The summer that was

That the media – mainstream and social – have become a shouting factory for debate about energy issues is rather beyond argument now, I’d suggest. The result is that facts seldom get presented (even in serious publications) without a loading of opinion and members of the community looking for straightforward information have their work cut out.

A case in point is the current coverage/commentary on a report by the Australian Energy Market Operator about last summer’s east coast power supply – which didn’t fail spectacularly despite all the dire stuff to be found in the media last spring and the season being the second-hottest on record.

(You may recall the ABC’s 7.30 Report asking back in early December “Is the electricity grid up to the summer?” – using the 2016 South Australian blackout for illustration.)

AEMO sums up the summer now ended in 20 words: “The system performed well and no NEM customer experienced interruptions to their electricity due to insufficient supply being available.”

Like the image of a swan on the water, this serenity masks a great deal of paddling below the surface including bringing back three mothballed plants, securing off-market sources through the reliability and emergency reserve trader, better focus on weather trends, rescheduling generation maintenance and a bit of leaning on gas supply to ensure sufficient fuel for Victorian turbines at a crucial time. There was also a significant reduction in unplanned transmission line outages at a time where interstate flows were an especially important factor in sustaining supply.

And buried deep in the report is this riposte to some of the most strident of the media commentariat: “Some media coverage in the summer period highlighted potential reliability concerns with the coal fleet. While there were unplanned unit outages (typical for thermal generators during warmer weather), the NEM coal fleet recorded its fourth-highest summer availability in the past 10 years, with around 250 MW more capacity available than the long-term average for this period.”  (And this, of course, with Hazelwood power station removed from the system for the first time, pulling about 1,000 MW from available capacity. AEMO records that the rest of the NEM coal fleet increased average load by 580 MW compared with the 2016-17 summer.)

Some current media coverage has made a big deal of the fact that there were days when Victorian and South Australian supply looked a bit shaky and AEMO used the “RERT” mechanism twice at a cost of $51.26 million to avert problems. Naturally, this has been headlined as “costly” back-up even as the operator points out that a large power failure of just an hour would have cost a lot more. AEMO chief executive Audrey Zibelman says that, averaged over the number of consumers saved pain, the cost works out as equal to two cups of coffee.

The operator also notes that some coal units in Victoria and New South Wales had “issues” with returning to service after long-term outages (“not uncommon after extensive outages and maintenance periods”) or because of access to adequate coal supplies. “These issues have now largely been resolved,” it says.

In passing, federal Environment & Energy Minister Josh Frydenberg has complimented AEMO on “doing a good job” over the summer; he could, I suggest, have taken the opportunity to say the same to the supply sector, which collectively seems to have performed well in fairly trying circumstances.

At least some of the fossil-fuelled suppliers – those not intent on painting themselves a greener shade of black – would like greater recognition that their contribution remains the backbone of the east coast grid.

As the Minerals Council has been quick to point out, asserting “coal remains Australia’s energy foundation and has a competitive future,” between the beginning of December and the end of April coal-burning generation (both brown and black) produced more than 76 per cent of the NEM’s power (leaving aside estimates of rooftop solar use), the next highest supply being gas at 10 per cent.

In saying this, it needs to be acknowledged, too, that rooftop solar installations hit a record for estimated use in December, according to current analysis by the Australian Energy Council. (It is calculated as 1,124 gigawatt hours for the country as a whole, meaning, I’d guess, about 900 GWh for the NEM – where the black coal plants alone in New South Wales and Queensland are averaging about 10,000 GWh a month, just to provide context.)

The solar statistic does underscore the need to get a better handle on the real impact of PVs, especially in the NEM, in the light of the capacity now installed and the continued rate of growth. AEMO is pointing out that the market can lose (quite suddenly) between 200 and 300 megawatts of capacity when the skies cloud over in a major city and managing this is just one more issue for the operator, one that will be harder to handle after 2022.

PS The past week’s bit of news that will have had the gentailers sitting up and paying attention, I reckon, is not the AEMO summer analysis but Frydenberg’s reported comments to the Coalition government’s party room that he is “worried” about the concentration of ownership in the NEM. With the Australian Competition & Consumer Commission due to produce its next major report on the sector at the end of June – and chairman Rod Sims signaling that he is concerned about market competition – this presages a new headache for the dominant companies, especially with the political need to play to the voter gallery as the next federal election looms. There is more than one reason that the heat will be on again for suppliers by next summer.

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