Why won't politicians stop lying about 'reliable renewables'?

Government policies forcing increased reliance on renewable energy were a response to political concerns about global warming. Renewable Energy Targets (RETs) and their ilk were intended to cut greenhouse gas emissions by cutting fossil fuel sources of energy.

What's the problem? We have one policy objective (cutting emissions) and a few policy levers to do that.

Wrong. While suppressed for a time, politically, delivering lower emissions was always subject to constraints and trade-offs. These included cheap and reliable energy – both central to our industry competitiveness and consumer benefits. (Reliability is reflected in the NEM reliability 'standard' of only 0.002% outages on average across the grid – which, however, excludes a bunch of 'excuses', which qualify its effective significance to the punter. This objective was set in 1998 and is retained today.)

Nasty trade-off chickens have come home to roost. Today, cheap and reliable energy are in the limelight – because we haven't got them. This is just where many politicians and their urgers don't want them to be. Energy market transparency, beloved of reformers and punters, is uncomfortable for those with a more exclusive focus on emissions ends regardless of means, and no interest at all in the notion of scarcity.

Today, we have a raging debate about whether renewable energy causes electricity grid volatility, higher prices and blackouts. Labor and the Greens deny it. They have faith in renewables. The Coalition isn't blameless: it also has a (less ambitious) RET policy, 'tho its 'broad church' is internally divided on this.

At all levels, most all politicians are accomplices before, during, and after the facts (blackouts and soaring energy prices). Unreliability and cost mud sticks more or less to all of them. (Let's not talk about gas supply in this article: it's embarrassing and worth another piece in its own right.)

Why do we have a problem?

Blame physics – and politicians' Canute-like attempts to deny it.

Alone, renewables wreck reliability.

Install as many wind-farms or solar panels as you like. Technology determines the maximum potential electricity supply capacity. Actual supply depends on the weather (and transmission losses). Too windy, or not windy enough, and wind farms deliver nothing. At night, or on dark days, ditto for solar panels.

Renewables electricity supply is volatile, from pretty much zero to some technical maximum. Some estimates suggest SA wind farms average about one-third of their rated maximum capacity over a year.

Electricity demand is much less volatile: high on hot or cold days, but with sizeable base-load demand.

Grids like the NEM need electricity demand and supply to be in balance at all times (and at a set frequency). This was complex when supply was from fossil fuels. Renewable energy makes it worse.

Well, d'oh! Reliability demands renewables capacity be matched by back-up capacity that – unlike the weather – we control. This includes batteries, gas, coal, interconnectors – especially whatever is cheapest.

The policy message is clear.

Don't invest in renewables at all without investing in the back-up capacity needed for reliability.

This raises big questions. What's the cost of back-up capacity? Who pays?

Could new back-up capacity double the cost of (subsidised/forced) renewables investment? How much would, say, expansion of 'pumped hydro' cost? How long will back-up capacity take to bring on?

Who pays? Should investors in renewables be required to pay for matching back-up ensuring grid reliability? Should governments supporting renewable investment pay? What will their taxpayers think of that?

So 'reliable renewables' cost a lot more than renewables without adequate back-up. Either costs: the first in dollars, the second in blackouts.

And whoever pays for back-up capacity up-front, the cost will be passed on mainly to Australian consumers. Reliability means bigger electricity bills. Sound familiar? It should.

Want some evidence?

South Australia is good place for wind farms. It's windy. Sometimes, SA generates so much wind power it exports it to Victoria. At other times, with no wind, it imports power from Victoria via the Heywood interconnector.

On low-wind days, SA is keeping its lights on by burning high-emissions Victorian brown coal via the Heywood interconnector. On very windy days, it exports wind power to Victoria, which surely should get the low emissions credit for using it, although SA claims this for itself.

The Heywood interconnector has a capacity limit. If demand from SA exceeds this limit (eg, last September when SA wind farms shut down to protect their equipment), the interconnector shuts down for the same reasons.

Not enough back up, so SA blacked out.

Recently, in hot weather with no wind, SA operators avoided trying to import too much power from Victoria. The Heywood interconnector ran at its capacity limit – no more. Lessons learned. But this exposed the local SA inadequacy of back-up power because, for various reasons, fossil fuel power plants were unavailable.

So, this time, no SA-wide black out, but about 90,000 homes (and how many businesses?) lost power. Stuff-ups abounded.

SA's claims of reliable low emissions from wind power ride the shrinking wings of Victorian brown coal.

Now what?

The community increasingly doubts the reliability of grid electricity supply. Solar panel demand, and demand for home batteries, and portable generators, are taking off. What happens to the grid if electricity customers get a taste for going partly or wholly 'off grid'?

Could the soaring renewables albatross produce a stranded, flightless, grid dodo – and higher power costs?

Would we want this? Poorer voters facing higher energy costs and less job competitiveness may say 'no'.

I think most Australians would offer two pieces of policy advice to the power problem blame-shifters:

• To politicians, please 'fess up to the grid reliability and cost damage you all have done.
• And please get together – all of you – and fix the reliability problems ASAP before somebody dies.

The first requires humility and 'mea culpa' (an 'electricity sorry day'?).

The second starts – right now – with retaining all existing generation capacity that can be used as a stop-gap back-up source until we get better and cheaper back-up options.

It probably ends with abandoning the RET, pricing emissions consumption, and letting new technology deliver.

Is there hope for an effective response to this problem?

Blaming others has been the across-the-board political response so far. No sign of the energy policy 'drunks' signing up to AA courses that I can see.

Indeed, current 'processes' remind me of the classic 1960 duet between Harry Belafonte and the late Odetta entitled 'There's a hole in the bucket'. Adapted to reflect the present flailing around, finger-pointing, blame-shifting, and general lack of concrete action (apart from big 'announceables' about future action, after – of course – more reviews), this classic song might read as follows:

EMISSIONS ARE RISING

(aka 'PUMPED HYPER-EXPECTATIONS')

Apologies to 'There's a hole in the bucket', Harry Belafonte, Odetta, and many others.)

Emissions are rising, dear Malcolm, dear Malcolm
The planet is warming …. is there no way out? …
Well, cut them, dear Joshua, dear Joshua, dear Joshua
As Minister, dear Joshua, that’s what you’re about.
…

With what shall I cut them, dear Malcolm, dear Malcolm
A price on emissions?  What will voters cop? …
Try wind farms and solar, dear Joshie, dear Joshie
RET funding, and faith …  and hope warming will stop!
…

But these are not base-load, dear Malcolm, dear Malcolm
They are intermittent … our lights will go out …
Well, back them with back-up, dear JF, stealth fighter
Keep black-outs ‘off-radar’ … remove any doubt.
…

But back-up is costly, and takes time, dear Malcolm
Such power investments our Budgets will smash …
Phil Lowe says ‘it’s not so’.  We’ll Tweet, blog and borrow
For Snowy ‘pumped hydro’, Zen batteries and gas.
…

Well, brown coal is cheapest, and here now, dear Malcolm
Keep Hazelwood running, it’s ready to spin …
Let Sim’s pricing probe kick reform down the road, while
more coal base-load now, and next poll I can win.
…

But … All coal is warming, dear Malcolm, dear Malcolm
Our ‘Paris placation’ we surely can’t dodge? …
With Pruitt’s submissions, to hell with emissions! No outages mean I stay here in the Lodge.
…

(Sigh)… Emissions are rising, ‘blame others’, our goal  ….
While policy leaks from … …. a bucket of holes!

I hope I am wrong. If not, blackouts, soaring energy prices, and business closures, may well be our lot.