SA electricity crisis: SA Premier Jay Weatherill’s top advisers in push to buy power station, likely Pelican Point

JAY Weatherill’s top advisers have told him the SA Government should buy a power station, likely Pelican Point at Port Adelaide, to fix the power crisis.

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PREMIER Jay Weatherill’s top economic advisers have told him the State Government should buy a power station, likely the Pelican Point plant at Port Adelaide, to fix the power crisis.

The dramatic plan to take back partial public control of the state’s energy grid has been revealed by Economic Development Board member Goran Roos to a State Parliament committee.

Mr Weatherill last month said controlled blackouts which cut power to 90,000 homes demanded dramatic action, but he is yet to reveal a plan despite promising one will be delivered soon.

Professor Roos, a former thinker in residence with expertise in manufacturing, told the Statutory Authorities Review Committee the advice was delivered to the Government last month but had been evolving since the Board began working closely on SA’s energy problems a year ago.

“In the medium term, which is one to two years, the SA Government should consider direct control of electrical generation facilities either through acquisition or leasing arrangements coupled with long-term back-to-back take-or-pay contracts with end users,” he said.

“A suitable facility could be the second 160 MW Pelican Point gas turbine.

“The second unit at Pelican Point was seldom operated from 2013 until the weather and operational events in the second half of 2016. A gas supply contract would need to be secured

to operate the facility, and this could be offset through back-to-back take-or-pay contracts.”

In a Senate committee hearing on Tuesday, the owner of Torrens Island Power Station, AGL, said it was struggling to source enough gas to run the plant, and predicted Pelican Point would be having similar issues.

Prof Roos said station owner Engie had argued the second Pelican Point gas turbine can’t compete with wind and it is commercially unviable to switch it on for high-demand days.

He said this could mean the Government would be able to buy the plant relatively cheaply.

The Government has been coy on details, but routinely said its plans for the energy grid involve “unpicking the damage done by privatisation” and asserting the state’s sovereignty.

It has also regularly pointed to the “absurd” situation of the second Pelican Point generator sitting idle at times of high demand, and while blackouts occur, as the sign of a broken market.

Prof Roos said the Board provided advice in July that there be a push for national rule changes.

“This was to be delivered through strong bipartisan federal leadership aimed at co-ordinating the energy and climate change policies at a national level and ensuring that there are state level renewable energy targets developed which do not inhibit the efficient working of the National Electricity Market and operating within the confines of the national policies,” he said.

“Even combining the federal energy environmental departments, the establishment of the Finkel review and the ongoing COAG energy minister meetings, it is difficult to see evidence of strong bipartisan leadership in Canberra in relation to the electricity market.”

Pelican Point power station.

Prof Roos said there were other options if the state were forced to go it alone on power.

“These measures can include guaranteed gas supply to operate electricity-generating units and ensuring that additional generation supply will be capable of being brought on line within 30 minutes,” Prof Roos said. “It is anticipated that the duration of these measures would not exceed six hours unless this is a result of long-term generator or interconnector outages.

“Examples when these intervention measures could be invoked would include anticipated periods of hot weather with resultant high electricity demand or interrupted supply as a result of planned outages of generation units or interconnectors or potential major storm activities.”

Generators that did not fire up willingly could be forced to at the Governor’s direction and receive additional payments to cover the commercial losses, Prof Roos said.

He said long-term measures included support and incentives for miners to extract more gas.

Quizzed on Tuesday on Prof Roos’ plan, Mr Weatherill said it was “just part of the input that’s been given to our process”.

“You’ll see how we respond when we actually release our plan but it’s going to be a very substantial plan”.

Asked if the plan was buying into Pelican Point, Mr Weatherill said “no”, before clarifying he wasn’t going to comment.

“Suffice to say that that input does not represent our plan,” Mr Weatherill said.