What's Best for South Australia's energy policy | RenewEconomy

What’s Best for South Australia’s energy policy

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SA BEST wants to meet and exceed the Paris commitment, deploy distributed energy, storage and energy management, boost competition, and legislate for power market transparency.

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At a recent energy event in Adelaide where I presented for Nick Xenophon’s SA-BEST, it was encouraging that the Greens, SA-BEST, Labor and Liberal all stated that renewables was the future.

However, the Liberal Party is going to be hamstrung by Turnbull/Abbott and the National Energy Guarantee (a thought bubble to appease the Abbott ilk, masquerading as policy); inaction on climate; and offering a $1 billion loan to Adani.

SA Labor, on the other hand, have got it arse-about-face again in going for a 75 per cent renewable energy target, purchase of a diesel/gas plant, its ETS policy, and choosing Tesla for its home power without going to tender or similar.

They keep doing this.

It happened with Coober Pedy Energy which targets 70 per cent renewables – which delivered prices above 50c/kWh for generation, when there were three alternative bid prices below  30c/kWh.

In fact, based on the economics, Coober Pedy could have been 90 per cent renewable at 30c/kWh, using hydrogen as a storage option.

The problem with a target is it is like choosing a solution rather than working from an objective.

Good engineering process is to identify the problem, have an objective, look at options, define criteria, then chose the best option; refine (e.g. bankable feasibility) then implement. Incidentally, SA-BEST has four engineers as candidates.

SA-BEST policy is for a key objective as affordable, reliable, quality and secure power.

A second objective is to meet and exceed the Paris commitment – and to limit global warming to 1.50C – and to achieve this, it is not confined to electricity alone.

We also want a thorough grid model to assess how best to deploy distributed energy, storage and energy management – and certainly more competition to break the monopolies that have been the major cause of price hikes.

In addition, we wish to legislate regarding transparency in retailers and generators costings (gentailers), and power distribution costs and processes.

Our overall policies of being open, honest and transparent mean that it would be disingenuous to offer detailed solutions without a thorough analysis, and also knowing what secret deals have been made. We also acknowledge to unpick the current NEM mess will not be trivial.

SA has among the highest power prices in the world, and add to that $550 million of taxpayers money thrown into the mix to shore up power – it’s not good.

It is absolutely essential that prices come down and reliability is secure as an immediate priority, otherwise we risk losing businesses and people leaving the state.

Low prices in SA would be good for the renewables image as it would dispel the myth that renewables push up prices, when it is clear the converse is true.

So based on the objective, my personal prediction is that this will result in around 90 per cent renewables by 2030. This is a prediction, not a target.

SA can lead the nation not just on energy generation, but all the manufacturing, construction and jobs that could go with this in areas such as PV panels, components, smart energy, CST mirrors, etc.

Our cooperative community power project is predicted to bring prices down for those involved by 20 per cent within two years and for all consumers due to increased competition.

The biggest reason that Labor’s proposed 75 per cent renewable energy target is a problem is that it does not look at the objective of climate change holistically. While Weatherill is promoting 75 per cent renewables, he is also fracking up the south east and promoting drilling in the Great Australian Bight.

Not only that, but energy minister Tom Koutsantonis is offering incentives to these projects: i.e. promoting a carbon bomb many times bigger than South Australia’s total energy use. SA-BEST oppose these specific projects.

Australia currently emits around 1.5 per cent of world emissions, yet has 0.3 per cent of the population.

So when people say that our emissions reduction won’t make a difference, it’s like the kid at the party who takes an oversized slice of cake saying that there is plenty left for others. It’s simply selfish and ‘un-Australian’. We need to pull our weight.

So if SA looked at the objective of addressing  climate (let alone other externalities), then Labor is actually not doing very well.

Weatherill’s policies would actually lead to ill Weather (ok that’s my zinger for the day) and cause a massive climate bomb – let alone stranded assets. This is not good for the environment or the economy.

Weatherill knows my position very well, and to say he thinks he could “persuade Nick” is patronising – as he knows we are already working on this.

Nick fully supports solar, wind and all renewable energy, and as a demonstration negotiated $110 million for concentrated solar thermal.

Nick Xenophon does care about people and does not like predatory behaviour or abuse of market power. In this regard he is able to change a position based on new information.

This is in contrast to the current South Australian government, who have overseen chaos in many departments, and instead of trying to fix it, go out of their way to cover it up.

This practice of cover up is also evident in the Liberals (federally), and reinforces the notion that these major parties are guided by vested interests, not necessarily the will of the people.

While the Weatherill government should be commended for moving on renewables and the big battery, it should be remembered that in 2015 they knocked back options on hydrogen, renewable projects, reverse auction options (unlike the ACT who contracted the low prices on Hornsdale – ironically in our backyard) and virtual net metering only to pursue a dump.

I’m of course referring here to the Nuclear High Level Nuclear Waste Repository (or is that suppository). Luckily the ‘Jury’ saw through this, and 80 per cent stated they did not trust the government.

It was Premier Mike Rann who made the push for renewables, but he was tapped on the shoulder by Weatherill who replaced him.

The government has consistently rejected many reports on energy reliability since 2011 and earlier (including my own recommendations).

In short the Weatherill government has got on the renewables band wagon which has landed in their lap, rather than good vision, strategy and planning.

The key message here is we need governance that follows honest and common sense processes such as – to first identify the problem, set the objective, assess options, then make a rational choice all within a frame work of honesty, transparency and accountability. Wouldn’t it be good if all policy was developed along these lines!

Graham Davies is an engineer and energy consultant and candidate for the seat of Waite. He is SA Best’s environment and energy spokesperson.

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  1. Peter F 3 years ago

    I am not South Australian and I am suspicious of minor parties but I wish the major parties could articulate their positions this well

    • Joe 3 years ago

      Does not Premier Jay do the articulating well?

    • Rod 3 years ago

      I was impressed by Jay’s podcast on here. For a Premier he had a good handle on energy and has said loud and clear that this election is a referendum on renewables. That suits me because Labor has got a bit of unpopular history on a few things. Which will happen when you have been around for sixteen years.

  2. Grpfast 3 years ago

    Wannabe politician covering all the feel good bases. Still going to struggle with federal LNP do nothings.

  3. Jon 3 years ago

    0 runs on the board, easy to say “we would’ve, we will” from the sidelines.

  4. Eb 3 years ago

    My understanding is that it was the Coober Pedy Council that signed the Power Purchase Agreement, not the SA Govt. The claim that Coober Pedy could be 90% renewable (for electricity) using hydrogen storage for 30c/kWh is difficult to believe. Technically, it’s feasible but it would cost more than 30c/kWh. How much more would depend mainly on the storage system proposed and also the conversion technologies.

  5. D. John Hunwick 3 years ago

    Yes Weatherill articulates well but carefully omits the full picture. How does new Party get a chance to show what it can do if all everyone says that so far they have achieved nothing. Let Xenophon and team keep tabs on Labor. The Liberals are quite unable to get the full picture. As for the Feds – let SA continue on its own.

    • Aluap 3 years ago

      Xenophon doesn’t do policy – it’s too expensive for the new party – so how the hell can he keep tabs on anything? At best SABest will argue over a small detail to prove that it can change things, but without having researched the whole big picture its hard to see if changing that small detail would be best for SA rather than publicity for SABest. I think SABest is a bit of a fraud and is not Best for SA.

      • BushAxe 3 years ago

        SAB will demand a multitude of inquiries/royal commissions etc to get the ‘detail’ they want, they will be slow and reactionary. If Graham had the foresight he claims he would be leading a world class consultancy on renewable integration.

      • Andrew Scott 3 years ago

        I have met Graham Davies and know him to be very well informed on Renewable energy and the much broader topic of Sustainability. He is active in the Institution of Engineers Australia and has for some years chaired its Engineering Sustainabilty Committees at state and national levels.

        Regarding the performance of Weatherill and Koutsontonis in relation to uptake of renewable energy in SA, see my post in reply to Ian

  6. Ian 3 years ago

    I’d like to get a confirmation /other angles about if Labor is indeed promoting fracking and drilling of the bight (oil?or gas?)
    It wouldn’t sit well with all the other excellent work Labor appear to be doing.

    • Andy Saunders 3 years ago

      There hasn’t been any fracking in the Bight. That’s part of development once there’s been a discovery (which there hasn’t been), and only if the geological conditions are right (highly unlikely – fracking is virtually only onshore technology, not offshore).

      There were some proposals for exploration in the Bight (by BP and Chevron) but they decided the prospects weren’t too good and ditched it.

    • Andrew Scott 3 years ago

      Some of us have lived in SA and been advocates for uptake of Renewables here for many decades. Some of us have also had lifelong careers in Engineering in this state and been able to investigate and assess renewable options over a very long time frame.

      It has been particularly frustrating therefore to experience the wasted years under Weatherill and Koutsontonis since they replaced Mike Wran.

      Wran was the architect of initial policy to facilitate wind farming in this state. He also established The Renewable Energy Commissioner and a Renewables SA group of professionals with a budget of $20 millions to undertake studies and facilitate encouragement of uptake of Renewables.

      A few weeks after Weatherill took office the departure of the Renewable Energy Commissioner was announced and the budget went elswhere. Working groups associated with the influential gas lobby in SA were encouraged and a government sponsored Roadmap for Development of Unconventional Gas was prepared within a few months.

      The Weatherill-Koutsontonis focus on gas has continued eversince. Energy security has been seen through the prism of gas fired generation for base load and peaking power and backup power.
      Substantial govt grants have been made in the past year for gas exploration. Most of the $550 million Weatherill Energy Plan has been directed to the purchase of Diesel Gensets and later conversion of them and subsequent setup in a new location as gas fired generators.

      There has been no meaningful action to replace the old and very unreliable low capacity 132KV transmission line from Whyalla to Port Lincoln that causes the people of Eyre Peninsula to suffer frequent power outages. This problem has been known for more than 20 years and replacement of the line along a more westerly route has long been recognised as the opportunity to trigger major wind farm developments along the high wind regions of the west coast.

      Much time and energy has been dissipated by many people in support of a proposal for Solar Thermal electricity generation which is complicated and relatively capital intensive for a modest output. Its success is far from assured but Weatherill and Xenophon have both opted for a populist approach and have committed to the direction of public funding and/or SA govt contractual arrangements to encourage it.

      Weatherill and Turnbull have not cooperated to investigate and establish the better alternative for achieving much greater energy security – a major Pumped Storage Hydro electric facility near Upper Spencer Gulf. In stark contrast with their impotence in this security matter, Mike Wran was able to cooperate with John Howard and they jointly funded the $1,800 million desalination facilities for security of water supply to Adelaide.

      Precious years and more than $13 millions have been wasted on a Royal Commission into the Nuclear Fuel Cycle.

      Wannabee explorers for Oil and Gas in the Great Australian Bight have been ‘entertained’ as is the proponent for underground coal gasification at Leigh Creek.

      I could continue further in this vein but you should by now be getting the picture if you have read this far.

      Much of what Weatherill has announced about renewables in recent weeks reads and sounds interesting and encouraging and I hope it turns out well.

      On the other hand we must be wary for appearances can be misleading. We must look very closely at the detail, or lack of it, to ascertain the depth or superficiality of analysis underlying the proposals on offer.

      We will likely find that much of it is a quick and slick response in an effort to combat recent poor electoral polling. Some of it is directed to inefficient ends. Some of it promises too little too late.
      One thing is very clear: It is not part of a holistic and coherent plan for transformation of the energy sector, that has been well considered over a long period.

    • Olwen2050 3 years ago

      Fracking for gas in the south-east of the state (Coonawarra wine region) and drilling for oil in the Bight are two separate things that SA Labor supports. I agree it doesn’t sit well with their renewable energy and other environmental policies they’ve supported eg marine parks. I suspect big SA employer Santos holds a lot of influence.

  7. Aluap 3 years ago

    If Graham wrote at the start of his article that he was a SABest candidate for Waite, then the article and its motivations would have made more sense as I read it. Why does SA Best think it is Best for SA, I don’t. Without time spent on research and analysis, how can SABest formulate considered policies? They can’t. SA just doesn’t deserve SABest.

  8. MaxG 3 years ago

    Clearly explained why this “Good engineering process is to identify the problem, have an objective, look at options, define criteria, then chose the best option; refine (e.g. bankable feasibility) then implement.” isn’t chosen by by politicians, because they are politicians and not engineers.

  9. GrahamD 3 years ago

    To Aluap and Bushaxe.
    The conclusions of mine have been thought about over many years. I do run a leading edge consultancy (Resonant Solutions), and have the credentials to back up the claims as required by a CPEng. I have 3 commercialised patents, was manager of energy and infrastructure at a large corporates, and have been on 10 boards/trusts. I’ve added my qualifications below FYI.

    One area that does require a bit of explanation, is that ARENA put $18m into Coober Pedy and the sell price was still pegged at 50c/kWh. The price of 30c/kWh assumes that around half of the ARENA money would be available. If the current contract had only got half (level playing field), then their price would have been 60c. The 30c was based on 3 EOIs, but the Weatherill Government rejected the analysis, and basically pushed the Council into signing against their will. I have plenty of evidence, but the multinational and Government are threatening legal action if this is made public. (Thanks Eb for your good analysis).

    Its this violation of public funds that I’ve personally seen on a number of occasions that got me into politics. I am on a strong ethical ticket and wish to clean up politics. I, like may am fed up with the dishonesty that pervades parliaments. My wife told me years ago “stop whinging and do something”, so I did.

    Aluap and Bushaxe, can I challenge you to show critical analysis to the article, rather than apparent bias without basis.

    I hope that clarifies things and I look forward to your response.

    Graham (FIEAust, CPEng, GAICD, M.Sc Eng, NER)

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