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!00% renewables = 100% unaffordables

By Geoff Carmody - posted Friday, 19 July 2024


They don't allow for costs of additional renewables generation capacity needed to cover day-to-day renewables intermittency fluctuations, new specialised transmission capacity everywhere, and more battery storage to smooth day-to-day fluctuations in intermittency. They ignore extra costs to ensure the grid can cope. They don't include the costs of disposal and site remediation when solar panels and wind turbines reach the ends of their relatively short economic lives.

100% reliance on renewables plus batteries is neither politically nor economically acceptable.

Allocating most production to batteries and renewables would boost currently-rising cost of living pressures a lot more. Links between Australian production and real incomes would be distorted.

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Nevertheless, many governments have promised to get to 100% reliance on renewables (plus battery storage only) by 2050 or thereabouts.

In practice, how?

If reliability and affordability are important energy policy objectives (are they?), how can the required 'firming' of power supply be achieved in this renewables-only, batteries-only, world?

For renewables enthusiasts, the answer seems to be: faith and hope. That is, faith in 'cheap' renewables. And hope something will turn up to cut battery costs, etc, enough to prove it.

I've already assumed battery storage costs are slashed to just one-tenth of Hornsdale's. Is it realistic to assume even further storage cost reductions are feasible? What's the evidence?

Others, letting facts or known/likely future changes determine their views, might pursue a different path. This might include the following steps.

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The first step is the most urgent. Currently-feasible base-load power sources, including gas, other petroleum products (including diesel), and coal (coking and steaming) must be secured quickly. These are our only hopes for quick answers to 'firming' intermittent power for the NEM. Without them, lights out. Look at Europe. Look at South Australia (esp, 2016). Victoria soon?

The second step is to halt growth of unreliable renewables. Battery back-up is less needed then.

We can't unscramble the renewables omelette already in place. Governments have added a very sour taste even to these scrambled eggs. Cash-strapped, they've reneged on, or slashed, incentive 'schemes' for private investment in renewables. Yet they charge private power customers for government large scale 'investments' in solar, wind, and 'pumped hydro' schemes. Energy investment expectations in general have been destroyed. Power prices continue to rise.

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About the Author

Geoff Carmody is Director, Geoff Carmody & Associates, a former co-founder of Access Economics, and before that was a senior officer in the Commonwealth Treasury. He favours a national consumption-based climate policy, preferably using a carbon tax to put a price on carbon. He has prepared papers entitled Effective climate change policy: the seven Cs. Paper #1: Some design principles for evaluating greenhouse gas abatement policies. Paper #2: Implementing design principles for effective climate change policy. Paper #3: ETS or carbon tax?

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