NSW Coalition government hints at Liddell intervention. Seriously?

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NSW Premier suggests intervening in Liddell closure as way of “guaranteeing cheap and reliable electricity” for state.

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New South Wales Premier Gladys Berejiklian has become the latest Conservative politician to flag possible government intervention to keep one of the nation’s oldest and least reliable coal power plants open past its use-by date.

On the same day of news of another trip at the Liddell coal fired generator – described by analysts as being “clapped out” – Berejiklian is speaking of keeping it open “as a way of guaranteeing cheap and reliable electricity for the state.”

The Daily Telegraph broke the news on Thursday, saying it was “heartened” to note that Berejiklian had opened the door “ever so slightly” to preventing the closure of the Hunter Valley coal plant, during an interview with the paper’s own conservative columnist Miranda Devine.

“Potentially there’s a whole range of options that we’re looking at,” the premier was quoted as saying to Devine, in reference to the privately owned plant’s scheduled closure. “I don’t want to say too much.”

This is, and isn’t surprising.

It is not surprising in that the increasingly rickety AGL Energy owned coal plant – which is slated to be closed on its 50th birthday in 2022 – has become the unlikely poster child of conservative politicians and media pundits who want their power coal-fired, and/or sourced from anything but renewables, thank you very much.

Numerous LNP members, both state and federal, have called for the plant to be kept open, going right to the top, when Prime minister Malcolm Turnbull confidently told Question Time in Septemeber that the Coalition would ask AGL Energy to keep Liddell open another five years beyond 2022, as a matter of national energy security.

What is surprising is that nothing – not the plant’s numerous unscheduled breakdowns and blow-ups; not AGL Energy’s swift and consistent message back to the PM that “Keeping old coal plants open won’t deliver the reliable, affordable energy our customers need;” not the projected $1 billion cost of keeping Liddell open; and not the global shift to cheaper and cleaner renewable energy and enabling technologies – seems to shake their belief that this might happen.

Never mind that AGL has confirmed its plans to close Liddell and replace it with 1.6GW of renewables, plus storage and other technologies – a plan the company argues is a smarter, cheaper, cleaner and more reliable option than keeping the ageing and unreliable coal plant open.

How much cheaper? AGL has estimated it would have to invest $920 million to keep Liddell open another five years, pushing the cost of its output up to around $106/MWh.

As Giles Parkinson noted here in December, this compares to just $83/MWh for the renewable-focused portfolio, including storage and some (expensive) gas peakers. That wholesale price also compares to an average cost of wholesale electricity in NSW in 2017 of around $100/MWh.

Meanwhile, the old coal plant continues to demonstrate that it is anything but reliable. Just this Tuesday, a unit at the plant failed unexpectedly, taking more than 400MW of scheduled capacity with it. Again, not surprising, for a generator that, as The Australia Institute put it yesterday, “predates colour TV in Australia.”

As we reported, one of the plant’s four units has been out of action for most of the summer after broken turbine blades took unit 1 (420MW) out of the market in mid-December. At that time, the number 2 unit at Liddell had not operated since early August.

But the Murdoch tabloids are relentless. This week, columnist Terry McCrann was doing his level best to convince himself and his readers that last week’s wholesale electricity price spikes were all the fault of renewables.

But just like energy minister Josh Frydenberg, his explanation completely ignored the prime cause of the first of those two price spikes – the sudden trip of Loy Yang B and the immediate loss of 530MW of capacity.

Price rises don’t happen by themselves. They happen because of the bidding actions of the dispatchable generators – the coal, gas and hydro plants.

And whenever there is an unexpected outage, or money to be made from a market constraint – they push prices into orbit.

It’s the exact opposite of what happens in other markets. Normally when you buy goods in bulk, you get a discount. In electricity, if you want to get more out of a fossil fuel plant, you have to pay 10-20 times more.

McCrann could have also made mention of two huge price spikes in Queensland – a state still largely free of large scale wind and solar – a week earlier, the first one caused by trips of a major coal unit and a unit at the most recently built gas plant, and the second by “technical” issues with a pumped hydro plant. Might not have fitted the theme.

In other news, the Guardian reports today that new data has revealed that “advertisements spruiking the benefits of coal and mining were the biggest political expenditure by third-party groups in Australia last year, dwarfing public contributions from unions and GetUp.”

According to Australian Electoral Commission disclosures, the biggest political expenditure was $3.6 million by ACA Low Emissions Technologies Ltd, which manages a fund established by the coal industry to invest in clean coal. The Minerals Council spent $1.3 million.

Note: Asked for comments on the Premier’s remarks, energy minister Don Harwin said in a statement emailed to RenewEconomy that:

“The NSW Government is developing with COAG Energy Council a sensible national plan to secure new investment in a mix of energy sources.

“The National Energy Guarantee is the key policy for our energy security.

“NSW has a huge pipeline of projects under construction that will boost supply and put downward pressure on prices.

“The Australian Energy Market Operator is currently assessing whether the new generation proposed will replace Liddell’s output, and we look forward to receiving their report.

“The NSW Energy Security Taskforce has said that NSW is well placed for this summer under normal circumstances.”

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51 Comments
  1. Chris Fraser 10 months ago

    More tedious political posturing. I bet Andy Vesey’s not fooled.

    • Chris Drongers 10 months ago

      Sign of a government looking at several thousand unemployed miners, mechanics, boilermen etc asking ‘what do we do now?’) in the wrong industry and the wrong place for alternative employment in the next decade. And the government of either stripe lacking the imagination and cognative fire-power to come up with any answer except to slow the transition.

      • Chris Fraser 10 months ago

        Were gunna redeploy all of them in the clean energy industry.

        • Joe 10 months ago

          …plenty of EV’s and Batteries are waiting to be built.

      • Coley 10 months ago

        “Sign of a government looking at several thousand unemployed miners, mechanics, boiler men”
        Eh? When did those bas”eds ever care? How many of the above ^^ can bung the odd $50,000 or more, to the Coal it ion?

  2. trackdaze 10 months ago

    Daily Telegraph/ Miranda Devine. Speaks for itself

  3. Pedro 10 months ago

    Here is a cynical thought. Everyone knows, even the government that aging coal is unreliable. By keeping these old clunkers open the government is helping their friends in the gas peaker plants price gouge the market when they inevitably have an 500MW outage.

    • Greg Hudson 10 months ago

      All the more reason for Tesla to join all the PowerWalls together into one giant virtual power plant, and bid up to maximum on behalf of all the battery owners. Now THAT would be a neat way to speed up your payback period, and make Tesla a bucket load at the same time (assuming they share the profits equitably)

      • neroden 10 months ago

        Apparently this is actually happening — Tesla and South Australia are doing this.

  4. John Mitchell 10 months ago

    I never read the the garbage that the murdoch morons publish, especially those like Devine & McCran.

    • Joe 10 months ago

      There is a reason that they nickname the McCrann… “Crackers”…he just digs that hole deeper every time he opens his mouth. And the Miranda is just Devine with the rubbish she spits out.

  5. Joe 10 months ago

    Every time I see a headline with ‘Liddell’ and The COALition is mentioned I just know I am in for the bellylaugh of the day. And so it is today with The Daily Tele and its interview with Premier Gladys….everyline is a sidesplitter. I mean the sheer stupidity of keeping the oldest and most clapped out Coaler running for another 5 years when isn’t even now capable of performing….it has to be the comedy act of the century, yes.

  6. Mike Ranford 10 months ago

    The “organ grinder “Coal interests setting the tune for the Murdoch Media “monkey”.

  7. Diego Fuentes 10 months ago

    They are ignoring all energy expert/economist advice and community sentiment for the sake of coal lobbyists at the expense of jobs/environment/tax payers. This is corruption and they need to be investigated and prosecuted accordingly.

    • Joe 10 months ago

      Federal ICAC? United Nations for crimes against The Planet?

    • Glynn Palmer 10 months ago

      More importantly, they are ignoring the business acumen of AGL which has determined that extending the operating life of Liddell is uneconomical and unfeasible.

      • Coley 10 months ago

        Yet a common argument on here (and proposed by yours truly, on more than one occasion) is that the generators are lobbying/paying the coal ition to subsidise their FF plants.
        Yet here we have a generator saying they want to shut down an aging plant and no, they aren’t interested in govt subsidies to keep it open!?
        What’s going on?

      • daw 10 months ago

        And not to mention AGL’s acumen for boosting profits by closing generation down

        • Glynn Palmer 10 months ago

          AGL plans to replace the generation capacity of Liddell with renewables and storage. Some of the replacement will be on the Liddell site.

          • daw 10 months ago

            Liddell has 4 x 500MW machines that have generated for the last 50 years albeit with the odd hiccup but capable of supplying power on a continuous basis. To emulate that, they will need 2000 MW of storage to ensure continuity of supply. What will that cost?

          • Glynn Palmer 10 months ago

            The upgrade cost of Liddell is between $0.5 – $1.0 billion. Additionally, the state government sold Liddell to AGL in 2014 for neglible benefit to the NSW budget. Maybe they wanted to avoid the escalating R&M costs.
            https://reneweconomy.com.au/agl-bought-liddell-for-nothing-what-will-it-cost-turnbull-14579/

            Liddell is as unreliable as other thermal coal generators of its vintage.
            https://www.bing.com/search?q=liddell+unit+outages&form=EDNTHT&mkt=en-au&httpsmsn=1&refig=5509ac3940464f5dc2f9c53923d33810&sp=-1&ghc=1&pq=undefined&sc=0-14&qs=n&sk=&cvid=5509ac3940464f5dc2f9c53923d33810

            AGL’s plans for replacing Liddell’s capacity include 453MW wind at Coopers Gap QLD(the biggest windfarm in Australia),, 200MW wind at Silverton NSW, Bayswater efficiency upgrade, new gas turbines, 250MW battery storage with 100MW fast demand response.
            https://reneweconomy.com.au/agl-plans-its-own-big-battery-and-renewables-to-replace-liddell-39499/

          • daw 10 months ago

            Well $0.5-1 billion is going to give better value than spending it on unreliable, because they are so intermittent, renewables.
            The world’s scientists haven’t yet found and developed methods for economic storage. Until they do we have either coal, gas (derived from Coal) or nuclear generation. Like it or lump it!

          • neroden 10 months ago

            They can produce five times as much generation from renewables for the same amount of money, and it will be reliable, unlike the incredibly unreliable Lidell.

            Join us in the 21st century some time.

          • Glynn Palmer 10 months ago

            Renewables with storage is currently about $93/MWh. A coal thermal power station with the lowest emissions technologically possible (100kg/MWh) (IE with CCS) is more than $150/MWh.

            Daw you should really get up the courage to step over the threshold into the 21st century.

  8. Robert Westinghouse 10 months ago

    Just written to all the politicans….I may as well have made my representions to a gold fish.

    • Joe 10 months ago

      Robert, please do not disrespect the goldie fishes. Our fish friends have more intelligence than The COALition.

      • Robert Westinghouse 10 months ago

        I just get so depressed!!! 🙁

        • Joe 10 months ago

          A cheer up perhaps…..an election is coming around again.

          • onesecond 10 months ago

            When finally? It has been ages!!!

    • Glynn Palmer 10 months ago

      The positive thing about communicating your thoughts and suggestions is that they will be lying if they announce on the public media that no one has raised this with me.

      Politicians will always be politicians and use every opportunity to spray their ideology and policies marketing.

  9. Ian 10 months ago

    I would have thought Andy Vesey had buried this idea. The Feds have gone quiet since then. Really the NSW Coalition must be a bunch of drongos

    • Joe 10 months ago

      NSW Coalition ARE a bunch of drongos. We’ve got a Transport Minister that couldn’t even run a toy electric trainset properly. We’ve got an Education Minister building new schools without solar rooves. We’ve got Planning and Environment Ministers that don’t not what greenspace is…its all being cleared!
      And then we have a Premier who might just buy back clapped out old ‘Liddell’ after we gave it away years ago to AGL for $1millions. This as she says other states may not be acting responsibly with electricity generation. There are no words but ‘Drongos’ does fit.

      • Jexpat 10 months ago

        Let’s not forget Duncan Gay’s war on bicycles.

        • Joe 10 months ago

          Oh NO..please do not mention the Gay! I am a bicycle rider. I don’t drive and my bicycle is my main form of transporations. And the Gay did everything he possibly could to stop us cyclists from riding. On a scale of 1 -10…the Gay was a ZERO.

      • Coley 10 months ago

        “Drongo”
        a songbird with glossy black plumage and typically a long forked tail and a crest, found in Africa, southern Asia, and Australia.

        Avoid confusion, just call them ‘lying bastards’👍🏻

        • Joe 10 months ago

          You are correct, I will not disrespect our feathered friend/s ever again…..Lying Bastards’ it is.

  10. Radbug 10 months ago

    Remember, Vales Point was sold by the NSW government for $1 million. Does Gladys intend offering $1 million as well for Liddell? If she doesn’t, how does she explain how a clapped out, coal-fired, power station skyrockets in price? The coalition clearly wants to forget that the CCS fiasco sent $450 million in government money down the toilet with nothing to show it! It is as clear as day that the best way to fight coal is over the money! Money, Giles, money, money, money!!! Money and corruption!

    • mick 10 months ago

      yep id whack a compulsory remediation cost on them then sit back

    • Greg Hudson 10 months ago

      Hang on a sec, wasn’t Vales Point sold for $1 ? (Not $1m) ?
      Or was that some other FF plant ?

  11. Robert Comerford 10 months ago

    There is one born every minute they say. Seems they also reside in or vote for the LNP.

    • neroden 10 months ago

      In the US, the Republicans are now known as the Party of Stupid, because you have to be stupid to vote for them. (Since they are transparently lying pretty much constantly, and contradict themselves when they get tangled in their own lies.) The LNP seems to be trying to win the same title in Australia.

  12. Glynn Palmer 10 months ago

    “According to Australian Electoral Commission disclosures, the biggest political expenditure was $3.6 million by ACA Low Emissions Technologies Ltd,”
    When I read this in my browse of Fairfax’s BT this morning I thought that ACA really was a low emissions energy supplier. Now RE is informing me that it “manages a fund established by the coal industry to invest in clean coal.”

    In the CSIRO’s Low Emissions Technology Roadmap report published in June 2017 they stated “According to CSIRO modelling however, in order to achieve abatement targets, all new build HELE will either need to be combined cycle gas and/or require CCS.” . In the Australian Power Generation Technology Report published in November 2015 and chaired by CO2CRC with CSIRO on the steering committee and a reference group including ACALET, Minerals Council, AEMO and many more credible organisations, The LCOE of supercritical pulverised black coal with CCS was $168/MWh (table 46). In table 31 the ultra super critical pulverised black coal emissions were: without CCS 773kg/MWh and with CCS 106kg/MWh.

    So I contend that ACA does not invest in low emissions technology, or if they do it would be with CCS and not meet the affordability criteria for the Australian market.

  13. The Duke 10 months ago

    So why the hell didn’t Miranda Devine raise the point that it was the LIEberal State Government that sold off Liddell years ago for YEAH.! You guessed it NIL,ZERO, ZILCH dollars. Yeah Gave it away for NOTHING.
    And it’s the same COALition side that want to interfere in how businesses run their own business just to make it look like they care. BULLSHIT.!!!
    They don’t have answers or plans to cover the facts that their own Policies aren’t working. And if NSW was to suffer black outs because of power failures, then they would be shown up as bigger hypocrites than they really are.
    Especially after they slammed South Australia for blackout because of severe storms and over a dozen towers being knocked down.
    So much for truth and honesty. But what can you expect from MS Devine and her side that excel at distorting the truth to suit their agenda.

  14. Jexpat 10 months ago

    Yes, seriously.

    The NSW government is packed with as many if not more corrupt right wing ideologues than the current federal government.

    • Farmer Dave 10 months ago

      Wow. That is a scary thought.

  15. Keith Dennett 10 months ago

    Agree with what everyone has said. We need to move away from a Fossil fuel era to a sustainable future. AGL’s plan to retire Coal fired power stations is a smart move. It is important to a have a new plan for baseload and renewables.

  16. Chris 10 months ago

    Cutting 2000MW suddenly from an already constrained market isnt the best of ideas. Until that deficit if filled by alternative generation, Liddell needs to stay open.

    • neroden 10 months ago

      Liddell isn’t reliable anyway. Build solar, wind and batteries ASAP, because Liddell simply can’t be relied on now.

  17. Terry Flanagan 10 months ago

    Liddell was commissioned in 1970 to 1972. I guess the plans were on the table in 1967.
    That’s a bit like doing up a 1967 HR Holden, still won’t get the performance safety and comfort of a modern car. Burning coal for power, has served us well, just like the sailing ship, but it is time to move on. I think we are in a 10 to 15 year transition stage and some of us just don’t like change. Also, why do politicians want me to buy coal, when sunshine falls on my roof for free.?

  18. George Darroch 10 months ago

    Time to shut down the old clunker. Rupert’s Telegraph has done as much damage to Australia as any institution I can think of.

    Oh, and shut down Liddell and the rest of the aging fleet of coal-burners too.

  19. The Duke 8 months ago

    This is the same COALition Govenment that sold of Liddell years ago for……….
    You guessed it,! …NIL, ZERO, ZILCH.
    Yeah, gave it away for nothing to a Chinese owned and run company and now the Federal COALition idiots want it to re-extend it’s life . All because they can’t stand to see NSW have blackouts after all the bullshit they heaped on South Australia.
    What’s another couple of billions of taxpayers money wasted and a relic from the past.
    Yeah, the idiots from the COALition are desperate to reinvent the wheel too.
    Just goes with their climate change denials and Flat Earth policies.
    Somebody please get rid of these clowns.!

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