths have not continued.

          • Beat Odermatt

            How do you train birds from landing or flying into danger? I am sure there needs to be a lot of more work done in Australia by Australians. We cannot rely on data from overseas as some countries have hardly any birds left. If you travel overseas for most Australians the lack of bird noise is the first thing many of us notice.
            I am sure that the fossil fuel industry will jump at a chance to close down a large expensive solar plant. In my opinion, we have still a lot more better and more cost effective ways to harvest renewable energy. We never sent a man to the moon but we still enjoy the benefits of satellites. We don’t need to spend massive amounts on unproven technologies if there are better ways to achieve the same.

          • I think most birds would feel insulted about how stupid you think they are.

            First off, there are birds in Spain. Here is a list. https://en.wikipedia.org/wiki/List_of_birds_of_Spain

            Magpies in Australia have learned that they can flip cane toads and attack them through their tummy, and not be affected by the poison. Smart birds.

          • Beat Odermatt

            You should take to some people in mines with tailing dams and then you find out how “clever” birds are. Australia has international obligations to protect migratory birds and I am sure that there won’t be a single Government which will approve projects which may cause mass killings of endangered migratory bird.
            Whilst we have many low cost options with pumped storage and the knowledge that battery prices are coming down all the time, it may be foolish to invest in projects which may cause great harm to the wider environment. Whilst we have anti-environmental politicians like Nick Xenophon trying to stop wind power, the last thing we want is to give these people more ammunition to prevent renewable energy in Australia.
            In Australia we need renewable energy AND our diverse wildlife.

          • Gary Rowbottom

            And in many countries, people put nets up to catch migrating songbirds to eat them. Source – National Geographic, a few years ago. I think generally you’ve not got a great argument with this bird killing lark. But I imagine there will be some, just as there are some at the coal power station where I work.

          • Beat Odermatt

            Yes, this does happen. Australia still has a large number of beautiful birds and I am sure nobody wants to kill them if there is a way to avoid it. Yes, I have seen bird being killed in a coal mine by having oil pollution on tailing ponds. I have seen Wedge-tailed eagles being killed from high-voltage power lines and I have seen Wedge-tailed Eagles poisoned with a sheep farmer.
            We need renewable energy AND bio-diversity.

          • hydrophilia

            I had no idea sheep farmers were so toxic!

          • Beat Odermatt

            Sorry, the sheep farmer used a poison to bait the Wedge-tailed Eagles. I think the poison was called Lucijet.

          • Tom
          • Beat Odermatt

            I have seen this article ages ago. My concerns are about the proposed location. It would be ideal for large scale solar PV and we need a lot more of them. They are proven, affordable and are environmentally harmless. I have great concerns that the current location may not be ideal for expensive “bird fryers”. I haven’t seen any EIS about such an installation.

          • Tom

            They don’t kill birds so there is no reason to use negative language.
            I agree more PV would be nice, and it is cheaper on an energy only basis, but Solar Thermal with storage is cheaper than PV with storage.

  • solarguy

    I think molten salt storage has a record of 24hrs currently. I wonder what the limit is. Is 72 hours or more possible?
    I reckon that CST/Wind Hybrid power plants, with max storage would be the way to go on any scale. Any knowledge on that front Giles?

    • Yes. Up to two months – assuming you don’t tap it, per a comment made by SolarReserve.

      • solarguy

        Thanks Susan. We may have to tap it’s cumulative daily output of up to it’s equivalent of 10 days production from the storage tank. These rainy or overcast weather events can last that long on rare occasions.
        Say, if plant can produce 110 Mwh av per day of excess output, then over 10 days would have 1100 Mwh stored. If 110Mwh can be taken out daily with molten salt, it will be time to pop the cork on the Bollinger.
        Failing that with MS storage, compressed air, Hydrogen storage and pumped Hydro would be a means to an end. Even stored bio gas perhaps.

        • It’s actually 1,100 MWh/day that can be stored though. The problem is more the opposite according to APS( the offtaker in Arizona for a trough CSP with storage, Solana). It is frustrating to “spill” surplus solar that could have been stored because the tank wasn’t emptied (to make room for it) the night before

          • Henry WA

            Susan
            I note your advice that the heated salt in the large insulated tank can usefully retain its heat for at least 2 months (or presumably forever if minimal additional heat is added to cover the heat losses). Would it be reasonable to have a second 1.1 GWh molten salt tank, not intended to be fully used and replenished on a daily basis, but to give more flexibility and used to take heat when there is surplus solar energy (rather than spill it) and therefore provide additional stored energy for cloudy days etc. I would have thought that just the additional storage container and its molten salt would be a relatively small part of the total cost of the plant. The major cost would be in the heliostats, the tower, the generators and general infrastructure.

          • Yes, I’ve heard that oversizing the storage (within limits) can make sense

  • john

    It is just possible that South Australia will become a case study into how to implement Renewable Energy.
    It would appear that using CST will be utilised.
    If there is a case to use pumped hydro then that should be used.
    Without a doubt South Australia will be looked at and used as an example of how to use RE or not to use RE.

  • JonathanMaddox

    Once Northern is *retired (not “returned”).

  • Rurover

    Surely the cost of installing CST at Port Augusta would be much less than at a greenfield site, given the major power lines, steam turbines and generators are already in place. (Assuming they are not in need of major refurbishment or replacement due to age.)

    The solar tower/reflector/molten salt installation simply supplies steam to that existing infrastructure, so saving significant dollars and bringing down the cost per MWh to a very competitive level hopefully.

    • Gary Rowbottom

      The Alinta study demonstrated hybrid solutions are not the way to go, furthermore the steam conditions and equipment capacity are a mismatch. Aslo in “human years” the power station is at least as old as me (55), and if we went down the path of melding an old plant to new technology, it would be plagued with technical issues (equals time and cost overruns) and operational problems that would no doubt taint the potential of CST with storage for a long time – I definitely don’t want that – it has been/is difficult enough as it is to get a utility scale plant built here.

      • Rurover

        Thanks Gary. Appreciate your perspective. Being a Croweater and seeing how industry in this state is suffering from high power prices, I’m as keen as you are to see this done successfully to benefit the local electricity market and of course, the environment.

  • DogzOwn

    Meeting with Minister Greg Hunt recently, asking how he feels about us being the only continent not developing with CST, he says no longer competitive, undermined by cheapness of PV. But what about storage to take care of fluctuation in output and after daylight? He reckons PV with all of CST plant except heliostats. What do you guys reckon?

    • all of CST plant except heliostats? What the hell?
      The CST plant is essentially a collector of heat that then creates steam and drives a turbine. If you don’t have the heliostats, you don’t have the rest of the plant.
      I hope you misunderstood him. But with Hunt, you never know.

      • DogzOwn

        Crystal clear, no mistake, double take was “electricity from PV to heat molten salt….”

    • You should tell him that CST is not competing with PV, but with dispatchable electricity like natural gas power plants. We have a great solar for day; PV. CST is our solar for night – and also dispatched on demand, like gas power plants.

      CST is the only dispatchable renewable because of cheap thermal storage.