AEMO restores energy market: Electricity boss says Australia must ditch coaL

Australia must quickly transition to renewable energy to avoid future blackouts, according to Chris Bowen and the boss of the energy market operator.

Last week cold winter weather, failures at coal-fired power stations, low wind and solar output and high global gas prices created an energy crisis on Australia’s east coast.

With generators refusing to provide power because they would make a loss, the Australian Energy Market Operator suspended the spot market in NSW, Queensland, South Australia, Tasmania and Victoria for the first time ever.

The national electricity market was suspended for the first time ever. Pictured: Bondi residents wrapped up warm on a cold morning

Today the operator said the market would be restored by Friday morning after blackouts were avoided following its intervention.

CEO Daniel Westerman said the way to avoid such a crisis in the future is to move away from coal-fired power. 

About 25 per cent of Australia’s coal power capacity has been missing in recent weeks due to planned and unexpected outages at ageing power stations.

‘This situation is caused by a multitude of factors. Yes, ageing plants which break down and have more maintenance issues is an issue,’ he said.

‘The war in Ukraine and the impact of global commodity prices is an issue, yes.

‘It points to the long term answer which is a transition to firmed renewables and transmission.

‘That is the long term answer to delink us from international price shocks, as well as ageing infrastructure.’

The new Labor government wants 82 per cent of Australia’s to come from renewables by 2030.

Energy Minister Bowen said: ‘This is a transformation which we need to get moving on.’

Of the renewable sources, solar makes up about 37 per cent and wind 36 per cent. Pictured: A Wind farm in Tasmania

Of the renewable sources, solar makes up about 37 per cent and wind 36 per cent. Pictured: A Wind farm in Tasmania

He has backed a ‘capacity mechanism’ which would pay generators to provide extra power during the transition to keep the lights on. 

‘We need to make faster progress on the transformation and we need the capacity mechanism to help us do that to provide that safety net underneath as we engage in this significant transformation to a more renewable economy, a more renewable energy system with more storage,’ he said.

‘I have made clear, and ministers have made clear, we want the capacity mechanism to focus on new technology, storage being prime amongst it. That is what we will deliver.’

Crisis was averted after NSW on Wednesday evening asked residents to reduce their electricity usage from 5.30pm to 8pm. 

About 60 per cent of Australia’s electricity comes from coal while 32 per cent comes from renewable sources.

Of the renewables, solar makes up about 37 per cent and wind 36 per cent, meaning the nation can be left short of power when the sun doesn’t shine and the wind doesn’t blow as much as usual.

The suspension meant the operator took control of directing supplies to the east coast power grid from the energy generators.

The generators were expected to make themselves available and were to be paid a set price. 

Why did AEMO suspend the market? 

 

It was the first time the whole market has been suspended since creation in 1998. The market in South Australia was suspended in 2016 after a state-wide blackout.  

In a press conference in Adelaide last Tuesday afternoon, AEMO CEO Daniel Westerman said the drastic step was needed because it had become ‘impossible to operate the spot market’.

He warned conditions would ‘remain tight’ and urged Australians, particularly in NSW, to conserve power. 

‘Today, AEMO has suspended the national electricity market. This decision was made because it was impossible to operate the system under current conditions while ensuring reliable, secure supply of electricity to Australian homes and businesses,’ he said.

‘By suspending the market, we are creating a simple process where AEMO has true visibility of which generators are available and when in advance. 

‘That visibility will help us to manage the system in real-time as well as to understand the balance of supply and demand in the period ahead. 

‘Despite this, conditions remain tight in the coming days, in particular in New South Wales where we would urge consumers to conserve energy where it is safe to do so.’ 

Last Monday night parts of Sydney’s northern beaches were briefly plunged into a blackout while Queenslanders narrowly avoided the same fate. 

On Tuesday AEMO had to direct five gigawatts of generation through direct intervention to prevent blackouts after generators stopped supplying power because a price cap meant they would have lost money.

Western Australia and the Northern Territory are not part of the national electricity market (NEM). The ACT is included in NSW for the purposes of the NEM.

Energy Minister Chris Bowen said he was pleased blackouts had been avoided so far and was confident they could be prevented

Energy Minister Chris Bowen said he was pleased blackouts had been avoided so far and was confident they could be prevented

Read more at DailyMail.co.uk

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