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Clean Power frontier-ppp

Published on January 15th, 2014 | by Giles Parkinson

34

Australian Low Cost Wind Energy — Graph

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January 15th, 2014 by  

Originally published on RenewEconomy

Given that the renewable energy target is going to be the subject of yet another review, and pages and pages of press speculation, commentary and, sadly, misinformation, we thought that these graphs might be useful.

They come from a report prepared by Frontier Economics for the UK government last year, which wanted to know how its support mechanisms for onshore wind energy compared with other countries. There are a couple of key factors at play – the cost of wind energy in any particular location, which can vary due to the amount of wind, construction costs, manufacturing etc, the average cost of electricity in the wholesale market, and the size of the subsidy needed to bridge that gap.

What’s interesting is that it shows that Australia has one of the lowest rates of subsidy of wind energy in the world, and one of the lowest costs of wind energy. Not surprising, given that even the government’s economic advisor, the Bureau of Resource and Energy Economics recently conceded that wind power was now competitive with new build fossil fuel plants.

This first graph shows how Australia competes on wind subsidies compared to other countries. It would largely be made up of the price of the renewable energy certificate. The first graph is calculated on different currencies and their “purchasing power parity” – or PPP – the second is based on market rates.

frontier-ppp

And the second …

frontier-market

These graphs below give an indication of the total cost of wind power, known as total support. Those countries that do not have a “market value” component are those with feed in tariffs, where the entire cost of wind energy is deemed a subsidy, which could be misleading because it merely reflects the structure of their tariffs.

But the interesting point here is that of the 26 leading wind countries assessed, Australia has the cheapest wind power based on PPP, and one of the cheapest based on market rates.

The full report can be found here.

frontier-absolute-wind-power

fronteir-absolute-wind-power

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About the Author

is the founding editor of RenewEconomy.com.au, an Australian-based website that provides news and analysis on cleantech, carbon, and climate issues. Giles is based in Sydney and is watching the (slow, but quickening) transformation of Australia's energy grid with great interest.



  • OutsideofWashington

    I hope this information has been made available to the clowns that run the Government of Ontario that believe in subsidizing the industry here. We have hydro company that tells the government what to do….much like the tail wagging the dog.
    There isn’t an ounce of Margaret Thatcher in our Premier.

  • JamesWimberley

    The “net support” graphs are pretty meaningless. In Brazil say, the entire PPA price for wind electricity is treated as subsidy, which is absurd. Wind is now competitive in Brazil with any alternative for new capacity. The comparison with electricity from old, amortised hydro plants like Itaipu is irrelevant; they can’t be replicated. New dams like the very controversial Belo Monte are on much less favorable sites.

  • Ronald Brakels

    I’m surprised to see that Australia has the cheapest wind power. I would have thought that our higher than average for a developed country interest rates would have caused our wind power to be more expensive. But then we do have excellent wind resources and land is cheap.

    • Jimbo

      Wind & solar power failed, rolling blackout in SA & VIC. Just lucky the state still burning coal in NSW keep the AC on.

      • Ronald Brakels

        BAH-HAHAHA-HA! Good one Jimbo! Actually folks, only Victoria had rolling blackouts on account of the failure of a brown coal generator. Overall electricity spot prices were incredibly low today throughout the National Electricity Market indicating that meeting demand was not a problem. And in tragic and related news large parts of Victoria have caught on fire again thanks to the ridiculous heat. At least we’re getting good use out of the new “catastrophic” fire danger category Fire Services have instituted to cover the beyond extreme fire dangers we’ve been experiencing this century.

        • Jimbo

          Yes prove the point that wind and solar not working to stop the rolling blackouts, Yes the spot price was only around $900 MWh, You were lucky we in NSW sent some good reliable coal fired power your way in SA to backup wind power.

          ESAA and the Grattan Institute argue electricity costs has been exacerbated by the huge uptake of rooftop solar panels, because solar households avoid the high network charges, and don’t pay their fair share cost of the network.

          • Ronald Brakels

            Jimbo, naughty boy. Go look up and write down the actual highest spot prices for each state in the National Electricity Market today. Lying is a naughty, naughty thing to do and you don’t want people to think you’re a fibber, do you? So you’d better put some effort into getting your facts right.

          • Jimbo

            Ok will do,

            The average price as of 15/1/2014 SA was $555.72, Peak running at $839.35.

            Like I said $900 MWh.

          • Jimbo
          • Jimbo

            Hey Ronald what about the
            ESAA and the Grattan Institute argue electricity costs has been exacerbated by the huge uptake of rooftop solar panels, because solar households avoid the high network charges, and don’t pay their fair share cost of the network.

          • Ronald Brakels

            No, it’s about $839. And that’s yesterday, not today, and apparently you were talking about South Australia. Anyway, that’s very good for South Australia. There were no rolling blackouts and a maximum spot price well below the cap. Looking back at the records of similar heatwaves you’ll see that’s quite a low result. If you think some sort of failure happened today I wonder what you must think of the rolling blackouts we had back in 2009 when the state’s wind and solar capacity was a fraction what it is now. Obviously gas and coal failed South Australia. Kind of like how coal failed Victoria today. And all those blackouts before we had any solar or wind power at all – so much failure, Jimbo. It’s enough to make you cry into your vegemite.

          • Jimbo

            I’m a happy little vegemite, bright as can be, reading the ESAA and the Garattan reports tells me that solar and wind power exacerbated electricity cost.

            If solar & wind power was working to lower demand the price would fallen in the heat wave, lowering cost for all. Yes looking back there was no wind & solar power and the price remain low in heat wave.

            The 839 MWh price is huge on the account of wind & solar, most likely that because of the anti-coal power movement, but it was coal energy that save SA from the heat wave and not solar or wind. We know that solar power stop working in hi-temps.

            What we know real energy come from coal, The real truth is solar power could not supply the state needs, nor could solar power supply the home AC, this is a huge issue now how is the state of SA & VIC going to run there AC with fake energy.

            The heat wave proven that the state need to invest in more coal power station because Wind & solar caused rolling Blackouts. Its time to re-think the policy on wind & solar as they only cause Blackouts.

          • Ronald Brakels

            You really are insane, aren’t you Jimbo. And that’s not an insult, that an observation that you’re not connected to reality. Go to someone’s house where they have rooftop solar. Preferably one where they have a little LCD readout on the inverter. Sit there with a notebook and write down how the solar system performs throughout the day and see whether or not it contributes to air conditioning load or provides electricity when it’s hot. If the people there ask you what you are doing show them this comment on the internet.

          • Jimbo

            Quite obviously that won’t work, because I tried hooking up a Grid inverter to the Aircon and in switch on nothing happened…
            Then I fed a small narrow current from the main to the 10kw grid tied inverter, 8kw solar array to a 5 kW air conditioner.
            Upon receipt of that, the outcome was, the grid inverter shutdown, failed to start the Aircon, the voltage collapse to 0 volts and smoke poured out of the inverter. It’s quite obviously smoke and mirrors technology without surge power capability.

            And upon what happened yesterday in the heatwave there was no dispatch energy from renewables when placed under load. The facts speak for it coal energy prop up the grid from collapsing and not on the counter coal energy that failed, but on the account of renewables energy failing to prevent blackout with smoke and mirror technology.

            I do hope they do shutdown more coal generators so the facts will speak for it self.

            Paying utility company $13 a kilowatt hours a good price to be paying under renewables on a smart meter.

            Looking at a liquid crystal display doesn’t prove anything you got to do the experiment like I did to prove whether it works quite obviously it failed.

            If you do some research on grid inverters companies all state they’re not capable of driving any loads like ACs unit on there own without the main grid to back up with the surge power capability from coal baseload energy.

          • Ronald Brakels

            So you think that one in five private residences in Adelaide with solar, most of which have air conditioning have fried smoking, or previously smoking inverters? Germany and Italy and plenty of other places must also be riddled with charred inverters. You see – this is what I mean by insane and not connected to reality. You really should get that seen to.

            Personally I am proud of the fact that South Australia’s rooftop solar capacity provided about 13% of total electricity use at noon and at least 5% of total electricity use from the peak demand period from five to six pm. All the electricity it provided was not sold on the NEM and did not raise spot prices and it was generated exactly where it was needed and did not put any strain on transmission infrastructure.

          • Jimbo

            You fail understand power generation, surge watts on demand.

            Grid inverter don’t do this, there is no store energy store inside a grid inverter to supply surge current to startup AC units with out baseload as the surge.

            CBS 60 minute reported & proven that 150 billion spent on renewables was a failure, just like in Germany and Italy renewables.

            Why don’t you disconnect from the main grid and try to run the AC unit off your solar panels to power your home 24/7.
            Why are depending power company main grid if solar power is working, what off grid don’t work? because you could not run an AC unit without the main grid.

            Yes I recall SA fair Trade department report large number of grid inverter that failed (smoked up) most of the inverter failed with week of operation.
            Also recall that power provider stated solar power caused dirty power in SA. solar power cause high voltage, hot spot in wiring, leading to solar house fires,damage other people appliances without solar power.

          • Ronald Brakels

            So according to you not only are Adelaide, Germany, Japan, California, New Jersey, etc. fire ravanged disaster zones, you are telling us that Australia’s thousands of solar powered off grid air conditioner units simply don’t work. That’s an interesting belief to have. From a clinical perspective, that is. Do you realise that you are also saying that it’s not possible to run an air conditioner off a generator? You know, you really should ask the university that gave you your degree in electrical engineering for your money back.

          • Ronald Brakels

            And I see that the electricity spot price in South Australia is now zero and we’re exporting electricity to Victoria. It is of course wind energy that has pushed the spot price down to zero as the sun isn’t shining at the moment, but maybe I shouldn’t have mentioned that as we may now be regaled with tales of how wind farms across the world are constantly exploding into flame.

          • Jimbo

            My engineering degree is not in question; it’s quite obvious that this week’s events have not lived up the expectation for that green movement, although you’re proud of your wind and solar you have the highest electricity cost in Australia.
            Renewable certainly has not driven down the price nor fill the void as seen on Tuesday where the spot price hit $13,000 megawatt hour = $13 kilowatt-hour.

            False sense of security and rooftop solar panels deployment of has not secured the energy need; the NEM reported a number of emergency alerts.
            In response of those emergency alerts the market was unable to supply the required energy as it did in previous years, resulting in rolling blackouts.

            Yes you’re talking about something in excess of 15-30 kW diesel for small air-conditioning unit running 6kw average to be off grid that was not my point. It is those with grid solar power of houses that have installed those large over 16 kW air conditioning units.

            I may my point very clear to you that you cannot run you’re air-conditioning directly off your grid solar panel, without the fossil fuel energy sources as base load.

          • Jimbo

            It’s quite obvious that Adelaide became the next Detroit of Australia

            Holden & Ford could not afford to manufacture in South Australia high cost electricity placing both company at a disadvantage to Asia low-cost energy production.
            It’s just unfortunate Holden and Ford builds their manufacturing industry in the wrong state.

            What about those reports South Australia has the highest default payments on electricity accounts, because wind and solar driven the cost sky high to those manufacturing industries.
            In such a short time of this renewable energy deployment I never have seen such massive exodus from South Australia of manufacturing industries sign of the times.

            And we still return to the main point that we argued in the beginning there is no energy security under wind and solar proven this week, a total failure for Victorian , South Australian.

          • Ronald Brakels

            Jimbo, another example of your disconnection from reality, we are not arguing, you are telling me your delusions and I am laughing at you. In order for us to have an arguement we’d have to have some agreement on reality. But you’re not able to see reality, are you? You are confusing reality with your desires and emotions. For example, you can’t even admit that you were wrong to say that spot prices reached $900, can you?

          • Jimbo

            Sure Ronald bring back to reality, to say that the heatwave didn’t happen your not in reality. The Average price run at: SA $555.72-$839.35. that a record, Tuesday where the spot price hit $13,000 megawatt hour = $13 kilowatt-hour.
            NSW run Average on the same day of $ 68.10-$76.20 that is reality, if renewable was working SA why did the price peak so high compare to NSW a bigger state?

            One answer renewable didn’t fill the void, nor supply demand, nor lower the cost, this why ESAA and the Grattan Institute argue electricity costs has been exacerbated.

          • Ronald Brakels

            I see the evidence so far is that you can not admit that you were either lying or stupid or perhaps just misled when you said spot prices reached $900.

          • Jimbo

            As I say before evidence set before you NEM “The Average price run at: SA $555.72-$839.35. that a record, Tuesday where the spot price hit $13,000 megawatt hour = $13 kilowatt-hour.”

            You just dam stupid if don’t understand that? or are you saying that NEM is lying on figures.

          • Ronald Brakels

            I’m saying you appear unable to admit that you were wrong to say it was $900 when it was $839. You even provided a link showing you were wrong to say $900 but you can’t seem to get around to admitting it.

          • Jimbo

            I did provided a link it was right, right!. looking again at the link there was no spot price at Zero.

            Pointing out you said the spot price is now zero $0.00 you didn’t provided a link ? free electricity ?

            Perhaps you are more concern that renewable didn’t fill the void, nor supply demand, nor lower the cost and reach the Cap rate set, and the spot price is not zero.

            I’m a happy little vegemite, bright as can be.

          • A Real Libertarian

            “I’m a happy little vegemite, bright as can be.”

            Being smart as fungus is not something to be proud of Mark.

          • Jimbo

            Just maybe you can show me the spot price is zero. Ronald have a link issue.

            Beside what Ronald said the cap rate will have to change this year, it’s way to low.

          • Ronald Brakels

            Jimbo, you said the price was $900 and you provided a link that showed you were wrong to say that. You wanna try to touch base with reality this one time and admit you were wrong to say that? It’s something you’re going to need to do to build this thing called credibility.

          • Jimbo

            You first show me the spot price is at zero.?.

          • Ronald Brakels

            Jimbo, you’ve already shown me that you were wrong to say $900. I want you to show me that you can look at something that’s outside of your head and tell me that we both see the same thing. If you can’t do that, then how can I show you something and know that you’ll see the same thing as me?

          • Jimbo

            Ronald, What are you going on about? you said the spot price hit zero, is there a link or not to your claim?

            I provided a link it was right, right!, It’s called credibility.

            Yes it’s hard for you to admit your wrong on the zero price.

            Have you run out of vegemite.

          • Ronald Brakels

            Yes Jimbo, it’s clear that you’re brimming with credibility. Anyone who reads your comments here can see you are the very personification of credibiliity. I’m sure some nice Swiss men in crisp white coats will be along any time now to give you your Noble Prize in credibility.

  • Adam Devereaux

    Further evidence that the specifics of incentives for renewable energy are very important for countries to get right at this point of the game.

    Policies need to incentivize market competition and lowered installation cost and effective production.

    This being one reason that I preferred the wind PTC versus solar’s ITC. You start getting perverse situations such as solar lease companies inflating installation cost to Pad their bottom line.

    Look to countries with large successful markets with lowest install costs as models. But be mindful that policies that were needed 5 years ago may be inappropriate now.

    The danger being that improper incentives will create an unsustainable market as well as provide legitimate fodder for RE opponents to claim the technology is unsustainable without inappropriate subsidy.

    Which is why I think Japan will need to be aggressive with their tariff reductions.

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