Zibelman on changing energy market: “Get used to it”

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Zibelman says critics need to get used to the fact that the energy market is changing, and it was underscored by AGL that said coal “is well and truly beaten out” by wind and solar.

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Australian Energy Market Operator chief Audrey Zibelman isn’t given to making grand statements.

But at the Australian Energy Week 2018 conference in Melbourne on Wednesday, she had a subtle message for those politicians, industry groups and media outlets still struggling to come to terms with the clean energy transition.

“I would say that (something) that would be really critical for all of us, is that we could all agree in Australia, that when we say it’s changing – it is changing,” Zibelman.

“So whether it’s 30 per cent renewables, or 40 per cent, or 60 per cent, or 30 per cent DER (distributed energy), or 40 per cent or 50 per cent, all of that is vastly different than what we’ve had before.

“So we need to to adapt to that change and we need to make sure that it happens in a way that benefits the consumer.”

Zibelman’s comments comes as AEMO prepares a landmark document – the Integrated System Plan – which it hopes will provide a template for planing and investment in coming decades.

As we reported earlier this week, some of the assumptions in the modelling for the report are profound: another 50% cut in the cost of solar, a huge uptake of electric vehicles, rooftop solar and battery storage, and a major shift to technologies like demand management.

The comments also follow yet another absurd week in energy politics, in which some of the federal government’s most senior members, including the minister for resources, Matt Canavan, reportedly issued a please explain to Energy Security Board chair Kerrie Schott over her comments that new coal would have no place in the future NEM.

“I can assure you that, unless there’s a change of technology, there would be absolutely no way that anybody would be financing a new coal-fired generation plant,” Schott told a the Energy Users Forum last week, in comments first reported by RenewEconomy.

Those comments, later seized upon by mainstream media, some claiming an “exclusive” resulted in two days of headlines, mostly reporting the outrage of Canavan, Abbott & co that anyone could say such a thing out loud.

But people are saying that very thing out loud, and those who do tend to understand a lot more about the machinations of the energy market than the Coalition’s right-wing rump. Like AGL Energy CFO Brett Redman.

“Australia is transitioning,” Redman told Australian Energy Week in a panel discussion on Wednesday.

“Historically, 90 per cent-plus of our electricity energy was coming from coal plant – it built the nation and was the backbone of the manufacturing sector,” he said.

“When we go forward, though, it has become very clear to us, it is very clear and very central to our planning, that new coal doesn’t stack up.

“New coal doesn’t work economically. Investing in new coal-fired plant doesn’t work, absent some very large government subsidy.

“New coal is now well and truly beaten out over the longer term by renewable energy, so that’s wind and solar. And the question becomes, firstly, how do you firm up wind and solar?

“So in the short-term, that’s using firming products like gas-fired generation. In the longer-term it’s a really fascinating discussion about storage – batteries and pumped hydro are the current technologies that we see.

“If we think about the energy mix, we can begin with saying the old coal-fired stations are now playing out… and as they finally retire, what you’ll find is that they will be replaced by renewable energy,” Redman continued.

“And so the mix of the future… and this is where Australia can get back to and capture its energy position in the world … will be very much built around renewable energy.”

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14 Comments
  1. Joe 5 months ago

    Hasn’t Dr Schott been sacked yet? I mean how can Abbott, Coalavan, Kelly and co allow this “left wing ideology and lunacy” talk by Dr Schott continue.

    • jeffhre 4 months ago

      So true. And remind me once again – what is Abbots current job?

      • Chris Fraser 4 months ago

        Ha, he’s better at wrecking than doing something constructive.

  2. Climatemonster 4 months ago

    Time to quote the Blessed Margaret at the slanted forehead brigade pushing a return to the 1950s. You can’t buck the market.

  3. Hettie 4 months ago

    This is just the sort of article that I was referring to in my comment on the previous piece about the budget. Plain language, easily understood by anyone with an IQ above 85.
    So share it around as a reason to vote the bastards out. Every anti coalition vote you gain is a vote worth having.

    • solarguy 4 months ago

      Did you see Bill’s reply to the bastards budget last nite………………what a ripper!

      • Hettie 4 months ago

        Yes and yes.

  4. DJR96 4 months ago

    Funny how politicians don’t like being trumped by economics. But as they say, ‘economics always trumps ideology’. Time they got used to it alright!

    • Hettie 4 months ago

      If they would only get out of the way!
      In really free market, which is what the conservatives all say is the magic fix for every thing, there are no subsidies.
      Zero. Zip. Nada.
      End ALL subsidies to fossil fuel miners and generators.
      That means
      No diesel rebate
      Pay the full cost of mine site remediation
      Cover all health care costs of those workers and community members affected by coal dust and compensate their families
      Pay for damage to roads and other infrastructure by mining vehicles
      Pay to repair the damage to old buildings from the erosion caused by sulfurous smoke.
      The fact that coal companies do not pay those costs is a series of indirect subsidies.
      Make them pay for all the damage they cause, and they would jump on the renewables bandwagon so fast you wouldnt see their feet move. Just a blur. Oil companies too.
      And remove all the government imposed obstacles to renewables and batteries. Remind the grid operators that unless they stop punishing rooftop solar owners business or private, those owners will leave the grid in droves, leaving all those privatised poles and wires as stranded assets. Like toll roads nobody will use because they are too expensive.
      The grid operators and power retailers need to learn that they must woo the rooftop solar owners. Lower daily charges (thank you Ausgrid), higher Feed inTarrifs. We are saving you money. Preventing blackouts.
      We deserve recognition and compensation for that.

      • DJR96 4 months ago

        Also, and most importantly, no subsidies means not funding the construction of new assets either. Especially nuclear or coal-fired power stations.

        • Alexander Hromas 4 months ago

          When I last checked it was not legal to build a nuclear power station in Australia. I doubt that the current mob in power could organize to build one anyway.

          • DJR96 4 months ago

            Conventional nuclear will most definitely NEVER happen in Australia.
            It would be at least a 10 year process and that is without hold-ups from environmental protests.
            Any political party that were able to pass the legislation through parliament to approve and fund one would be promptly voted out and the next government would simply scrap it.

            New coal would be pretty much the same scenario.

          • Alexander Hromas 4 months ago

            Totally agree, Abbot in wrecking the carbon tax destroyed any bipartisan consensus on clean energy and incidentally also did the same for any long term investments in power generation. Coal and nuclear have 10 year lead up times and 35 year cost recovery times. Far longer than any political cycle and what one government can do another can undo

  5. solarguy 4 months ago

    Audrey ” get used to it” ……..love straight shooters and she’s bang on target. Can’t wait to read the ISP!

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