Prime minister Malcolm Turnbull is mighty proud of the upgraded rooftop solar array and battery storage system that he had installed in his Point Piper harbourside mansion in Sydney earlier this year.
Apparently the brainchild of his “energy-aware” son Alex – as Turnbull put it in a radio interview on Thursday – the 14kW of rooftop solar and 14kwh of battery storage means that the Point Piper house doesn’t draw any energy from the grid for much of the day.
“My son Alex is very knowledgeable on renewables, energy economics generally, and we had solar panels for a long time,” Turnbull told 3AW’s Neil Mitchell in an interview.
“We got some new ones recently and a battery and that’s certainly meant that for much of the day, even with the big power demand we have there (increased by his heightened security protection), we’re actually not drawing any electricity from the grid.”
And, we’re told, Turnbull loves to look at his iPhone app to check on how its performing.
But Turnbull has touched on something important here.
For all the forecasts of catastrophic blackouts in NSW once the Liddell coal generator is closed in 2022, people being stuck in lifts busting for a pee, and what will happen “when the wind don’t blow” and the “sun don’t shine”, the risks are likely lower – barring some extreme event – than is being made out.
And that’s because many households, like Turnbull, are going to install more rooftop solar panels and battery storage in coming years, partly because it is an obvious way to deflect the inflated cost of energy bought from utilities and because costs are falling rapidly.
It may seem crazy to compare a household system with a big coal generator, but the issue here is not how much Liddell puts into the grid (around 8,000GWh, or 10 per cent of the NSW supply at the moment), but when. Much of its output is at night-time and can be easily replaced by renewables.
The key is what happens at the critical demand peaks, and as we discuss below, when it really mattered last February, much of Liddell was a no-show, and the grid operator does not like the idea of having to rely on ageing generators that are vulnerable to high temperatures – the usual ingredient for critical peaks.
The Australian Energy Market Operator’s assessment of short and medium term energy needs – the cause of this sudden interest in prolonging the life of a 50-year coal generator – says rooftop solar PV is going to play a critical role in minimizing outages.
First of all, rooftop solar will offset projected increases in demand caused by a growing population, economic growth and the increase in appliances and air conditioning. It predicts strong growth of rooftop PV coupled with battery storage, especially after 2019/20 in NSW.
That rooftop solar push maximum demand from mid to late afternoon until after sunset, and so narrowing the peaks, those few hours of the year when the market operator will experience a white-knuckle ride, fearful that that big coal and gas generators will suddenly trip in the heat, as they did in NSW on February 10.
Its ability to address those peaks will be helped by battery storage installations liked Turnbull’s, which can be pooled and provide a useful service to the grid – acting like virtual power plants. It is the sort of smart technology AEMO now wants to pull into its portfolio to manage a changing system.
As Turnbull himself said after visiting the Tesla HQ in California in 2015: “Batteries have the potential to revolutionise the energy market, reducing peaking power requirements, optimising grid utilisation of renewables ….”
And there’s another important point made by AEMO that was conveniently glossed over by the Coalition reaction to the AEMO reports this week.
It said that if there was a national mechanism that aims for around 45 per cent renewable energy by 2030 – the level that causes the conservatives in Turnbull’s Coalition to choke on their charcoal cookies – then the risk of “unserved energy” is further reduced.
The graph above shows that even with the closure of Liddel, Australia’s tight reliability standards are not breached, and the potential for unserved energy is greatly reduced by the assumption of more rooftop PV and large scale renewables.
And it also worth pointing out that AEMO’s estimates for potential unserved energy post the Liddell closure do not include increased levels of storage – either at household level like Turnbull’s or with large scale wind and solar farms.
Nor does it factor in a boost in demand management likely to encouraged by the ARENA sponsored initiative this year and next and by a market mechanism after that which could deliver “half a Hazelwood”. Nor does it include the much-vantued Snowy 2 pumped hydro scheme.
It all makes the Coalition’s interest in extending the life of Liddell harder to understand. Clearly, it is an idea promoted by the Minerals Council of Australia, but its choice of a poster child for a revived age of coal is a strange one.
Liddell, as we noted this week, is one of the oldest, dirtiest and least reliable generators in the country.
It rarely operates with all four units, is prone to problems with its boilers and other equipment, and only gets anywhere near its recently downgraded capacity rating (1680MW instead of 2000MW) around 0.45 per cent of the time – or about once every 220 days.
Which, given its vulnerability to hot weather, puts the likelihood of Liddell being able to respond to the maximum demand that AEMO is preparing for somewhere between zero and the chances of acting prime minister Barnaby Joyce getting a diploma in energy economics.
As we pointed out on Thursday, Liddell’s output was lowest at the time of greatest need during the February heatwave.
Had it been able to operate more than two units, there would likely have been no need to close down pot-lines at the Tomago smelter. It simply does not meet AEMO’s requirements for reliable, flexible and dispatchable and quick reacting machinery that the operator needs.
It was interesting to note that Turnbull, in the same interview on 3AW, acknowledged that the 1600MW Hazelwood generator, which had nearly twice the output of Liddell, had to close because it was no longer viable.
“Hazelwood was … a very, very old plant, it had been run down over a number of years. I don’t think it was viable. My understanding was it wasn’t viable to keep it going.”
But here’s the thing. Liddell was opened just one year (1972) after Hazelwood, and is clearly struggling to maintain output, and its costs are rising. Even its favourable coal supply contract with NSW is slowly being exhausted.
And yet Turnbull is arguing that Liddell should seek to generate for a decade longer than Hazelwood. It beggars belief, for all sorts of reasons, not least the costly failure by the WA government to resurrect the similar-vintage with the Muja coal units in Collie.
In the 3AW interview, Turnbull also had the hide to criticise Victoria over its plans to build new renewables. He should take a closer look at the AEMO report:
It shows that the risk of unserved energy is dramatically reduced by Victoria’s state-based renewable energy target (see the green squares and triangles in graph above, showing zero unserved energy) which brings on renewables in the next two years, and would be further reduced if there was a national policy.
In fact, a national policy that would aim for that 45 per cent renewable energy target by 2030 would not just eliminate the risk of unserved energy in Victoria from 2020/21, it would also eliminate almost all the risk created by AEMO’s worst fear for NSW, that of another coal generator also closing at the same time as Liddell.
(See the graph below, and the blue triangles at the bottom).
The biggest risk of blackouts in Victoria, AEMO notes, is not from renewables, but the failure of one of the big coal units: “There are risks of significant failure or outages in scheduled generation, due to the state’s aging coal fleet,” it says.
And what is the Coalition’s response to the crisis? Extend the life of the ageing coal fleet. (Face palm).
In the interview on 3AW, Turnbull even asked what Victoria was doing about storage. The answer is, quite a bit already.
A 20MW/34MWh storage facility has been announced for Stawell in western Victoria, adjacent to a new wind farm, and the results of a tender for two more 20MW battery storage insallations, totaling 100MWh, will be announced soon. Local network operators Ausnet and Spark Infrastructure have been having lots of fun using storage to test mini-grids, virtual power plants, and “mobile” storage back-ups.
In South Australia, the 100MW/129MWh Tesla big battery and the 30MW/8MWh Electranet battery will be built this summer, and other storage facilities are also on their way, waiting for the right market signals and rule changes.
And let’s be clear about what AEMO is saying. CEO Audrey Zibelman is confident that the grid will be able to cope, thanks to the many measures – battery storage, demand management, emergency back-up and other initiatives – that were not factored into the ESOO report.
Indeed, Zibelman used it to make a point: Australia needs “new approaches” to ensure it has a reliable portfolio of dispatchable energy resources capable of responding quickly and effectively.
It’s certainly a contrast to her predecessor, the late Matt Zema, who just three years ago in the 2014 ESOO was talking of a massive over-supply of baseload power – of nearly 9,000MW – and was using that estimate to call for the renewable energy target to be reused. How times and visions change.
As Turnbull finally admitted in that same interview, and as AEMO made perfectly clear in its reports: “No electricity provider can guarantee 100 per cent.”
Turnbull added. “There is also the risk of a generator failing or a transmission line falling over, so there’s always a risk of failure. There’s no 100 per cent guarantees, let’s be very clear about that.”
That’s right, there are no guarantees. The only thing that is certain is that if the power does go out, Turnbull will put the blame on renewables, and Labor, just as he did in South Australia.