Yesterday in Question Time, Malcolm Turnbull stood up and lambasted the “sorry tale of Labor mismanagement” of energy policy. He particularly criticised South Australia and described the Victorian government’s call for more renewables as “ideology and idiocy”.
Mr Turnbull was supposedly basing his comments on the latest annual Electricity Statement of Opportunities released yesterday by the Australian Energy Market Operator (AEMO).
He quoted some figures about the likelihood of blackouts in Victoria and South Australia this summer but then he completely misrepresented the thrust of the report which is that any delay or impediment to investment in renewable energy will lead to less reliable supply.
These are the parts of the report Malcolm seemed to miss:
From 2018–19 to 2021–22, progressively decreasing levels of potential Unserved Energy (USE) conditions are observed over the next four summers, due to increasing renewable generation.
– the projected USE risks increase if maximum demands are higher than forecast (for example due to higher usage and/or lower than projected uptake of energy efficiency measures or rooftop PV).
– the projected USE risk decreases if the modelling assumes increased investment in renewable generation.
– Any material reduction in capacity over the peak summer months (for example, from slower than projected renewable generation installation, lower than projected yield from wind, or reduced capacity of thermal plant during high temperatures) could lead to significant supply shortfalls and USE not meeting the current reliability standard.
The USE risk is expected to ease from 2018–19 in South Australia and Victoria, as peak demand is moderated by increasing rooftop PV uptake and energy efficiency, and additional large-scale renewable generation enters the NEM.
There is a significant difference in USE forecasts in the later years of the 10-year outlook between the Committed and Existing generation scenario and the additional renewable scenarios, highlighting that delays in the development of this future investment will keep USE risks heightened for longer.
The government’s “agnostic” approach to electricity generation completely ignores the dangers of exacerbating climate change through the continued use of fossil fuels.
When climate sceptic Dick Warburton (also of Note Printing Australia bribery scandal fame) was appointed to head the review into the Renewable Energy Target, he specifically instructed the modellers ACIL Allen to ignore climate change and the likelihood of a carbon price, financing issues and community views when assessing the prospects for coal-fired generation.
Add in highly conservative estimates of the cost of solar and wind generation and benign forecasts about the cost of coal and gas and this highly constrained report still found that a scenario of 30 per cent renewable by 2020 would deliver the greatest benefit to consumers, jobs and the industry, and would be the most economically efficient.
According to the World Economic Forum, “Insurers estimate that since the 1980s weather-related economic loss events have tripled.”
AEMO’s report says “The overall responsiveness and resilience of the system is at risk from increased vulnerability to climatic events, such as extended periods of high temperatures, and the risk of loss of, or reduction in output of, major generation units.”
So what is Turnbull’s response to all of this?
Keep an old coal-fired power station going for a few years past its use-by date*, flirt with building new government-funded coal-fired power generators, and offer to build a railway to a new coal mine.
Oh and Snowy-Hydro 2.0 which will cost billions and take many years to build if it is actually even feasible. As opposed to wind, solar and battery storage which can be up and running with little lead-in time.
Agile and innovative? Or ideological idiots?
*This is the response from AGL to Turnbull’s announcement about keeping Lidell open:
“AGL has committed to the closure of the Liddell power station in 2022, which is the end of its operating life. AGL has provided this advance notice to avoid the volatility created by the sudden exit of other coal-fired power stations. AGL is actively assessing what capacity will be needed post 2022 and we, along with other market participants, will consider AEMO’s report in light of these plans.”