Future of the Australian Electricity Market

[Beardy]

Beardy

I suspect battery storage may only be an interim measure (say, twenty to thirty years?) and more likely hydrogen fuel will take over. However, that is pure speculation on my part and is not even close to viable until hydrogen is produced only from renewable sources. Once in place it could be used for many applications.

Regards
Paul

So do you go down the path of battery with all its limitations, required infrastructure and perhaps short lifespan or head straight to hydrogen and reduce its emissions as we move forward?

[Beardy]

I am on an American based car forum and EV’ s are discussed often. There is a very strong vibe coming from the yanks, particularly now with the Ukrainian events that they are not interested in anything that will make them reliant on other countries.
Fossil fuels are the way to go for them as they maintain control over the source, Germany has been put in a particularly vulnerable situation as an example

I don’t know how widespread that sentiment is though??

[FenceFurniture]

There is a very strong vibe coming from the yanks, particularly now with the Ukrainian events that they are not interested in anything that will make them reliant on other countries.
Fossil fuels are the way to go for them as they maintain control over the source

Well they can only retain real control over the fossil fuels that they have within the USA. They have plenty of coal as I understand it, but I don't know about their oil reserves these days. I'd not be surprised to learn that they are importing a considerable amount.

Is there something about EVs or batteries, or components thereof that they are concerned about? Lithium supplies, etc? I can't see any reason at all why the USA wouldn't be able to jump into Blue and then Green H.

[Beardy]

Well they can only retain real control over the fossil fuels that they have within the USA. They have plenty of coal as I understand it, but I don't know about their oil reserves these days. I'd not be surprised to learn that they are importing a considerable amount.

Is there something about EVs or batteries, or components thereof that they are concerned about? Lithium supplies, etc? I can't see any reason at all why the USA wouldn't be able to jump into Blue and then Green H.

As I understand it they have plenty of oil supplies but choose to use everyone else’s at the moment, lithium is a problem for them so are reliant on others for supply

[Beardy]

China Dominates the Rare Earths Supply Chain - IER

[FenceFurniture]

Hmmm. Not so much oil in the USA.

Oil.JPG

They're pretty good for coal:
Coal.JPG

Lithium is not too good:
Lithium.JPG

[Bushmiller]

However, is there any getting away from batteries for solar (et al) power? (maybe that's not what you meant – just vehicles) One way or another, renewables are all going to begin with solar, wind, wave and whatever else, so we can then produce green hydrogen which is far more compact for the purposes of fuelling transport in all its forms. Nor do I see getting away from household batteries for a good long while yet – not sure I want a hydrogen combustion engine banging away down the back!

All of the above is why I think manufacturers should be making hydrogen powered vehicles now, using Blue hydrogen, so that the transition into Green H is utterly painless for the vehicle owners, and the suppliers of fuel to the punters (Servos). I think I am correct in thinking that the only thing holding back Green H is investment? There are no big secrets to crack are there? How much worse is Blue H than using the same fossil fuel in vehicles? The pollution is at least all in a much smaller number of places for capturing, rather than spread out all over the place in billions of individual vehicles.

Brett

While I was primarily thinking in terms of mobile transport for hydrogen power and in particular larger machines such as ships and planes, I also see that the H2 fuel could power the grid generators at night (not so much your 3KVA beast down the back of your block).

The types of hydrogen or rather their method of production has become quite controversial and the pollies seem to delight in trotting out "colourful" catch phrases. I suspect you may actually be thinking of "grey" hydrogen ! grey H2 is produced by using natural gas, which those of us that have been following this thread know is a fossil fuel with a carbon intensity of between .6 and .8 depending on how efficiently it is utilised (modern coal fired stations are between .9 and 1.2 depending on their age and level of technology, which is pretty much a euphemism for efficiency). Blue hydrogen goes a step further and captures the CO2 emissions from the natural gas as the hydrogen is produced. Unfortunately the process of CCS (carbon capture and storage) emits even more CO2 gases than if the gas had just been burnt. As such it is a nonsense of the first order. Carbon Capture and Storage is being trialled n many places (including at my own power station, Millmerran) to prove the technology, but that does not mean it is a viable option unless something dramatically changes. For the moment all these installation are pilot plants.

I do agree that one of the keys to the energy issue is investment in research, which has not only been not been forthcoming in recent years, but has been calculatedly scaled back. In fact I would argue that not only has encouragement into new technologies fallen down, it has been actively discouraged. That is at least partly a consequence of the privatisation of the industry (even the government owned stations have to abide by the commercial regulations, theoretically at least) and something of which both sides of politics have been guilty. If it seems that the liberal party is more guilty, and they do seem to be that way, it is really only because they have been at the helm more often. If I may continue the nautical analogy, it seems quite obvious they have not noticed the wind has changed.

They are heading for the doldrums.

Regards
Paul

Edit: a link to the "shades" of H2:

What is green hydrogen vs. blue hydrogen and why it matters (cnbc.com)

[Bushmiller]

[QUOTE=FenceFurniture;2278506]Hmmm. Not so much oil in the USA.

Oil.JPG

They're pretty good for coal:
Coal.JPG

Lithium is not too good:
Lithium.JPG[/QUOTE

One of the issues not so often mentioned is exactly how accessible these reserves are. Early oil drilling may have cost one barrel of oil for every hundred barrels obtained. Today oil is not found so easily. The other extreme is shale oil where it may cost one barrel of oil for every three won. Even coal has a ratio of overburden excavation compared to tonnage recovered irrespective of whether it is underground or open cut.

This is not quite the comparison I was searching for, but maybe explains why some countries import despite having their own reserves.

What it costs to produce oil - CNNMoney

Regards
Paul

Edit: changed the typo of ration to ratio and added overburden: previously confusing.

[woodPixel]

I feel green hydrogen is huge. Tech to rip it from the air and tech to hydrolyse water are super advanced.

I saw one tech that did both of these things with amazing efficiency (I think I posted some of these above)

Rolling these out bigly will mean stupendously huge storage for our after-hours doings.

As oil prices climb due to war, depletion and chaos, these solutions become vastly more economical.

Fancy a country, blessed with abundant land, sun and ability getting stuck on something like solar power!


edit - on Lithium, I read an article about the Salton Sea in Calif recently that I cant find now. Apparently the resources there are MINDBOGGLING.

[woodPixel]

This isn't directly related, but it's highly tangential...

From seawater to drinking water, with the pus | EurekAlert!

20 watts of power per liter and it's self cleaning.

This unit is designed for portability and produces 300ml per hour using a tiny portable solar panel. The paper and discussions with the guys shows this thing can scale up to city desal size and use a fraction of the power....

This is excellent. Factor this into the "where do we get all the fresh water for...." Storage/farms/humans/hydrolysis/etc.... This might form part of that puzzle.

Edit - the paper Just a moment...

[Chris Parks]

I feel green hydrogen is huge. Tech to rip it from the air and tech to hydrolyse water are super advanced.

I saw one tech that did both of these things with amazing efficiency (I think I posted some of these above)

Rolling these out bigly will mean stupendously huge storage for our after-hours doings.

As oil prices climb due to war, depletion and chaos, these solutions become vastly more economical.

Fancy a country, blessed with abundant land, sun and ability getting stuck on something like solar power!


edit - on Lithium, I read an article about the Salton Sea in Calif recently that I cant find now. Apparently the resources there are MINDBOGGLING.

Hydrogen to point of storage is one thing, Hydrogen distribution and storage in use is another ball game not yet resolved in an economical manner when applied to transport. When it comes to Hydrogen in transport there are two different methods at this time in history, use it to fuel current ICE technology which is already low efficiency losing about 65% of the fuel used to heat and mechanical inefficiencies or using it to power fuel cells which then means the vehicle is a BEV so why go to all that bother when electricity is far easier to distribute and can largely be obtained via known and easier to manage methods such as hydro, solar etc. TTTT I doubt if any of the boof heads in Canberra understand Hydrogen at all and think of the fuel as they do LPG or natural gas as do a lot of people who listen to them and believe what they hear. Hydrogen has a lower calorific value than petrol and add that to the inefficiencies of an ICE and things don't add up at all when compared to batteries in transport, cars or trucks using ICE technology. Stored and used without having to distribute it appears to have some potential according to some pundits out there but at this point of time I am not sure what. I am sure things will change for all the alternative sources of energy for transport but that is a few years ahead yet. The biggest problem using BEV and static storage is the battery manufacture, sourcing of materials and the end of life disposal methods and that is going to be a huge issue.

[GraemeCook]

... I have some questions and concerns about this but before I get into that, the premise is that wholesale prices have averaged a 141% increase for the first quarter of 2022 compared to the same period in 2021. I wouldn't dispute that. I did find it strange that when questioned the Prime Minister blamed the situation in Europe for the price spikes ...

That article was also run by the ABC.
Wholesale power prices soared 141 per cent, year on year, and households should brace for more - ABC News
It didn't seem to make sense as renewals production should be at a peak in the March quarter - nice and sunny - so I put on my economists hat and tried to analyse the figures. This raised so many questions that I initially dismissed the article as inept journalism - a non-numerate journalist writing about something that they did not understand. Later I went back to the source ducumentation - and could not find it! The smell increased.

The Australian Energy Regulator publishes a lot of reports on the energy markets, but intriguingly have not yet published the first quarter of 2022; their stats stop at the end of 2021.
Quarterly volume weighted average spot prices - regions | Australian Energy Regulator
The wholesale prices increased dramatically between Q1 and Q2 of 2021 in Queensland and NSW - no idea why - and do not yet have data for 2022 Q1.

Electricity Prices to 2021 Q4.jpg


But there is an election in the air; is there a correlation?

[GraemeCook]

... I feel green hydrogen is huge. Tech to rip it from the air and tech to hydrolyse water are super advanced. ...

I beg to differ. Hydrogen is an odourless, tasteless, colourless gas; how the hell are you going to paint it green?

Had an interesting discussion on this topic recently with a bunch of engineers - all solar energy zealots - and they were all unimpressed with the future of hydrogen unless there is some radical discovery. Their arguments basically come down to some simple points:

1. Production of hydrogen by electrolysis is extremely energy intensive meaning that it is expensive.
2. Hydrogen does not liquify like LPG and it does not disolve into another substance like acetylene. It is thus very bulky to store and transport.
3. It is very volatile.

SUMMARY, at existing levels of science and technology:

• Hydrogen is to expensive to produce,
• It is to expensive and too dangerous to ship, and
• It is to expensive and too dangerous to store.

Is the hydrogen debate yet another political diversionary ploy?

[ian]

I suppose that with the forthcoming general election and the populace demanding statements on climate change as well as security in the region, the subject of electricity supply and cost was bound to rear it's ugly head. This article outlines some of the issues:

Slow move to renewable is spiking power prices for households (thenewdaily.com.au)

I have some questions and concerns about this but before I get into that, the premise is that wholesale prices have averaged a 141% increase for the first quarter of 2022 compared to the same period in 2021. I wouldn't dispute that. I did find it strange that when questioned the Prime Minister blamed the situation in Europe for the price spikes (actually SWMBO thought the comment had been made by the Labour party), but I fail to see the relevance. Solar, wind and hydro do not have a fuel that is dependant on Europe. Coal fired stations burn rubbish quality coal mined in Australia that is never ever exported. The only possibility that I can see for a European influence is if gas prices have gone up because there is more of a demand for our product overseas. If that were the case, and I don't believe it is, it would be the last nail in the the already fully constructed coffin that gas is a way to clean energy.

Even more surprising is that nobody has apparently called this one out!

Back to the article linked above. These are the the flaws in the article I would point to:

1. There is an increase in price of ~ 141% compared to the 2021 quarter. It is still higher than Q1 2020, but not so much and it is less than Q1 2019.
2. It is the first time in years that I have seen QLD prices the highest.
3. QLD has more solar power than almost any other state, but not the most as a ratio to total demand. That falls to South Australia, but they would be in extreme difficulty if they did not have the Victorian interconnector.
4. The statement was made that we need more renewable energy and that is probably true, but not in isolation and not without sufficient corresponding storage facilities.
5. Blame was laid at the feet of the coal fired power stations for pushing the price up. What did these nut jobs expect when they went to a competitive market? If there is a dearth of toilet rolls the price goes exponential. Excrement is not the only "shirty" business.
6. "The best response to breakdowns at old coal fired generators is to replace them more quickly than planned," said independent economist and Climate Council member Nicki Hutley." Replace them with what? More renewables that don't function at night or in calmed conditions or during a drought?
7.Professor Mountain said " We only need one megawatt of storage for every megawatt of solar and wind." I would contend that it is the other way around and even that is a vast understatement. I would be most interested to know how that is going to work. Also we need to talk in megawatts per hour and not megawatts for one hour (or maybe two hours), which is the extraordinary small capability of the existing storage batteries.

Paul
I have a slightly different interpretation of most of what you say.

With the influx of renewables onto the Australian electricity market, the price of renewable (solar and wind) electricity has fallen to near zero -- during the main sunlight hours -- which in turn is making coal based electricity generation uneconomic. Your power station has to burn coal at near full capacity for around 10 hours per day, and loses a boat load of money while doing so, and then in the morning and afternoon peaks, those gas burning "bastards" -- aka peaking generators -- jump in and run their gas turbines for a couple of hours per month stealing what little profit you might otherwise make.

So coal is rapidly exiting the market place -- what you expect in a privatised competitive market -- and being replaced by gas fired stations.

But there's a war between Ukraine and Russia -- oops my mistake, Russian has a "special military operation" underway in Ukraine.

The "war" has driven up the oil price -- it's now north of USD $100 a barrel.
The spot market for gas is based on the spot market for oil -- but gas is priced in Giga Joules (energy delivered), while oil is priced in terms of volume (barrels).
It is the spot gas market that is important as no gas powered electricity generator is going to enter into a long term gas supply contract -- aka take or pay -- if they only need the gas supplied for a couple of hours per month. So the gas required will be purchased on the spot market.
The current spot gas price is about 2.5 times what it was 12 months ago. (USD $2.996 vs USD $7.244)


So straight off there is part of your answer.

The war in Ukraine has driven oil prices northwards and they have dragged the spot gas price with them.

[ian]

I beg to differ. Hydrogen is an odourless, tasteless, colourless gas; how the hell are you going to paint it green?

Had an interesting discussion on this topic recently with a bunch of engineers - all solar energy zealots - and they were all unimpressed with the future of hydrogen unless there is some radical discovery. Their arguments basically come down to some simple points:

1. Production of hydrogen by electrolysis is extremely energy intensive meaning that it is expensive.
2. Hydrogen does not liquify like LPG and it does not disolve into another substance like acetylene. It is thus very bulky to store and transport.
3. It is very volatile.

SUMMARY, at existing levels of science and technology:

• Hydrogen is to expensive to produce,
• It is to expensive and too dangerous to ship, and
• It is to expensive and too dangerous to store.

Is the hydrogen debate yet another political diversionary ploy?

without directly addressing your last point, I say "piffle" to your three main summary points.
and as a consequence, who really who cares about whether hydrogen is "another political diversion"


For me the main issue with establishing a large scale hydrogen economy is a smallish thing known as "hydrogen embrittlement" of carbon steel piping and the fact that most steels will leak hydrogen.
Using existing natural gas infrastructure to distribute hydrogen -- is for me more than a little bit of wishful thinking -- I have not heard a peep about the risk of hydrogen embrittlement in high pressure gas lines.
And thinking back to 2nd year uni, I seem to recall that the toughness requirements for the steel used for high pressure gas supply pipes will not work high pressure hydrogen supply lines.


Not that I would ever accuse an Australian politician of not telling the truth, especially during an election campaign.