5 facts you need to know about energy

“Worried the electricity system won’t keep up over summer? Worry about coal,” wrote economics editor Peter Martin in The Age.

He wasn’t kidding. In the space of one December week last year, coal power stations in Australia failed without warning, or ‘tripped’, four times:

• Millmerran coal power station (QLD), 420 MW unit, failed on 12 December 2017
• Mt Piper power station (NSW), 700 MW, failed on 13 December 2017
• Loy Yang A power station (VIC), 560 MW unit, failed on 14 December 2017
• Eraring coal power station (NSW), 700 MW unit, failed on 18 December 2017

Victoria’s Loy Yang A in particular has had serious reliability issues, failing six times in three weeks over summer.

This sudden loss of hundreds of megawatts from coal-burning power stations represents a big risk to energy security.

In fact, leading energy economist Bruce Mountain has said: “The biggest single source of insecurity to the power system is a trip of a major coal thermal generator unit simply because they are so large – [it’s] not the wind or the sun, or people switching on their air-conditioners.”

Below is an interactive timeline showing the list of coal power station failures in Victoria last summer. For the full national list see tai.org.au/gas-coal-watch

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It’s understandable there’s concern about blackouts over summer. During long spells of hot weather, people crank up the air-con, increasing electricity demand and strain on the grid.

But there’s another reason to be worried: our electricity grid infrastructure, especially ageing coal power stations, are vulnerable to faults and breakdowns in the heat.

As climate change drives longer and hotter heatwaves, coal power stations are getting critically hot more often. “When temperatures in control rooms get as high as 50 or 60 degrees,” writes Peter Martin in The Age, “the electronic control systems buckle and the boilers leak.”

The Australia Institute report Can’t Stand the Heat notes that Australia’s aging coal and gas fleet is not designed to operate in extreme weather conditions. During the February 2017 heatwave, 3600 megawatts (MW) failed during peak demand periods in South Australia, New South Wales and Queensland, equivalent to 14 percent of Australia’s coal and gas generation in those states.

The NSW Energy Security Taskforce drew similar conclusions, flagging that “large coal thermal plants generally will not perform as well in extreme hot weather and can also have output limited by environmental constraints, for example, cooling pond temperature limits.”

Other climate-driven weather events can affect the electricity system. In September 2016, an extreme storm knocked over 22 transmission towers in South Australia, causing a ‘system black’ event. Low rainfall or prolonged droughts have also reduced the ability to use hydroelectricity generators.

Australia is home to the Big Banana, the Big Pineapple and the Big Gumboot (yes, really, it’s in Far North Queensland). To this list of eminent tourist attractions we can now add another: the Big Battery.

Officially called the ‘Hornsdale Power Reserve’, South Australia’s new lithium-ion Tesla battery is currently the biggest in the world — but there are already plans to build an even bigger one!

And it’s doing some amazing things. In December it responded lightning fast to help stabilise the grid after a unit at a Victorian coal power station failed.

But the benefit of the big Tesla battery is not just providing dispatchable, on-demand supply. It is also providing a really important function for the electricity grid called ‘frequency control’.

When a major coal unit trips, the frequency in the grid can fall rapidly. If it falls too far, the grid can become unstable and fail.

More large-scale batteries are on their way, including a battery linked to a Victorian wind farm and glasshouse at Nectar Farms and possibly an even bigger battery in Queensland. (A state which already has a large share of Famous Big Things.)

The growth in rooftop solar over the last ten years has been phenomenal. Victoria now has more than 1100 megawatts (MW) of small-scale solar panel systems, and they’re playing an important role in reducing peak electricity demand.

The graph below (from The Australia Institute’s Gas and Coal Watch) shows how, on a very hot day this January, Victoria’s rooftop solar:

• Reduced the highest point of peak demand from the grid (at 4pm) by almost 600 MW
• Delayed the moment of peak demand from the grid by almost three hours, meaning the grid was under strain for less time.

Source: The Australia Institute

This rooftop solar is also helping to reduce the cost of electricity by displacing expensive and polluting gas power stations.

Here’s how. To meet moments of peak demand, typically on hot summer afternoons, the grid normally requires peaking gas plants to fire up. These generators can turn on relatively quickly but are expensive to operate, and the costs flow through to consumers. Most of Victoria’s gas generators, for example, only run a few times each year when demand gets very high.

With more rooftop solar shaving off the high points of peak demand, there is much less need for gas peaking plants to turn on, or they will run for much less time. The upshot is fewer price spikes in the wholesale market, which helps lower average prices for consumers.

At any point in time, the electricity market has to balance supply and demand. There are two sides to it, but the media mostly focus on the supply side: coal, gas, wind and solar power plants that generate electricity.

However, often reducing demand is a much better solution than increasing supply.

Rooftop solar is one way to reduce demand and strain on the grid (see Fact 4 above). Another is energy efficiency. While less visible to the public, this unsung sidekick is doing a lot of the hard work, helping families and businesses slash their running costs and cut energy waste.

Energy efficiency simply means using less energy for the same result. In a heatwave, for example, an energy-efficient home will be able to maintain a comfortable temperature with less electricity consumed for air-conditioning.

Improving energy efficiency in a home can cut energy costs by 40 percent – or savings of up to $1,000 per year, based on the average Victorian household.

Many energy efficiency improvements save money in the long run. The up-front cost can be recovered through lower bills in as little as a few years, after which the benefit of lower bills continues into the future.

And it’s not just the public who benefit. Because residential homes and businesses consume so much electricity, getting more energy efficient in the home or at work benefits the system as a whole.

Another measure ramping up this summer is ‘demand management’ or ‘demand-side response’. This essentially involves payments to consumers to reduce their energy use for a short period. The Australian Renewable Energy Agency has an excellent post explaining the concept here.

Want more detail on any of the facts above? Read our full media backgrounder >>