The Future of Electricity Generation in South Australia

This post discusses the future of non-wind electricity supply in the state of South Australia, as it further expands its already substantial wind power sector. As wind power capacity increases the total energy supplied by other sources reduces, but on low wind days most of the electricity supply will have to come from these other sources. Increasing deployment of intermittent wind power forces an increasing intermittency in the use of other sources, which may drive some of them out of business, leading to great uncertainty in the future electricity supply in South Australia.

The focus in this post is on the changing demands placed on non-wind sources, either conventional generators or interconnectors, obtained by subtracting wind power from the total demand placed on all sources. The wind power used in this subtraction is scaled between 0 and 3 times the 2015/16 level, to get an idea of how non-wind demand will vary in the future.

Three days (19/20/21 December 2015) at the end of a major heatwave are used to illustrate the range of non-wind demands. The following figure shows the total demand (black) within South Australia for these three days, together with the non-wind demand (red), and the non-wind demand with 50% more wind power (blue):


The 19th December 2015 was the hottest day of that summer (43.2C maximum temperature at Adelaide Kent Town) , and the peak demand would likely have well exceeded 3000 MW if the day had not fallen on a Sunday. Increasing wind power by 50%, easily foreseeable within the next 5-10 years, would reduce the non-wind demands to very low levels on the other days shown, but would have very little effect on the peak non-wind demand, an illustration of the Law of Diminishing Returns (more on that law below) from generation sources with intermittent fuel supply.

Thus, increasing wind power can drastically reduce the total output from other sources, but cannot reduce the need for most of the capacity of the other sources to remain. As Australia does not currently have capacity payments for electricity generators there will tend to be a driving out of business (and a lack of replacement of) that which must not be driven out of business.

Law of Diminishing Returns

All methods of electricity generation with intermittent fuel supply suffer from a tendency to diminishing effects on peak demand. The figure above illustrates the problem for wind generation. As wind power increases the non-wind peak demand moves towards times of lower wind power, meaning that each new MW of wind power has less effect on peak demand than the previous MW. The following figure shows the problem for the very hot day of Sunday 19th December 2015, with wind power increasing from zero to 3 times the capacity of 2015/16:



The figure above shows that increasing wind power from its current (2015/16) level will have very little effect on peak non-wind demand, meaning that no more non-wind sources can be lost, but the first figure shown above illustrates the diminishing market share of non-wind sources, which must threaten their economic viability.

The remaining major conventional generators in South Australia are gas-fired, and their increasingly intermittent operation suffers from the problem of obtaining intermittent supply of gas, as described by the Australian Energy Council in the following recent analysis:

“AEMO’s analysis also assumes that gas generators in Victoria can transport gas if and when they need to generate. In reality, gas transport for intermittent use by gas generators is difficult to procure with most gas transport services written on long-term contracts, making it challenging to get significant volumes of short term transportation for occasional use for periodic gas electricity generation.”

The economic viability of conventional generators in South Australia is threatened by the rise of renewables, which means that the state may become more reliant on interconnectors, but high capacity interconnectors (such as Heywood) require high capacity backups, and conventional generators with fuel storage at the other end to supply heatwave demand spikes.

There is clearly a need for a NEM-wide electricity system design, and constraints on the freedom of individual states to make local decisions about their mix of generators.

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One Response to The Future of Electricity Generation in South Australia

  1. Proving once again that 2 x nothing = nothing.

    Doubling a wind contribution of zero on a wind-free day has no impact on a situation where the whole of the load must be carried by non-wind generators.

    It does, however, address the common myth along the lines that every additional MW of wind must be backed by an equal number of non-wind MW (typically, gas).

    My rephrasing: On windless days, other generators must be able to serve the whole of the load.


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