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Turnbull doesn’t need new baseload, he just needs some balls

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(AAP Image/Fairfax Pool,Alex Ellinghausen) NO ARCHIVING

(AAP Image/Fairfax Pool,Alex Ellinghausen)

Prime Minister Malcolm Turnbull is out on the energy hustings and conservatives be warned: He’s wearing that leather jacket again.

On Monday, Turnbull took a helicopter tour of the Snowy Hydro, held a press conference and conducted some TV interviews. And, with his second meeting with electricity retailer CEOs scheduled for Wednesday, he was keen to be seen to be Doing Something on power prices.

These media events are not designed to announce anything new – the $8 million ARENA funding contribution to a $29 million feasibility study for Snowy Hydro 2 had already been disclosed – but to show that Turnbull is Looking to the Future.

And for Turnbull, the future is perhaps not that far away. In two weeks from today, Turnbull will have served as prime minister a day longer than his nemesis and predecessor, Tony Abbott.

Don’t discount the importance of this: with his ego sated, and his rival riled, it is tempting to think that Turnbull might turn his attention to his legacy, and begin to stare down the nonsense he has had to contrive to satisfy the hard right ideologues in the Coalition, and to finally move on from the Abbott-era climate and clean energy policies he inherited but dared not touch. If not now, when?

Central to this and the politics of energy is the concept of “baseload”. Turnbull and others have been throwing the term around like confetti, as thought it was central to the energy future. But it is important to note that baseload no longer means cheap energy, and nor does it mean reliable energy.

Turnbull, deep down, understands this, as he hinted in his comments on Monday: “We have no plans to build a new coal-fired generator,” he told the ABC.

And earlier: “It is very important you have the right plan going forward. So vitally important that we also get that information from (AEMO). We have to get a handle on the size of the problem we are facing in terms of dispatchable or baseload power.”

That last sentence is crucial. As we wrote earlier this year, Turnbull’s pursuit of a $2 billion Snowy Hydro 2 (it is likely to cost considerably more if it does go ahead) was an admission that the future did not lie in new “baseload” fossil fuel plants, but flexible and reliable “dispatchable” generation – which means supply that can be switched on when needed – in the form of storage like pumped hydro, solar thermal, batteries, or even demand management.

Turnbull’s biggest challenge, though, is not to in convincing the public, or winning over Labor or The Greens, but in dealing with those right-wing ideologues and the internal Ministry for No, led by Abbott.

Let’s be clear: No-one wants to invest in new baseload power. The major electricity companies have rejected it, and so has the lobby group that represents all the major fossil fuel generators. It makes no economic, or environmental sense.

And it is not needed. The CSIRO and Energy Networks Australia have said anything between 30 and 50 per cent penetration of wind and solar should be considered “trivial” to the operations of the grid – and that would include the 42 per cent renewable energy share contemplated by the Finkel Review.

Transgrid, the major grid operator, says a 100 per cent renewable energy share is both feasible and affordable, and wants to get on with it.

And numerous studies show that what Australia needs is reliable, dispatchable energy – and this will not come from new coal or gas baseload generation, but through any number of new and existing technologies such as pumped hydro, solar thermal, battery storage, not to mention the smart software and program that focus on managing demand, rather than just simply building new peaking power stations.

AGL has reinforced this point, saying that only renewables will provide the new “baseload” power, not coal.

“What’s the new baseload for us? It’s going to be large-scale renewables,” AGL CEO Andy Vesey said in June. “It’ll be firmed up by probably open-cycle gas and, eventually, when storage comes down, that’s what it will be.

“We don’t see anything baseload other than renewables.”

And this also needs a new management approach to the grid. The failures in South Australia last year and this year and the near misses in NSW and Victoria this summer were not about renewable energy, but the overall management of the grid.

It was also a failure of corporate culture. The price surge and the lack of security were mostly about the actions of the dominant incumbents: The biggest lesson was that Australia’s ageing grid needed updating, both in technology and the way it is managed.

What is needed – particularly as the existing coal generators exit over time – is a lot more wind and solar. There is about 30GW of approved wind and solar projects in the pipeline, just waiting for a long-term market signal. A fraction of these will get the green light thanks to the RET and some state-based targets.

As Ivor Frischknecht, the head of ARENA said when accompanying Turnbull on Monday: “The future really belongs to wind and solar, but we know they are not really available all the time. We need to think about how to store that energy when it’s available and cheap. That’s where pumped hydro comes in.”

Cheap wind and solar is what Michael Liebrich of Bloomberg New Energy Finance refers to as “base-cost” renewables, a prospect underlined by Martin Green, the renowned UNSW solar researcher, who predicts that solar costs will average in the $US20/MWh within a few years, cheaper than coal has ever been.

And that’s where other “balancing” technologies come in, including the Tesla big battery that the federal government derided, the smaller 30MW battery it is so enthusiastic about, and the solar thermal plant in Port Augusta.

South Australia, Victoria and Queensland all have tenders for storage or dispatchable renewables that will lay the groundwork for the transition to come.

And for pumped hydro, and the Snowy 2 proposal, there are still questions about whether it makes the grade.

It has an advertised capacity of 336,000MWh, but it will use half of this pumping water up hill, and to make money it will rely on a big arbitrage from when wholesale prices are cheap to when they are expensive. There may not be enough of such hours in the day to justify the experiment.

But what we are seeing is a shift from the narrow boundaries of “baseload” to the greener pastures of “dispatchability”. Some in the Coalition understand this.

The NSW energy minister Don Harwin has said it is time to move on from the old concepts of baseload power, even if the Queensland LNP are struggling with this concept and the federal Coalition is all over the place on the issue.

Back in June, Turnbull was equivocating: “It would be good to have a state of the art clean coal plant in Australia.” On Monday, he said there were no such plans.

Is it needed? No, of course not. Right now the biggest coal-fired generators are running at low capacity – Liddell was at 50 per cent this past year.

The key is whether they are available during the demand peaks, and in the heatwave this year they went missing. Heat-stroke affected coal and gas fired generators right across the grid.

That’s why the AEMO report – which will outline the need for “baseload”or dispatchable capacity – will be critical.

The future, though is clear. It is what chief scientist Alan Finkel calls Electricity 3.0, and he says is just a few decades in the future. Many think it will be quicker that that.

In a speech to Monash University on Monday night, Finkel described the future:

  • We convert all electricity generation to zero-emission sources.
  • We back up those sources with storage technologies we’ve scarcely begun to imagine.
  • But it’s not enough. We need to double it. Triple it.
  • We ramp up that cheap, reliable and clean electricity production.
  • Then we run the world electric: electricity instead of petrol in cars, electricity instead of gas heating in homes.

And what do we need from our politicians to get there? According to Finkel, three things: Aspiration. Encouragement. Education.

These are concepts Turnbull showed – at least in the past – that he understands well. And from September 13, hubris satisfied, he will have his opportunity.

We wish him a Happy anniversary. But from that moment on, there will be no more excuses for not showing the courage of his convictions, if that is what they were.  

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  • howardpatr

    How much longer will Abbott and his fellow RWRNJs be allowed, by Turnbull, to hang around his neck; like a dead carcass?

  • Joe

    I have to say that Big Mal looked rather fetching in his Black Leathers. At his presser in the Snowy he sounded as excited as schoolkid looking forward to a school holiday break. Big Mal should give the Premier Jay public smackdowns a rest though. It is not a good look, hypocritical in fact, for Big Mal to pump up his version of RE Storage with Snowy 2.0 and at the same time smackdown Premier Jay who is already leading the nation and streets ahead of Big Mal with RE and Storage.

    • solarguy

      Spot on, but ain’t politics a bitch, the switched on will look at Mal and say WTF are doing man.

      Well the answer might be, hiding from Tony and tin foil hat brigade.

  • john

    As i see it Turnbull has a huge problem.
    His predecessor is seething that Turnbull has the job and will pounce on any mention of putting in policies that in any way support Renewable Energy.
    The opposition understands this and will try as hard as they can to wedge Turnbull to enable the Predecessor to try to regain his rightful place as leader.
    What does this have to do with trying to get a good outcome for the energy supply situation in Australia absolutely nothing; however I honestly think this is how it will play out.
    As to decisions I do not think any will be taken any time soon because, just read the statement they are doing a study, then when it is done they get a report, meanwhile as a company who wishes to invest what signal do you get?

    It tells you there is sovereign risk.
    Meanwhile with the Federal Government having gone missing for a few years now the State Governments have got on with it and are putting in place at least some preliminary aspects of a system that should deliver lower cost energy to the country.
    Is the Snowy Project a good idea?
    Yes we need PHES is this the cheapest perhaps.
    It can be augmented by water runoff so that will help.
    I think Malcolm is between a rock and a hard right place.

    • Barri Mundee

      A question: is MT biding his time to take on his very conservative rump or did he never have a progressive bone in his body in the first place?

      • Tom

        +1. When he was advocating for climate change mitigation, this topic was the flavour of the month all around the world. Did he give a stuff? or was he just riding the wave of popularity?

      • Petra Liverani

        Agreeing to speak and his speech itself at the Sydney launch of Beyond Zero Emissions’ Stationary Energy Plan in 2010 would suggest he did. https://www.youtube.com/watch?v=KqZTh7HT180

    • solarguy

      The last sentence you mentioned……….is of Mal’s choosing, isn’t it. He does need to grow a pair.

  • John Saint-Smith

    “If not now, when?”
    Indeed.

  • Tim Forcey

    If, as the Chief Scientist suggests, we will be heating homes with electric devices (i.e. heat pumps) instead of gas, find out how at the Facebook discussion group “My Efficient Electric Home”. New members welcome!

    Link below.

    https://www.facebook.com/groups/996387660405677/

    • solarguy

      And don’t forget Tim, SHW is part of the all electric house capper.

  • Matt

    Hi Giles, Looking forward to you taking up my invitation to visit the Tomago Aluminium smelter and find out first hand, just how essential baseload supply is to to an industry like ours. I believe you have my number and email address. Best regards, Matt

    • Alex Hromas

      Matt, you don’t need base load power you need constant power there is a difference. Base load was the load thermal power stations sought at night because they could not be shut down or run at less than about 30% capacity. Aluminium smelters were great customers especially if they accepted some interruptions as Tomago does. Renewables & storage can deliver continuous power just the costing will be different so you only have Cinalco to worry about

      • Mike Westerman

        You could always move to Sarawak and enjoy 7×24 hydro at <$50/MWh fixed for 30y. Certainly closer to sources of bauxite and alumina.

    • Tom

      Tomago could be a key player in stabilising the electricity market if they gave a shit.

      There is absolutely no reason that Tomago needs 700MW at a perfectly constant rate. Almost all of this is pumping electrons into aluminium ions – this can be done at any rate they want. Only a small amount is keeping the pots at a constant temperature.

      Why can’t Tomago run itself on 200MW when energy prices are high and demand is scarce, and 1500MW when prices are low and demand is plentiful? “Because that’s not the way it works” doesn’t cut it – a small amount of redesigning could change the way it works.

      At the present, Tomago is part of the problem, which is a shame, because they could easily become part of the solution.

      • Ian

        Tom, you’re on the money. But what you are saying is that true? Can an Aluminium refinery vary their demand? Have other refineries already done this? These sorts of plants were purposely constructed where electrical energy was plentiful and cheap, such as Tasmania, New Zealand etc. It turns out that wind and solar in Australia can be very plentiful and cheap but just not 24/7 constant. In order to achieve reliability, excess solar and wind needs to be built and the frequent electricity excess is curtailed or dumped cheaply. Instead of Matt’s insurmountable problem we can turn this around and make it Tom’s incredible opportunity. Aluminium smelting may be just the humongous ‘battery’ we’ve been looking for, soaking up the excess electricity spill and creating an exportable product.

        If the management of Tomago are so dull as to view their process as fixed and final then maybe our mate Musk can help them out with some new ideas. Or perhaps they can pack their bags and head off to China or Sarawak or some other gastly place.

    • solarguy

      And that can be supplied by RE and storage Matt, I have no doubt. And it will be cheaper too.

  • stalga

    Is Snowy 2 a good option compared to the many other potential sites that have been identified? I’m generally a wide-eyed enthusiast but this one isn’t ringing many bells. You could buy a lot of leather jackets for those 29km of tunnels.

    • Tom

      It’s a great site in terms of the amount of GWh of potential storage. Not an inter-seasonal volume, but certainly a couple of calm & cloudy weeks worth.

      However, it’s a terrible site in terms of capital expenditure required, and efficiency of the pump-generation cycle once it’s running.

      I’ve got to agree. It’ll never happen.

    • Ren Stimpy

      We’ll have to wait for the $29 million feasibility report.

      My thoughts are that this beats the snot out of a new coal fired power station, but wouldn’t it be better to put that $2 billion into a series of smaller and more distributed pumped hydro projects? in order to establish a learning curve (where each project comes in at a lower cost / MWh than the previous project) and to decrease the risk of one local storm taking out the grid line to a massive amount of generating capacity.

  • phred01

    What happens if the High court disqualifies all dual citizen members currently in parliament. Will legislation passed so far be invalidated? Will runners up be awarded vacated seats? So hydro2 ain’t going anywhere!

    • Tom

      Runners up in the senate will be awarded vacated seats.

      House of reps will require by-elections.

      Legislation is very unlikely to be retrospectively invalidated.

      However, while seats are vacant in the house of reps (waiting for a by-election), it’s going to be very difficult for either side of the house of reps to get 76 votes to pass anything.

      • phred01

        Disagree about the 76 seat majority to pass anything take this example 150 members in the house 51 yeah 50 nay 50 abstentions the bill is passed. Basically 50 abstentions or missing members are not counted as yeah or nay This called a simple majority

        • Tom

          @ phred01 – Thanks. I didn’t realise that – I always thought “abstain” was effectively a “no”, but without saying so.

          I’ll look this up later, but for now, I’ve learned something today. That’s why I contribute to this site – I love learning.

          Cheers

          • phred01

            Certain members in the past used a abstention as a no vote without breaking party rules. The other convention an abstention is used when a member has a perceived per quinary interest. There is an agreement between the major parties if a member is sick dies or is overseas like the foreign minister there is pairing so as not to take advantage of situation ie maintaining the status quo.

  • riley222

    Time to move on this one. Look at the RE live generation widget to get a handle on the size of the problem coming as existing fossil fuel powered stations close.
    Snowy 2 will be a start only. If we don’t make some big decisions soon we really will be buying electricity from China.

  • Chris Fraser

    The Premiers from Victoria and South Australia could upstage this fellow, and announce more substance in their renewable projects, anytime even without a leather jacket. The main reason being they don’t have a right wing rump to deal with.

    • Marg1

      Yes, thePremiers are upstaging him and showing how to lead, Maclom doesn’t seem to know how to do that.

  • MaxG

    Who is Turnbull?

    • mick

      an empty suit

  • johnnewton

    And still he bleats ‘when the wind doesn’t blow and the sun doesn’t shine’ I hate being vulgar but FUCK ME!

    • Ren Stimpy

      I love being vulgar but I’ll refrain on this occasion because he has a point, and it’s easy to find examples, such as right now with just under 3GW being generated by wind and solar, out of a possible/potential 11GW if the wind and the sun were blazing full-on in all states simultaneously.

      https://uploads.disquscdn.com/images/653c85a789c6134a44a91ba33fb517981c5455f39a4122c7fa5ba3fa36ad05d7.png

      Turnbull has now finally said that a new coal power plant won’t be built, which should go a long way to giving more investment confidence to dispatchables, such as grid batteries, pumped hydro, CST, and biomass which will be needed to displace the black, brown and red bars off of the above chart at times like now when (there is no denying it) the wind doesn’t blow enough and the sun doesn’t shine enough for the cheapest forms of renewables to do so on their own.

  • Brunel

    We can ban gas heating in new homes today. Or put a massive tax on new homes that have gas heating.

    It is absolutely pathetic that the ALP wants land to be very expensive but the buildings to be dirt cheap. The buildings should be better quality with rainwater tanks and heat pump water heating. While land should be as cheap as possible.

  • BPH

    Hi folks, quick quandary of mine, would it be worth heating molten salt with electricity from solar pv? Would save building that tall tower and fiddling around aiming all of those heliostats. Or are heliostats just far more efficient?

    • Mike Westerman

      PV are typically 15-20% on a surface area basis whereas mirrors reflect 99.9% of insolation, less losses (reradiation) at the collector of a few percent, so yes heliostats are much more efficient at converting insolation to stored heat by 4-5x.

      • BPH

        Thanks, would be interesting to know how cheap PV would have to be for it to compare.

        • Mike Westerman

          Yes that is an interesting question. The Holy Grail of heliostats was to try to get the cost down to $200/m2. Several years ago when I looked at it it was twice this, then you have the tower and collector cost, for collecting about 1kW/m2 of mirror. To get that electrically from PV would $1,200. So way cheaper with heliostats. Maybe parity when PV gets to 30-40c – that would be interesting!