Taste of the future: Australia’s southern states at 50% renewables

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Last week, in Tasmania, Victoria and South Australia, the share of renewable energy was above 50% for most of the time.

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Here’s a taste of the future: Last week, over the three southern states of Tasmania, Victoria and South Australia, the share of renewable energy was above 50 per cent for most of the time.

Prices were low, observes Hugh Saddler, the leading energy analyst from The Australia Institute, who provided these graphs. And in South Australia, where there was a very high share of wind energy, only four gas units operated on days such as Thursday and Friday.

The top graph shows the share of grid supply in Tasmania, Victoria and South Australia, while this below shows the share in South Australia only.

Note that wind, from Monday on, accounted for a minimum 60 per cent of supply, and on occasions more than 100 per cent. Gas went up and down as needed – but note how little was needed from Wednesday through Friday.

The balance was maintained by the inter-connector, with exports as the wind blew hardest, and some imports when it pulled back slightly and offered a cheaper option than gas.

Here’s much the same thing in South Australia, with rooftop solar included in the graph below.

And here’s what the prices showed us. By and large, prices stayed around $50/MWh and below, apart from the occasional spike. And there were some negative pricing events, not including the midday negative pricing that was recorded in Queensland as a result of its solar production late last month.

Sadly, such low prices don’t last. As we saw on Monday, when the wind and solar back off, and the fossil fuel generators can create an artificial network constraint, they then have the market power to bid prices to the market cap in order to extract maximum value from the market.

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27 Comments
  1. Ren Stimpy 2 months ago

    Sadly Eric Abetz is a cheerleader for coal which is absolutely going against the grain of the state which he was elected to represent.

    How does more coal help Tassie Eric, you chumwad?

    Tasmania doesn’t need new coal to be built on the mainland, and indeed has a lot of energy export potential, while keeping their own state electricity prices low if they fill up their windy island with wind generators – PS they have the backing of a huge battery.

    If Ian McDonald can be relegated to moron old-henry-wit status, why can’t Eric Abetz?

    • solarguy 2 months ago

      They could be used as anchors or pop up targets at the range. Recycle a pollie, good for the environment.

      Shoosh, I never said that.

      • Ren Stimpy 2 months ago

        No they should just be left to fade away into a long overdue retirement, where hopefully we won’t hear another peep out of them. I want them to live and be healthy for at least another 20 years so they can witness the complete transition of our energy system away from their beloved fossil fuels.

        • solarguy 2 months ago

          Yeah, that’ll do. Really had my heart set on the pop up target capper, but what about paintball guns, now every ones happy.
          LOL.

  2. GlennM 2 months ago

    Inconvenient facts…..
    and the lights stayed on, people cooked, people worked…no one died …

    That was not supposed to be possible….

    • Ray Miller 2 months ago

      The biggest inconvenient fact is high % renewables = lower prices.

    • solarguy 2 months ago

      And it tastes pretty bloody good too!

  3. Ren Stimpy 2 months ago

    FYI Those squiggly graphs in the article (although they might be truly representational) are just rubbish for the purpose of conveying meaningful information to normal people.

    • MaxG 2 months ago

      I reckon it depends who is reading them 🙂
      But then, ‘normal’ implies to refer to ‘majority’, and then you’re right, as STEM was never an Australian strong suit :))

      • Ren Stimpy 2 months ago

        Yep I studied them again and still they look like squiggles!

      • Ren Stimpy 2 months ago

        Squiggles = MC ² ?

    • phillyc 2 months ago

      Made plenty of time sense to me! The shockjocks need to see these graphs.

      • Ren Stimpy 2 months ago

        Excellent, can you explain the squiggly graphs to us in lay-persons language?

        • Steve159 2 months ago

          Easy.

          refer to the graph above https://reneweconomy.com.au/wp-content/uploads/2018/07/SAgenerationType.jpg

          Wind was pretty constant (green line). Demand went up during the day (red line at top, SA total demand). Gas ramped up to meet shortfall (purple line). When demand dropped (at night), with strong constant wind, gas dropped, and there was a net export to Victoria (grey line, at bottom). Imports from Victoria (bottom red line) fluctuated around zero, or slightly above, when exports were zero. Peak exports were during the day with high solar (yellow line).

          • phillyc 2 months ago

            Exactly. I just tweeted a link to this article to MalcolmTurnbull.

          • Ren Stimpy 2 months ago

            Got it. But maybe an area chart would have been the better choice?

  4. Malcolm M 2 months ago

    Over the last week Victorian spot prices dropped to as low as $8/MWh at times of high wind and low demand. What will it be like with another 1600 MW of wind currently under construction joins the Vic market ? Unlike NSW, the Vic brown coal generators have very low marginal costs, so they can place low bids. We desperately need more pumped hydro to mop up the excess.

    • solarguy 2 months ago

      Correct on all accounts, my dear Malcolm.

  5. Rick 2 months ago

    Sadly, such low prices don’t last. As we saw on Monday, when the wind and solar back off, and the fossil fuel generators can create an artificial network constraint, they then have the market power to bid prices to the market cap in order to extract maximum value from the market.

    And why wouldn’t or shouldn’t they extract the maximum value when tey are in the box seat because they provide dispatchable generation and need to make a living. The dispatchable generators are not guaranteed market access like the intermittent ambients so they have to make the money to pay the operating and financing costs over a shorter interval. Of course the price is going to go up over those intervals.

    There is no artificial network constraint. The fact is that when the power was needed ALL the intermittent ambients on the grid could only provide a lousy 1% of the demand.

    • Giles 2 months ago

      Read the AEMO notices. They imposed a constraint because of negative residues. When the constraint ended, the price went down.

      • Rick 2 months ago

        Show me a market notice produced by AEMO that specifies an “artificial network constraint”.

        The wind generators produced nothing in SA from 11am to 6pm on Monday 9th July. Forecasting that caused an AEMO financial constraint to be triggered. Where is the “artificial” part?

        It demonstrates that all the 1810MW of wind generation connected to the grid was useless when needed. Why should SA get a free pass to rely on the dispatchable generation in other states without some cost imposed.

        This is the taste of future because intermittent ambient generation is often not available when needed and the dispatchable generators, that are all required to be available when there is no wind or sun, need to get a return on their investment. Their output is reducing but the costs are not so they need a higher unit price to cover those costs – simple economics.

        • Shilo 2 months ago

          South Australias Average price for the year was going pretty good, it was only second highest on record, I thought they may be able to maintain that. So this year now is looking like yet another record average price.

        • Barri Mundee 2 months ago

          “It demonstrates that all the 1810MW of wind generation connected to the grid was useless when needed.”

          That surely makes the case for storing as pumped hydro, batteries etc compelling, whether in SA or in other states in the grid, no?

          • Rick 2 months ago

            Correct – no. Any form of storage that does not already exist comes at an incredibly high cost. All is technically feasible but South Australians would need to be paying at least 50% higher than they now pay for power unless they buy the batteries themselves and couple with solar. That results in an average cost between 50c to 60c/kWh. An intermittent ambient energy supplied grid will always be more expensive than solar/battery at the load due to the high cost of transmission, distribution and retailing; these combined more than double the current wholesale price.

            So far this week from Monday 9th July the wind energy in SA has averaged 300MW against an average demand of 1600MW so a shortfall of 1300MW for 80 hours so far. That would require 870 HPRs to keep the state supplied so far and there is a large high still centred over SA so the figure will more likely be closer to 1800HPRs by the time the wind gets back up to matching the demand.

            The wholesale price in SA is now $309/MWh due to the gas generators operating near capacity and price forecast to hit the $13,100 cap during the evening peak. The power is cheap during the times when wind blows but is extremely high when there is now wind. Building grid storage will make it more expensive.

          • BushAxe 2 months ago

            You need to read up on the market manipulation that is occurring this week which AGL is exploiting to maximise its profits while it still has the majority share of gas in SA. http://www.wattclarity.com.au/2018/07/high-sa-prices-on-monday-9-july-business-as-usual/
            Torrens Island is a 45-50yo heap of junk with a delivered efficiency of 30% (new OCGT is more efficient), it doesn’t need a return because it’s a fully depreciated asset like Liddell. AGL will continue its current trading practises until new generation comes online forcing the closure of TIPS and it will lose market share because of it’s minimalist approach to investing in new generation. As for storage the picture will become clearer as utility solar comes online, if it was more expensive companies like GFG wouldn’t be investing in it.

        • Greg Hudson 2 months ago

          IMO the economics are only simple if you are a FF lobbyist…

  6. Tint Depot 2 months ago

    Impressive!
    How many years did it take the southern states of Australia to get here? 1 year, 2 years, 3 years, 5 years of investments?

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