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How much do we have to pay people to NOT use electricity – up to 30 times more?

February 17, 2018

How much do we have to pay people to NOT use electricity – up to 30 times more?

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…

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…

Blowout Week 167

March 12, 2017

Blowout Week 167

There are some people you just can’t hold down. One of them is Elon Musk, who has offered to solve South Australia’s grid problems within a hundred days by installing Tesla utility-scale batteries and not to send a bill if the fix doesn’t work, thereby displaying true confidence in the future of energy storage technology. As a reward for this generous offer he gets to be the feature story in this week’s Blowout.

BBC: Elon Musk offers to fix South Australian power network in 100 days 

Elon Musk, boss of electric car firm Tesla, says he can help solve South Australia’s power crisis within 100 days – and if not he’ll do it for free.

The offer follows a series of blackouts in the state. On Thursday, Tesla executive Lyndon Rive had said the company could install 100-300 megawatt hours of battery storage in 100 days. When asked on Twitter how serious he was about the offer, Mr Musk said if Tesla failed, there’d be no bill. “Tesla will get the system installed and working 100 days from contract signature or it is free. That serious enough for you?” he tweeted in response to Mike Cannon-Brookes, co-founder of Australian software maker Atlassian. Having offered to “make the $ happen (& politics)”, Mr Cannon-Brookes then told Mr Musk: “You’re on mate.” Mr Musk went on to quote a price of $250 per kilowatt hour for 100 megawatt hour systems. The state of South Australia has suffered from blackouts since September last year, leading to a political spat over energy policy. Battery storage is one of several options the government is looking at to help ensure reliable power supplies as Australia grows more reliant on intermittent wind and solar power.

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

Live: SA faces most dangerous day since Ash Wednesday as ‘incredibly dangerous’ bushfire burns NE of Adelaide; crews battle blazes in Victoria – ABC News (Australian Broadcasting Corporation)

January 2, 2015

Live: SA faces most dangerous day since Ash Wednesday as ‘incredibly dangerous’ bushfire burns NE of Adelaide; crews battle blazes in Victoria – ABC News (Australian Broadcasting Corporation).

Firefighters in South Australia and Victoria are battling out-of-control bushfires, with warnings today’s conditions in the Adelaide Hills are the worst since Ash Wednesday more than 30 years ago.

A huge bushfire at Sampson Flat in the Southern Mount Lofty Ranges north-east of Adelaide has already destroyed homes and is expected to turn south fanned by winds of up to 110 kilometres per hour. A major emergency has been declared.

Meanwhile, temperatures are forecast to reach above 40 degrees Celsius in Victoria, hampering conditions for firefighters battling a fire which is threatening Maroona in the state’s west.

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

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