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Energy Prices Skyrocket in South Australia (yahoo.com)
Slashdot reader sycodon quotes an article from AFR:
Turmoil in South Australia's heavily wind-reliant electricity market has forced the state government to plead with the owner of a mothballed gas-fired power station to turn it back on. The emergency measures are needed to ease punishing costs for South Australian industry as National Electricity Market prices in the state have frequently surged above $1000 a megawatt hour this month and at one point on Tuesday hit the $14,000/MWh maximum price...
"A planned outage of the Heywood Interconnector to Victoria, coupled with higher than expected gas prices and severe weather conditions have contributed to large-scale price volatility in the energy spot market in recent days," said South Australia's energy minister, Tom Koutsantonis. The Australian Associated Press adds that "The state Labor government has invested heavily in wind and solar energy at the expense of baseload power, a move critics say has left the state exposed during poor weather. Mr. Koutsantonis has described the energy volatility as a failure of the national energy market because a lack of interconnection means South Australia often produces more renewable power than it can sell into the grid. But opposition spokesman Dan van Holst Pellekaan said the government had been too hasty to invest in renewables."
"A planned outage of the Heywood Interconnector to Victoria, coupled with higher than expected gas prices and severe weather conditions have contributed to large-scale price volatility in the energy spot market in recent days," said South Australia's energy minister, Tom Koutsantonis. The Australian Associated Press adds that "The state Labor government has invested heavily in wind and solar energy at the expense of baseload power, a move critics say has left the state exposed during poor weather. Mr. Koutsantonis has described the energy volatility as a failure of the national energy market because a lack of interconnection means South Australia often produces more renewable power than it can sell into the grid. But opposition spokesman Dan van Holst Pellekaan said the government had been too hasty to invest in renewables."
The unfolding energy crisis in South Australia was foreseeable and foreseen
Exactly. Pricing in an instantaneous supply and demand market is naturally highly volatile. It just doesn't work very well even when there is a big swing on either side. You can have negative pricing at times, and spikes at other times. The high price numbers thrown out there sound crazy, but in reality its typically very short duration. The market structure doesn't yet account for all instantaneous demand/supply scenarios optimally.
The conservative government of the time provided the transmission lessee a 99 year lease with a guaranteed return. Failures in the agreement have permitted the lessee to "gold plate the network" to their advantage/profit as the cost is recovered from consumers.
Electricity have since steadily increased to a level 2-3 times, where it's often cited as the most expensive in the world. Going off grid might work short term, but as that gains popularity, the burden of the transmission lease on the remaining few, will force the government to charge every property a supply charge.
The subsequent price increases, combined with the (national) RET scheme, have driven a massive adoption of solar in SA. The RET also fueled a massive increase in wind farm investment, but it's important to understand that scheme is a national scheme.
The third factor is the main interconnector to Victoria is being upgraded and presumably offline or running at reduced capacity.
The four factor is the recent shut down of the pt Augusta Coal plant that one served the majority of state. It was switched off last month.
Fifth factor is recent cold weather has increased demand.
It's important to appreciate the it's a combination of all these factors that have put the state in this predicament. Not just an abundance of renewable electricity.
Why it's only now made the news is because industry and retailers that normally get it wholesale for $50/MWh and lockin consumers at 30-40c at KWh [600-800% markup] are now losing money as these spikes get bigger and more common.
As the current treasurer pointed out, the markets are failing as there is no incentive to put on more transmission capacity and that has largely protected the remaining duopoly baseload generators who are cashing in.
SA just needs transmission capacity. Either interstate or to the northern geothermal sites.
Area51 - We are watching...
It has nothing to do with "psychopathic private corporations"...
I live in Alberta too. You seem to have forgotten about this. An excerpt:
In 2014, the province’s Market Surveillance Administrator alleged that TransAlta engaged in “anti-competitive conduct” in 2010 and 2011 by taking three coal-fired power plants off line on four cold days, during high-demand hours and in periods when other players in Alberta’s competitive power market were the least likely to be able to pick up the slack. This, the administrator said, drove up electricity prices and allowed TransAlta to reap millions in additional profits.
Only crack the nuts that crack. You don't put the ones that don't crack in the sack.
If an aluminium smelter doesn't get electricity constantly there is a very expensive problem of a lot of solid pots that should be full of liquid.
They get built in places where they can be sold continuous cheap power.
Aluminum smelters cannot (except at great expense) shut down altogether. But they can modulate their power consumtion a fair amount. They have to keep enough power flowing through the aluminum to keep it molten, but they don't have to run it at peak production rates through each cell.
Hourglass says she knows a kid in Iowa who grows up to be president.