The Catch 22 of Australia's Future Electricity Pricing

Most of the electricity debate in recent times has been about security of supply; will the power be available when you want to switch on your air conditioning during a 40 degree day this summer, and subsequent summers? While it’s a good conversation to have, a better one would be about price. More so, what you might be expected to pay for the privilege of being able to use power at those peak times.

The Australian Electricity Conundrum

Today we are transitioning to a renewable tomorrow. Renewables, largely being wind and solar, generate when nature provides the source of the power, not when people want it to be there. So unless we have storage (and lots of it) we will not have the power available when we need it to meet the demands of consumers.

Herein lies a big problem.

2017 Contact Energy Partner's Conference - Taupo, NZ

A number of senior Smart Power NZ staff spent 2 days earlier this month as guests of Contact Energy at their first partners conference in Taupo.

Between the jet boating, golf, Geothermal Power Station tour, fine food and wine it proved to be a sensational way for all involved to strengthen their existing partnerships within the energy sector.

“Sometimes you worry about finding the time in your work schedule for these sorts of events but heading away with the Contact Energy team actually gave us all time to talk about our respective businesses in more depth and with a longer term focus” explains Brett Cameron, Smart Power CEO.

Energy Futures Seminar - Dr Finkel's Review of the Security of the National Electricity Market

I attended this highly informative seminar last night sponsored by the Melbourne Energy Institute and The Grattan Institute. 

Dr Alan Finkel provided an overview of the Review while Audrey Zibelman, CEO, Australian Energy Market Operator (AEMO) and Tony Wood, Energy Program Director at Grattan Institute gave their impressions on the Review, the political responses to it, and where they see the industry evolving to. This was followed by a question and answer session moderated by Sabra Lane, Chief Political Correspondent with the ABC.

Procurement the way forward no matter how big or small

Smart Power New Zealand’s Brett Cameron, Nathan Carruthers and Ken Syme took two days out of their normal busy schedules to represent the Smart Power team at the Aged Care Procurement Conference in Auckland last week.

As the newcomers on the exhibitors list, Smart Power drew the attention of attendees who ranged from large scale commercial aged care providers to much smaller privately owned operations. “The overriding theme of the conference was on showing why it’s important to maintain a commercial approach when it comes to securing supply agreements” explains Brett. “What we noticed was that this is a growing industry and yet there are a lot of operators out there who do not apply basic commercial procurement systems to what they do.”

Rod Boyte from Smart Power presents ideas on how to mitigate rising energy prices at the 2017 FUTURE STATE OF ELECTRICITY CONFERENCE

This visionary event organised by VicWater - the peak industry association for water corporations in Victoria - brought together leaders from the new and traditional energy industry to provide their thoughts as to where the electricity industry is heading and how this might impact on the Water industry.

We also had representatives from the Water industry talking about how they are responding to these changes - a move from being simply consumers, to prosumers and beyond to being net suppliers of electricity. Thanks to VicWater for giving me the opportunity to attend. Thanks also to all the presenters for their insightful contributions.

BEWARE OF HEADLINES PROMISING LOWER ELECTRICITY PRICES!

Since the Finkel review was released late last week, there have been headlines stating that electricity prices would fall if the recommendations of the review were adopted. Here’s a warning: These headlines are misleading. I want to be clear in that I am not in disagreement with the review nor the recommendations put forward. What I take issue with is how they are falsely being framed and fed into mainstream media.

NZ - An Update on Smart Meters

According to the Electricity Authority there are over 1,209,740 smart meters installed in residential homes, which is approximately 70% of all residential connections. This coupled with the smart meters installed for large and small commercial meters, means that New Zealand has a pretty good coverage of smart metering nationally.

NZ - EECA Funding for Energy Initiatives

In the past, EECA used to energy audits as a means to obtain energy reduction throughout the industrial and commercial sectors. This has now changed to funding based on actual kWh's saved via several methods. The funding is targeted to provide enough funding to make the saving initiative proceed.

EECA presume most projects with a payback under 2 years are likely to proceed, so this is a cut off basis. Thus if the funding reduces the payback from 3 years to 2, applications are more likely to be successful. A key point to note is that savings need to be measured and verified over the payback period of the project. If all the savings don't result, a prorated amount of the funding needs to be paid back.

Types of funding opportunities:

Australian Energy Climate Change Policy Impacts

At the start of a new year it is timely to look back over the last couple of years and view how energy policy has impacted on energy pricing, and how it might change going forward.

Currently the mainstream policies of Government(s) impacting on energy pricing appear to be:

• Use Renewable Energy Policy as the primary tool to impact on reducing emissions from electricity and

• Limit gas supply by placing moratoriums on new production.