Why is Tasmanian wholesale electricity price the highest in the NEM?

My chart of 10 day smoothed daily AEMO prices shows that Tasmania has been the NEM price pusher for over a month now and was also near the top of the price skein through much of 2017.
My attention was guided to Tasmania by seeing our PM on TV news offering Commonwealth largesse in Hobart and he mentioned Tasmanian renewable energy and the “Battery of the Nation” project that he seems smitten by. Note there is a State election looming and the Liberal Govt is behind in polls. “Battery of the Nation” seems to be a scheme for the State to bludge more money out of Canberra to increase wind power, pumped hydro and general hydro. Facts are Tasmania is a large importer of power now with average net imports of 5,761 MWhrs per day which is ~23% of demand (see figures in Table for Mar and Apr 2017).

So a fiscally sensible Fed. Govt. would say to Tasmania – look you are big importers of electricity now so you are far from being the “Battery of the Nation” in fact you are one of the “importers of the Nation”. Contact us again when you develop your own projects and your electricity supply situation is near import/export neutral.
I am trying to get data for all 2017. Does anybody have costings for the “Battery of the Nation” boondoggle which is probably on a par with Snowy 2.0 in the $5 to 10Bn range of extra Commonwealth debt.

16 thoughts on “Why is Tasmanian wholesale electricity price the highest in the NEM?”

  1. When ideological obsession transcends all else, as with Turnbull and and his progressive Left cheer squad, affordability and reliability of supply are of little importance.  And as the PM well knows whether its the Snowy 2.0 or Battery of the Nation feasibility studies complete with glowing endorsements can easily be had simply by paying for the best professional opinion money can buy.
    Paul Miskelly and Tom Quirk concluded recently that for SA alone a battery storage capacity of 270GWh would be required to support a fully renewables powered grid.  This would cost between $60 and $90 billion, assuming sufficient wind/solar capacity is available to provide charging power which certainly isn't the case at present.
    Unfortunately as you point out Hydro Tasmania has been struggling to keep the lights on in Tassie lately.  Whether it's the junking of the strategically critical gas generation station near Launceston or the ham-fisted overloading leading to failure of their Basslink umbilical with the mainland, they seem to be clueless.  So while Tassie is probably better placed than the mainland states when it comes to existing hydro sites and prospective sites for pumped storage developments the likely cost of integrating such a grandiose scheme would be astronomical and technically fraught.  Think of why the Chinese giant Shenhua gave up a few years ago on turning King Island into one giant wind farm in spite of the multi millions on offer in the form of RET subsidies, it might give you a clue that all is not rosie-red in the apple Isle.  Think of the cost of say three or four new Basslinks, think of the yet to be achieved technically feasible means of operating a zero inertia renewables powered grid and think of the astronomical cost of carpeting much of south eastern Australia with tens of thousands of additional wind turbines.

    The trouble with short term political opportunists is that long after the likes of Turnbull, Andrews and Weatherill have retreated into the sunset to enjoy their dotage, the poor power punter and tax payer must pay for their opportunistic stupidity.

  2. Couple of screenshots this morning from AEMO illustrate how Tasmanian prices are so often high. Remember Tassie Hydro is State Govt owned and dominates the Tas market.
    I would ask of the 1st frame at 705am why “so much higher”. Do you have to be ~65% above other States to buy power for Basslink?? Would a bid of say $70 got you no spark?

    The 2nd frame 5mins later at 715am and Tas price has rocketed to +$12,000 – so was somebody asleep at the console? Away getting a coffee? Or was this a deliberate and planned balancing of some column of numbers to get some required daily outcome? Possibly related to keeping Tassie power bills at some desired level related to the monster Hydro debt. As I have said before – there would need to be a savvy Royal Commission run by electricity supply engineers to get near the truth for the poor mug people.

  3. Wave power on shores facing the prevailing Westerlies has the huge advantage over wind that waves don’t vary much (except summer to winter). Thus is the most reliable renewable energy source in temperate zones.

    But major technical issues remain before we can just stick one in the ocean and switch on the lights.

  4. Wazz,
    Isn’t it so instructive that the spikes are in the two States which have been shuttering their coal and have the highest wind penetration? No surprise to the informed, of course, but not something any of the general public are ever made aware of.

    The exception, of course, is Tas with its hydro. It has been virtually maxing-out the Basslink cable all day long. I haven’t kept up with rainfall levels in Tas recently, but one wonders whether they are going to make the same mistake as a couple of years ago, when they emptied their dams to grab the easy mainland dollars.

  5. Speculative but maybe Tassie is sailing close to capacity limits and calling on high cost generation such as OCGTs, Diesels or maybe even emergency reserves of hydro?? If the bass cable is close to capacity this could be their only option. I don’t know the name codes for the various Tassie gen units but I expect they are all part of this current AEMO dispatch SCADA report. Review of the relevant 5 min. time blocks may reveal what high cost unit(s) have been loaded:

    Off topic but I think this blog post by Dr. Roy Spencer: www.drroyspencer.com/2018/01/sydney-heat-and-bomb-snowstorm-pimped-out-for-climate-change/
    is quite relevant to your recent post, “50°C in Sydney region 1939 – perspective on recent heat”:

  6. As I recall, Old Joh used to get mocked for all kinds of statements.

    However “They’re all coming to Queensland” may get a re- run
    [ at least until the the wind farm virus & AGL gaming starts to bite].

  7. Until recently Hydro Tasmania published a valuable report on the state of its hydro dams.
    It was updated every Monday morning and among other important details such as dam capacity and associated generator outputs, it reported the current dam levels (as percentage full), and whether each dam was rising or falling.
    A visit to the original link now brings up the message –

    “Sorry, this page is off the grid.”

    Why is this valuable source of information now being denied?
    If one substitutes “Tasmania” for “this page” in the message above we might be getting be a warning of what is ahead.

  8. WAZZ – The original one page presentation of current data was far easier to use and a better and clearer presentation of the data than this version.
    This data is vitally important for those who are concerned by the perilous state of Eastern Australia’s politician (mis)managed electricity grid.
    This morning, Tasmania is frantically pumping up the grid and draining its dams – it has happened before.

  9. I agree Rob that the “old” Hydro www site was easier to navigate and more user friendly. Hey I could complain that MS ditched XP instead of just tweaking it sl. But at least TasHydro still make their xls file of GWhrs stored available for mug punters to ponder.
    On that subject – have you ever come across similar data for Snowy Hydro?

  10. No wass, haven’t found that info anywhere – it sure would be interesting.
    I remain surprised at the level of transparency the AEMO presents on its website just as I was surprised at Hydro Tasmania’s readily understood presentation (you know, the one that has now been “disappeared”).
    It would be very interesting to see the statistics re hits to both sites. In other words, how long will it be before AEMO restricts access to its fascinating presentation?

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