Future of the Australian Electricity Market

[Bushmiller]

-at the moment I see the primary use of batteries is as frequency stability (because they can start feeding the grid in milliseconds, which is better than spinning reserves in some cases, giving time to bring up gas/coal /hydro. But as noted the actual storage capacity is minuscule.


Russ

Russ

You are right on the money.

It is probably true that for the moment there insufficient batteries even for this aspect. In Queensland it is now obligatory for each station to have PFC (Primary Frequency Control), but thermal stations are nowhere near as responsive as the battery or hydro power for that matter, which was the market leader until the advent of these large batteries. tesla is not the only battery: It is just the one that got all the publicity.

Regards
Paul

[woodPixel]

I harp on about CAES/LAES but it solves literally every problem presented so far.

It simply needs to be implemented on a per suburb basis.

Liquid Air Energy Storage: A Power Grid Battery Using Regular Old Ambient Air | Hackaday

Climate emission killer: construction begins on world’s biggest liquid air battery | Renewable energy | The Guardian

I was chatting with the CEO only a little while back and he said Canberra was ideal for this storage. Three of the big units can supply 100% of Canberra residential energy needs for three days.

Naturally we'd want some smarts built into the network, such as shutdown or throttling built into residential air conditioning, etc.... But my 5 year old Daikin already has such tech built in.... Just unused.

Surely we can do better.

Build these bulk LAES storages at core areas and pesto... One small part of the problem solved.

[BobL]

My understanding is that liquid air storage is relatively inefficient (25-30%) and only become more efficient/viable when colocated near unused cold storage ( eg a LNG plant) and waste heat supplies (eg coal fire power stationS). As these are going to eventually be phased out, investors are nervous about putting long terms funds into these developments. Despite this they appear to have a part to play in the transition to renewables process, at least they don't leave a mess behind.

[woodPixel]

I'll try to find the fact sheets.

From memory, there were two systems. One was 68% efficient and the other 80%.

The waste heat and cold were either stored or on-sold to industry.

There was a discussion on the storage of the heat and how it was used in an exchanger prior to the gas being "released", thereby reducing the cold generated from the decompression. The doco was quite extensive. This was at the time they were hunting for investors. I was terribly interested, but Sumitomo took the lions share

What I really liked was that the facility is quite passive. The ideas floated were for the whole thing to be pre-fabbed elsewhere and assembled by the locals (much like that excellent bridge of your cousins Bob). The bits were not hard to make or composed of exotic materials or complex fabrication. Extra capacity can be added simply by slapping more storage/compress/decomp on as needed.

My impression is that an entire facility could be built for $50 mil... but this number was a super-early-stage-working-stuff-out number.... again, my impression was this would rapidly drop to 1/5th that.

The other thing I especially loved is it quickly overcame much of the "what if" arguments about solar/wind. Sure, the obvious solution to no-wind is to overbuild in multiple regions.... but imagine, just for a moment, that a combo solution of solar-wind-CAES were installed, then run the thing like crazy when its sunny/windy and run off CAES during the night (bushmiller would know these numbers).... but I'd reckon night use is only a fraction of daytime use.

One other thing that was floated is there are areas with empty oil reserves, cave systems, salt mines, etc, that can be used as enormous stores of compressed air. This is the next argument of many.... "what if" you run out of air..... well, obviously a few above ground tanks can only store so much, even if chained together... but a coal mine... or old salt mine!!! Those things are vast..... depleted gas reserves would be ideal and there are lots of those around thanks to the curse of fracking and the pure evil of coal-seam gas...


The CAES systems were envisaged to be set up in neighbourhoods. They are silent. One could easily be hidden within a residential area, or within a trendy looking fascade/building or behind some nice hedges...

I'd also imagine that the local-storage thing would also make the electrical engineers happy - big changes to the mega-grid are reduced as capacity is local (??).

[woodPixel]

This wiki is pretty interesting: Compressed-air energy storage - Wikipedia

One thought with efficiency.... this really matters when one is charging the system with gas, coal or nukes... but becomes less so when charging with wind and solar.

After all, its designed to take the excess energy, at the cheapest price, for resale later at higher prices - just like the Tesla battery.

[Lappa]

Interesting article pointing to problems with the uptake success of solar in certain emergencies.

Power granted to switch off household solar in SA to prevent statewide blackout - ABC News

[Bushmiller]

Each quarter the market operator, AEMO, produces a comprehensive report. The latest full report for Q4 2020 can be viewed here, but these are two summary pages for those of you who do not wish to wade through the pages. However, if you have a burning (not fossil fueled I hope) interest I recommend the read.

AEMO Q4 2020 Extract p1.PNGAEMO Q4 2020 Extract p2.PNG

There are some notable points in the summary including maximum and minimum demands and the fact that, for this quarter SA was the cheapest state displacing QLD. Also of note is that SA is nearly self sufficient in renewables, although they cannot go 100% for the moment. I have some snap shots of yesterdays power, which may be of interest and highlight this aspect. I will include them in another post.

If you wish to look at or compare any quarter load "AEMO Quarterly Dynamics report" into you search engine.

Regards
Paul

[Bushmiller]

These are some snaphots of the way prices went yesterday during the day. One of the aspects I wished to emphasis was the volatility of the market even without a major disturbance such as a large unit tripping. Following on from my previous post it is interesting to note that although electricity usually flows from a low priced state to a higher state (indicated by the direction of the chevrons) at all times, even when prices were negative in SA (figures in brackets) at least one interconnector was flowing from high priced NSW into SA. This is for frequency stability. Generally the solar and wind is unable to provide frequency control. The addition of large battery storage in the future may well overcome this problem, but it is not there now.

Spot market 0701hrs (QLD) 18 Mar 2021.PNGSpot market 0846hrs (QLD) 18 March 2021.PNGSpot market 0911hrs (QLD) 18 March 2021.PNGSpot market 0928hrs (QLD) 18 March 2021.PNGSpot market 1000hrs (QLD) 18 March 2021.PNGSpot market 1010hrs (QLD) 18 March 2021.PNGSpot market 1105hrs (QLD) 18 March 2021.PNGSpot market 1725hrs (QLD) 18 March 2021.PNG

The time of day is indicated in the QLD area just above SA. You may need to double click on the pix to read details more clearly.

These snapshots update every five minutes and some I have included just to show how the market can change in that single period. The load indicated is precise but the prices are only for the spot market element and do not include contacts, which are negotiated by the generators and their customers.

Generally prices were stable through most states except SA

Daylight saving mitigates the electricity demand during peak periods in that it is staggered. The morning and evening peak periods tend to be when solar is either non-existent or has low productivity.

Please feel free to ask questions.

Regards
Paul

[Bushmiller]

Some of you may remember discussion about a new coal fired power station proposed for the old and now defunct Collinsville site in QLD. I can't remember where this occurred, but there again I am having difficulty remembering last week. At the time I commented " What on earth are they thinking? A new coal fired power station...in Queensland?!!!!"

It appears that it is dead in the water: Actually it never even got to the water and the alleged indigenous company "Shine" is not very indigenous at all or at least from an Australian perspective. My memory, such as it is, thought there was a $1 million grant up for grabs for a feasibility study. That seems to have been $3.3m, but the company concerned, Shine" has failed miserably to even meet the conditions of the grant despite being prodded in the right direction! Full details of the exposé:

Another Taylor shocker: Auditor lambasts dodgy handout to energy company that couldn’t do the job (msn.com)

As always, I suggest with reports such as this that you look at the origins of the article and make your own assessment as to hidden agendas. As it happens, I don't think this Crikey-originated article has an agenda other than exposing a ludicrous rort at best and a bizarre incompetence at worst. However, Crikey is not friends with the CO2 brigade.

Regards
Paul

[Bushmiller]

Another comment I would make when considering new power plants is that because they are privately owned they require finance. To qualify for finance they have to have a viable business plan indicating they will be able to repay their loan. In Australia I don't think any of the banks will even re-finance loans for fossil fuelled stations let alone fund a new station and that includes gas. Almost certainly they would have to go offshore for finance. The reasoning is quite simple: The banks see a good chance of those companies defaulting on their loan as fossil is phased out. As it is the loan may only run for a limited period of time

This is the reason I keep harping on about any project being commercially viable: Not viable? Forget it, no matter how potentially exciting it may be.

Welcome to the commercial world.

Regards
Paul

[BobL]

Another comment I would make when considering new power plants is that because they are privately owned they require finance. To qualify for finance they have to have a viable business plan indicating they will be able to repay their loan. In Australia I don't think any of the banks will even re-finance loans for fossil fuelled stations let alone fund a new station and that includes gas. Almost certainly they would have to go offshore for finance. The reasoning is quite simple: The banks see a good chance of those companies defaulting on their loan as fossil is phased out. As it is the loan may only run for a limited period of time

Thanks for your posts Paul.

The other massive financial investment entity that is increasingly divesting itself of greenhouse gas producing activities are super funds. Members can increasingly require which areas of investment their contributions can be invested in and many choose not to invest theirs in non green technologies.
This decision is not without financial significance.
SWMBO and I both have funds in the same super fund and her funds are under a "green" investment option whereas mine are under an "open - green and non-green" option and SWMBO's strategy has consistently outperformed mine since 2105.

[Bushmiller]

Thanks for your posts Paul.

The other massive financial investment entity that is increasingly divesting itself of greenhouse gas producing activities are super funds. Members can increasingly require which areas of investment their contributions can be invested in and many choose not to invest theirs in non green technologies.
This decision is not without financial significance.
SWMBO and I both have funds in the same super fund and her funds are under a "green" investment option whereas mine are under an "open - green and non-green" option and SWMBO's strategy has consistently outperformed mine since 2105.

Bob

That is most interesting. Only last night a friend and colleague, who is far more financially savvy than I, mentioned that the super funds with female CEOs appear to outperform the rest! probably not a topic for this thread, but I couldn't help but toss that out. I will look into the super options.

regards
Paul

[woodPixel]

New investments certainly are available.

I took two positions in these ETF's last week: CLNE and ERTH...

CLNE - VanEck Vectors Global Clean Energy ETF
Climate Change Innovation ETF | ASX: ERTH | BetaShares

So far they are flogging around, but volumes are thin. The Authorised Participants will pick up soon. I'd imagine once they are marketed a bit they'll attract more interest. The makeup of the ETFs holdings are interesting.


On funding environmental polluters, it superficially seems the banks have become moral.... but I seriously DOUBT this is the case. They are simply backing the horse most likely to win.

Banks have no morals. They are blood sucking vampires who would sell their grandmothers kidneys for a few quick pieces of silver. Their only motive is pure profit. The fact they have aligned their public stance to being "Good" is purely circumstantial.... i.e pure marketing.

[Beardy]

New investments certainly are available.

I took two positions in these ETF's last week: CLNE and ERTH...

CLNE - VanEck Vectors Global Clean Energy ETF
Climate Change Innovation ETF | ASX: ERTH | BetaShares

So far they are flogging around, but volumes are thin. The Authorised Participants will pick up soon. I'd imagine once they are marketed a bit they'll attract more interest. The makeup of the ETFs holdings are interesting.


On funding environmental polluters, it superficially seems the banks have become moral.... but I seriously DOUBT this is the case. They are simply backing the horse most likely to win.

Banks have no morals. They are blood sucking vampires who would sell their grandmothers kidneys for a few quick pieces of silver. Their only motive is pure profit. The fact they have aligned their public stance to being "Good" is purely circumstantial.... i.e pure marketing.

Whilst your take on the banks might be true I think it is a bit rich to criticise them for doing what basically everybody else does. They are a business and in it for the money just like every other business and every employee of those businesses. Can’t see they are any better or worse than the rest

[woodPixel]

I come at it from the banks are not what 99% of people think they are.

They receive a unique capability to literally mint money. Their business is both protected by law to restrict and reduce competition. Their funding is essentially free and is both protected from competition and guaranteed. Their retail operations support their behind-the-sceens money market operations and is again funded by the public via deposit guarantees and government backing for when the wheels fall off.

There is no other business like banking. No other business can do what they do legally and they abuse both their implied public trust and also their position as money maker, market creators and agents of arbitrage. They are hopelessly conflicted and abuse this conflict of interested nakedly.

Their history is a litany of abuse, scams, shams, ripoffs and private profiteering.


Now, IF their retail operations were perfectly firewalled from their private banking operations it would be not a problem. But it is not. Retail operations are the fattest slowest milk-fed cow their is and they raid this obscene coffer in order to make private money. The markets are not benefited and nor are the retail client, the depositors, borrowers as they are paying (essentially) to insure private functions.

The moral hazard is obscene.

I'd also argue that shareholders are not rewarded either. That's a bigger issue.