Legislative Council


August 2nd, 2017

The Hon. M.C. PARNELL: I rise today to speak about energy security. South Australians, quite rightly, demand a secure and reliable electricity system. We expect power to be there when we need it and for the network to be robust enough to cope with all types of weather and to cope with predictable technical problems. The tornadoes that ripped through South Australia in September 2016, bringing down several high voltage transmission lines and blacking out the entire state, were a wake-up call to take energy security more seriously.

Also, the failure of gas generators to operate in hot weather, and the failure of gas generators to operate when they did not feel like switching on, are other wake-up calls. However, there is a lot of misinformation out there. The vested fossil fuel interests and their political backers in the old parties are scared of what new, renewable energy technology will mean for their profits.

That is why they are engaged in a desperate and misleading campaign to blame wind and solar for just about every problem in the electricity system, but they are being proved wrong. Adding storage to wind and solar generation is a game-changer that allows intermittent renewable power sources to deliver energy around the clock. It is a future that is happening now and it scares the pants off the incumbent coal and gas generators.

Policies that promote new gas as a transitional fuel are expensive and unnecessary, and they are blocking our path to a 100 per cent renewable energy future. Certainly, gas will be with us for a little while longer, but new gas power stations are likely to become white elephants long before the end of their useful lives. So, what are some of the things that we need to do to achieve energy security in South Australia?

First, we need to promote grid-connected battery storage that can provide both energy services and rapid frequency control to stabilise the grid. The Elon Musk Tesla battery is a good development for South Australia; it will improve our energy security. However, we also need to promote domestic and battery storage at the household and business level to help manage and reduce peaks in demand from the grid.

One energy storage technology that received a little bit of attention but appears to have faded is pumped hydro. We need to seriously look at locations and to invest in pumped hydro as a means of storing energy, which can be dispatched quickly at times when other generators cannot meet demand. Over the last couple of years, a number of members have spoken about a solar thermal plant at Port Augusta. That still is a good project that needs to be advanced.

Some time ago, the government introduced some energy security regulations. Those regulations were flawed. They were flawed because they unfairly and unnecessarily discriminated against renewable energy. They did this by insisting on real inertia rather than synthetic inertia. To put it simply, they were preferencing gas ahead of renewable energy. The commentator, Giles Parkinson, writing on 30 May, congratulated the state government on pulling the regulations or, probably to be more accurate, delaying them. He wrote:

The South Australian government is expected to rethink the draft legislation of its planned energy security target after being told its current design will end up simply providing a multi-billion dollar subsidy to gas, and will do nothing to lower prices for consumers or increase energy security.

The draft legislation for the energy security target was released earlier this month, and…its decision to grant incentives only to 'real inertia' appeared to effectively rule out battery storage, and put a question mark over future wind and solar developments in the state.

Energy minister Tom Koutsantonis has been told that if the draft is not changed, the legislation would effectively put a cap on renewables, raise the cost of wholesale electricity and likely fail to deliver any more energy security.

The only thing it would deliver, critics say, is a $3.5 billion subsidy to the owners of the state's gas generators, the very people who have caused prices to jump because of the rising cost of gas, and what the Australian Energy regulator notes is the 'region's relatively concentrated generator ownership…and (their) bidding behaviour.'

These regulations have been postponed, but they have been postponed until 1 January and that creates a big problem for this parliament. That problem is that, if the regulations are still defective, there will not be any ability for us to disallow them until parliament resumes after the election, which could well be in May of 2018. So, the regulations could do some damage before parliament gets to them. I would urge the government to introduce the regulations earlier and to rethink their content.

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