Renewable energy targets are incompatible with the National Electricity Objective

South Australia’s electricity is neither reliable nor cost-effective. The National Electricity Objective, as stated in the National Electricity Law (section 7 the National Electricity (South Australia) Act 1996), is:to promote efficient investment in, and efficient operation and use of, electricity services for the long term interests of consumers of electricity with respect to – price, quality, safety, reliability, and security of supply of electricity; and the reliability, safety and security of the national electricity system. Why then has South Australia failed to achieve an electricity supply that is neither reliable nor cost-effective?

One possible answer to this question is that, South Australia’s ambitious renewable energy target is incompatible with the national electricity objective. This has huge implications for other states such as Queensland, that have set a 50% renewable energy target by 2030.

Competitive federalism and the South Australian experience has shown that renewable energy targets are a wasteful disaster and should not be adopted by other States. Interestingly, on the ABC’s QandA program the Coalition’s Christian Porter and Labor’s Mark Butler both rejected federalism and agreed that Australia should have one national renewable energy target. If anything the recent South Australian blackout shows the value of different States adopting different policies and allowing natural experiments to occur. We’ve had a natural experiment on renewable energy targets and the results are in: They’re terrible.

The national electricity objective rightfully puts a high importance on the reliability and security of electricity. An unreliable electricity supply jeopardises industry and forces industry to either shut down during blackouts or makes provisions for their own electricity supply which is extremely costly to both the economy and the environment. In many developing countries businesses and households are forced to rely on costly diesel/petrol generators. This would be an undesirable outcome for South Australia and the nation as a whole. It is therefore legitimate that reliability of electricity supply remain an objective and be balanced against any desired environmental outcomes.

Price too is a significant objective that must be considered against environmental objectives. Renewable energy often is more expensive, requires significant subsidies and doesn’t generate electricity during peak times. For many industries electricity is a significant input cost; failure to keep the price of electricity competitive will have significant impacts to the competitiveness of Australia’s industries. Industries that shut down in Australia will simply move to other markets where electricity and other input cost are more affordable. Resulting in no real reduction in greenhouse gases. The cost of electricity in South Australia has increased significantly partially due to the rapid move to renewable energy.

Renewable energy targets are a poor way to achieve reductions in greenhouse gases when compared with other alternatives such as NSW’s Greenhouse Gas Abatement Scheme (GGAS) that operated between 2003-2012 prior to be abolished after the introduction of the carbon tax. That scheme achieved significant reductions in greenhouse gases with a minimal impact on electricity prices. That scheme allowed reductions in greenhouse gases to be achieved in the most economical way possible; by comparison renewable energy targets focus on the building of expensive technologies such as wind and solar that cannot provide baseload power or provide affordable electricity.

Renewable energy targets, especially high ones such as set in Queensland, are command and control systems. They significantly reduce the flexibility in the economy to achieve reduced greenhouse gases – for example it may be cheaper to improve existing coal power stations to be more efficient. This is exactly what happened in NSW under GGAS. By Comparison Renewable Energy Targets make great political policies – the politicians get to seem like they’re doing something; but make they make for poor economics. They make greenhouse gas reductions unnecessarily expensive contradictory to the national energy objectives.

This lack of flexibility also has reduced the reliability of South Australia’s electricity supply. Having lost their local base load energy capacity after shutting down its coal power stations, South Australia has become dependent on expensive gas during peak times (that can’t meet peak demand) and a vulnerable connection to the national grid via Victoria. To ensure reliability South Australia will need to ‘gold plate’ its poles and wires and possibly build another connection to the national grid via NSW; or it would require significant investment in storage of renewable energy. Had South Australia pursued reductions via other means they could have achieved similar results without the corresponding loss of reliability.

The objective of having electricity that is both reliable and affordable is still today as in important as it was when the national electricity objective was set in 1996. While it’s important to balance these objectives with desired environmental outcomes renewable energy targets have proven to be a costly and inefficient tool that contradict the national electricity objective. They should therefore be dropped and other alternatives such as a revamped Greenhouse Gas Abatement Scheme should be considered in its place.

 

(Originally Published at www.onlineopinion.com.au)

Justin Campbell is on the executive committee of LibertyWorks

91 Comments on "Renewable energy targets are incompatible with the National Electricity Objective"

  1. This is just being demonised by the government and the coal industry

  2. Utter rubbish.
    What the SA blackouts show is that transmission lines failing mean that power transmission is stopped.

    • And the cost issue comes from demolishing a power plant and replacing it with alternatives that don’t output as much as the original power plant did and then buying the surplus needed at 5x cost from Victoria. Whoever signed that deal ought to be hung.

    • Toby Zuijdveld as I understand it a lot of the cost increase in SA is down to rises in prices for gas

    • This ia covered in the article…

    • No it’s not covered.
      The transmission network failed, that’s going to cause power loss irrespective of the type of generation used

    • [email protected] | 26/10/2016 at 5:27 pm |

      Wrong. Most of the power lines were down after the blackout. The blackout was caused for erratic wind output, that eventually ‘tripped’. That put extra demand on the interconnector, causing the draw to exceed its capacity. This caused the interconnector to trip. All supported by the AEMO.

  3. Total garbage. LibertyWorks is obviously just a mouthpiece for propaganda from the big end of town.

    From SA’s recent experiences, the thing that is not compatible with the National Electricity Objective is the selling off of transmission networks to private operators who have no interest in providing redundancy and protection swithcing to cope with events like this.

    Where is that mentioned in the so-called “article”?

    The Federal Government’s recent rejection of the sale of the main transmission network in NSW to a Chinese-led consortium (as was done in SA back in 1998-99) on the grounds of poor energy security at least gives us some hope that politicians are finally realising the stupidity of this type of privatisation. Shame it’s too late for SA.

  4. Nicola, please read the rest of my reply – I was still typing. You are falsely linking “affordable and reliable power” with fossil fuel based generation. There is no real connection between the two.

    Concentrating power generation at large facilities like coal or gas fired power plants then reying on long-distance transmission networks to get the power to where it is used is inherently unreliable for precisely the reasons demonstrated in SA – if the transmission network gets knocked out and there is no redundancy, then large areas loose power.

    Always. Everywhere on the planet where this is the practice.

    Pretending otherwise is extremely dishonest. It is simply smoke-screening – literally – in an attempt to hide the inherent problems with conventional fossil fuel-based generation and the culpability of this in the recent events in SA.

  5. Perhaps it is actually the other way around. Rethink.

  6. The only reasons that stopped all of us driving electric cars and having free energy from solar , wind and tidal generators today is GREED AND CORRUPTION!!!!!!! say what you like but there are many houses and certain COUNTRIES running mostly or fully from renewables.. WE HAD THE TECHNOLOGY OVER 50 YEARS AGO.. BUT HEY.. MONEY AND POWER IS MORE IMPORTANT THAN THE WELL BEING OF THE PLANET AND EVERYONE IN IT.. only project venus to save the world from this corrupt mess!!! https://www.youtube.com/watch?v=_EkMjTnWk14

  7. this is a terrible article lmao

    • The entire thing can be boiled down to “we shouldn’t have targets to deal with negative externalities because it might reduce flexibility in a few minor areas that actually have nothing to do with what I’m saying” and here I was hoping that “liberty works” was libertarian, not reactionary conservatism hiding under the guise of liberty.

  8. Remember Allano’s Law: The corruption of a State Government is DIRECTLY proportional to the number of wind turbines found within its boundary. Nobody in their right mind would include a wind farm within the power supply mix. The only good renewable resource is hydropower.

  9. The only good renewable resource is hydro power. But I don’t believe Malcolm Turnbull about the SA Black out as it was the storm and the down cabulls that was the problem

  10. Facts are stubborn things. All you blind Greenies should see now what you wanted!

  11. There are so many fallacies in this piece of crap one has to wonder is it funded by the coal industry? Naturally they stand to make money if renewables are scrapped. Pointless trying to debunk the utter garbage being spouted by this dinosaur head in the sand article.

  12. The way things are going we will have “cost effective” electricity but no jobs so no one will be able to afford the electricity anyway. The way ahead is for households to be right off grid. You can’t make money from people who are actually (not virtually) unemployed. You can’t afford much for one hour per week of pay.

  13. Only because it’s so unreliable look what happened in SA I bit of bad weather and they had to shut it down what a joke

    • The DISTRIBUTION INFRASTRUCTURE was destroyed – not the ability to generate the power but the ability to distribute it. Don’t believe the political spin. This network is owned by the Chinese – is the most expensive in Australia and has had minimal maintenance done. It is not the renewables that are the problem. Germany generates up to 90% of their needs through renewables no problem.

    • You are so wrong that area could have been isolated and power used from other base units but they had to shut down the wind generators because of high wind it just proves that it is to expensive and to unreliable S A is a laughing stock and so are you

    • Gary Stewart Shirt You are so wrong, they shut the wind generators down because the grid went down not the other way around. If the grid had been set up (and maintained) to be able to operate in smaller areas (and they were not all taken out by the 23 towers that went down) then those wind generators would have kept going.

  14. Here we go again..there was an independent power expert on the radio saying even if we had no alternative energy connected, the power would have gone off, via the safety feature. I will believe him before I believe the federal govt, idiots with their heads in the sand. Typical Liberal supporters blaming alternative energy also have their heads in the sand!! And I’m not a lefty…but idiots with that caveman thinking are enough to turn me into a lefty!!!

  15. What a bunch of lying pus worts you so called ‘Liberty wankers are? Not a word of truth in anything you say. You are just the same old corporate coal stooges who wouldn’t know your ares from your elbows… except when it comes to money grabbing, tax breaks and bullshit. Go away you dipsticks. We don’t believe your nonsensical shite.

  16. Talking out your rear end again no substance whatsoever in what you have dribbled Libberty’s arse

  17. a propaganda post is this……

  18. I agree; in short this Liberty stuff is crap.

  19. BULLSHIT by THE LIBERAL PARTY as usual!

  20. Well no but they are incompatible with the grid in its current form

  21. “Coal is good for humankind” Being kind to Coal is good when taking Coal donations. The Liberal Party is so devoted to Coal donations Greg Hunt refuses to speak further on CO2 turbines coming on line, he and his Liberal Party parade and parade in ever increasing volume why Coal is good for mankind. In fact they back that which cant compete with Coal power 24/7 (Wind and Solar) and stand proud at keeping those Coal donations pouring in. 350 megawatt Steam turbine requires a heat of +600*C. This leaves a further +600*C going to heat the attmosphere. Instead of allowing and extra seven 350 Megawatt turbines to use that waste heat. CO2 requires +40*C to have 200 bar pressure in place of Steams +600*C to have 200 bar pressure.

  22. Of course you would say that because you are whores to the fossil fuel industry. Suck it up. Youre going to be the enw dinosaurs whether you like it or not. Its a global trend now, so enjoy the dark ages if you will, but its coming to an end along with coal and oil. Denial wont help you.

  23. And how pahetic to blame the alternative energy system in S.A when it was the weather, stupids! You insist on rejecting that I know. But the system of delivery was the same as it would be if the grid was coal fired. Then over the weekend, Vic was knocked out in some regions. Again, it was the weather. And guess what? The storms are goingto get worse. Hundred year, five hundred year events are now happening every year, sometimes twice a year and I know how mush you deny climate change is man made. But none of you are scientists. just armchair scholars.

    • [email protected] | 26/10/2016 at 5:33 pm |

      Armchair scholars! haha, I like that! Takes one to know one I guess! Oh, I guess you didn’t notice the storms that Victoria had, yep, some blackouts, but not the whole state! A stable system doesn’t just crash like that!

  24. Renewable power is modern while coal is outdated but more importantly coal affects climate change for future generations .Just because Australia has lots of coal does not mean it should stuff the planet by raising the temperature

  25. S.A, the blackout state!

  26. Hmmmm. It is a FACT that if each household, or even small community, was running solar/wind/water energy generators – then the storm wouldn’t have been so damaging. I’m sure people who Invested in solar with storage weren’t without power!

  27. The NEO must be owned by the coal companies.

  28. Liberty works is a gov spam site

  29. The dearth of logic and evidence, and the outright religious hysteria in most of the outraged responses to this post are a dead giveaway. 😀

  30. A paid political announcement by energy and mining corporations supporting the LNP.

  31. Says you… not any of the experts. That would be ‘liberty’ to acquire corporate welfare, tax breaks, huge CEO salaries and a bulldozer to keep the mountain of bullshit in your marketing dept from falling over… right? Take your right wing Planet killing uber shitola somewhere else… we’re not buying it here. Sheesh.

  32. So the SA blackout wasn’t just down to a storm blowing over transmission towers after all. This from the ABC:

    “So the renewables are off the hook? Not exactly, So-called synchronous generators (which include gas, coal and hydro generators) don’t respond to network disturbances in the same way as asynchronous wind farms…Previous reports by AEMO make clear that the growth in cheap, subsidised renewables are contributing to the retirement of traditional thermal generators…without those large, stable, inert generators operating within state borders, South Australia is increasingly reliant on the [Heywood] interconnector.

    http://www.abc.net.au/news/2016-10-19/what-do-aemo-findings-into-sa-blackout-mean/7946490

  33. Josh Friedenberg still out there knocking renewables and SA, and the other Labor states! Still saying his govt has the best policy. Would it be because Gina has just bought a big coalmine in QLD?

  34. then it is time to change the national energy objective and properly fund the sector! the coal and gas industry has had their time and made their mogals way too rich now it is time for corrupt intrests to get out of the way of humanity’s future! if the south aus and dandenong ranges back outs showed us anything it is that decentralizing power and making it eaiser for people to be able to generate their own power is the future not a fantesy! transmission lines can be knocked out and wrecked but you don’t have the same kind of blackouts when every house its generating it’s own power

  35. Now that comes as a shock‼️‼️‼️‼️‼️

  36. Australia should be world class for renewable energy. We’ve got so much sun, wind and surf.

  37. WHAT HAPPEN IS STRONG WIND PICK UP ALL TONY ABBOTTS BULLSHIT ABOUT WIND POWER TURBINES THAT KILL POWER IT WEGHT LINE DOWN AND PYLONS FELL OVER

    • What does that even mean dude? Incidentally, Tony Abbott didn’t like wind turbines. Looking at the blackout of an entire state, I’d say he had a point. Most expensive electricity in Australia, and the most unreliable too.

  38. Wind power
    Just stupid as is solar good in day light then at night nothing
    Outrageously expensive
    Hydro is OK if you have the water

    • And getting cheaper and more efficient by the day Scott. Throw in the introduction of the Tesla batteries and you can store the power you’re not using. Coal is finished. In many places it’s also subsidized with discounted diesel, if not wage subsidies in order to make it viable to dig up. Every solar roof set up is a customer lost that will never return. To maintain profits, power companies will continue to increase prices and demand cheaper coal. It’s only a matter of time before coal will have to accept the inevitable.

  39. I looked this up on the internet and this the guy who is head of this organisation is such an idiot that he forgets that Ayn Ranf was a fiction writer and takes her as one of his inspirations.

  40. Why not these arguments happening in Europe where they have lots of renewables

  41. It appears the Liberals, Labor and Greens desperateley need be seen as anti Coal which is they back innovation that unlike Coal cannot supply electricity 24/7, and all three Political Parties oppose Australian Free to Copy CO2 24/7 power generation.

    • Yeah, sure. Coal can be 24/7 except when the transmission lines get blown over.

      Unfortunately for your argument, coal-fired power generation is not economical unless the power generation is concentrated at large generation facilities near the coal fields.

      This inherently means that you need extensive transmission lines to get the power from the generators to where it is used, and these transmission lines inevitably get blown over or otherwise damaged. This has a demonstrated track record of resulting in large-scale blackouts not just here, but all over the planet where this type of generation/transmission arrangement is in place.

      The end result is that for coal-fired power generation to be economical, it cannot at the same time be reliable. If you want coal-fired power generation to be reliable, then it will cost a damn sight more because you will have to provide duplicate or triplicate transmission networks.

      If you want reliability, you will only get it economically by using a large numer of local power generation and storage facilities so if one gets knocked out, the rest can keep going. Coal can’t do this economically. Renewables can.

  42. We should be working harder at implementing renewable energy with more rigorous security. More than 20% of wind energy in the mix is risky. There are other sources that can be developed. Where there is a will there is a way!

  43. thats bs,,,,, there worried about owning a stranded asset

  44. Now tell us who is funding “Liberty Works”

  45. piss off – this deserves no better response

  46. We’re calling total bullshit on this crap. Concur… piss off.

  47. The only GOOD renewable energy is HYDROPOWER……use it. POX on the wind industry..reject it.

    • No thanks. With the Tesla batteries now available making it possible to store unused power and significant resouces being used to develop the “next generation” . I’d say wind is pretty safe when it comes to sticking around. There are also much better designs available for farms aswell as rooftops. I’m surprised we still see the old GE models being installed

      • [email protected] | 26/10/2016 at 5:37 pm |

        At this point in the game, there is NO battery technology that can provide the storage that is required. Storage battery tech is not there yet, and not in the foreseeable future!

  48. Renewable energy targets are incompatible with “MY POCKET AND COMMONSENSE” give it up you green fools and get on with living with brown coal and nuclear power (THERMAL… you green slime) and if that;s too hard… use the gas that;s all going over seas as fast as ships can transport it.

  49. Keep the propaganda coming, too many people can see through it now

  50. That objective would be to make oodles of easy money for the energy companies?

    • Instead of the individuals that own the land leased for a windfarm. Do you know what a farmer earns of our tax dollars. It’s on going at our expense. These things are so far from green it’s not funny

  51. Now tell us who finances Liberty Works

  52. Who keeps sponsoring this fossil fuel propaganda?

  53. Tory hacks, piss off & die!

  54. Taking way too much liberty

  55. ha ha ha ha ha ha : Oh the irony ! i.e after the storm ‘battery storage orders’ went through the roof!

  56. the objective needs updating. The target should be 100% renewable energy supply.

  57. New technology with old infrastructure

  58. What utter bullshit, so called Liberty Works. Do you really think anyone but the very stupid will believe this garbage? Whenever I see the word ‘Liberty’ I fear an attack of American style libertarianism-and that’s what we’ve got here. Disinformation and straight out lies done in the service of the fossil fuel industry.

  59. Nicola & Judd seem to be Liberal lackeys,judging by their FB profiles.Wonder what that job pays?!

  60. Renewables are good but not reliable enough. We need clean gas power generation for reliability. But the dumb politicians keeps listening to dumb gullible activists and have banned it everywhere but QLD.

  61. CO2 is a renewable energy resource thanks to the invention of the Photothermo Chemical Flow Reactor which converts H2O and CO2 into hydrocarbon fuel,

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