Wednesday, 4 November 2009

Still living in the dark on baseload power
October 31, 2009

WE ARE often told we need more ''baseload'' power. But baseload power generated in a distant coalfield, delivered by a dumb grid, suits almost nobody these days, bar the incumbent operators. What's occurred in the past decade or so is a rapid growth in peak loads-especially on summer afternoons, when everyone gets home and turns on their air-conditioners, causing a huge spike in demand. Total electricity use, as against peak demand, has increased much more slowly and even fallen in some cases.

Forget for a moment whether those air-conditioners are necessary; we don't need to build more baseload power stations just because peak loads are expanding. A presentation this month by AGL's Paul Simshauser, chairman of the Loy Yang brown coal-fired power station in the Latrobe Valley, showed the national electricity market (NEM) had too much base and intermediate-load power (by about 4000 MWs, enough to power more than 1.5 million homes) and not enough peak-load power (we are short about 1700 MWs).

Michael Ottaviano, chief executive of Western Australia's Carnegie Corporation Energy, took up the theme at this month's Eco Investor conference in Sydney, arguing for an expanded role for wave energy, sitting somewhere between baseload power and intermittent energy sources such as wind. ''Wave is a very consistent resource with 90 per cent-plus availability,'' he said later. ''It will vary as wave height varies. But unlike wind, which varies in minutes and is difficult to predict more than a few hours in advance, wave will vary over hours and be predictable over days.''

A key, Ottaviano says, is a smart grid that can make use of all the available energy - renewable sources are not always conveniently located near coalfields, so we're going to need new transmission lines- and supply it where and when it is needed. (Communications Minister Stephen Conroy is on to this and on Thursday, with cabinet colleagues Martin Ferguson and Peter Garrett, invited bids to build a $100 million smart grid in Queanbeyan, near Canberra. Which is a start.)

Distributed generation can help, too. At the same conference, Ceramic Fuel Cells managing director Brendan Dow Chemical presented slides showing about 80 per cent of the energy generated by coal-fired power stations is lost as heat (65-70 per cent wastage) or in transmission and distribution (5-8 per cent). Given coal-fired power stations account for about 35 per cent of Australia's carbon dioxide emissions, that's a lot of carbon pollution for nothing.

Ceramic Fuel Cells makes a gas-powered fuel-cell appliance about the size of a dishwasher that can provide 17,000 kW hours of electricity a year- twice that needed to power an average home, meaning far greater energy savings than an equivalent-cost solar panel installation. The so-called BlueGen units have a world-beating 60 per cent electrical efficiency. Even without any subsidy in the form of a feed-in tariff, the BlueGen unit is a commercial proposition-as long as utilities will connect them to the grid, and take the electricity they generate, as they must do with home solar panels.

Meanwhile, the grid continues to roll out, whether the public wants it or not. As reported earlier this month, on the NSW North Coast there is majority community opposition to a $227 million power line from Lismore to Tenterfield, according to state-owned proponent TransGrid's own consultants. The residents say they don't need the power, question the demand projections and point to cleaner alternatives such as solar, wind and the bioenergy already generated from bagasse at sugar cane mills at Condong and Broadwater.

At the root of the problem is this: the national electricity market is run with disregard for the environmental objectives contained in the original Ministerial Council on Energy agreement that established it. A recent report for the Total Environment Centre, by energy consultants McLennan Magasanik Associates, showed the agreement aimed to ensure ''environmental impacts are effectively integrated into energy-sector decision-making'' but the institutions that run the market were not given this responsibility. In 2005, what is now called the Australian Energy Market Operator said it had ''neither the power nor the authority to make decisions based on considerations of sustainability and balance in resource management''.

Efficient, clean-energy development was being frustrated by the current market frameworks, MMA found. TEC campaigner Jane Castle says the owners of Australia's power stations, and the network, have every incentive to build more infrastructure and none to cut electricity use. ''It's called gold-plating,'' she says. ''If the networks save energy, they lose revenue.'' Demand modelling, she says, is based on the assumption that the market will continue to be operated in the interests of energy suppliers, and not in the interests of energy consumers. ''There's an assumption that supplying more energy is the only way to go,'' says Castle. ''It serves the interests of the incumbents.We're stuck in a paradigm of generating more power as people come online.

It's completely outdated in the era of climate change.'' The power of the generators is obvious, and extends to forcing brown-outs and blackouts. If they want to shut down a power station to send a message, they will, and worry about the fines later. Britain's International Power, owner of the Hazelwood power station, is already threatening to run down Victoria's power supply if it doesn't get enough compensation under the emissions trading scheme.

"Enron: The Smartest Guys in the Room," showed us how California's economy was held hostage by energy traders in the crisis of 2000-01. Now, says Castle, the US state has one of the most progressive market regimes. ''When they look at new demand they have a loading order: first, energy efficiency. Then demand management. Then renewables. Then gas,'' she says. Australia's energy problem, says Castle, is ''not a baseload problem, it's a problem of how we're meeting increasing demand''. Reducing demand does not mean going back to the Stone Age. It means making the grid work for us, not against us.