Keeping the Lights On !

 Here we are, one third of the way through summer and Sydney is yet to experience one of those sweltering hot day and nights when the temperature hovers about forty degrees,.  In fact we have been having a wet, cool summer and many people wonder how the electricity system will cope if - and when - the traditional summer chooses to arrive.

Over the next twenty years, sixty percent of our coal fired generating capacity is set for closure. There is an essential urgency in reforming the grid to put in place the right regulations to stop the price blowing our and power supply failure.  If we keep kicking this further down the road, it is going to cost us more for electricity in the future.

What is alarming is the discrepancy between the generators estimate of how renewables will shoulder the load and the picture projected by the Federal government.  The operators think that their " step change " policy will result in renewables increasing from 37 percent of the energy mix in 2020 to 63% by 2030,  rising to 94 % by 2040.

The government projection, published last November, estimates that renewables will achieve 55 % of the power mix by 2030.   Obviously, they can not both be right and that gap might leave parts of Sydney in the dark.

One example of the challenge from renewables is the world leading installation of  rooftop solar which generates so much power that demand from the grid in major cities is wiped out during the day, creating  a headache for operators managing the basic outload from the old coal and gas generating plants.  It is evident that sometimes we are getting more than we need from renewables.

The basic plan in place to correct this imbalance was supposed to be Snowy Hydro, where excess power from renewables generated during the day was used to pump water back to the higher lakes, so that it could be used to create hydro power at night when the sun is not shining and those solar renewables are not contributing to the grid.

Of courser, that plan to rely on renewables leaves us at the mercy of unusual weather events which can cause fluctuations in the amount of wind and solar available in the middle of the day.  We should remember last year's bushfire summer when the air above Sydney was choked with smoke for days that extended into weeks.  A volcano exploding on an island to our north could disperse an ash cloud over Australia that could deliver a similar effect.

It is inevitable that those old coal fired power generators will be phased out and with them will go our ability to guarantee a reliable base load.  Taking action now is critical in ensuring we will minimize disruptions and avoid unintended consequences.

Prices are forecast to fall over the next three years as the lower cost of gas and renewables  drives a $30 fall in energy bills for the average NSW household.