Change needed to keep the lights on and industry working in SA

September 30th, 2016

Two reports this week sparked some very different discussions about the best way to address man-made contribution to global warming – at least to the extent that electricity generation contributes to greenhouse gas emissions.

On Monday, the Climate Institute proudly declared that Australians were more keen  than ever to actively tackle global warming, with 68% of respondents to a survey saying individuals and households should contribute to the campaign.

The following day the Grattan Institute published a report saying a clear policy change was necessary to avoid higher prices and “another SA power shock” .

Entitled “Keeping the lights on – lessons from the SA power shock”, the Grattan Institute report turned out to be portentous.

The Grattan Institute report was written in terms of a warning, but its authors, Tony Wood and David Blowers, could surely not have anticipated that within two days of publication, the lights would indeed go out in SA.

Renewable-energy lobby groups have been quick to deny any link between this week’s blackout of the whole of SA and the State’s high dependence on wind power. However, the Prime Minister, Mr Turnbull, had a different view.

The SA power grid dropped out when a severe storm knocked down regional electricity transmission towers.

At its genesis, this was clearly a weather-driven outage.  However, it is not yet clear why the infrastructure damage sparked a sustained blackout of the entire State.   Some industry watchers have suggested the management of the SA grid may have become significantly more challenging since the State has shifted to 40% wind and solar power.

Increased use of intermittent solar and wind energy sources places increased frequency management strains on any electricity grid.  South Australians may well be learning this the hard way.

They are already familiar with escalating cost.

Electricity prices in SA are the highest in Australia.

They have been around 150% of prices in neighbouring Victoria and NSW since the State’s taxpayer-subsidised push into wind power put the SA coal-fired generator out of business last year.  And the Energy Market Operator expects them to remain high in the year ahead.

But nobody anticipated what happened with this week’s blackout, or the July price crisis, when wind power failed and the back-up coal-fired power from Victoria was unavailable because of work being done on the network State interconnector.  In this crisis, prices soared to 100 times their usual level and the Government was forced to put out an urgent rescue call to a gas-fired generator.

This week’s  Grattan Institute report said the July price spike event exposed SA’s vulnerability to power price and reliability.  Industrial customers and the SA Chamber of Commerce have put out urgent calls to the SA Government to sort out the problems, which are threatening the viability of business.

ACC SA Power

The Climate Institute may get a different response to its survey (mentioned at the top of this article) if it conducted it in SA today.

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