David Gillespie (Lyne, National Party) Share this | Hansard source

I rise to say a few words about some of the comments made about this report. I gather there was a lot of work done, but I don't agree with all the conclusions. I just want to repeat a few reality checks. A lot of people are concerned about the cost, the delay in building them overseas, that it's not the answer, that it's a stalking horse to keep coal and gas in the system, that it uses way too much water and that renewable energy is very affordable and cheap. I just want to place some corrections on that.

First of all, the states of Victoria, New South Wales and Queensland are already relying on coal and gas, and they are subsidising the power stations to stay in. It's not a secret plan of the coalition; it's just a reality that 60 per cent of the energy in Queensland, Victoria and New South Wales—roughly; if you follow the AEMO live generation, it's still 60 to 65 per cent—comes from coal. You can install all the gigawatts that the former member for Bennelong talked about, but the fact of the matter is they are all low capacity, randomly generating and often generate nothing or next to nothing. Capacity factor is how often an installed capacity actually generates. Everyone thinks Australia is so sunny and we'll have heaps of solar power. There is light for half the day, so it's at least 50 per cent. But actually, averaged over a year, it's 24 per cent. When it's light in the early morning, it's not generating, although it's light. In the dusk it's not, because the sun is not going straight onto the solar panels. When it's cloudy, it stops. When it's raining, it stops. When you have wet weeks and months, it stops. So you can install as much as you like and, because Australia is part of a world that has a north-south axis for the biggest part of the national electricity market and because of our native weather patterns, all these renewable generators are highly correlated. That means they all generate at the same time and they generally, over vast distances, stop at the same time, and overinstalling them doesn't mean that you will get something that's available 24 per cent of the time on average. If you build four times as much, you won't get 100 per cent of the time; it just means more and more installed capacity all stops at the one time.

The second thing is, 'All it needs is a lot of firming, and we are firming.' Well, that's what the New South Wales government is paying the power stations for. Firming is a euphemism for what you turn to when renewables are not generating. At the moment, the New South Wales Labor government is subsidising power stations to stay there because the market rules have sent them broke. They are old plants designed to get up to steam and spin a generator, which then generates electricity. They're not designed to ramp up or ramp down. Some of the new nuclear plants can do that handsomely. The BWRX-300 that Canada is building can ramp from 45 per cent up to 95 per cent because the neutronics in these modern plants is great. You can go from 45 per cent up to 95 per cent. But back-up is expensive because it is generally a low-capacity-factor utilisation. If you're having gas on standby and it sits there and it's only firing up when there's a shortage, it makes it a really inefficient gas power plant. It's the same for coal, pumped hydro and batteries. They are very expensive.

Why are people's electricity bills going up and up even though they've got rooftop solar? There are plenty of businesses that have got rooftop solar and batteries, yet their bills are still going up. That is because in your bill stack, what makes up your bill, the electricity is the minority part. That's the wholesale cost of electricity. It is low compared to the network costs, the poles and wires and all the synchronous condensers that you have to add to the system that utilise energy but don't generate energy. All the new poles and wires, the massive expansion—all these extra bits and pieces on a renewables based grid—are what makes it expensive. Sure, they're cheap. But they're only cheap 24 per cent of the time. By giving them a red-carpet ride onto the grid, they can do that because the market allows them to. They're not responsible for the other 75 per cent of the time.

They also get other payments than what they get paid for their electricity. If you're a coal plant, unless you're selling electricity, you get diddly squat. You don't get paid anything. It's the same for gas. It's the same for countries overseas. You can bid in the market, but you only get paid for your electricity except if you're renewable. You can get a contract for difference, so your risk is reduced. You can get Capacity Investment Scheme payments to get your facility up and built. You get the grid from the whole public that pays in their bill. You can get the grid built for you even though you're not near where the load is needed. When we had a sensible, engineering based system, you had your load near where the generation was happening, and you had your fuel next to the load.

Basically, firming is expensive. Putting electricity into batteries, into a pumped hydro from direct current into alternating current, sending it through the wires, then putting it into a battery energy storage system, then taking it out, then inverting it back into AC and then getting it to your house uses oodles of the energy you've just generated. In an alternating current generated system, it's AC to AC to your house. You can transmit alternating current hundreds of miles without much consumption of the electricity.

These guys called Tesla—remember him?—George Westinghouse and Thomas Edison had battles about this in the 1880s and 1890s. One guy was building a DC system, and the other decided: 'No; this is crazy. You're losing all your energy.' They had to build a direct-current power station every two or three blocks in Chicago and New York because they couldn't transmit it. Tesla came along and developed how to make alternating current. It's pretty easy. You have copper wires intersecting the electromagnetic field of a magnet, and—hey presto!—electrons come out the end of it. How do you get a big 150-tonne magnet to spin around at 50 hertz a second? You boil water to produce steam, which spins a turbine that then spins the generator. Hey presto; that's what you've got.

That's what you get in nuclear. They are big. The Minister for Climate Change and Energy said, 'The member for Lyne has talked about nuclear; it's just a big kettle.' Actually, a coal plant is just a big kettle. A closed-cycle gas plant has a gas energy source which spins a turbine. But then it has a side channel that boils water so that you've got two bites of the energy to make more.

So, ladies and gentlemen, the idea that you have a cheap system based on renewables is quite fallacious. It is not a cheap system. It's cheap when you've got it, but, for the rest of the time, it makes the system unsustainable. The International Energy Agency has written about this forever—or since this renewable transition was proposed. They said, 'Up to 10 per cent, it doesn't cost you much; it's just money for jam.' You stick a wind tower up and—hey presto!—you get a bit of extra electricity. It's the same with a solar panel. But, once you get into the double figures, all the integration costs, all the extra poles and wires, all the bits and pieces, all the inverters, all the batteries and all the pumped hydro just sends you broke. Now—hey presto!—that's what happened in Germany. They have thousands of wind towers and they are about to start up their nuclear plants, because, if you have big baseload providers that can work with the existing renewables, then—hey presto!—you don't have to rely on Russia; you can just rely on yourself. And Germany has worked that out the hard way.

An honourable member: And you can't get gas anymore.

Yes—and you can't get gas. So you need a constant—

An honourable member interjecting—

But we can get uranium and we can run a plant for three years, so a lot of the stuff is very—

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