South Australia most at risk of summer blackouts, AEMO report reveals

AUSTRALIA’S biggest battery, temporary diesel generators and every power station in the state must be up and running in tandem to prevent blackouts in SA this summer, a report reveals.

• POWER DOSSIER: What you need to know about SA’s electricity
• Government unveils $550 million power plan
• Ban on gas exports to prevent shortfall and blackout risk

AUSTRALIA’S biggest battery, temporary diesel generators and every power station in the state must be up and running in tandem to prevent blackouts in SA this summer, a report reveals.

Worst-case scenarios also forecast an energy supply shortfall in November followed by massive deficits in January and another smaller one in February, which could cause widespread blackouts.

The Australian Energy Market Operator’s first energy supply outlook combines two earlier reports into power and gas that had warned of significant shortages and considers the likely impact of recent government policies aimed at shoring up national supplies.

It found that the power system remains susceptible to extreme conditions but, if announced safeguards were in place by summer, there was low risk of electricity shortfalls for an “average” summer this year.

“In this assessment, South Australia is considered most at risk of breaching the reliability standard (the benchmark for available power supply),” the AEMO report states.

“To meet the standard, existing generation capacity must be available and operating, Pelican Point Power Station must return to full service, and the new battery storage and diesel generation contracted for by the Government must be available as planned.

“There remains a risk of supply shortfalls occurring in SA and Victoria over the next two years which could result in load shedding, especially during extreme conditions.”

Modelling which factors in warnings to the market operator that 240MW of SA generation would not be running at full capacity in the next 12 months showed blackouts were likely in January in particular, but also November and February.

AEMO chief executive Audrey Zibelman said the report showed there was also a risk of supply shortfalls if low wind and solar generation coincided with very high demand across SA and Victoria at the time of peak demand in the day.

“The power system is changing, and this latest analysis indicates there will be challenges that will need to be managed proactively on days of extreme conditions to maintain secure, reliable and affordable energy to Australian consumers,” she said.

Prime Minister Malcolm Turnbull announced in April that the Government would take the dramatic step of banning gas exports during domestic power shortfalls after AEMO released a dire forecast revealing that declining gas supplies were leading to likely blackouts from 2019.

Ms Zibelman said the new analysis suggests gas supply remained low.

“However the latest industry projections of gas production are just sufficient to meet current projections of gas demand,” she said.

“Gas availability on the supply side, together with new initiatives to reduce peak demand via demand side management, will form a formidable combination in managing power system security during those hours on the very few extreme condition days per year.

SA Energy Minister Tom Koutsantonis said the report “proves” SA Labor’s $550 million energy plan is working.

“The national market operator believes our energy plan will improve grid security,” he said.

“The outlook for the next two summers with our grid-scale battery and temporary generators is significantly more secure.

“Ultimately, tight electricity supplies have occurred because of policy uncertainty from the Federal Government that has led to a strike on investment in new electricity generation.”

Key findings

■ South Australia, Victoria and NSW all remain at risk of blackouts during the next two summers but recent policy announcements have lessened the risk.

■ The State Government’s energy storage and diesel generation programs are expected to reduce

the likelihood of blackouts over the coming summer.

■ Gas supply and demand remain finely balanced, with continued risks of shortfalls.

■ Coal-fired power stations, particularly in NSW, will need to ramp up generation.