Geoff Bertram's recent comments on this power rort:
Comment posted on Newsroom story “Gas and solar to help answer ‘power profiteering’ claims” 14 August 2024
The call to roll out rooftop solar on a grand scale is absolutely right – but it’s important to remember why it hasn’t happened already. New Zealand was level-pegging with Australia …
Geoff Bertram's recent comments on this power rort:
Comment posted on Newsroom story “Gas and solar to help answer ‘power profiteering’ claims” 14 August 2024
The call to roll out rooftop solar on a grand scale is absolutely right – but it’s important to remember why it hasn’t happened already. New Zealand was level-pegging with Australia on rolling out new renewables until 2013 , when part-privatisation killed new investment by the gentailers and anti- competitive market structures and pricing policies blocked private citizens from exercising their own initiative. (Besides which the installation cost of solar here is nearly double Australia’s because of the lack of scale and scope economies to date).
There are three key changes needed right now to unlock rooftop solar and battery backup:
1. Repeal the lines-energy split that was central to the Bradford reforms. That would mean that the local distribution companies (or new entrants!) could get back to their long-ago role of integrated operation of local energy systems and markets – both investing in, and coordinating, decentralised renewable generation and battery backup at community level.
2. End Transpower’s monopoly pricing arrangement under which all grid charges are compulsorily passed through to lines companies to pass through to all connected customers as (steadily rising) fixed charges. Those fixed charges really hurt the economics of rooftop solar (because even if you no longer require grid-supplied power you still carry the full grid costs unless you disconnect completely). Ideally, go back to the old Bulk Supply Tariff pricing arrangement under which the big gentailers would have to pay Transpower to carry their power to Grid Exit Points, where bundled wholesale supply would have to compete head-to-head with local distributed renewable generation. It’s called “competition for the market” and it has been completely stifled by the Bradford arrangements. Oil companies don’t (because they can’t) impose a fixed charge to drive into a petrol station. Supermarkets don’t (because they can’t) charge entry fees. They have to recover their fixed costs through variable charges.
3. Break up the gentailers to eliminate the self-hedging, barriers to entry and market-sharing that has kept independent retail confined to a tiny fringe. (And yes, the distribution companies, if freed from the lines/energy-split shackles, could be part of a retail revival).
As for Contact’s self-serving rhetoric about big balance sheets to fund investment, check out the last two decades. These fat cats didn’t get fat just yesterday – they got fat and stay fat by squatting on undeveloped investment opportunities that they control directly, while blocking entry by distributed generation. As for the Electricity Authority, the important thing to remember there is that as soon as it was set up in 2013 it demanded a memorandum of understanding relieving it of responsibility for regulating prices.
Rooftop solar is useless for this dry year problem, the scale of energy needed is almost beyond comprehension. Read the executive summary of the NZ Battery Project Indicative Business Case, prepared by Ernst & Young for Megan Woods & co. Here is the link:
One of starting assumptions behind that report is that the current market and regulatory settings remain unchanged. A big assumption.
"Overbuilding is considered a feasible way to achieve 100% renewable generation as it makes use of mature and well understood technologies (wind and solar) that can be built at scale under existing market and regulatory settings."
And the rest of the paragraph? Fixing profiteering is a great idea but it doesn't solve the dry year problem any more than rooftop solar will, these are supporting measures, not solutions, to the problem of missing Terawatt hours.
The executive summary clearly acknowledges that "it [the NZ battery project] aims to address an element that neither the market, nor policy or regulatory measures, are likely to solve on their own – the large-scale, long- term, and highly uncertain dry year problem."
Will better regulation save a bit of water? Sure.
Will it save enough to deal with NZ's unique dry year problem? Not even close.
How do we deal with the dry year problem at present? We light the fires of thermal, whenever we like. At least we did, until we started running out of gas - now we're having to de-industrialize too.
How do we deal with the dry year problem when thermal has been replaced with intermittent renewables? Terawatt hours worth of batteries! Overbuilding in the extreme!
We could explore the storage options tabled for further investigation by the project (link in my other post, nothing easy about those either), or we could drastically simplify our lives to live with an energy reduction (most sustainable, but impossible by choice). The most likely scenario I believe is we gradually build intermittent renewables backed up with imports of more gas/coal to keep the place civilised, and wait until the technology for NZ's unique energy security/storage/risk use case emerges at a viable price point and scale before we cut the fossils.
We had a solution for the dry year problem, but due to Willis insisting on tax cuts - and no doubt lobbying by the gentailers - it was one of the first items the hydra head threw on their bonfire.
Is rooftop solar useless, or are people missing the fact that using the solar at other times means less hydro needs to be used and therefore becomes the storage for the dry year, or those few months...
Solar will help conserve water for sure, but the issue is our lakes are too small, they don't actually store much water. So if it's not raining we still end up with a problem. This is why things like Lake Onslow got explored; from a conceptual/theoretical point of view, solar backed up by pumped hydro is absolutely marvellous
Geoff Bertram's recent comments on this power rort:
Comment posted on Newsroom story “Gas and solar to help answer ‘power profiteering’ claims” 14 August 2024
The call to roll out rooftop solar on a grand scale is absolutely right – but it’s important to remember why it hasn’t happened already. New Zealand was level-pegging with Australia on rolling out new renewables until 2013 , when part-privatisation killed new investment by the gentailers and anti- competitive market structures and pricing policies blocked private citizens from exercising their own initiative. (Besides which the installation cost of solar here is nearly double Australia’s because of the lack of scale and scope economies to date).
There are three key changes needed right now to unlock rooftop solar and battery backup:
1. Repeal the lines-energy split that was central to the Bradford reforms. That would mean that the local distribution companies (or new entrants!) could get back to their long-ago role of integrated operation of local energy systems and markets – both investing in, and coordinating, decentralised renewable generation and battery backup at community level.
2. End Transpower’s monopoly pricing arrangement under which all grid charges are compulsorily passed through to lines companies to pass through to all connected customers as (steadily rising) fixed charges. Those fixed charges really hurt the economics of rooftop solar (because even if you no longer require grid-supplied power you still carry the full grid costs unless you disconnect completely). Ideally, go back to the old Bulk Supply Tariff pricing arrangement under which the big gentailers would have to pay Transpower to carry their power to Grid Exit Points, where bundled wholesale supply would have to compete head-to-head with local distributed renewable generation. It’s called “competition for the market” and it has been completely stifled by the Bradford arrangements. Oil companies don’t (because they can’t) impose a fixed charge to drive into a petrol station. Supermarkets don’t (because they can’t) charge entry fees. They have to recover their fixed costs through variable charges.
3. Break up the gentailers to eliminate the self-hedging, barriers to entry and market-sharing that has kept independent retail confined to a tiny fringe. (And yes, the distribution companies, if freed from the lines/energy-split shackles, could be part of a retail revival).
As for Contact’s self-serving rhetoric about big balance sheets to fund investment, check out the last two decades. These fat cats didn’t get fat just yesterday – they got fat and stay fat by squatting on undeveloped investment opportunities that they control directly, while blocking entry by distributed generation. As for the Electricity Authority, the important thing to remember there is that as soon as it was set up in 2013 it demanded a memorandum of understanding relieving it of responsibility for regulating prices.
Rooftop solar is useless for this dry year problem, the scale of energy needed is almost beyond comprehension. Read the executive summary of the NZ Battery Project Indicative Business Case, prepared by Ernst & Young for Megan Woods & co. Here is the link:
https://www.mbie.govt.nz/dmsdocument/26295-new-zealand-battery-project-indicative-business-case-and-appendices-february-2023
One of starting assumptions behind that report is that the current market and regulatory settings remain unchanged. A big assumption.
"Overbuilding is considered a feasible way to achieve 100% renewable generation as it makes use of mature and well understood technologies (wind and solar) that can be built at scale under existing market and regulatory settings."
And the rest of the paragraph? Fixing profiteering is a great idea but it doesn't solve the dry year problem any more than rooftop solar will, these are supporting measures, not solutions, to the problem of missing Terawatt hours.
The rest of the paragraph is dependent on the assumption of now change to regulation or market setup.
The executive summary clearly acknowledges that "it [the NZ battery project] aims to address an element that neither the market, nor policy or regulatory measures, are likely to solve on their own – the large-scale, long- term, and highly uncertain dry year problem."
Will better regulation save a bit of water? Sure.
Will it save enough to deal with NZ's unique dry year problem? Not even close.
How do we deal with the dry year problem at present? We light the fires of thermal, whenever we like. At least we did, until we started running out of gas - now we're having to de-industrialize too.
How do we deal with the dry year problem when thermal has been replaced with intermittent renewables? Terawatt hours worth of batteries! Overbuilding in the extreme!
We could explore the storage options tabled for further investigation by the project (link in my other post, nothing easy about those either), or we could drastically simplify our lives to live with an energy reduction (most sustainable, but impossible by choice). The most likely scenario I believe is we gradually build intermittent renewables backed up with imports of more gas/coal to keep the place civilised, and wait until the technology for NZ's unique energy security/storage/risk use case emerges at a viable price point and scale before we cut the fossils.
We had a solution for the dry year problem, but due to Willis insisting on tax cuts - and no doubt lobbying by the gentailers - it was one of the first items the hydra head threw on their bonfire.
Is rooftop solar useless, or are people missing the fact that using the solar at other times means less hydro needs to be used and therefore becomes the storage for the dry year, or those few months...
I found this info from Rewiring Aotearoa interesting: https://www.linkedin.com/posts/rewiring-aotearoa_who-woulda-thunk-it-when-theres-not-much-ugcPost-7231881946476208130-sn-9
Solar will help conserve water for sure, but the issue is our lakes are too small, they don't actually store much water. So if it's not raining we still end up with a problem. This is why things like Lake Onslow got explored; from a conceptual/theoretical point of view, solar backed up by pumped hydro is absolutely marvellous