Federal energy and environment minister Josh Frydenberg joined the Twitter frenzy about soaring NEM power prices during Thursday’s heatwave conditions, but from an entirely different angle to most.
While much of the social media conversation around yesterday’s eye-watering NEM prices focused on the fact that a unit at the newly purchase Victorian coal power plant, Loy Yang B, had tripped and failed just when it was needed the most, Frydenberg opted for a bit of political point scoring, with the Tweet below.
SA electricity prices went over $11,000MWh at 4pm & $14,000MWh at 5pm today. A reminder why SA needs the NEG & Snowy. pic.twitter.com/U2i9gToztY
— Josh Frydenberg (@JoshFrydenberg) January 18, 2018
It did not go down well.
Here is a selection of comments Tweeted in response to the minister, including from energy market experts, analysts and players …
josh, are you going to mention that today’s high prices were courtesy of a #coalfail which cost the market ~$168,330,000?https://t.co/k6v9j9u6eL
— simon holmes à court (@simonahac) January 18, 2018
The trigger for these price spikes was coal power stations failing, for the Nth time this summer.
So I guess coal power won’t qualify under the reliability guarantee of said #NEG? With all this downtime, it’s looking good for emissions reduction though!— Craig Memery (@craigmemery) January 18, 2018
The lack of wind was forecast a day in advance, and AEMO made arrangements accordingly. The failure of the coal plants was not forecast, and it came at a time when the power was needed most and gave AEMO barely any time to respond.
— Ken McAlpine (@KenMcAlpine) January 18, 2018
Is this your way of saying that we should never rely on coal-fired power stations? The fact two tripped today is the reason for the market spike!
— Graham Perrett (@GrahamPerrettMP) January 18, 2018
Interconnects from NSW into VIC, and VIC into SA were both at capacity today. How would Snowy 2.0 have helped?
— Michael Bell (@Xtrackka) January 18, 2018
And the final word, though not via Twitter, goes to ITK analyst and regular RE contributor, David Leitch:
“Is Josh Frydenberg forecasting that South Australia will never have high prices again if/when Snowy 2 is eventually built? If so, I’d like a small bet with him on that. In any case it’s a bit irrelevant because Snowy 2 is still a long way away and will need an awful lot of high price events to make a return on capital.
“As for the NEG not sure how it would make any difference since no one, probably including Mr Fydnenberg, yet knows how it will work in practice, if it is ever adopted.
“In any event it appears that the interconnected flow from Heywood dropped down at the critical time and this was responsible for the high price. If this is the case, Snowy power couldn’t have got to SA anyway.” (See pink line in attached graph. Red line is price; blue is gas supply; yellow is wind; green is PV and pink is interconnector; black the battery.)
Also, adds Leitch, “it looks the Victorian price was also high in the same period which probably means Victoria didn’t have enough power spare to send to South Australia. So if Snowy had operated maybe that might have made a difference to Victoria and so to South Australia. On the other hand, by the time Snowy is up and running there will be much more supply in Victoria as well.”
