Too late to avoid an electricity transition catastrophe?

Oct 13, 2022
Power grids - iStock

About two years ago, I wrote an article for Pearls and Irritations (December 1, 2020) suggesting Australia was tracking to repeat and reap the mixed railway gauges folly of the Nineteenth Century in our handling of the transition from fossil fuel to renewable electricity generation.

At the time, P&I invited reader commentary and the article received what could be termed a “mixed response”.

One reason for disagreement seemed to be that some readers interpreted raising concerns about the transition with supporting the retention of fossil fuel generation. This mindset – an inability to separate the issues of emissions reduction from how we change electricity generation – has continued to inhibit an orderly transition. If anything, the intensity of the disagreement has blown out as the evidence about the dangers of emissions-driven climate change have become more clear and stark; but at the same time, the details of how to transition the electricity grid have become more complex and harder to understand.

At least they have become harder to understand for those who actually look closely – i.e. those charged with carrying this transition out – electrical engineers trained in the operation of large power systems. (And interestingly, this is a type of electrical engineer you won’t find being trained in many – possibly any – Australian university.)

But is this a catastrophe? What might a “catastrophe” look like?

Put simply, it would be a catastrophe if after almost a century of cheap, reliable electricity, that has not only under-pinned a high level of domestic comfort, but been the basis of much of our manufacturing industry, we are faced with the prospect of blackouts and at times unaffordable electricity.

It would be a catastrophe for our economy if unreliable and expensive electricity not just acts as a disincentive for industries to invest in Australia, but actually causes existing industry to close or move elsewhere.

It would be a social catastrophe if the more affluent roof-top solar generating, EV-driving citizens can insulate themselves from blackouts and expensive grid power, especially as this happy scenario for them will be subsidised by government handouts paid in part by those who get no benefit.

It would also be a catastrophe if we miss out on the opportunities that the transition offers to become a world leader in the potential benefits of a successful transition – benefits like those detailed in the recent P&I article by Roy Green and Phil Toner (P&I 8/10/22).

All of these scenarios are playing out right now and can only get worse unless things change.

What is the evidence that we are heading for a “catastrophe”?

For this, we need look no further than reports that appear almost daily, if not weekly, in the media:

  • The CEO’s of three of the major generators (Alinta, Energy Australia and Origin) quoted as saying we are close to an energy transition “train wreck” (AFR 8-9 October 2022)
  • The CEO of Transgrid, one of the largest transmission companies detailing a list of the infrastructure challenges associated with the transition, which need to be addressed, “or the lights are going to go out.” (AFR 7 October 2022)
  • Queensland announcing it will go it alone, close down all coal generation and have 80 per cent renewable energy by 2035 (AFR 29 September 2022), but:
  • “Energy experts” (Grattan, Melbourne University Climate and Energy College, Infrastructure Partnerships Australia) warning the planned pumped hydro and other schemes may not be enough to replace the generation planned for closure and the move from 21 percent to 80 percent renewables “diabolically difficult”. (AFR 30 September 2022; 3 October 2022; 5 October 2022.)
  • “Going it alone” in itself is a recipe for disaster: the NEM is a national system, but each of the states seem to be running their own race. Apart from the operational risks of closing existing generators ahead of previously planned closures, waste of money from duplication of effort and lack of coordination looms large.
  • The Energy Security Board (ESB) and the Australian Energy Regulator (AER) warned the transition would be “bumpy and new challenges will emerge” also that this was “an unprecedented period of transformation” and flagged the importance of “an orderly timeframe for closure”. Oops! Didn’t anyone speak to Queensland? (AFR 29 September 2022). And also, to AGL, who announced they would bring forward closure of Victorian generator Loy Yang A by ten years. (Guardian 29 September, 2022).
  • Large energy projects currently underway – Snowy 2.0 and EnergyConnect, the transmission line linking SA and NSW – are experiencing long delays and massive cost blow-outs (AFR 5 October 2022)
  • Courtesy of Vladimir Putin exacerbating a similar poorly planned rush to transition, the Europeans are already facing grim, if not catastrophic consequences. For example, the UK’s electricity system operator, National Grid, has flagged the imposition of rolling blackouts to cope with anticipated winter power shortages. (The Age, 8 October 2022)

Australia’s potential for catastrophe is being pushed by two key failures: lack of an over-arching energy transition plan and a failure to listen to the experts.

In response to the recommendations of the 2017 Finkel Review of our energy system, the system operator, the Australian Energy Market Operator (AEMO) since 2018 has been producing “Integrated System Plans (updated biennially). These are the closest we have to a “national plan”, but sadly, it is nowhere near close enough. One example should suffice to demonstrate its inadequacy: the maintenance of reliable electricity supply is predicated on an orderly process of closure of existing generation, to make sure replacement renewable generation is in place. The AGL and Queensland Government announcements of 29 September demonstrate that this simply isn’t happening.

We all use electricity and most people seem to have an opinion about how best to manage the transition, but how many actually understand how the system works? AEMO’s name actually highlights the problem: it is the Australian Energy MARKET Operator, and when it was set up, operating the market was (and is) an incredibly complex task. But now we need scientific and engineering expertise and AEMO is scrambling to meet this requirement.

Announcing a move to 80 percent renewable generation by 2035 is not a plan, it is an aspiration. We simply don’t know how to operate an electricity grid with that level of renewable generation and have yet to invent the batteries and other control devices that will guarantee its continuous and smooth operation.

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