Heatwaves and electricity supply, or how to stop a ticking bomb


The previous two days were a nightmare for the Australian Energy Market Operator (AEMO). As failed gas and coal structures caused huge energy supply gaps, and off-market emergency reserves proved to be insufficient, the AEMO had no other option left but to order load shedding.

While the mercury soared above 40 degrees C, the AEMO cut power to Alcoa aluminium smelter, the biggest consumer in the state of Victoria, for two hours on Thursday, and ordered load shedding of more than 250 MW, affecting as many as 200,000 Victorian households.

Some 1,800 MW of power capacity in Victoria went offline, including AGL Energy’s Loy Yang power plant and EnergyAustralia’s Yallourn, both in the Latrobe Valley, as electricity spot prices went through the roof reaching the price cap of $14,500/MWh.   

However, the power outages could not be considered to have come completely out of the blue. In its 2018 Electricity Statement of Opportunities, the AEMO has already warned of a heightened risk of power failure during summer peak-demand periods, based on reduced reliability of ageing fossil fuel generators. 

To avoid a blackout scenario, the AEMO sourced up to 930 MW of additional reserves under the Reliability and Emergency Reserve Trader (RERT) mechanism, which allows it to pay major energy users to power down or retailers and distributors to reduce customer loads to support the grid. However, as two units at the Yallourn and one at Loy Yang tripped, the reserves were not enough.

“We lost 1,800 MW of power capacity generation in Victoria,“ Victoria Energy Minister Lily D’Ambrosio said. “That is an extraordinary figure to lose. Essentially most of that was a result of failed infrastructure from coal and gas – in particular coal.“

“The fact is that our thermal generators are ageing, they are becoming less and less reliable. Wind power came through today (Friday), it produced sufficient power generation. Our largest batteries were available last night when we needed them the most. Renewable energy is the way of the future and the here and now.“

With the price cap also reached in SA, the AEMO called on the RERT mechanism, turning to the state’s fleet of diesel generators for the first time since they were installed following the state-wide blackout in 2016. As Adelaide on Thursday recorded its hottest ever day – 46.6 degrees Celsius – almost 30,000 households lost power after transformers on local power lines overheated and switched off.

A dire consequence of climate change, this year’s extreme heatwave is an emergency call for renewables. For D’Ambrosio, it was clear that Australia’s summers are getting longer, hotter and more extreme because of climate change.

“People should be rightly disappointed that the power grid was not up to the stakes today,” she said. “We have a 20th century energy system, for a 21st century climate.“

What can rooftop PV do?

Clearly it can mitigate the demand. According to The Australia Institute’s (TAI) January report, rooftop solar helped curb energy supply by nearly 10% in Victoria and South Australia. An update was released a couple of days ago:

On the customer side, rooftop installs and reducing load are still the only available options to help the grid during heatwaves. With over two million – one fifth – of homes having solar and an average of six panels installed per minute across the nation, Australians are greening the grid and doing their bit on fighting climate change.

This month,  the Australian Energy Council and Energy Networks Australia released a fact sheet on potential impacts of heatwave conditions on the energy system. Noting increased reliance on air conditioning has caused a rise in peak demand over the past couple of decades, the document added, in recent years that has been tempered by the greater role household solar and batteries are playing and a reduction in demand from large industrial facilities, some of which have closed.

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