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To understand the real value of electricity, consider the price at which people will give it up. “Demand Response” is the nice euphemism for a voluntary blackout. At what point do people volunteer to go without? For most of the market, apparently, it’s more than $7500/MWh.

If I read this graph correctly, look how fast the prices rise, and how small the response is. For example, in South Australia there is only about 10MW available at less than $300/MWh? (From this AEMO report). For reference the total SA demand is around 1500MW. So 10MW is less than 1%.

AMEC report, 2017, Demand Response in the NEM, Electricity, costs, graph, Australia.

(See below for the

Consider how few people are willing to turn the electricity off:

AEMO expects there to be approximately 50 MW of demand response in NSW when the price reaches $1,000/MWh.

The total size of the NSW state market is about 10,000MW. Retail electricity sells for $250 — $470MWh (and only $100/MWh in the US). Hence when the price hits two to four times the normal retail cost of electricity, only about 5% of the market say they will willingly stop using it. When the price hits $7500MWh another 2% will give it up. We can’t take this reasoning too far, but the message is clear that the pain of giving up electricity costs a lot more than generating it. Demand is “inelastic”.

Electricity generation creates wealth. People value the product far above the cost of production.

We could raise prices but business locations are “elastic”….

Here’s the text to go with the graph from that report:

Demand response observed to date

A 2016 survey for the AEMC suggested that there is at least 235 MW of demand response capability under contract to retailers, mostly involving exposure to the wholesale market spot price, with more demand response contracted to specialist demand side-management companies.

…click on the above link to read the rest of the article…

Another Massive Blackout Struck Puerto Rico Last Night

February 12, 2018

Another Massive Blackout Struck Puerto Rico Last Night

Last night, an explosion at a San Juan power plant regressed Puerto Rico’s efforts to restore power to the island five months after Hurricane Maria struck a massive blow. Much of Northern Puerto Rico has suffered another blackout, including the capital city.

The island’s Electric Power Authority said several municipalities were without power, including parts of the capital, San Juan, but they were optimistic it could be restored within a day as they worked to repair a substation that controls voltage…

…It was not immediately known what caused Sunday’s fire, which was quickly extinguished. Officials said the explosion knocked two other substations offline and caused a total loss of 400 megawatts worth of generation. (source)

Before this explosion, more than a million people were still without power from the Category 4 hurricane that struck the island on Sept. 20, 2017. They’ve been thrown back in time by a hundred years, with no power, no running water, and damaged homes.

This is a prime example of how disasters aren’t just one-time occurrences. They’re very often followed by subsequent disasters.

Think about it. Fires are often followed by floods which are followed by mudslides and sinkholes. (See California for reference.) The tsunami in Japan was followed by a nuclear plant disaster. Hurricane Harvey in Texas had storm surges and floods that caused a chemical plant to explode a few days later. Now, this already-stressed infrastructure has crumbled again under it’s increasing demand.

Power has been restored to a few critical locations.

This is one situation in which living in a more populated area can benefit you. After last night’s explosion, workers were quick to restore power to specific locations.

By late Sunday, electricity workers had been able to restore power to key locations, including the Luis Muñoz Marín International Airport in Carolina, as well as the Medical Center. (source)

…click on the above link to read the rest of the article…

Peak heat: Electricity prices lifting off; industry shutting off in Australia. Hospitals switching off lights, “Code Yellow Alert”.

January 19, 2018

Peak heat: Electricity prices lifting off; industry shutting off in Australia. Hospitals switching off lights, “Code Yellow Alert”.

UPDATE: MELBOURNE hospitals are enacting emergency procedures to prepare for the potential loss of power. Hospitals are switching off non-essential electrical equipment, including some lights, to minimize energy use. This is a “Code Yellow” alert asking hospitals to check their back up generators are ready. The Victorian Minister insists this is not about the “threat” of blackouts, but because hospitals need to be “good corporate citizens”. Pull the other one. At the very least, this is about reducing electricity bills. h/t Chris in Harvey Bay.

See further UPDATES on “The art of blaming coal” at the bottom.

How much fun can you have? The AEMO (Australian Energy Market Operator) projects that as temperatures hit 42C in Victoria, prices are forecast to rise over 100 fold. The AEMO is furiously busy issuing market notices.

The ABC tells us it is 42C, that Portland Alumina has reduced production, but for an ‘undisclosed price’ (why can’t taxpayers know what they are paying this group, not to produce aluminium today?) Meanwhile the AEMO has put the RERT plan into action: “Under the RERT scheme, AEMO has contracted 884 megawatts of “demand side response” across Victoria, NSW and South Australia.” Translated, that means the AEMO has organised 884MW of controlled blackouts to prevent the system breaking. What’s the cost!

For the next three hours Victoria is short of reserve by an eye-watering 1090MW. There is an Actual Lack of Reserve, level 1 (LOR1): “The Actual LOR1 condition is forecast to exist until 1800 hrs. The contingency capacity reserve required is 1120 MW. The minimum reserve available is 32 MW. “ South Australia has been upgraded to a LOR2 (2nd level) requiring 350MW but having only 32MW available. (Why the exact same number?). The next level up, LOR3 would mean “unexpected load shedding blackouts are likely.“

…click on the above link to read the rest of the article…

Summer heat — electricity prices hit cap of $14 per KWhr in SA, almost there in Victoria

January 18, 2018

Summer heat — electricity prices hit cap of $14 per KWhr in SA, almost there in Victoria

Watching the AEMO dashboard as a hot summer day hits

Is this the summer crunch-time that the the National Grid managers have been fearing?

Today things are not running smoothly in the green states of Victoria and SA where prices this minute have hit $14,000 per MW hour, or $14 per KWh. These are wholesale prices. Right now heads of major industries are watching the dashboard, turning off everything they can turn off, or switching on the diesel generators, or counting hundreds of thousands or even millions being added to their bills if production cannot stop.

Demand Management schemes (a form of load shedding) will be running to reduce demand — air conditioners will be remotely switched down.

How much of the productive brain power of Vic and SA is distracted from more useful tasks today?

The AEMO has put out an Actual Lack of Reserve Notice (LOR1) saying that Victoria is 300 MW short: “The contingency capacity reserve required is 1100 MW. The minimum reserve available is 815 MW”. Another notice of a “non-credible contingency event” (a code for “something broke”) reports that a busbar, transformer, and line have tripped or opened in Victoria, unplanned.

Victoria

…

SA

SA AEMO electricity prices, Jan 18th. Graph.

…

The notices and forecast for tomorrow are worse

With a few hot days in a row, as buildings get warmer and tempers get shorter, people use more electricity. Hence even if temperatures don’t rise, the longer a hot spell goes, the higher the electricity demand.

This is the 30 minute graph including price and demand, and the forecasts for tomorrow. As far as I can tell, often the shocking forecasts which look like being 3 solid hours of $14,000 electricity will instead resolve to smaller shorter spikes. But millions of dollars of productivity is likely to be burned.

Victoria

…

In SA:

…

Inconvenient Bill: Electric cars may lower your fuel bill, but make electricity, jobs, lifestyle, unaffordable

January 17, 2018

Inconvenient Bill: Electric cars may lower your fuel bill, but make electricity, jobs, lifestyle, unaffordable

The electric car push is on. Sadly, what people save on petrol bills looks like it’s going to be spent on electricity or tax.

Steve Goreham outlines the international push to get our cars and heaters electrified. But the dark alter-implication of electrification is renewables. (No point in driving a coal driven car.) It follows then, that electrification of everything that isn’t already electrificated, will mean more solar, more wind, and then more decimal places on your electricity bill. Welcome to the Bermuda triangle of cost savings in a subsized-mandated-unfree-market. The more you save, the less you have.

We all know wind power is “free”, but somehow costs seem to keep rising in places with more wind power. It’s so unfair:

Inconvenient Factoid: Electricity prices in most top “wind” powered US states rose 2 – 7 times faster than in other states

Read and weep Australians. Pedal faster:

“…on average US electricity prices increased less than five percent during the eight years from 2008 to 2016″

Some US consumers are still paying rates in single digits.

For contrast, the Australian situation, is pathos and bathos simultaneously:

Australian households are paying 60 per cent more for their power than those in the US and double their Canadian counterparts after enjoying the third-lowest electricity prices of any OECD nation a decade ago. — Simon Benson

See the graph. Please someone tell me why Texas prices have fallen. Is that shale oil I see? Wikipedia tells me “Texas produces the most wind electricity in the U.S., but also has the highest Carbon Dioxide Emissions of any state.” Ahhh. — Jo

…click on the above link to read the rest of the article…

This and That Vol. 4–Mid Winter Musings

January 16, 2018

THIS AND THAT VOL 4 – MID WINTER MUSINGS

Probably the one topic Mrs. Cog and I return to more often than any other is our amazement how so many people who profess awareness and understanding of the coming chaos and hard times remain firmly rooted in their present situation. Despite acknowledging the runaway train barreling down the tracks directly towards them, they do little to nothing to get out of the way.

They know they are dependent upon a failing state for most, if not all, of their needs. Whether it is food, water, sewer, electricity, security, employment, whatever area we wish to examine, they remain tragically dependent upon a failing state to ‘not fail’ in order to continue to provide what the failing state soon will be unable to supply.

The thing is, there is no particular reason we can point towards as the reason for remaining shipwrecked and locked in the winter ice, slowly crushed by the ever thickening, shifting, grinding mass surrounding us.

This is not to say one can escape in totality from the insanity. There remains no ‘new world’ to travel to for a fresh start. Or at least none that is conveniently located within two miles of a grocery store, mall, movie theater, schools, Home Depot and Starbucks.

And therein is the rub and possible the central reason why people simply won’t get off the tracks. The railway we lay upon leads directly to all the conveniences so many of us take for granted that they are no longer wants, but bleeding needs.

We are so thoroughly entangled by and dependent upon our consumer culture that it is unthinkable to voluntarily withdraw from what we believe nurtures and sustain us. We are main-lining our own poison in every way imaginable and it’s killing us softly.

…click on the above link to read the rest of the article…

How Chile’s electricity sector can go 100% renewable

January 3, 2018

How Chile’s electricity sector can go 100% renewable

If pumped hydro plants that use the sea as the lower reservoir can be put into large-scale operation Chile would be able to install at least 10 TWh of pumped hydro storage along its northern coast. With it Chile could convert enough intermittent solar into dispatchable form to replace all of its current fossil fuel generation, and at a levelized cost of electricity (provisionally estimated at around $80/MWh) that would be competitive with most other dispatchable generation sources. Northern Chile’s impressive pumped hydro potential is a result of the existence of natural depressions at elevations of 500m or more adjacent to the coast that can hold very large volumes of sea water and which form ready-made upper reservoirs.

Valhalla’s pumped hydro plant

My recent review of the Valhalla solar/pumped hydro storage project is what set me to wondering how much untapped pumped hydro potential there might be in Northern Chile, so I begin with a brief recap of pumped hydro potential there.

Valhalla’s project layout map shows its two upper pumped hydro reservoirs (they will be connected by a canal) occupying two natural depressions at around 600m elevation and about seven kilometers from the sea. According to Valhalla they can hold at least 25 million cubic meters of sea water and according to my estimates about 15 gigawatt-hours of stored energy:

Figure 1: Valhalla’s pumped hydro project layout

The question I had was how to go about identifying other prospective pumped hydro reservoir sites in the area, and the best tool at my disposal was Google Earth. So before beginning my search I checked to see whether I could duplicate Valhalla’s reservoir outlines and volumes from Google Earth, which in Northern Chile uses good-quality imagery and gives spot elevations to the nearest foot.

…click on the above link to read the rest of the article…

Welcome to renewables world: Australia plans for blackouts, throws billions of dollars, but ABC says it will get “cheaper”

December 21, 2017

Welcome to renewables world: Australia plans for blackouts, throws billions of dollars, but ABC says it will get “cheaper”

The fear is palpable

How much fun can you have living in a global experiment? In Australia, peak summer is about to hit in a post-Hazelwood-electricity-grid. We’re drowning in electricity news as summer ramps up. Everyday there’s another Grid story in the press, and a major effort going on to avoid a meltdown. Minister Josh Frydenberg announced today that “we’ve done everything possible to prevent mass blackouts”. Or as he calls it, a repeat of the South Australian Horror Show. Politicians are so afraid of another SA-style-system-black that they are throwing money: The “Snowy Hydro Battery” will be another $2 billion. Whatever. It’s other people’s money.

This is what they are afraid of:

The red bars mean “Reserve Shortfall”. The dark blue matter is “Generation”. The graph covers two years (sorry about the quality) so the two red bursts are summer 2018 and summer 2019.

SA MEdium Term Forecast, Outlook, AEMO, Mt PASA. Australian national electricity market, 2017, South Australia, Graph.

SA Medium Term Forecast, Outlook, AEMO, Nov 16th 2017, South Australia.

Oddly we are headed for a critical time, but this’s the most recent graph I can find — thanks to Wattclarity – from November 16th, 2017. (Here’s an earlier version from March 2017. and from Dec 2016). Perhaps there is a newer kinder forecast, but curiously the AEMO Medium Term Outloook page isn’t working “til early 2018″. Hmm? Odd time to take it down.

The words in that top box (rewritten below*) indicate they do a new outlook every two weeks, but I can’t find one on the Wayback Machine, or Google Cache. Perhaps you can? Please let me know.

Australian electricity prices forecast to rise and fall at the same time

The ABC tells us prices look set to fall:

…click on the above link to read the rest of the article…

VIDEO: What Everyday Life Is Like in Puerto Rico Now

December 15, 2017

VIDEO: What Everyday Life Is Like in Puerto Rico Now

In Puerto Rico, everything has changed since Hurricane Maria struck nearly 3 months ago.

Many people have no running water. And if they do, it can’t be consumed without boiling.

There’s no electricity in many regions.

Supplies are scarce.

I’ve written about the SHTF aftermath in Puerto Rico, both the day after the storm, a week after, and a couple of months later. But while there is a lot of good information in all those articles, it’s just words on a page.

The video below brings it to life. This is what life looks like for people who have just watched everything be turned upside down by Mother Nature.

Transformation glitch? Biggest issue facing South Australia is electricity say 70%

December 11, 2017

Transformation glitch? Biggest issue facing South Australia is electricity say 70%

A Sunday Mail survey (paywalled) shows that despite SA having more “free, cheap and clean” renewable electricity than just about anywhere in the world, the number one biggest issue for most South Australians is … “electricity”. And despite all the renewable jobs created, the second most common concern is “jobs”. Going for the Paradox-Trifecta: most strangely of all, with elected leaders who are leading the largest energy transformation since civilization began, the third “biggest issue” facing South Australians is “political leadership”.

Thanks to Eric Worrall, who describes South Australians as “the world’s renewable crash test dummies”.

Survey, South Australia, 2017, biggest concerns, results. Graph.

…

SA has an election coming up in March, but at the moment voters there are caught in the bind between the reality of electricity shocks, and the belief that “renewables are cheap”. Will the local Libs (the opposition) have the spine to stand up and speak the truth and make this election about energy and climate, or will they pander #metoo, and lose the unloseable?

Will the Libs get the message here? Most South Australians like the sound of renewables, but when it comes to the crunch, and the issues they will vote on, electricity prices and jobs will rule. This is a bubble ripe for the popping. As for political leadership — sucking up to global bullies and namecalling parasites is not leadership. Speaking up against the dominant paradigm and against the fashionable memes is. Saying things that are unpopular but true is leadership.

As long as Liberals wait for the opinion polls to change (and produce even more obvious results than this) they are not leaders.

In agenda-setting results on a cornerstone issue for the March state election, more than 3500 respondents overwhelmingly ranked affordability and reliability as the most important components of electricity supply in the Sunday Mail Your Say, SA survey.

…click on the above link to read the rest of the article…

What Life Is Like for a Million People in Puerto Rico Who STILL Don’t Have Power

December 4, 2017

What Life Is Like for a Million People in Puerto Rico Who STILL Don’t Have Power

If you ever wondered what it would look like if the grid collapsed here on the mainland, the island of Puerto Rico is a tragic, real-life case study. These stories show us what life is like for more than a million people who STILL don’t have power and running water nearly 3 months after Hurricanes Irma and Maria devastated their communities.

According to a website showing the status of utilities on the island, four months after two hurricanes wrought havoc, 32% of Puerto Ricans are still without power and nearly 10% are still without running water. However, even those who have running water must boil it.

But statistics don’t tell the real story.

At first, it was a war zone.

In the first days after the grid went down, chaos ruled. I vetted as many of the stories as I could and concluded:

…there is very little food, no fresh water, 97% are still without power, limited cell signals have stymied communications, and hospitals are struggling to keep people alive. There is no 911. Help is not on the way. If you have no cash, you can’t buy anything. As people get more desperate, violence increases. (source)

A friend wrote this post about her family on Puerto Rico:

“My family has lost everything. My uncle with stage 4 cancer is in so much pain and stuck in the hospital. However, conditions in the island are far worse than we imagined and my greatest fear has been made reality. The chaos has begun. The mosquitos have multiplied like the plague. Dead livestock are all over the island including in whatever fresh water supplies they have.

…click on the above link to read the rest of the article…

The Asymmetry of Bubbles: the Status Quo and Bitcoin

November 30, 2017

The Asymmetry of Bubbles: the Status Quo and Bitcoin

Shall we compare the damage that will be done when all these bubbles pop?

Regardless of one’s own views about bitcoin/cryptocurrency, what is truly remarkable is the asymmetry that is applied to questioning the status quo and bitcoin. As I noted yesterday, everyone seems just fine with throwing away $20 billion in electricity annually in the U.S. alone to keep hundreds of millions of gadgets in stand-by mode, but the electrical consumption of bitcoin is “shocking,” “ridiculous,” etc.

Since the U.S. consumes about 20% of the world’s energy, we can guesstimate the total amount of electricity wasted on stand-by and similar sources of waste is more on the order of $100 billion annually.

What’s shocking and ridiculous is that upwards of $100 billion in electricity is squandered globally annually on stand-by devices and other painfully obvious sources of waste. But this attracts essentially zero concern or commentary. Do you notice any asymmetry in the scrutiny being applied to the status quo and to bitcoin et al.? The status quo– wasteful beyond measure–is just fine: nobody questions the staggering waste built into the status quo, from hundreds of millions of devices consuming electricity but doing no work to hundreds of millions of vehicles idling in traffic for hours each and every day across the globe–nope, the really big issue is bitcoin / blockchain consumption.

Does anyone question how much electricity the vast server farms of Google and Facebook consume in order to serve up adverts and store photos of puppies and kittens? And how about the energy consumed by the NSA and the dozens of National Security agencies that have proliferated over the past 16 years? How much coal gets burned to serve adverts, archive photos of puppies and kittens, and store billions of emails, phone calls to Aunt Sadie, etc. for future analysis?

…click on the above link to read the rest of the article…

SELLING OUT OF PRECIOUS METALS & BUYING BITCOIN…. Very Bad Idea

November 22, 2017

SELLING OUT OF PRECIOUS METALS & BUYING BITCOIN…. Very Bad Idea

There is a new trend by individuals in the alternative media community who are now selling out of precious metals and buying into Bitcoin and cryptocurrencies. While this may seem like a good idea, especially when Bitcoin and the cryptocurrencies reach new all-time highs, it is likely a big mistake. Now, I am not saying that individuals shouldn’t invest in cryptocurrencies. Rather, it’s a lousy idea to sell all of one’s precious metals holdings and put it all into Bitcoin and cryptocurrencies.

Recently, Sean at SGTReport published a short video in which part of the headlined was titled as “SILVER BULL CAPITULATES.” In the video, Sean explains how past frequent guest and precious metal analyst, Andy Hoffman, has sold out of all his silver and is now only in Bitcoin and gold. Andy explains in his interview on Crush The Street that he sold all of his silver this summer as he really has no interest in it. He goes on to say, “Because, in a digital age, I just don’t believe people are going to store thousands of pounds of silver hoping that the gold-silver ratio is going to come down.”

I have to tell you, not only do I find this sort of thinking, utterly preposterous, I also find it quite troubling that analysts who have been promoting precious metals for the past decade are now implying that gold and silver are no longer high-quality stores of value. I disagree entirely with this faulty and superficial analysis.

There are several reasons why I believe it is essential to hold most of one’s wealth in precious metals than in Bitcoin and cryptocurrencies. However, the most important factor has to do with the fragile nature of a highly technical complex system that allows Bitcoin and cryptocurrencies to function.

…click on the above link to read the rest of the article…

Implementing the Helm Review on the Cost of UK Energy

November 17, 2017

Implementing the Helm Review on the Cost of UK Energy

The UK Government has made a call for evidence on the Helm Review published on 25th October 2017. At the time the review was published I chose not to share my opinions on the consequences of implementing Helm’s proposals since I believe these may be far reaching and have a large negative impact on UK citizens, businesses and the economy. At the time I did not want to upset the apple cart since I also believe Helm offers the best path forward for so long as the UK Government remains committed to its 2008 Climate Change Act (CCA). Helm’s proposals will deliver sharply higher energy and electricity prices, carbon reduction and hopefully a functioning energy and electricity system and market. Muddling along as now will also deliver sharply higher prices with no guarantee of carbon reduction and the near certainty of a broken and dysfunctional energy system.

[Inset image is the Coire Glas pumped storage hydro scheme in Scotland, designed to store surplus wind power and provide 30GWh of storage. Still empty after all those years, Coire Glas stands as testimony to renewable fantasy colliding with thermodynamic and economic reality.]

Energy is More than Electricity

Helm’s review was on the cost of UK energy, which encompasses oil, gas, coal, nuclear and renewables. While his review is focussed on electricity he does make sufficient reference to these other energy sources to make clear that his recommendations apply to the whole energy system.

[Inset image is the Coire Glas pumped storage hydro scheme in Scotland, designed to store surplus wind power and provide 30GWh of storage. Still empty after all those years, Coire Glas stands as testimony to renewable fantasy colliding with thermodynamic and economic reality.]

…click on the above link to read the rest of the article…

Centrally Planned UK Generation Scenarios for 2030

November 8, 2017

Centrally Planned UK Generation Scenarios for 2030

The economies of the European Union have centrally planned energy delivery strategies where the amount of electricity to be generated from a particular source by a particular time is planned in minute detail by legions of civil servants and academics.

This post summarises some of the scenarios for 2030 from The UK Committee on Climate Change and discusses the consequences for the grid, companies and consumers.

Dieter Helm’s recent independent review into the UK’s Cost of Energy (big pdf) provides a stark reminder of the scale of State intervention into the electricity generation sector. Figure 1 (Helm p40) summarises the various State sponsored organisations involved.

Figure 1 17 State-sponsored organisations involved in the centralised planning and delivery of UK electricity supplies.

Helm also reminds us of the Committee on Climate Change (COCC) plan for the UK 2030 (Figure 2) which forms the basis of the analysis presented in this post.

Figure 2 The plan for the fifth carbon budget ~ 2030 (Helm p11) showing scenarios for installed generation capacities.

With four scenarios offered, and 12 months/year to analyse, this presents a total range of 48 monthly scenarios to evaluate. In this post, I have reduced this to 4 monthly scenarios looking at the High Nuclear (High N) and High Renewables (High RE) scenarios for the months of January and July.

Notably the COCC has a low electricity demand scenario simultaneous with the policy of electrifying motor vehicle transport and heating.

…click on the above link to read the rest of the article…

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