SA power: How the State Government plans to fix energy crisis
PREMIER Jay Weatherill has foreshadowed “dramatic” plans for SA to step away from the national electricity grid “and take control of our own future” as fury mounts at another blackout.
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PREMIER Jay Weatherill has foreshadowed “dramatic” plans for SA to step away from the national electricity grid “and take control of our own future” as fury mounts at another blackout.
Mr Weatherill would not provide full details of the plans today, other than to say that they had been long in the planning and were likely to be finalised and announced imminently.
He did indicate that a contract for a bulk-buy of State Government electricity, for which tenders have been received, was likely to lead to the creation of a new gas-fired power station.
Mr Weatherill said last night’s load shedding blackouts were “totally and utterly unacceptable”, “didn’t need to happen” and the state was right to be furious about the failure of a key utility.
“One thing that is absolutely clear to us is that SA is now on its own in relation to the national electricity market. It’s on its own because the national Energy Market Operator is unable to run a system which can guarantee us security of electricity supply,” Mr Weatherill said.
“We have to step up and take control of our own future, and we are determined to do that.
“The SA Government has been planning to intervene dramatically in the SA electricity market. Those plans are well-advanced and we’re expecting to have further meetings today.
“The events of last night only confirm in our minds the need to take this dramatic step.
“I think we have complete political permission from the people of SA to take these steps.
“South Australians are not prepared to put up with being ridiculed and having the finger pointed at them by a Federal Government that has abdicated its responsibilities.”
Mr Weatherill said the current market, where SA is linked to Victoria who in turn is connected to the eastern seaboard, was all about dollars and cents rather than focused on people.
“People are trying to maximise profit and minimise cost, without any regard for the human toll,” he said.
“We’re going to put people back in the middle of this electricity market.
“People expect there to be security of supply, affordable electricity and a clean future.”
Mr Weatherill said detailed plans would come in the following weeks and months.
He said one options was “to completely nationalise the system”.
“That’s an extraordinary option, it would involve breaking contracts and exposing us to sovereign risk, and the SA taxpayers to extraordinary sums of money,” Mr Weatherill said.
“It’s not a preferred option, but we’re ruling nothing out at this point.”
Mr Weatherill said intervention taken would be “careful and methodical” but “dramatic”.
He said the state was disadvantaged by being at the end of a “long, skinny network”.
Mr Weatherill said further load shedding could occur today, pending action by regulators.
Mr Weatherill said the Government’s power tender was likely to deliver a new power plant.
Mineral Resources and Energy Minister Tom Koutsantonis said SA’s problems were “coming to a city near you on the eastern seaboard soon”, and the entire nation must respond.
He said the suburbs blacked out in load shedding were chosen from a list that exempted critical infrastructure like hospitals.
The order of residential suburbs was generated randomly and worked through in a cycle starting from where previous load shedding ended, Mr Koutsantonis said.
Mr Koutsantonis said three thermal generators could not work at full capacity and the significant drop in production from wind farms was due to the fact that wind wasn’t blowing at the time.
This should have been better forecast and prepared for by system operators, he said.
“Wind wasn’t present,” Mr Koutsantonis said. “It’s not as if, all of a sudden, this wind energy that exists in our system just appeared last night. It’s been there for a number of years.
“The market operator has insufficient intel about how it operates. That is unacceptable.”
Mr Koutsantonis said he was concerned about the “age and state” of SA’s single biggest power station, a gas-fired plant at Torrens Island that was supposed to be substantially mothballed.
“I’m very concerned about the way that the national market is not getting them the profits they need to reinvest, despite the price signals coming out of the SA market,” he said.
“(That) again shows a fundamental failure.
“It needs to be upgraded.
“You need certainty to upgrade that infrastructure. That’s why we want policy responses that the federal level.”
Mr Koutsantonis renewed calls for an energy intensity scheme for the country, which would be expected to deliver a smooth exit of coal power and increased investment in baseload gas.
Mr Koutsantonis played down fears the SA’s electricity network would be even more fragile next summer after the closure of Victoria’s brown coal Hazelwood power station. He said it was likely to lead to investment in more supply elsewhere, including locally in SA.
Mr Weatherill conceded there was a problem with the state’s energy mix. SA now gets more than 40 per cent of its power from wind, and does not have an operational coal station.
He said it was due to national policies that incentivised certain types of power supply.
“You’re squeezing out cleaner gas, which would solve all of the problems,” he said.
“Gas is the transitional fuel. What we have is a national energy market which goes to wind first, coal second and squeezes gas out. In SA, where our coal-fired station has ceased to operate, it essentially punishes our cleaner gas-fired generators.
“We’re using direct Victorian coal instead of cleaner SA gas.”