Who Picks the Winners in the Australian Electricity Market?

Last week, Reuters published an interesting piece about Australia's progress on renewable energy - For those who can't be bothered reading the article, I'll summarise it for you:

• The Aussie government recently committed to generate at least 20% of our electricity from renewable sources by 2020. To support this goal, it put in place a scheme called the Renewable Energy Target (RET).  
• Although it is still early days for the RET, it appears to be working pretty bloody well. So well in fact, that we seem set to beat the 20% by 2020 target (perhaps even generating as much as 25%), if things continue.
• Because of this success, "The Australian Coal Association (ACA) has argued that the RET should be abolished completely because it unfairly picks winners in the electricity market."

I do not intend to write another scathing post about the hypocrisy of the ACA's position - Blind Freddy can see that a highly profitable industry that still sucks billions of dollars from Australian taxpayers every year is taking the piss to argue that their competitors shouldn't help themselves to a small serve from their feeding trough…

I'll try not talk about the ACA at all actually, because I think it's time that Aussies started to talk about the big picture...

Australia is one of the richest countries on the planet and we have a tiny population. Our land abounds in Nature's (renewable energy) gifts. We have boundless plains on which to harvest solar, wind, and geothermal energy. For fuck's sake - hasn't anyone noticed that our home is girt by sea? Maybe we might look into some marine and ocean energy? 

Nature and history have picked the winners in the Aussie electricity market, not the RET!

What is wrong with Aussies these days that we just let the ACA get away with spouting that kind of crap? We should all march down there and tell them to shove it!

Don't get me wrong - I am no fan of the RET either! At only 20% by 2020, the current goal is just as big a piss-take as the ACA's tax perks!

Australia should set an example for the world and aspire to generate 100% of our energy from renewables by 2020! (Edit: if bloody Scotland can be that ambitious, why the hell can't we?!)

I made this observation on Farcebook last week, and it sparked a predictable conversation with an old uni mate. He's an electrical engineer and a computer nerd who has an MBA for good measure. He's consulted to Australian governments on plenty of very large scale electricity distribution projects - He's a smart cookie who knows exactly what he's talking about, and his deeply considered and detailed response about why my proposed 100% target didn't make sense ticked all the usual boxes. Without any intention of setting up a straw man, I will summarise his position here and translate it for this non-technical blog.

The Argument for the Status Quo:

Fact: To guarantee a stable electrical network, we must ensure that supply matches demand. Otherwise we get voltage sags (brown-outs) and over voltages (blown fuses and burned out iMacs).  

Fact: To guarantee a reliable supply, we must provide a big "base-load" - that is, we need lots of energy on-tap at all times to handle unexpected peaks.

Fact: Many renewables are inherently unreliable (wind isn't always blowing, sun isn't always shining) so such sources are not usually the best choice to underpin "base-load". 

Fact: We also have "dispatch issues" - how do we get the energy from where it is generated (from solar farms in the desert or wind farms on the southern coast) to where it is needed by consumers and industry (in the cities)? 

Fact: Transmission lines have limitations - Energy is lost during transmission. Australia in particular has looooong distances so we will see large losses.

Fact: A power network of Aussie scale is particularly susceptible to all sorts of overloads.

These facts, supported by my mate's expert focus on efficiency and economic rationality, bring him (and industry lobby groups like the ACA) to the following line of reasoning:

Conclusion: Even if we have renewables, we still need lots of of fossil fuel-driven generators distributed throughout our energy infrastructure to ensure base load wherever and whenever it is needed. 

This conclusion leaves him with an engineering problem though:

Problem: Fossil fuel-driven generators can't just be flicked on and off like a light-switch because it takes a bloody long time to heat and cool all that plant during startup/shutdown - This is seriously inefficient.

But, every engineering problem has an engineering solution:

Solution: Let's just keep the fossil fuel plants running all the time, even when they are not needed. 

So, this simple solution to an engineering problem that came from the original conclusion leads him to a conundrum...

Conundrum: If we have all this coal and gas burning inefficiently just to keep the power station warm, then why don't we just fire the bloody station up properly and use the bastard to generate energy efficiently?!?

This conundrum leaves him going full circle and asking a question...

Question: What then, is the point of all those bloody windmills in the first place?!

Ok, that was the non-techie, abridged version. As mentioned, I do not wish to setup a straw man, so please do let me know if I've misrepresented any of the core ideas of "the argument for the status quo" (bearing in mind please that we're talking 10,000 foot level to non-techies here.)

The Rebuttal:

If you're still with me after that, then I will now discuss why this line of reasoning with its conclusions, solutions, conundrums, and questions is entirely wrong-headed... 

But wait! What about nuclear?

Ok, ok... First, I will preempt the rush to inform me that I forgot to mention nuclear power... This rush will no doubt come from electrical engineers like my mate (who are genuinely good guys and want to reduce CO2 emissions at the generator) as well as from various other complete arseholes (who get paid to troll for the nuke lobby), and they'll say something along the lines of...

No worries! We'll just replace those trillions of short tons of carbon-heavy coal with some of that uranium that we're shipping off to the US and China, and she'll be right mate!

Well, no - she won't be right mate - That model might just work in China if we're lucky, but I'm quite convinced that nuclear is a lost cause here in "the West". My convictions are based on observations of the US situation - specifically:

1. Despite astonishing subsidies and perks to the nuke industry, there is (almost) precisely zero interest in nuclear energy from Wall St. 
2. Even if Wall St did start to invest heavily in nuclear tomorrow, it would still be more than 20 years before new nuclear capacity could be brought online (assuming that it could ever be brought online in the face of extensive public anxiety.) 

I want to be proven wrong on this one, and I'd be delighted if a nuclear lobbyist can convince me that these two points are not complete showstoppers for nuclear power in "the West". It hasn't happened yet though so I remain convinced that "the West" must stop wasting tax dollars to subsidise nuclear instead of renewables that can be deployed quickly now!

Of course I hope that the Chinese will continue to invest heavily and will come to the party in 25 years with small, safe, easily deployable GenIV IFR generators. If they do then it will probably be a huge bonus for humanity, but if we haven't weaned ourselves off fossil fuels long before then, then the planet will already be fucked.

The Context:

Which brings me to my core point at last. We know perfectly well how to generate electricity reliably and predictably. We don't know how to do so without trashing the planet though.

In this context it is absolutely imperative that we take a science based approach to climate change. When we do this we are forced to accept that every additional gramme of fossil carbon that we burn takes Earth's climate just that bit closer to Venus's. This means that the day we stop burning fossil fuels altogether must come as soon as physically possible. 

I trust Neil deGrasse Tyson on that one...

This requirement to move away from fossil fuels quickly is of course, incredibly inconvenient politically and (arguably) quite difficult economically - but it is physics. The physics of fossil fuel-driven climate change is a complete showstopper for fossil fuel-based electricity generation, because... 

... physics tells us that continued burning of fossil fuels is a showstopper for all higher life on Earth!

Anthropogenic climate change is the context and seeking context-based sustainability means that we cannot allow politicians to negotiate with the fossil fuel industry over arbitrary, contextless numbers like 20%, or 41000 GWh by 2020. (These numbers are no different to the masturbatory bullshit that we hear so often from corporations "we've achieved 78.7% of our goal of a 50% CO2 reduction by 2015 vs a 2007 baseline.") 

Everything must be put in context and the context is that all these numbers are bullshit.

The only number that matters is 100% fossil fuel free. 

This means that it is time to start using our imagination. It also means that it is time to stop subsidising an already insanely profitable fossil fuel industry. It is time to put those subsidies into ideas that will make fossil fuel free base load power possible! 

We must not keep falling back on the old way of thinking that fossil fuel generation must be available just in case renewables aren't. 

No! It does not need to be! No, it cannot continue to be!

There are many renewable generation technologies that are available today. With sufficient investment they can be used in combination to bring Australia quickly to a 100% renewable 24x7x365 energy system. Every single distribution problem has an answer. The technologies exist today - all we need is investment.

Investment must be made in the right context though. Only when working from a reality-based contextual foundation can we stand firm against challenges by fossil fuel interests and get acceptance of a 100% fossil free vision. Only with a 100% fossil free vision can we avoid endless political conciliations by people who would have us forget the context.

Without the context that fossil fuels are quite quickly destroying all known life in the universe, it is all too easy for experts like my mate to defend the status quo - It is time for change so let's get to work and start challenging rather than defending the status quo.

Of course, we all know that getting down to work is much easier and more fun if we focus on applying our expertise to solve an actual problem, instead of worrying about political and economic bullshit. So let's try and do that - let's think of climate change as a physical rather than an economic or political problem because that's what it is. If we do this, then we find that solutions are not as difficult as they seem when they are obscured by political and economic bullshit.

To try and change the discussion and make the next step more fun, I want to offer a little thought experiment - Let's imagine that the politics and economics are gone from the climate change debate, and let's just solve the physical problem.

A Worthy Challenge:

I am now king and supreme ruler of Australia. I do not need to make political deals for short term personal interest - I am concerned only about the sustainable flourishing of all my subjects! My word is law and I have just delivered a Royal Sustainability Decree of 2012.

The Royal Sustainability Decree of 2012 insists that by the end of 2017 there will be zero fossil-fuel or nuclear generated electricity used in Australia. Bear in mind that I'm a king, not a god, and so I cannot change any of the facts or physics described above - I am simply exercising my regal right to reject the ACA's unimaginative initial conclusion, and am replacing it with an inspirational challenge to rally my people!

You know that I am a kind and benevolent king who is deeply concerned about the wellbeing of my subjects. You can trust therefore that I will never negotiate with an industry that has proven callously indifferent to the suffering and death that it has brought to my subjects in the past. You can trust that I will never negotiate with an industry that is responsible for untold ecological horrors inflicted upon my country and indeed upon the entire planet.

I am king, so I take a long view, and I promise that will not move the goalposts on you in 3 or 4 years time - Your target is 100% renewable to meet 100% of Australia's electricity needs. 0% fossil fuels, 0% nuclear. By end 2017. 

Money is not an object but you've only got five years, and I expect it to be at least as available and reliable as today!

Your king awaits! Tell me what you are going to do?