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The Forum > Article Comments > Electricity cost dissections: do they reveal – or conceal? > Comments

Electricity cost dissections: do they reveal – or conceal? : Comments

By Geoff Carmody, published 20/10/2017

What's the 'official family' feeding the punter about cost increases within the National Electricity Market (the NEM)?

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The preliminary report is here
https://www.accc.gov.au/system/files/ACCC%20Retail%20Electricity%20Pricing%20Inquiry%20-%20Preliminary%20Report%20-%2022%20September%202017.pdf
Section 2.4 on green schemes appears to look at only direct costs in terms of feed-in tariffs and renewable energy certificates. However there is an indirect cost from inefficient operation and types of thermal backup plant. Since the RET is a penalty backed quota with a generous subsidy incentive it forces thermal plant to take a back seat in sunny and windy times when it could be operating more steadily.

I believe in Australia expensive and high emitting open cycle gas plant out-produces more efficient combined cycle by two to one or so. In the northern US and UK it appears to be the reverse. Therefore those costs and emissions are a consequence of green schemes and should be factored in. Recall the 2014 RET Review found the cost of CO2 avoided was $59 per tonne but then the LGC subsidy was less than half what it is now.
Posted by Taswegian, Friday, 20 October 2017 8:59:15 AM
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Were once a country where we just didn't have a national grid! At least until the snowy mountains scheme. Tasmania rolled out hydro.

The states rolled out their systems as publicly owned and operated models. The end result, a massive increase in manufacture and disposable incomes, due solely to affordable reliable power!

Nowhere since and as privatised generation, has reliability increased or power price come down or remained affordable!? NOWHERE!

But would seem to include the highest, most price gouged system in the world? As pompously prevaricating politicians of all persuasion try and sheet home the blame!

As opposed to actually doing something about it!

That something, for welded on coal devotees, could be a GREAT BIG NEW COAL FIRED POWER STATION, built adjacent to a GREAT BIG THERMAL COAL SEAM.

As publicly owned and operated amenity!

The plant could be a GREAT BIG 4000 M.W Giant with as many as 16 GREAT BIG smoke stacks belching GREAT BIG, CO2 laced smoke day and night for around the next fifty years?

Built to supply peak load power, all the way south through N.S.W, Vic and S.A.?

Using the already environmentally accessed and approved, resumed Galilee Basin? As such financially feasible. Able to be done off budget and financed by the R.B. As a guaranteed, loss free GREAT BIG profitable investment!

Just need to be able to turn a GREAT BIG blind eye to your grand-kids and the world we leave them and perhaps thousands of terminally ill cancer patients, effectively robbed of their sole remaining hopes of a GREAT BIG cure?

Given that a cure is possible! Tantamount to holding a GREAT BIG revolver to their foreheads and playing Russian roulette with their lives!

Because that's what the decision makers do by outlawing walk away safe nuclear power and with it, miracle cure, nuclear medicine. Had a chat with Caspar, and he said, since the funeral, the last thing on his mind was the cost of power!

Just whether or not a few myopically focused loony tunes had condemned his Grand-kids and or the planet?
Alan B.
Posted by Alan B., Friday, 20 October 2017 10:38:55 AM
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I wonder just how much of the "Transmission & distribution ('poles and wires'): up to 50%" cost is down to interconnectors & the huge expense of transmission lines able to carry high loads, but normally carrying only Micky Mouse loads from widely scattered wind farms.

Interconnectors are only there to cover the politicians who have stuffed up, & not provided for their own states. How long would the fairyland mob in South Australia have lasted, without Victorian power?

Like most of these reports, designed to hide & protect the culpable, rather than sort the problem.
Posted by Hasbeen, Friday, 20 October 2017 10:41:25 AM
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There is a wonderful article on this site, titled, Blowing a whistle into an empty room.

I think it says it all about reports like this.
Posted by Wolly B, Friday, 20 October 2017 10:52:39 AM
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"Generation without electricity transmission, distribution, and retail sales is production without customers."
This article completely misses the point of cost breakdowns. Of course transmission is needed, but we're paying far too much for it. The poles and wires companies have no incentive to do the job efficiently - in fact they actually had substantial incentive to maximise the cost, and toothless regulators sat back and did nothing.

And the bit about retail sales is technically incorrect, as without them there'd still be wholesale customers. You may regard that as a minor quibble, but one way of keeping the retail sector competitive is to give customers the option of buying wholesale. With a fee of 5%, it would still on average be 7% cheaper than the retail price. I'm certainly not saying it's for everyone, but as home batteries and smart appliances become more prevalent, the desirability of this option is likely to increase.
Posted by Aidan, Friday, 20 October 2017 11:24:03 AM
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Alan you degrade your comment, & make a fool of yourself when you join the ratbag greens, particularly here, where most are more highly informed.

I'm sure most here know, even if you don't, that there are no "GREAT BIG smoke stacks belching GREAT BIG, CO2 laced smoke" at any modern power plants.

Just in case you are too poorly informed to know, those "GREAT BIG smoke stacks" are cooling towers, belching water vapour.

Why you would want to sink as low as the Greens & the ABC by making such fool comments I can't imagine. Such misinformation does nothing to promote your ideas, & merely degrades the value of your comments.

While you do appear to have been taken in by the global warming scam, you will not do your objectives anything good by posting known lies.
Posted by Hasbeen, Friday, 20 October 2017 11:46:10 AM
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My bill just tripled!
Posted by Shockadelic, Friday, 20 October 2017 2:22:45 PM
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Hasbeen, pants on fire, I'm not against coal per se, just the way we do it.

Given my druthers they would sit alongside a large coal seam and another area covered in snaking, large clear plastic pipes.

These pipes would contain treated, nutrient rich effluent and grow oil rich algae.

Some of which are up to 60% oil and absorb 2.5 times their body weight in CO2 . And under optimised circumstances as outlined, able to double that body weight, oil content and CO2 absorption every 24 hours!

In fact, able to eventually absorb every ounce of CO2 such a plant could make!

But ought to be rolled out ahead of the build with maximised capacity already operational and daily harvesting of some of the oil rich algae, done daily as an automated, drum filter process. Removing ready to use oil simple child's play. And only involves sun drying then crushing the harvested material.

Other mineral contaminant smoke stack material removed ASAP by electronic precipitation or electronic deionization dialysis desalination, which also removes many more ions than just salt. Some of which could be refined for industrial applications?

Boiler water would go through the normal demineralization, to be followed in my model by vacuum tower degassing. To remove any possibility of oxidation of the boilers.

Meaning shutdown for boiler maintenance could be halved.

If we are to build a Great big coal fired power station, with public money?

Then lets design it as a zero emissions plant only needing assistance from nature to sequester CO2, which instead could become, ready to use diesel and jet fuel and a reserve for the defence forces, if we ever do need to become entirely self sufficient?

Looking more likely by the day.

As a publicly owned and operated amenity also producing transport fuels. I'd expect the median cost of wholesale/OP power, could be as low as 3 cents PKH, particularly for those businesses and households with battery backup systems.

Sadly, these plants produce not so much as a single gram of life saving bismuth 213!
Alan B.
Posted by Alan B., Friday, 20 October 2017 3:01:44 PM
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Hey Alan, remember Telecom. Yes Government owned.

How much did your phone calls cost then?

How many dead head employees did Telstra do away with, while improving service? Something like a 70% reduction in staffing, & still overmanned.

If they used local call centres, I'd be a customer.
Posted by Hasbeen, Friday, 20 October 2017 5:22:30 PM
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Everything that I have read about the Turnbull government's talk of
lower power prices leads me to believe that it is all bulldust, as usual. The same people who caused our electricity problems cannot fix the problems.
Posted by ttbn, Friday, 20 October 2017 6:10:26 PM
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Comparing apples with oranges there Has. When East Timour rolled out her telecommunication service, like so many Asian countries, rolled it out as a wireless system and costing less for them, than our antiquated Land line.

Or our quite massively price gouged mobile phone service!

Yes I do remember telecom and the annual 7 billion it earned, with all its faults, for consolidated revenue! And I agree with your call centre sentiments!

I also remember some notable telecom, press club addresses. The most memorable by Honest John Howard shortly after he rammed his G.S.T, down our collective throats and against the polled 87% of a representative polled wishes/opinion.

And as he finished explaining his reform? [Or tax surety merely masquerading as genuine reform?]

One of the reporters in the room asked, why a G.S.T?

To which the former PM replied, well it was either that or a transaction tax and the transaction tax was thought to be regressive. Quote, unquote.

Our electricity system could be vastly improved with a different generation/supply model. Micro grids and genuine competition from suppliers, be they public or private, clean coal or cheaper than coal, thorium!
Alan B.
Posted by Alan B., Friday, 20 October 2017 6:43:00 PM
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And to set the record straight Has, I'm probably one of a handful posting here that has actually worked in a coal fired power station, in a science related capacity and actually understands the difference between a smoke stack belching CO2 skyward and a cooling tower belching clouds of water vapour.

The difference?

You can actually see water vapour! Be it from a cooling tower or the exhaust pipe of a still cold engine.

But then, as one of the better informed, you already knew that, didn't you?
Alan B.
Posted by Alan B., Saturday, 21 October 2017 9:48:33 AM
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So the idea is to build , with public monies, whatever is the most beneficial so the politicians of the day can sell it.
Why bother we have the same result now.
When society is enlightened sufficiently enough beyond a knee jerk reaction when they go to the polls there may be some merit in what is being proposed, but until then, by all means, carry on in the theoretical exercise of 'what to do about"
In the short term, legalise drugs and tax the hell out of them like tobacco and liquor and ban on line gambling by taxing it and making it harder for the morons to lose their money.
Neither of them contribute to social advancement
Those two alone will pay for as many power creation schemes one may desire
Posted by ilmessaggio, Saturday, 21 October 2017 10:45:29 AM
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Careful there Alan, your prejudice is showing. You are picking up the left method of lying about things.

As I recall Howard took the GST to an election. Bit hard to have "rammed his G.S.T, down our collective throats and against the polled 87% of a representative polled wishes/opinion", when he took it to the only poll that matters.

I employed a Telecom bloke in the Whitsundays as a deckhand. He had taken 12 months leave to get over a nervous breakdown, [family matters]. He was head maintenance bloke at Coffs Harbour.

While working his but off one day, loading 14 tons of stores onto a barge by hand, he said, "gee it's great doing some actual work for a change". We are so over manned, I only get to do a few hours work a week.

Yes government industry is just so efficient. That is why they have 44 clerks to oversee 11 nurses at our local hospital. All up it takes a staff of 147 to man a 6 bed hospital.

Then there was the bloke who built himself 2 racing motor bikes in the government railways workshops, all at taxpayer expense. I could go on, but you should have the idea by now. There is no more inefficient way of doing anything, than having it organised by bureaucrats
Posted by Hasbeen, Saturday, 21 October 2017 12:46:34 PM
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Ah yes the never ever, dead buried and cremated G.S.T. Installed and then taken to the people. Only to be rescued by 9/11 and the shameful Tampa incident! Without which, Howard's motley crew, heading for a landslide defeat!?

I didn't know there was a left method of lying? So Has, I bow to your very obvious expertise in such matters.

Moreover, I'm not the one advocating the use of public money to build a coal fired power station, just your mates on the hard right.

I would not however hand it to bureaucrats to build or manage. But tender out contracts in the usual time tested fixed price way, inclusive of time related penalties.

Those managing the finished project could also be employed on three year contracts? Also the staff. And that being preferred, run like a co-op where the profits and or losses, are shared and the workforce able to obtain the tax treatment applicable to private operators.

Shifts could compete for productivity awards etc.

In the past, government created these monopolies, which instead could have been created as competing duopolies and run as government financed and facilitated co-ops, competing for market share.

On the understanding. This was the most efficient private enterprise free market model we'd ever had! So much so, it stands alone as the only private enterprise, free market business model to mostly survive the great depression, largely intact! And never known to grow too big to fail?

In today's world Has, there's no left or right. just up or down good or bad policies or in or out! And by implication finally allows bipartisan pragmatism to win the day and the argument. Except you can't outlaw stupidity!

The ones with the most to fear from co-ops are unions, because it not only doesn't involve them, but makes them completely surplus to requirement, Ditto the parasitical born to rule drones/leaners! Acquiring all their income on the sweat soaked, bent backs of the lifters!
Alan B.
Posted by Alan B., Saturday, 21 October 2017 3:01:22 PM
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Alan B, there is no way all communications can be by radio.
There is enough trouble trying to manage the spectrum now with wifi and mobiles.
There are lots of applications that need a slice of spectrum and it
would be to waste spectrum when it could be avoided with landline of whatever type.
Posted by Bazz, Saturday, 21 October 2017 6:23:10 PM
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This whole lot of waffle on the governments new plan for grid
management and power sharing between renewables and other generation
systems seems anything but transparent.

It boils down to me the following question;

Is the demand on a warm still day in summer at sunset less than the
generation capacity ?
Watching the AEMO dashboard display I do not think there is enough
spare generation.
It is interesting to watch the Queensland price go from $85 to $245
per Mwatt/hr in a matter of seconds.
Therein lies a tale ?
Posted by Bazz, Saturday, 21 October 2017 6:36:14 PM
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I've listened very carefully to the new energy plan of the coalition and if able, would advise Labor to give it their provisional agreement, as a useful first step they can agree on, improve and enhance!

With the emphasis on technology neutrality!

In other words, officially abandoning their moronic moribund moratorium on the development of peaceful, CARBON FREE nuclear energy!

I mean they're going to look both stupid and archaic if they continue with their verboten line, on all things nuclear! As our nearest neighbour Indonesia, beats us and our ally America, with the development of Molten salt thorium reactors?

Followed and or preceded by, Brazil and South Africa!? And just how diabolically doubled down dumb would that look?

Although not too many Australians with death sentence cancer hanging over their heads, would object to having to fly to Bali for their Bismuth 213 treatment? [Always providing they had secure tamper proof luggage!] Finally, finally made available by, decades overdue, pragmatism replacing puerile, pomposity personified, personality politics!

Some things are well and truly above, who polishes treasury leather!

Particularly pugilistic, pernicious, pugnacious, primordial, Puppet master personalities, regularly 12 minutes late for televised question time? So as to be able to make the grand, Prima Donna extraordinaire, entrance!?

No names no pack drill.
Alan B.
Posted by Alan B., Sunday, 22 October 2017 10:02:51 AM
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Bazz:
Given decade old and twice triple times paid for! Land line is available!? Agree, with you sentiments!

Always, always providing it was the much, much, as it should be, the cheaper option!
Alan B.
Posted by Alan B., Sunday, 22 October 2017 10:10:36 AM
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