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Will Tasmania be the ‘battery of the nation’?

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Lately we have been subjected to Prime-ministerial statements on energy policy that jump from Snowy 2.0 to propping up aged coal-fired power stations in NSW, to government support for a new “clean” coal power station in Queensland and back to pumped hydro in Tasmania. Long term strategy seems to have gone missing.

The latest announcement is a feasibility study of pumped hydro in Tasmania supported by ARENA.

Is investing in Tasmania as the ‘battery of the nation’ likely to be a sensible idea?

Tasmania itself doesn’t need more centralised energy storage. At full capacity, our dams hold more than a year’s supply of electricity. Tasmania’s problem is lack of renewable generation, which leaves our energy security dependent on imports from Victoria and increasingly expensive gas fired electricity.

The mainland grid would certainly benefit from more large scale renewable generation backed by storage. Implementing this would require both a bipartisan consensus on closing down aged coal infrastructure and a long term policy in support of low emission renewable energy.

Sensible, bipartisan, long term planning doesn’t appear likely to break out any time soon. Even if it did, the next questions are what is the best form of storage and where should it be located?

Pumped hydro is the most cost-effective form of large scale energy storage but it requires a stable investment climate, and in some locations, significant investment in transmission infrastructure.

Snowy 2.0 does have the advantage of being well connected to the NSW and Victorian grids. If the national battery is located in Tasmania it would require a billion dollar second interconnector to the mainland.

The sorts of big national project preferred by politicians are not the only solution. Our electricity system is rapidly moving from centralised energy generation to distributed generation and storage.

CSIRO and the Australian electricity network operators have developed one of the most credible scenarios for the future of the grid.

It anticipates that by 2050, 30-45% of our electricity would come from customer owned generators. The plan identifies the need for incentives to ensure that customer battery systems provide benefits to the network as well as to customers.

A recent ANU study has identified 22,000 potential sites for off-river pumped storage around Australia in a range of sizes. Only a few of these are likely to provide viable but they offer possible advantages in being smaller investments that can address local requirements and reduce rather than increase the need for network enhancements.

If there is a role for large scale pumped hydro storage, is Tasmania likely to be the most cost effective place to build it?

As Everett Dirksen never actually said, “A billion here, a billion there, pretty soon, you’re talking real money”. At over $1bn for a second interconnector, $2bn for a 600 MW wind farm on King Island or over $1bn for the Robbins Island and Jim’s Plain wind farms, and Hydro Tasmania’s estimate of $5bn to build 2500 MW of pumped storage, we are talking ‘real money’.

And it is ultimately our money, whether the infrastructure is built as a regulated asset (added to our electricity bill), by government grant (our taxes) or by private investment (including our super).

Investments on this scale take the best part of a decade to plan, fund and build, and are paid for by users over a 40 year period or more.

We need to be very sure that this is the most cost effective way to meet our energy security in an electricity market where the significant trends are to increased energy efficiency, local generation and storage, and demand management.

The detailed analysis of pumped hydro funded by Hydro Tasmania and ARENA will be a welcome contribution to the public debate. But big schemes may well have had their day.

Hydro Tasmania dropped work on the King Island project and the Tamblyn report on the viability of a second interconnector was lukewarm on its viability to say the least.

My prediction is that the market will have provided decentralised solutions to the challenge of reliable, affordable clean electricity long before these big schemes see the light of day. The flurry of announcements and feasibility studies mainly serves to convince the public that the politicians are dealing with the problem.

Jack Gilding is the Executive Officer of the Tasmanian Renewable Energy Alliance but the views in this article are entirely personal. This article first appeared in The Mercury and is republished here with permission of the author,  

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  • Kevin O’Dea

    A year or two ago, Tasmania faced a drought induced energy shortage combined with a major breakdown in the Bass Strait cable, which forced many of the major industries to cut back on production and to seek creative ways of finding power. Climate change could create more droughts and therefore more havoc with reliable energy for the island state.

    • Joe

      There was a fair bit of newspaper coverage here in Sydney at that time. That drought and the cable issue caused a crisis in Tasmania’s power industry. I don’t think there is anyway to ‘drought proof’.

      • Kevin O’Dea

        That is the point, Joe. This talk of Tassy being the BATTERY of Oz is absolute bunkum because it assumes constant rainfall and reliable water storage, very risky in times of climate change.

        • Mark Fowler

          The whole point of pumped hydro is that you keep reusing the same water – rainfall irrelevant as long as it covers evaporation and any environmental flows needed.

          • itdoesntaddup

            You can only pump if there is surplus power imported to do so.

          • Mike Westerman

            Or surplus local solar and wind.

          • itdoesntaddup

            I doubt Tasmania would ever install enough wind and solar to power itself without using normal hydro (which in any case provides grid inertia and stability). You only pump once you have a surplus over and above all normal hydro capacity – otherwise, you’re throwing away the energy lost in the pumping round trip.

          • Mike Westerman

            Sorry what you are saying doesn’t add up – surplus solar and wind (which is highly likely because of the different drivers for each) allows preservation of conventional hydro and greater flexibility in water use for other purposes. PHES allows capture of surplus that may be wasted if, as is the case occasionally in SA, wind is curtailed. If energy would be lost anyway, the cycle losses are irrelevant. PHES also allows hydro to avoid water releases to meet peaks.

          • itdoesntaddup

            Why not just have cash for ash? You seem very careless about energy if you think it should be wasted pumping unnecessarily while you still have hydro in production that you could turn down instead, which would allow you to produce much more energy when you need it. We’re talking about Tasmania’s energy balance and how much wind and solar they install on the island, not SA here. It makes no sense at all to have a surplus of wind relative to Tasmanian demand: you need something to give you grid stability. Tasmania is also the least favourable location for solar. No sense in over-investing in that either.

            If you want renewables to work, it’s vitally important to aim to use them in a cost effective manner. Otherwise, you’d be much better off building more new coal capacity.

          • Mark Fowler

            I am afraid your arguments really don’t add up.

          • itdoesntaddup

            I’m afraid you have no argument to present, else you would have done so.

          • Mark Fowler

            My thoughts then – first off the issue of PHES is not about Tassie’s energy balance other than if it can reach surplus it has the opportunity to export energy to the mainland as solarguy points out. PHES would allow higher usage of currently intermittently used generating capacity and existing storages at what are likely to be modest cost.
            Tasmania’s position in the roaring 40’s makes low cost windpower ideal to provide the energy for the pumping. By capturing that energy using PHES it allows Tasmania to sell into the mainland electricity market when power is short there and prices are high. – the standard arbitrage that batteries rely on for economic viability. It can of course sell the wind power directly but it is likely to overlap with SA and Vic wind generation and thus achieve a low price.
            Unless you plan to ship in coal Tassie local coal resources are both limited (mainly Fingal Valley) and of relatively poor quality plus the cost of new coal fired generation is far higher than almost any alternative other than nuclear.
            One of the key aspect of solar and wind is that by spreading it geographically you increase reliability.

          • George Darroch

            Mark’s right. Best wind resources in the country, and although there’s a degree of correlation with VIC and SA, it’s not exact. Very often there’s a high pressure system sitting over the southern mainland that’s not affecting TAS. The further south you go, the more this is true.

            And this is at much lower cost than chemical batteries. Snowy would then (presumably) send its electrons north more often. However all of this would require a bit more cooperation between parties than we currently see.

          • itdoesntaddup

            There is absolutely no sense in making Tasmania a continuous net exporter of power via expensive undersea cables. Generation needs to be close to demand centres where possible: grid costs escalate alarmingly if you have to deliver power from a remote point, especially undersea. Of course, it is technically possible – but why opt for the more expensive solution?

          • Mark Fowler

            I am not suggesting BassLink 2 be built but BassLInk 1 is a sunk cost (it exists – money spent) so only the operating costs need to be considered in assessing the viability of future plans rather than the capital cost, although it is best if the capital cost is fully recovered.

          • itdoesntaddup

            Precisely: it makes much more sense to use Basslink to import surplus wind and then to re-export when there is a lull in the wind, rather than not using it to import, but spending out on a whole bunch more wind farms which will be producing a surplus that must be stored, during which Basslink would be idle and not earning transmission revenue. Why spend out on the extra wind farms given a surplus already exists and is being curtailed in high wind conditions?

          • Mike Westerman

            Tas needs income – wind is a resource that could earn that income, particularly since wind farm development in Vic is/will continue to be, constrained by competing land use. Tas has the better wind resources anyway. Along with its hydro resources it can value add to wind energy by exporting it into a high value market. Basslink wouldn’t be idle during storing of excess wind any more than it is now during times when prices in Vic and Tas are similar.

          • itdoesntaddup

            You get the income by buying cheap and selling expensive.

          • Mike Westerman

            Retailers do, not investors in capital goods. They make income by the revenue stream exceeding the capital return to financiers plus the operating costs.

          • itdoesntaddup

            Any storage project requires the ability to stock up on the cheap and sell out at a premium. It doesn’t matter whether it is ageing wines and port, or storing hydro power. The investor in the storage may choose to lay off some of the risk by renting it out (but risk remains that he may not always have a rental customer when storage margins are inadequate).

            Norway operates on storage arbitrage: compare the situation at 00:00 on Nov 5th, when the entire Nordic grid was in surplus and the price was €24.54/MWh and Norway was importing about 1.6GW from Denmark, and 15:01 on the 8th, when Norway was exporting 1GW to Denmark (who were also importing 1.5GW from Sweden, much for onward sale to Germany I suspect), with the Danes paying €82.52MWh for the privilege.

            http://www.statnett.no/en/Market-and-operations/Data-from-the-power-system/Nordic-power-flow/

          • Mike Westerman

            Arbitrage is one revenue stream, but FCAS, black start and future ESB requirements are not reliant on this. But even for arbitrage, the whole argument for PHES, the thing that has brought it back into contention, is the rapid build up of rooftop solar and large scale wind. Rooftop solar is being driven by high retail prices ie not entirely linked to wholesale prices, so there is a perverse incentive for owners to keep installing (which they are). At the same time, wind cannot be scheduled so owners analyse actuarial data to justify their investments knowing that there will be times when prices will be very low if coincident with excess solar. This situation will only get “worse” while forcing inflexible generation out of the market, so exacerbating supply into the evening market as solar subsides. That is, every indication is that arbitrage will become more profitable, particularly for states like SA which are transmission and supply constrained.

          • itdoesntaddup

            More simply, wind becomes less and less valuable the more of it you incorporate into the grid, because you need more and more backup, however you choose to source it. The backup itself at the margin is only used at progressively lower capacity factors, so it needs to have a low capital outlay.

          • Peter F

            You make a good point very badly, The cheapest way to make Tassie the battery of the nation is to install more wind so that Tasmania has enough water in their hydro dams at all times so that when there is no wind they can still supply all local demand and run basslink in export mode most of the time. 500-600MW of new wind will do that at about half the cost of a similar quantity of pumped hydro

          • itdoesntaddup

            Tasmania has 2.6GW of hydro capacity, and average demand of about 1.2GW, and peak demand of about 1.7GW. In practice, demand is met mostly from hydro (unless the reservoirs have been run down too far by a greedy Hydro Tasmania exporting into the expensive market to the North), with the extra capacity offering the flexibility of using different reservoirs. There would certainly be no sense in installing say 3GW of wind capacity (to generate 1.2GW on average). Basslink only handles 500MW, so extra interconnection would be required to be of much use to VIC/SA/NSW. But there is no point in installing extra wind on Tasmania itself which will be correlated in production with surplus wind the other side of the Bass Strait: just import the wind so that there remains sufficient water in the reservoirs to export when winds are low. That way the interconnectors get better use, and you aren’t building surplus wind, leaving it to be curtailed where there is no storage.

          • Peter Campbell

            “unless the reservoirs have been run down too far by a greedy Hydro Tasmania exporting into the expensive market to the North”
            So, why not install plenty of wind, which allows flow to be held back whenever there is wind, so dam levels can be higher, which means ‘greedy Hydro Tasmania’ can avoid wasting water on generation when prices are low (wind supplying that demand) and run more when export prices are high and they can export as much as they can push down the cable without risk of dam levels falling too far, and then fund another cable to be able to export yet more.
            Put another way, why would excess wind be curtailed if, as you say, the dam levels are low? Just let the wind run ,turn down the hydro generators and let the dams fill up then export the saved energy when the wind is not blowing and Hydro Tas can get a better price.

          • itdoesntaddup

            Hydro Tasmania is already sitting on a ticking time bomb due to wind
            farm expansions that had no business case. The wind farm Power Purchase
            Agreements (PPA) that Hydro Tasmania entered into with Chinese owners,
            Shenhua, will cost the Tasmanain taxpayer almost $100 million over the
            next six years.

            I’m sure there are plenty of other pockets looking to be lined at taxpayer expense.

            https://tasmps.greens.org.au/content/energy-prices

          • itdoesntaddup

            So, why not install plenty of wind,

            Plenty of wind is going to be installed anyway in SA/VIC/NSW as coal gets shut down. You don’t need to invest in more in Tasmania. You just need to take advantage of the periodic surpluses and deficits across the Bass strait, which will be amplified by the extra wind and solar.

          • solarguy

            Tassie has a fantastic wind resource, being located in the roaring 40’s. This whole discussion has been about Tassie being the PHES battery for the country, not Tassie itself really.

          • solarguy

            Correct Mark. And if there is a concern about fresh water supply PHES from sea water works just fine.

        • itdoesntaddup

          To be a battery, you can operate much as the Norwegians do – they have almost no pumped stroage. So you would import surplus power on very windy/sunny days from Southern Australia and not run Tasmanian hydro, thus “storing” it by saving hydro for later use when there was a shortage on cloudy/windless days on the mainland. You do not have to pump (which incurs a round trip loss of 20% or more). Of course, you also incur a round trip loss on the interconnectors even if you do not use pumped storage of the order of 6%. Pumping economics must repay the energy loss and the added cost of lower reservoir containment, as well as the pumping capability (might be possible without too much alteration of the existing power turbines, but you may want additional generating capacity with or without pumping, rather than just reducing the risk of reservoirs running low).

          • Tom

            I’m with itdoesntaddup on this thread – he/she gets it.

        • Ren Stimpy

          – Wind power is cheaper than hydro, particularly if the ownership of the wind farms is independent from HydroTas.
          – Tasmania has extremely good wind resources.

          Seems to me the more wind farms built in Tasmania the cheaper power will be for Tasmanians. Tassie should be building wind farms like the clappers.

          This would have the side-effect of allowing the dams to recover. If dams recover enough, e.g. back to 90%+ levels, then exports become a good way to earn revenue for the state, using ‘spare’ hydro to supply dispatchable electricity to the mainland.

          Agree with some others that pumped hydro would be uneconomic in this case. Instead install many more Tassie wind farms which would have the double whammy effect of cheaper power prices for locals and ‘saved hydro’ which creates more security and export possibilities.

      • Tom

        Restore the dam levels. Drought proofed. Easy.

        We did it between 2010 and 2012 in slightly below average rainfall years in preparation for the carbon tax – it’s easy to do and we could do it again.

    • Mike Westerman

      Looking at annual summaries on the BOM site, there doesn’t seem to be a correlation between rainfall and wind: wind seems persistent regardless, with Tasmanian wind resources some of the best in the world. It would therefore seem the obvious “drought proofing” source, especially in combination with pumped hydro, since water could then be prioritised to consumption rather than power generation.

    • Peter F

      The drought induced energy shortage could have been averted by
      a) not over exporting during the carbon Price Years
      or
      b) firing up their CC gas plant as soon as basslink went down (except that they were in the process of dismantling it) thus extending the available water by months
      or
      c) installing 300MW of wind following on from Woolnorth which they are now doing. That again would have allowed them to keep sufficient water in their dams so that lower hydro + extra wind+ CCGas would have provided enough power at only a small premium to get through the drought

      • Tom

        Exactly. 3 dry months – September, October, November – that was it. The winter was going pretty well until then – we were a net exporter until mid-September 2015.

        Low dam levels was the cause – not 90 drier than average days and a cable failure.

  • Mark Fowler

    One of the advantages Tassie has with pumped hydro is that the Mersey, Forth and Derwent all have multiple dams with power stations on them which removes the cost of reserviors and power stations. These river systems only run intermittently while the Great Lakes and Pedder provide the – dare I say it – “base load”. I don’t know the costs of extra pipes and the renewables to drive the pumping but it seems like a good start.

    • Tom

      True – and the Pieman. Probably not the Derwent, as all these dams are relatively tiny, and probably not the Mersey – Parangana is tiny and the long tunnel between Cethana and Parangana would create efficiency losses.

      However, for part of every year, all of these dams are spilling, and so there is no point pumping as the water would just spill over anyway.

      If you installed a pump-generator several times as big as the current generators, then you could overcome this problem to a large degree, but 1) you may run into demand constraints when generating (need more cables to the mainland), or 2) need to upgrade transmission infrastructure to bring the power to the pumps.

      Also, if Tassie ever installed an off-stream PHES (or on-stream but unlikely to ever spill), then it would render all of this on-stream PHES infrastructure largely redundant.

      • Mark Fowler

        Tom – I am sure you are right about the possibilities.

        While those river systems do spill and thus there is no need for pumping over thoseperiods, there are also long periods where the units are not run, or only run for an hour or two a day to help meet peak demand due to lower inflows. It is at these times additional hours of operation can be achieved through PHES.

        I expect off-stream PHES will require additional capital expenditure for storage top and bottom as well as generators.

        • Tom

          Exactly true. It’s a question of CapEx + environmental destruction vs usefulness & potential redundancy.

          I’ve looked into this reasonably deeply because I previously believed that a PHES at Cethana dam and also at Bastyan Dam and Mackintosh Dam would be cheap and 80% of the time would be useful.

          However, no matter how much wind and solar Tassie installs, most of our potential energy wastage will occur while multiple dams are spilling, hence these “cheap” schemes will only capture a small fraction of our potential energy wastage as they will be relatively useless during these periods.

          Also, if another large CapEx scheme was ever to be built in Tasmania which was not at risk of spill in high inflow periods, then this would render these cheaper schemes largely redundant.

          So unfortunately I had to change my biases and accept that these “cheap” schemes are unlikely to be of significant use.

          August to December is when 80% of our dam spill occurs, and this is when it is windier (March to July are the relative doldrums) and also averages out to about the annual average of solar radiation.

          There’s no perfect renewable solution for March to July, except to keep our dams full and to draw them down during this period to be replenished later.

          Mind you, pumped hydro in Tassie for Tassie will not be particularly useful at all until we have around 1000MW wind PLUS 1000MW PV installed. We currently have 308MW wind and about 60MW (+/-) rooftop solar.

          • Mike Westerman

            I’ve been told by my Norwegian colleagues that some lower value windfarms in Norway have been decommissioned, as only very low cost windfarms compete where hydro is sometimes spilling coincident with high wind periods – ie something has to been curtailed, even tho’ Norway has substantial exports of power. PHES is only being considered in context of major increases in transmission links to Europe. I would expect it is similar on a smaller scale in Tas. BTW, did you ever look at a PHES from Arthur’s Lake as upper and a low weir on Lake River, Parknook as lower. This gives 700m net but potentially GWh of storage with very little Arthur’s Lake fluctuation and only a low cost lower pond. It would need an underground PS similar to nearby Poatina.

          • Tom

            I’m not an expert on Norway, its rainfall, its wind, or its hydro network, but a quick Google suggests that they get higher rainfall in summer than winter in most parts, and this summer rainfall is often skewed toward autumn, with winter/ spring being relatively dry (a bit like Sydney).

            With snow-melt occurring during spring, this would indicate significant inflows from late spring right through to late autumn. Therefore, if the dams were not large enough to store more than half a year’s worth of water, then they would spill from late spring right through to late autumn – 6 months.

            Tassie experiences significant spill (or near-spill) for an average 12 weeks per year (>500MW of dams at or near capacity) or 8 weeks per year (>1000MW of dams at or near capacity). Chance of spill >500MW/>1000MW per month (from the last 12 years of data) is:

            Jan 15%/ 10%
            Feb 0%/ 0%
            Mar 0%/ 0%
            Apr 4%/ 0%
            May 13%/ 6%
            Jun 12%/ 6%
            Jul 13%/ 12%
            Aug 42%/ 29%
            Sep 50%/ 29%
            Oct 62%/ 44%
            Nov 37%/ 25%
            Dec 29%/ 19%

            The crux of this is that, as long as there is less installed capacity of wind/ solar than Tassie’s minimum demand constraints (approx 1300MW including Basslink exports), then energy is only potentially going to be wasted for 8-12 weeks per year, and even then only if the wind/ solar is generating at a high capacity factor.

            As for the Arthur’s Lake/ Lake River scheme – I’ve had a look at it – I think it might have been on your previous prompting. There are many good points – minimal environmental damage from the lower dam, lots of energy storage (depending on how high you build the dam on the Lake River), and nearby transmission infrastructure although it’s capacity may need to be upgraded. Bad points are that, despite a relatively cheap lower dam, you’d need about 10km of tunnelling through dolerite (very hard rock) which would make the project very expensive – over $1 billion I’d think. Also, with the distance between storages and the tunnel, you’d struggle to achieve over 70% pump/ regeneration efficiency. If trading with the mainland you’d have to subtract another 10% from the efficiency due to Basslink transmission losses (5% each way), putting it in the low to mid 60s.

            Still – it’s a much better scheme than Snowy 2.0. I reckon that would be lucky to get 60% pump/ regeneration efficiency given the storages are 30km apart, and if they think they can build it for $2 billion they’re dreaming.

          • itdoesntaddup

            Norwegian hydrological data here:

            http://www.statnett.no/en/Market-and-operations/Data-from-the-power-system/Hydrological-data/

            The reservoirs are run down over the winter, and replenish most rapidly during the spring and early summer with the snow melt. In late summer and autumn, inflow tends to equate to usage, and levels remain stable. Use of significant overspill is rare – only in years of bounteous precipitation. Overall precipitation dictates how much power they can produce: a poor year can knock them back. In 2000 they produced 142.2TWh of hydro, but poor rain/snowfall restricted them to 106.1TWh in 2003 and 109.3TWh in 2004.

  • Ray Miller

    We need to go with the available resources and geographic diversity. Up-scaling the wind generation would be a good first start and then look at possibly adding some pumped storage capability to value add. Yes it is all about system management, not only within Tasmania but also the export to Victoria, as can be seen by the daily interstate energy flows especially when SA has excess wind, it is starting to look like the future we need to have.
    At some point someone will need to make a decision on what value a second Bass Link has for not only TAS but the greater NEM or do we cut our losses and invest more in the local distributed model? Maybe large off shore wind farms in Bass Straight may achieve that value adding?
    But then again improving the energy efficiency of the load side of the equation will be the cheapest option of all!

  • Phil Harrington

    A very good article, Jack. We need more renewable energy generation on-island for our own energy security, let alone the mainland’s. Our dams have not been ‘full’ for decades and never will be again for economic reasons but also thanks to climate change. Tasmania’s notionally competitive energy system is actually comprised of government business enterprises who seem to be more keen on extracting rent from Tasmanian consumers than they are in investing in new renewable capacity. Increasingly, consumers are making up their own minds about their energy futures, as you say, and doing it themselves.

  • Peter Fagan

    Good analysis Jack.

    I do dispute your statement “Snowy 2.0 does have the advantage of being well connected to the NSW and Victorian grids.” The connection to NSW is OK, but the connection to Victoria is inadequate.

    Dr Ariel Liebman, Deputy Director of Monash Energy Materials and Systems Institute at Monash University writes “We note that the existing transmission network from Snowy to Victoria, as well as NSW, will need to be upgraded at a cost of several 100’s million to deliver the peak power to where it needs to go.”

  • Peter F

    In an “average” year Tasmania generates about 8TWhr from hydro and consumes 9TWhr. Wind and solar are less than 0.5TWhr. Until recently, the cheapest way to make up the difference was to import brown coal fired electricity from Victoria. Lately running the combined cycle gas plant at more or less constant load and using hydro as the swing producer has been generally the most economical and has allowed dam levels to rebuild somewhat although there are still some imports from Victoria.
    The planned 300MW of new wind farms should generate about 1-1.2TWhr per year so Tasmania will be net zero imports in about 2-3 years. In all but the longest droughts should not need to run gas. An additional 4-500 MW of wind would mean that Basslink could run at 80% CF as pretty much exclusively export. The question is can Tassie wind and hydro + transmission costs be cheaper than Victorian wind +hydro.

    For a large part of the year it is likely that the mainland states could absorb 500MW but whether they would pay enough money for power beyond that to justify the expense of Basslink II or even pumped hydro in Tasmania is questionable

    • neroden

      If Tasmania builds some more renewables Tasmania could routinely export to Victoria. I hope they do that at least. I don’t know if Basslink II could be justified but it’s definitely justifiable to build enough renewables to make Basslink strictly export-only.

      • Peter F

        Agreed

      • Tom

        It still makes sense for Tassie to import if/ when energy is dirt cheap on the mainland, to preserve energy in storage for export when mainland energy prices are more expensive.

        Also, if Tassie was always exporting, then effectively we would be “baseload” for the mainland. If we are intermittently importing or exporting, then our 500MW cable is effectively 1000MW of dispatchable power for the mainland. And dispatchable power has more value than “baseload” power.

        • Peter Campbell

          If Tassie were always exporting and, as you say, effectively a renewable baseload generator for the north island, then wouldn’t that start to justify a second link so that export could vary in a range above the capacity of just one cable? Then Tassie would look more like a coal power station except with capacity to load follow rather faster. Years ago a justification for more dams in Tassie was to try to attract a high value export industry with cheap power. Now the power itself can be the export.

          • Tom

            A few good points that you raise:

            Firstly, Tassie could comfortably generate 2600GWh per year extra from wind/ solar without changing anything. Currently we generate about 900GWh pa from wind and very little from solar, so there’s a long way to go here.

            2600GWh would replace the energy generated by Tamar Valley Power Station (methane, approx 800GWh pa), and would turn us from being a net importer through Basslink of approx 800GWh pa to a net exporter of 1000GWh pa, which I think is a good number. 1000GWh pa is roughly 25% full import, 25% neither import or export, and 50% full export.

            Technically Basslink can export up to 4400GWh pa (500MW X 8760hrs), but of course this isn’t practical for a number of reasons.

            Your latter comment is very interesting – “Years ago justification for more dams in Tassie was to try to attract a high value export industry with cheap power”. Exactly! Rather than building a second interconnector to export extra energy (assuming that we massively increase our generation), wouldn’t we be better off expanding our own industries to use that energy here instead?

            Energy is economy, and economy is jobs.

          • Mark Fowler

            Agree.
            It would be useful for Tas to get to a point where it is self reliant for electricity over the full year and it is very likely that this will occur and at a lower cost than elsewhere in Australia.
            Benefits – no need to be part of the NEM if it turns feral. Any exports of power add to the Tas economy whereas now the power imported, even though it is cheap is still money leaving the state – the high value peaking power can still be exported.

    • Chris O’Neill

      The planned 300MW of new wind farms should generate about 1-1.2TWhr per year so Tasmania will be net zero imports in about 2-3 years.

      I am amazed that it is taking so long for Tasmania to reach zero net imports. If there is anywhere ideally suited for integrating wind generation then it is Tasmania with its abundant existing dispatchable power. Someone should be embarrassed that this is taking so long.

  • Tom

    Great article – a very accurate representation of what is a “solution” to a poorly articulated (and misrepresented) “problem”.

    Regarding the need for a second interconnector at over $1 billion (the “estimate” was $1.1 billion, but my personal estimate is $1.5B), this would only provide an extra 500MW of transmission. So you’ve got a suggested 2500MW of pumped hydro capacity and only 1000MW of transmission – you’d need 5 extra 500MW interconnectors to take full advantage of the proposed Tassie pumped hydro. This would probably cost less than $5 billion, but a hell of a lot more than $1.1B.

    One thing I’d add which you haven’t really covered is transmission losses. Basslink loses about 3% of its energy in the cable, and 1% at each end (DC to AC conversion or vice versa). So if Tassie was arbitraging energy for the mainland these transmission losses would apply twice – a 10% loss. These losses are not free, and put Tasmanian pumped hydro at a competitive disadvantage to mainland pumped hydro, of which there are a lot of very good sites.

  • Jonathan Prendergast

    Great contribution Jack and some great discussion too!

    I am hesitant about the ‘common sense’ on transmission lines, where local generation can be more valuable. Particularly in the Tassie case where it is blessed with great Hydro that can fill the gaps of wind and rooftop solar to become more self reliant and a net exporter.