…
By Jo Nova
At the top of the Magic Faraway Tree, the cheapest form of energy needs more subsidies. Just keep pouring the money…
The Australian Energy Market Commission (AEMC) has finally quietly admitted that they’ve given up on wind and solar power becoming cheaper than coal. Instead, renewables are so uncompetitive they will need another ten years of subsidies, or however long it takes until the last coal plant shuts off.
It’s so revealing. Once upon a time they might have thought (or at least pretended) that subsidies were there to get the unreliable generators ‘over the development hump’ so they could compete in a free market. But after 20 years of subsidies, there are no new economies of scale left to wait for. We got to the bottom of the cost efficiency curve and we’re going up the other side. Costs are now rising as the new projects have to go to far flung fields and wait for impossible transmission towers to appear. Windmills kept getting bigger until there was a nasty surprise in the maintenance bills that wiped 36% off Siemens shares in a single day.
AEMC opine about getting back to a free market once the coal plants are forced off the grid by the Big Government subsidies. They might as well be telling the world that wind and solar will never be as cheap as coal is.
How could the new unfree market, post coal, possibly be cheaper than the old one?
Australia’s official energy policy adviser says government subsidies for renewables will likely be kept in place for as long as coal-fired power generation keeps operating, locking in underwriting schemes for at least another decade.
It’s not renewables fault, it’s because we need “an orderly transition” (to a forced, fixed, and unfree market):
The Australian Energy Market Commission said underwriting mechanisms were needed to ensure there was an orderly transition to green energy as coal generation exited the nation’s power grid.
Sorry, did we say the subsidies would end? We meant “maybe”.
“Are we going to get past this at some point when we won’t have governments underwriting new capacity. Maybe once we’ve seen coal exit and we’ve built out this phase of the transition,” AEMC commissioner Tim Jordan told the Citi Australia and New Zealand Investment Conference on Tuesday.
All the talk of free markets is just an illusion:
“We can then return to a more market-led approach where underlying demand growth will determine whether new capacity enters.”
Mr Jordan said the industry and government should aim for “market principles to take over again” once the transition from coal to renewables was complete.
What do we call a free market when the cheapest competitor is banned?
If the green subsidies can’t end until coal power is gone, it looks more like their primary goal was not to help renewables so much as to destroy coal…
And so the lie continues – with less breath – but it continues. Yet only half (latest poll) of those with an opinion want net zero gone with a large undecided cohort. More pain is required. The needle is shifting and a solid Conservative Opposition would shift that needle quickly. But we have the Leymobile and the brakes are still on.
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Robbing coal revenue to feed renewable subsidies must continue otherwise coal fired power would be economic and someone would build a new coal fired power station.
The bankruptcy of Victoria in 2027-28 is going to bring all this bad policy out in the open for the whole world to see.
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“But we have the Leymobile and the brakes are still on.”
It’s a Ley-land P76.
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Twain needs updating – There are lies, damned lies and climate/energy statements by bureaucrats and politicians.
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There will come a time when the current cabal of fools is voted out of office and those currently in opposition takke over. What those opposition politicians could do now is declare unequivocally that a new administration will nullify and void the subsidy packages now being assembled as a last hooray and will do so on day one. Without any compensation for subscribers, because they would have known what was going to happen. That’s what Farage did in the UK and it may persuade as lot of players to pass the buck. It could nick the next round of the idiots merry go round in the bud.
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Ed Zuiderwijk,
That day will come, sooner or later, but what is much harder to change is the underlying bureaucracy. All this nonsense is administered by bureaucrats. Bureaucrats apply to bureaucrats for authorisation to appoint more bureaucrats who will be answerable only to bureaucrats (not to politicians, not to the voters). It’s a cancer. I would like to hear how Farage plans to get the Civil Service to serve the people.
Trump had a tough time of it — used up his whole first term — but at least the senior bureaucrats in the USA are political appointees he is able to hire or fire. Not so in the UK and Aus.
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Never ever believe that the opposition, in its current form will dump net zero or subsidies which is the fuel it runs on!!
The Liberal Labor Coalition is deeply infiltrated with socialist acolytes. Should they regain power there’ll be minor changes to most minor issues but the silence on net zero will be deafening, whilst they work to achieve the Net zero they are working to achieve. Deception is what the Ley administration is planning. Trust the current opposition mob at your peril!
Hastie is fresh breeze thru their ranks but we need a lot more from him & colleagues before they’re awarded any TRUST whatsoever!! The Australian swamp is probably worse than the the USA!!
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Supposedly the subsidies were meant to end in 2030, it doesn’t surprise me in the least that they want another ten years, and when that comes about, still more subsidies will be requested for or by the subsidy harvesters.
Wind and solar electricity production is not a viable or profitable business without subsidises. Warren Buffett effectively stated that when he said:
To overseas readers: in Australia most subsidies for wind and solar don’t come from the tax system but directly from forced purchase of W&S electricity via consumer electricity bills but its the same idea. Fortunately TRUMP is putting an end to this madness in the US.
But as Australia’s standard of living and economic output declines (even Their ABC admits that, see *), who’s going to pay for it all? There won’t be much of an economic pie left.
And it should be illegal for Government officials such as CSIRO “scientists” and other public serpents to constantly say wind and solar is the “cheapest form of electricity generation” when it is an obvious lie because the more we get, the more expensive electricity becomes and the more subsides are required.
* https://www.abc.net.au/news/2025-05-07/can-albanese-government-fix-the-economy-four-corners/105260320
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DM .. you have fallen for their word trickery..!
It may be true to say they are the cheapest form of electricity GENERATION…
..BUT they are not the cheapest source of electricity SUPPLY to the consumer.
Because generation cost is only a fraction of the total costs involved in providing a reliable electricity supply to the end consumers.
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Evening Chad,
I don’t think David has fallen for their trickery at all, but I think your differentiation between “differentiation” and “supply” is great. The nearest I’d got was “wholesale” and “retail” which was close, but always inadequate.
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And is it actually “generation” or more accurately “collection”?????
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DM,
These “scientists” at CSIRO might not be the same ones who endorsed the official global statement in the BOM State of the Climate 2024 that Australia had warned 1.51 +/- O.23 deg C since records began in 1910.
I have calculated using 2 different methods that the correct number is close to 1 deg C. How small does it have to be to say “This causes us no alarm about climate change”.
Geoff S
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Translation: Expect to pay more for less reliable electricity.
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Shouldn’t that be the ‘AEMC’?
[Thanks! It should. Dang. Fixed. – Jo]
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In the dystopian Leftist “utopia” of an Australia run on wind, solar and unicorn flatulence, just how many more thousands of windmill, solar panel and battery plantations, all with serious actual or potential environmental harm, will be needed?
And as we get more, the more economic productivity decreases.
At a certain point there will be no money to pay for it. And then what….?
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In the end, there may be still enough money to pay for one or two solar panels with small battery for each household.
This will give enough power for two or three lights; once per day cooking, say to heat a bowl of your insect ration for two minutes in the microwave; and a small internet connected appliance to receive Government propaganda, Government-approved “entertainment” and for the Government to spy in you (the Telescreen of “1984”).
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Such a dystopian future was more or less covered in the animation at:
https://youtu.be/vWkepoLUZfs
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Unless Australians and other Westerners are prepared to elect actual conservative individuals and parties then this dystopian future will DEFINITELY happen. We are already a good way there.
In Australia, the fake conservative Liberal Party is not the answer, they are part of the problem. They are even behind getting us into “renewables” in the first place (Howard), giving much of our gas supply to the Chicomms at world’s cheapest prices (Howard), the disastrous SH2 (Turnbull), banning fracking in Victoriastan (a Lib/Lab joint effort), banning nuclear power (Howard) etc etc..
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“At a certain point there will be no money to pay for it. And then what….?”
Hello darkness my old friend.
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Logic would tell you that we could drop the subsidies all together by dropping renewables and just keeping coal. Then again when did the leftists ever apply logic to any of their crazy and destructive ideas?
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Ah but their planet to be saved Lawrie. Sadly only they understand problem so clearly only they can guide through the necessary levels oof waste and self destruction.
The major port/industry city of Hamburg recently voted for energy suicide in a low turnout referendum. Seems like its Germany, UK and Australia in a race to the bottom.
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Thanks!
Hamburg –
https://www.cleanenergywire.org/news/hamburg-referendum-backs-more-ambitious-climate-action-2040-net-zero-target
I see 5 in 9 didn’t bother voting [tho there may have been some attempt to nullify the referendum, through abstention: if so, it failed!]
Massive changes talked about as necessary,
Industry is already talking about moving out.
I assume the jobs will go too [no WFH for petrochemicals or ports].
Auto
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“There will not be a carbon tax in a government I lead” was a lie. The lie continues with the massive Safeguard Mechanism, Labor’s secret plan to pay for all this by hidden CO2 taxes in EVERYTHING. The practice of hidden taxes was all developed in the old days before the GST of Sales Tax which could reach 100% and was often 20%. In America Sales tax was always shown because it was resented, but Labor’s CO2 tax will be doubled and hidden in your costs. The 2001 RET is never mentioned either, which makes carbon power unprofitable and makes wind and solar financially mandatory and pays wind and solar providers for electricity twice, once for what was sold and again as carbon credits which you cash. You get paid if your green electricity is not sold. This all goes on public electricity bills without anything being said. And that was Howard’s Liberals.
So we have been robbed for 26 years and each year more and more. If the hidden taxes were removed, solar and wind would collapse tomorrow. So they have to close the coal and gas power stations, not because they are expensive or problematic but because they work and they are far cheaper. And you have to pay for all those government departments who administer and enforce all these hidden taxes while National debt soars with projects like Snowy II and the interest on the $1Trillion Federal debt soars while state debts pass $200Billion each. If China stopped buying our coal and iron, we would be bankrupt as we pay for massive migration and 90% of new jobs in Victoria alone are by the Labor Government. Why?
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And the soaring price of electricity is not just another cost. Manufacturing is about turning electricity and gas into product. Once the price of energy exceeds the value of the product, manufacturing is pointless. Aluminium is now cheaper than the electricity required to make it, so the government is quietly subsidising industries to keep the jobs, which is why Trump slapped tariffs on our aluminium. Otherwise all smelting of iron, bauxite, lead, zinc, copper,.. will close. Then concrete and fertilizer. Processing in general and manufacturing. All will go to China.
Is that what our Labor governments want? And even the Greens are waking up to the wholesale destruction of the environment by replaceables, vastly more land lost than ever by mining and transmission systems we never needed before, all to save the planet. Which is such an obvious lie, so absurd that you wonder how Chris Bowen can keep a straight face.
It’s all economic and jobs seppuku for our Chinese masters. But you just soak up the unemployment in the booming public service and no one notices. As we turn into Argentina.
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“…so absurd that you wonder how Chris Bowen can keep a straight face. ”
Perhaps we should call him Botox Bowen?
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It appears AEMC is slightly less deluded than the Grattan Institute. I nearly fell over when l read about this report the other day. They want to amp up (pardon the pun) the Safeguard Mechanism next year. According to their models power bills will be much cheaper in the way distant future. Implicit in all this is the assumption you will be told what to drive, what type of appliances you have in your house and a mandatory solar set up.
https://grattan.edu.au/report/bills-down-emissions-down-a-practical-path-to-net-zero-electricity/
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So how long before the average Aussie voter wakes up and understands that everything Albo and B O Bowen etc have been telling us is delusional nonsense?
We must ditch the super expensive, toxic, unreliable W & S rubbish and build only BASELOAD energy like coal, gas or nuclear ASAP.
Who wants to waste TRILLIONs of $ and waste decades more of our time building more of the toxic, unreliable W & S lunacy?
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I’m not sure that they will.
In any case Australia is effectively a One Party State with no useful or knowledgeable major party in opposition and who more or less support the Government’s Official Narrative on this insanity.
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“So how long before the average Aussie voter wakes up”
Well if we keep listening to that famous environmentalist, Twiggy Forest, the answer is NEVER. Poor Twiggy , endless projects to save the planet, endless cancelation of projects because reality bites. Still every announcement attracts government money, every cancelation does not, apparently, require any monies to be repaid. Oh well.
https://www.news.com.au/finance/fortescue-axes-hundreds-of-jobs-in-green-retreat/news-story/5d3dae14fe12fe18a13c1790c0b430fb
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Not “government” money, OUR taxpayer money.
Otherwise agree, Sambar.
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When they continue to receive all their news from the ABC and the Guardian, never.
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Even without data, it’s obvious that toxic wind, solar and Big Battery plantations have to be expensive simply because they need an enormous amount of infrastructure spread over a very wide area and with long lengths of interconnecting cables. In addition, this very expensive infrastructure is idle 70% of the time. They also are very labor intensive to maintain. The wind and solar product they collect is diffuse, random and of low energy density, hence the enormous amount of “stuff” required to collect it. It’s just like a sailboat needs a huge sail and a lot of labor to operate it when a small, compact petrol or diesel engine would do the same job and much cheaper.
In contrast coal, gas and nuclear power stations are small, compact and usually invisible. They work close to 100% of the time cleanly delivering an inexpensive, reliable product that is the lifeblood of Civilisation. You generally never see them unless you go looking for them, unlike “in your face” wind and solar plantations.
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I totally agree with you DM, unfortunately, due to the constant brainwashing by media and Grubberment, the ignorant response from the average punter or even the renewable zealot is : “but I have solar on my house and it saves me money so renewables are great”…
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I recall a time when Tony Abbott was the PM. He discussed ending renewable subsidies, possibly over a short time frame. Wasn’t long after that he was knifed by Malcolm Turnbull and the other LINOS in the LNP. The knighthood for Prince Philip was just the smoke. The trigger had already been pulled. Then we got Snowy Hydro II, Net Zero. All under the LNP. Now we know subsidies will probably stay and possibly increase. Sure, Labor are terrible, but the LNP are not much better.
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Before it happened, Lord Monckton warned that the Left would try and get rid of Tony Abbott over the climate change scam.
https://youtu.be/NG0WcjGHkEw
Tony also offended the Left and members of a certain demographic by referring to extremist followers of a certain ideology as a “death cult”.
Abbott’s “death cult” speech in Parliament is at https://youtu.be/m–oecA_Jmw (3 mins)
Abbott further offended the Left by being pro-Australia.
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Also, apologies to TdeF. I should have included the Safeguard Mechanism which was originally introduced in 2016.(First legislated in 2014) Guess who was the PM in 2016? Yep, you guessed it – Malcolm Turnbull.
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I stand to be corrected but wasn’t it the LNP under Turnbull that removed the crime of Treason from our laws?
Or did it just feel like that happened. . . ?
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Treason has not been removed as a crime
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There’s another very important reason to stop building the clueless W & S rubbish and that’s to stop destroying thousands of klms of our pristine wilderness areas.
A few well chosen adds on the TV or online would quickly change the voter’s opinion, but that costs money and I’m afraid most ordinary people wouldn’t have the time or the funds.
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A start would be a very good anti wind farm video at the link below.
I urge people to download it before it’s censored. Judging by the low number of views and how hard it is to find in a search, I think Gulag/YouTube are already shadow banning it.
https://youtu.be/zr3z_7iQ35s
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David, I think the Bolter put part of this video on his show about 12 months ago.
But I agree 1900 views over many years is a shame.
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An interesting example of the desecration caused by a solar factory is that located to the NW of Wellington NSW, between the Mitchell highway on its west and Goolma Road to its east.
(The image displayed by my iPad Maps app appears more up to date – shows more panels – than does Google Earth.)
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Isn’t this all about keeping the Gravy Train A Rollin?
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So why are we doing this, when we know that Aussie W = 24% and S just 15% capacity factors?
Again that means that W on average only generates for about 2.9 months of every year and S on average is about 1.8 months out of 12.
Doesn’t this prove that the W & S rubbish is a cruel toxic joke?
You don’t need complicated sums to understand any of this, so what’s their problem?
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Of course to back up toxic W & S with more toxic batteries is another cruel joke and the cost would be horrendous.
Would enough Aussies vote for these toxic disasters if they really understood the facts?
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The purpose is twofold:
1) Destroy Western economies and ultimately Western Civilisation.
2) Enrich the Elites of the Left.
Who benefits? The economic destruction wrought will allow the Left to establish their “glorious” socialist dystopia. Who do you think will win the race, UK, Australia or certain countries of Western Europe, all already in massive social and economic decline under Leftist regimes.
Of course China will hugely benefit from this madness by selling the means of destruction, wind, solar and battery plantations, to the useful idiots of the Left. Hence the endless stream of Australian communist politicians visiting China, including the PM, to pay tribute to Emperor Xi.
And China gets to eliminate all economic competition as well. The only survivor in the West will be the United States under TRUMP.
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David, I think another useless Politician is on their way to China and India……..B O Bowen……enough said
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Indeed Froggy.
He wants them to invest in wind and solar plantations in Australia.
And why wouldn’t they?
It’s the perfect way to destroy our economy and eliminate possible economic competitors.
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This is so depressing, we are witnessing the destruction of Australia’s manufacturing base and with it the rest of Australia!
By the way there are some cheap hydrogen generators for sale in South Australia, our SA government spent $284 million of our money, and has scrapped the project using the money left in the hydrogen project account to hopefully save the steel works in Whyalla.
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Let me rephrase the statement. Subsidies will continue until coal and gas are forced out of business and solar and wind can charge what they like with no competition. Job done as electricity become unaffordable and the enormous never ending cost of replaceables is added to the price.
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So let’s say we are 10 years into the future and all coal power stations have been closed.
What happens when/if the subsidies to unreliables are removed?
Does anyone believe that electrickery will be cheaper? The answer is an emphatic NO.
The unreliable tricksters will still want to make a profit. The only way they can do that is for the electrickery prices to remain high.
The policies of the uniparty have royally stuffed what was a reliable and cheap electricity grid.
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Yes – My neighbour has just locked in electrical energy cost of 8c/kWh for the rest of his life; maybe 20 years.
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Ten years?! Pull the other one. Hundred years, more like. If ever the Blobsters get to their finish line, they will be shattered to learn that it’s just another start line, so they will keep throwing our wasted trillions at their rubbish solutions to their imaginary problem.
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I’ll believe in net zero when my electricity bill hits net zero (ie at 2005 levels).
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Our feckless PM, Albo, is about to meet Donald Trump. What’s the bet, all the media will focus on newly introduced US tariffs and possible discussions around that? But forget that all the damage being done to Australia’a economy and productivity is self harm. The list of self harms include: uneconomic energy prices largely due to subsidies, uncompetitive work practices, BIG government, union domination. We’ve done all these things to ourselves and looks like in the real meaning of stupidity- keep repeating it via inefficient subsidisation.
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One of the reasons Australia no longer gets favourable treatment from the US is because:
1) Our three most important people in relation to the US Alliance, Wong, Albanese and KRudd, all have TDS and are anti-American and are also low IQ fools, and TRUMP hates idiots.
2) Australia’s heavily subsidies what little industry we have left such as steel and aluminium because it is impossible to run such operations profitably on expensive wind and solar.
3) Albanese made no serious effort to meet with TRUMP but him and other Australian politicians are making regular visits to China and Emperor Xi.
4) Not being very supportive of the Australia-US Alliance and realigning Australia’s interests toward China.
5) Australia has a fanatical commitment to the anthropogenic global warming scam.
6) Rewarding Hamas for their October 7th atrocities. Albanese even quoted Hamas propaganda in a statement. https://www.skynews.com.au/australia-news/politics/anthony-albanese-attempts-to-distance-himself-from-hamas-praise-despite-multiple-statements-welcoming-palestinian-recognition/news-story/6d1d7ad8d04b3908059b3ef7b6359582
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Even the experts are acknowledging that the existing electricity market is going very wrong now:
https://wattclarity.com.au/articles/2025/10/nelsonreview-theschism/
First, it was the lack of system strength and inertia, two factors that inverter based resources couldn’t produce. Then it was increasing FCAS costs, which have become a lucrative market for battery players, when we were told they were there for energy storage.
More recently, it has been the Capacity Investment Scheme, of which the fourth round of successful tenderers has just been announced. This was supposed to provide “firming” backup for times renewables were not generating, and was supposed to be reliable and 100% available. That would have allowed more gas generation onto the grid, until Victoria’s previous premier, China Dan, blocked the use of gas.
The Nelson Review is still not letting engineers to have a say, but at least they acknowledge that an energy only grid simply cannot work:
https://judithcurry.com/2021/02/18/assigning-blame-for-the-blackouts-in-texas/
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None of that has identified the problem which is – Grid scale WDGs offer no benefit of scale. Solar panels in solar farms are the same I have on my roof just more of then. Batteries used to firm output are the same cells I have in my battery but the big batteries have more cells. Wind is useless because it goes missing for long periods.
I have one key advantage. I own my demand that my rooftop solar and battery serve. I have other less significant advantages – I own my roof- I do not need to acquire land – I do not need to submit an environmental report – I do not need to get First Nations approval – I do not need transmission lines. All other rooftops enjoy these same benefits.
What all these clowns reviewing the electrical grid have failed to recognise its that grid is stuffed economically. It cannot survive under the present conditions because rooftops are killing it. The big loads are all disappearing because Australian grid prices are astronomic and rooftops are never going to run smelters.
So the Australian grid is quite rapidly heading for zero demand as rooftops and batteries take over. Midday today, rooftops serving 51.2% of demand in the NEM. Rooftop solar was not measurable a decade ago.
They need to be looking ahead.
Rooftops going in today are 10kW of panels and 20kWh of battery. In a decade, there will be 12M of these systems giving 120GW of solar and 240GWh of battery. That, along with some fossil fuelled generation to make up in winter, will be all that is needed to run the NEM once all the heavy industry is gone. I expect all the smelters to be gone by 2030 if Labor remain at the Federal and State levels.
Next time you see any statement on a wind farm, solar farm or battery and how many households it will run, tell the author that it is a thoroughly stupid statement because households are powering themselves. And for sound economic reasons.
My neighbour uses about 8000kWh a year – almost twice what I use. He paid $13,000 for 10kW of panels and 27kWh battery. Both will last at least 20 years but taking 20 years, he has locked in an energy price of 8c/kWh for the rest of their lives.
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May your neighbor have a good warranty on his inverters and a supplier that will still be in business in 12 years.
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Based on my 14 years operating panels, inverters and batteries, I doubt he will need to worry about that. He will also have much less leaf litter to contend with than me because I get a good deal of the leaves from the huge (listed) swamp gum that overhangs my garage. He only needs to get 4 years to be in front. If he needs a repair outside the 10 year warranty, it will already be paid for.
A feature of household appliances is that they do not work very hard. My wife has been waiting for now 35 year old fridge to die but it keeps going. It has run off inverter for the past 13 years.
My off grid system has a Chinese designed and built inverter of 2012 vintage (really low cost) but it keeps working. It has fan cooling and the fan still runs when needed.
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One of my two 2012 inverters was replaced twice.
(Why 2? Blame WA 480v rural).
The replacements of 2022 seem to be working OK (with more panels on the shed roof)
Apparently if I want more than 5kw of inverters (and therefore access to more winter panels) I will lose the FIT (such as it is) if the connection is considered single phase. But it would be an added consideration in the ROI calculation. I need to clarify if Western Power considers the hookup single phase (5 kw) or two real phases (6 kw). At least it is complicated to confuse the cold call sellers.
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You left out a few:
” I don’t run a petrol station, I don’t run a hospital, I don’t run a sewerage system, I don’t run a supermarket, I don’t run a high rise building, I don’t run a police district…”
And perhaps railways and airlines should get a mention. And having fire brigades restricted to daylight hours might be a problem too.
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It’s not 8c/kWH as the Opportunity Cost hasn’t been included, which pushes the price up to at least 10c/kWh. And he will be lucky to achieve 20 years of top performance out of the batteries.
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Kathryn Porter has a few words on the renewables caper and related matters:
https://www.youtube.com/watch?v=MzCiEHGVMwA
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Subsidies are the currency of government.
Net Zero is kind of a terminal subsidy.
This subsidy results in reduction of productivity.
Until the tax base well runs dry.
This is especially a problem when your ideology is based on the idea that productivity causes the problem your trying to eliminate with your subsidy.
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No problem: subsidies can be “repurposed” to where they will achieve satisfactory outcomes.
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How I wish there was a way for my taxes to not turn into government money, which then morphs into subsidies that prop up projects l have no interest in whatsoever.
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Privatized profits, socialized losses.
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I have been doing an analysis of the electrical supply situation in South Australia.
The income from the wholesale market for grid solar in SA peaked at $57M in 2022. Last year it was down to $43M and this year heading for just $40M. It is no doubt a stranded asset. There is 792MW installed capacity costing around $800M. So annual revenue of $40M is not going rio cover interest. The value of LGCs produced add revenue but ends in 2030. And if you cannot sell power you do not earn LGCs. So almost immaterial if the RET ends or not. It just accelerates rooftop solar and batteries.
Wind income peaked in Q1 2019 at $100M for the quarter not counting the windfall gains in in Q2 2022 when the interconnector to Vic went down. There were high costs of stability service for SA wind in Q2 2022 that is subtracted from what is learnt on wholesale sales.
Wind income for Q1 2025 was down to $56M. The income from the wholesale market for wind in 2024 was $413M. Wind’s best year so far was 2018 with income of $447M. So around $5bn invested in wind stillers producing revenue of $400M per year. They might survive if they write off the capital.
WDGs in SA may get better demand access into NSW if EnergyConnect ever gets done but even that will be temporary because NSW rooftops are also going in fast. Snowy 2 will also provide a brief reprieve in the inevitable decline.
All existing subsidies will need to be shifted to general revenue because the market volume for grid scale WDGs is in decline so unit costs have to go up unless the government just guarantees a return on investment. Australia is then full USSR with taxpayers paying for electricity and for uneconomic jobs in heavy industry.
South Australia is first to show the economic vortex that is sucking Australia’s economy into a death spiral. But the same thing is happening in the other States just lagging a year or so.
The only way out of this mess is to go to at least 24 hour bidding and only permit dispatchable generators to bid. If you do not meet your bid capacity when called on, no income for the whole period.
My neighbour has just put in a solar/battery system that has a 4 year payback based on his recent bills. It did include about 40% rebate from both Federal and Sate offer of OPM to assist. But those “subsidies” are similar to what the big players are getting.
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“Green energy company Fortescue is expected to lay off hundreds of workers in the UK and Australia as it downsizes the company.
Fortescue is reducing its ambition to become a top competitor in the industry.”
And the hits keep coming.
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Tim Nelson is, in my opinion, a Dracula in charge of the blood bank. Iberdrola is a Spanish renewable energy company. By inference he will not give one single second of time for conventional electricity generation. Topping it off he teaches at THE greenest of universities in Australia. Griffith, from its inception, is pro-environment. This review is dead in the water before it even delivers a preliminary report. Nelson will submit we must go harder on penetration of renewable infrastructure. We must shut down our conventional assets as soon as practicably possible, increase subsidies and fast track approvals. A complete waste of a lot of time and money!
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WOW, Australia is going to get EXTREMELY EXPENSIVE than it already is under Albos NET ZERO FANTASY RUINABLES ENERGY FUTURE…bwahaha. Enjoy.
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It appears that even with taxpayer funded subsidies incentive profit before operating profit is received is not as attractive as first appeared to be.
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Even in windy Port Fairy the
myth of efficient wind energy
goes astray.
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Very sunny here at 37S today. At 2:50pm (1:50 Sun time) my batteries has been fully charged for about an hour and street voltage only at 250V. So there must be quite a few other batteries soaking up excess solar this year compared with last.
Under same conditions last year, the street voltage would be on the limit of 254V and my system would be backing off.
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By the time “we’ve built out this phase of the transition” it will be time to start the full rebuild of the by then no longer functional solar and wind generators being subsidised in “this phase of the transition”.
Are these people completely without the capacity for logical thought?
Don’t answer that!
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The investors obviously have business plans.
Based on 20-25 years average operating life of the assets, the substantial costs involved in dismantling, preparing each site for replacement and the replacement costs, a sensible business plan would contain an exit strategy, for example sell shares in advance of projected replacement timing.
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On the plus side here, both grid wind and solar are in a deflationary spiral. Grid solar and wind price peaked in South Australia in 2018 before the rooftops started taking over.
Grid WDGs would be dead without subsidies and keeping subsidies till coal shuts down is not going to ensure their survival. The grid is no longer an economic entity.
The punters have taken their money and put it into their own power generation. The demand for grid scale WDGs is drying up.. Wind generation in SA peaked in 2022. Grid solar may be yet to peak because they were still being built as late as 2022. So all battling for a slice of a fast reducing pie – suckers.
There was a lot of hidden potential in rooftop solar that is being unleashed wth every household battery installation. The batteries are spreading the solar glut from lunchtime to all day and night on a sunny day.
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Rick, I have a friend with two houses each with a 12kW solar system. What extra information is needed to establish if a battery is worthwhile for him?
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He needs to Gert the price of different size batteries after available subsidies and then the difference in what he is getting to export versus what he pays for energy.
He can then determine the saving from different size batteries and the payback for each size.
There was no point in me getting a battery till my 66c/kWh FIT ended. If he is using say 5kWh peak at 45c/kWh and producing excess that gets say 4c/kWh then he can make 0.41 X 5 = $2.05 per day. So say $700 per year would buy a battery in about 4 years. If he used 10kWh at peak rate than a 10kWh battery would have similar payback.
The bigger the battery, the less energy you draw from the grid because you may not get the battery fully charged on a dull day.
A typical house will get very good return from a 10kWh battery and that is the most common size being installed.
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Thanks Rick.
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Many years ago, I was walking back from a Royal Society of NSW meeting with a well-known climate scientist at least one of whose papers has featured here, and I expressed doubt about some feature of climate science. Their reply shocked me, it was along the lines of: it doesn’t matter whether it’s right, we simply have to get rid of coal.
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Well, I do not trust one thing about AEMO or the gummint.
I will contest EVERY tax take foisted on me.
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The other disturbing feature is they are not creating an asset that the government owns and can sell because by the time it’s rolled out its time to start replacing it. If they had taken the nuclear ( or coal path) they would cover the cost in the first 15 or so years and then have an asset with a 60 years plus life still left. Something that could be privatised and potentially sell an asset that returns what was its original cost. This enhanced resale value never gets taken into account when comparing the cost of nuclear and renewables. Wind and solar assets are basically an expense and the cost of their roll out should be in the budget not off budget.
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Feel sorry for green places. IMHO the most likely path is AI being very useful but oversold;
like fiber optics. For years dark fiber has represented an opportunity for low cost development &
played a part in building out streaming. When AI stabilizes, there will likely be excess power
to shed, markets being what they are, at low cost. Countries that have allowed the build out
by modifying green idiocy will have surplus cheap power — this is a great asset to attract new
business. Build blank industrial space next to AI centers with half used captive power and
watch the green shoots grow. Or have a net Zero economy. Nothing from nothing is nothing.
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Subsidies for 10years? But in a decade there will be increasing numbers of those panels and turbines reaching their end of life; need tearing down and put into landfill before replacement.
How many investment companies would invest in that scenario which must be hugely more expensive than the current establishment of new projects? Even environmentalists will be all over it at that stage, just as they are now voicing concerns over windmills spoiling pristine places and beautiful natural vistas.
If Bowen thinks he is getting resistance now, he hasn’t seen anything yet. Yet he is already off overseas to Belt and Braces China looking for investments to fill his ruinous dreams. Albo has blocked Chalmers tax stupidity in a moment of self-survival. I wonder if he will soon do the same to Bowen as the wreckage of the national economy extends under his rapacious tutelage.
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The biggest demand for subsidies wont be from the power companies but their business customers both big and small who will not be able to afford to run businesses or manufacture in Australia. Ironically every business that closes helps a little by reducing the demand for electricity. Its a pity about the loss in revenue and jobs
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Interesting to note that over 100 coal fired stations have been converted to gas. Additionally the green cultists/grifters whine that coal is old technology but China has developed a highly efficient coal whose pollution standard exceeds that of gas plants.
https://www.powermag.com/chinas-pingshan-phase-ii-sets-new-bar-as-worlds-most-efficient-coal-power-plant/
Would hate to be living high up in an apartment block when the Bowen blackouts start.
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