200,000 Victorians left powerless in heatwave

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by Peter Westmore

For the second year running, thousands of Victorian households and businesses have faced blackouts during summer heatwaves, following the closure of the 2,000-megawatt base-load Hazelwood Power Station in 2017.

The reality of the power blackouts is obscured by the Orwellian language used by the Victorian Labor Government and the Australian Energy Market Operator (AEMO), which spoke of “load shedding” and an “emergency mechanism” in response to a depletion in power reserves.

Perhaps the most striking example of Newspeak was the comment by the Victorian Energy Minister, Lily D’Ambrosio, who said Victoria’s “old, dirty, brown-coal power plants” had failed and the situation highlighted the need to shift to renewables.

The fact is that the Victorian Government is committed to the closure of all the remaining coal-fired power stations in the state, and wants Victoria to rely completely on wind and solar power.

The closure of base-load power plants, which still supply over 70 per cent of Victoria’s power, inevitably reduces the reliability of the electricity grid, which must deal with intermittent sources of electricity including wind and solar.

The largest single source of renewable energy in Australia, hydroelectricity, is limited by extreme environmentalists’ campaigns to prevent the construction of new hydroelectric plants.

No new hydro plants have been built since mass protests, backed by the then federal Labor government, forced the Gordon-below-Franklin Dam to be scrapped in the mid-1980s.

No new coal-fired power stations have been constructed in Victoria since the Loy Yang power station was completed over 30 years ago.

The remaining power stations in Victoria are of the age of vintage cars, and urgently need to be replaced with new, high-efficiency low-emissions power stations, like those currently being constructed in Japan.

Total opposition

However, the Victorian Government is totally opposed to new coal-fired power stations, and is propelling Victoria back 100 years to third-world energy status, with electricity prices now among the highest in the world. Victoria also has serious shortages of gas, as a result of bans on gas exploration and development within the state.

Labor’s anti-coal policy has also discouraged new investment in existing power stations, making machinery failures like those that happened during the late January heatwave more likely.

In fact, three units from Victorian power stations were out of action at the time.

During that heatwave, the two worst affected states were Victoria and South Australia, where coal-fired power stations have been closed down in recent years, without the development of any base-load replacements.

The “renewable energy” mantra, which has been repeatedly intoned by federal Labor leader Bill Shorten, Victorian Premier Daniel Andrews, and the Greens, has been repeatedly shown to be a dangerous experiment: it has forced businesses to close, and has imposed radically higher costs of power, which impact most on the poor.

Since the closure of the Northern Power Station in SA in 2016, that state has suffered a statewide power blackout, a political repercussion of which was the defeat of the Labor government in the state election. It has also meant dependence on imported base-load power from New South Wales and Victoria.

While widespread blackouts in Victoria were the most obvious feature of that state’s power crisis, the reality of Victoria’s power situation was more clearly seen in the price of electricity listed on the AEMO website.

AEMO has legislative responsibility for maintaining the reliability of the interconnected national power grid.

The website showed that on the hottest day in January 2019, the forecast price of electricity jumped from the average price of around $110 per megawatt/hour to $14,500 per MWh, an incredible 130 times the average price. (See graphic.)

In order to handle the power shortfall, the market operator ordered electricity retailers to cut demand by blacking out areas of the state, as well as requiring the largest users of electricity, including the Alcoa smelter in Portland, to shut down.

It is of great interest that the AEMO website lists the average price of electricity by state since 2000. It shows that electricity prices have risen in all states in recent years, as renewable energy has been introduced in place of base-load coal-fired power.

It shows that across Australia, average prices of electricity were about $30 per MWh in 2012, but prices have risen substantially in subsequent years.

For South Australia, average electricity prices have risen from $38.29 per MWh in 2015, the last year before the Northern Power Station was closed, to $61.67 the following year, and up to $98.10 last year.

For Victoria, electricity prices have risen from $46.14 in 2016, the year before Hazelwood was closed, up to $66.58 the following year, and up to $92.33 in 2018.

Labor’s policies have caused massive price increases for both business and domestic consumers, along with increased unreliability. This is a return to the 19th century.