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As the energy is essentially free, renewable electricity costs, like those of nuclear electricity, are almost entirely dependent on the up-front construction costs and the method of financing these.  Minimising the initial investment, relative to the expected energy yield, is critical to commercial viability.  But revenue is also dependent on when, and where, the energy can be delivered to meet the demand patterns of energy consumers.

For example, if it requires four times the capital investment in equipment to extract one megawatt hour (1 MWh) of useable electricity from sunlight, as compared to extracting it from wind, engineers need to find ways of quartering the cost of solar capture and conversion equipment; or increasing the energy converted to electricity fourfold; to make solar directly competitive.

Similarly if a technology produces electricity when consumers don’t want it; or produces it so far from the consumer that most of it is lost in transmission; then the revenue available will be proportionately less than a similar investment that better matches demand; or is located close to where it is consumed.

 

In most developed nations, including Australia, electricity is a traded product with the market price fluctuating from hour to hour; day to day; season to season; in five minute intervals, according to supply and demand.

 

Without government intervention in the market, supply and demand determines the return that is available to an investment; while the engineering solution and qualities of the resource determine the energy that a particular investment can theoretically deliver.

 

Before intervention, current renewable technologies, with the exception of hydro- electricity, are substantially less competitive, in terms of return on investment, than fossil fuels or nuclear electricity.  It follows that wherever alternatives are in use there are other factors at play: such as the cost or practicality of a grid connection; or a government intervention in support of renewables.

In Australian electricity markets this intervention takes the form of Renewable Energy Certificates (RECs) described later. Other governments have other instruments such as cap and trade carbon reduction schemes; carbon taxes; energy buy-back schemes; and tax breaks; to achieve similar ends.

 

In Australia grid losses are of particular concern. Australia’s population of just over 21 million is highly concentrated in a few large cities; just eight cities accounting for over 70% of the population. The largest Sydney; Melbourne; Brisbane; Perth and Adelaide account for 63% but are separated by distances of between 670 and 3,600 km; ‘as the crow flies’. This is similar to the continental USA and a substantially greater area than the entire EEC.

Transmitting electricity over such distances results in significant losses.  The market price received by a generator is therefore influenced by transmission costs and the point on the grid into which electricity generated is injected.  A renewable energy project remote from the points of high demand will receive a lower price than one adjacent. 

Very high voltage DC (HVDC) technology can reduce the net grid loss problem over long distances, and this is in use for links to Tasmania and South Australia, but it adds at least two costly voltage translations and the additional capital cost, together with the low capacity factor of wind and solar, precludes its use in most, if not all renewables dedicated situations.

 

Even with the present substantial and probably increasing REC cross-subsidies from electricity consumers, transmission factors limit the economic distance an exploitable wind or solar resource can be from the main electricity grid and electricity consumers.

 


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Travel

Egypt, Syria and Jordan

 

 

 

In October 2010 we travelled to three countries in the Middle East: Egypt; Syria and Jordan. While in Egypt we took a Nile cruise, effectively an organised tour package complete with guide, but otherwise we travelled independently: by cab; rental car (in Jordan); bus; train and plane.

On the way there we had stopovers in London and Budapest to visit friends.

The impact on me was to reassert the depth, complexity and colour of this seminal part of our history and civilisation. In particular this is the cauldron in which Judaism, Christianity and Islam were created, together with much of our science, language and mathematics.

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Fiction, Recollections & News

Recollections of 1963

 

A Pivotal Year

It appears that the latest offering from Andrew Lloyd Webber: Stephen Ward, the Musical, has crashed and burned after four months in London.

On hearing this I was reminded of 1963,  the year I completed High School and matriculated to University;  the year Bob Dylan became big; and Beatle Mania began. 

The year had started with a mystery the Bogle-Chandler deaths in Lane Cove National Park in Sydney that confounded Australia. Then came Buddhist immolations and a CIA supported coup and regime change in South Vietnam that was the beginning of the end for the US effort. 

Suddenly the Great Train Robbery in Britain was headline news there and in Australia. One of the ringleaders, Ronnie Biggs was subsequently found in Australia but stayed one step of the authorities for many years.

The 'Space Race' was underway with the USSR holding their lead by putting the first female Cosmonaut into obit. The US was riven with inter-racial hostility and rioting.  But the first nuclear test ban treaties were signed and Vatican 2 made early progress, the reforming Pope John 23 unfortunately dying mid year.

Towards year's end, on the 22nd of November, came the Kennedy assassination, the same day the terminally ill Aldus Huxley elected to put an end to it.

But for sex and scandal that year the Profumo affair was unrivalled.

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Opinions and Philosophy

Manufacturing in Australia

Originally written in August 2011 - it might have been yesterday - so little has changed.

 

 

Manufacturing viability is back in the news.

The loss of manufacturing jobs in the steel industry has been a rallying point for unions and employers' groups. The trigger was the announcement of the closure of the No 6 blast furnace at the BlueScope plant at Port Kembla.  This furnace is well into its present campaign and would have eventually required a very costly reline to keep operating.  The company says the loss of export sales does not justify its continued operation. The  remaining No 5 blast furnace underwent a major reline in 2009.  The immediate impact of the closure will be a halving of iron production; and correspondingly of downstream steel manufacture. BlueScope will also close the aging strip-rolling facility at Western Port in Victoria, originally designed to meet the automotive demand in Victoria and South Australia.

800 jobs will go at Port Kembla, 200 at Western Port and another 400 from local contractors.  The other Australian steelmaker OneSteel also recently announced a workforce reduction of 400 jobs.

This announcement has reignited the 20th Century free trade versus protectionist economic and political debate. Labor backbenchers and the Greens want a Parliamentary enquiry. The Prime Minister who reportedly initially agreed has now, perhaps smelling trouble, demurred.

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