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Renewable Electricity - Renewable Energy Certificates

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Renewable Energy Certificates

 

Wind and solar power is not intrinsically commercially competitive with fossil sourced energy in Australia. This is due to the very high up-front capital cost of the equipment required to capture the energy and the intermittent nature of the energy resource; so that the equipment is typically generating revenue for less than a third of the time. In addition there is a point at which peak energy delivery begins to exceed demand at different times, requiring equipment to be turned off even though the energy source is available; for example it is windy or sunny when consumers don't want the energy.

 

In Australia wind generated electricity, and to a lesser extent solar, is made economically viable by a system of Renewable Energy Certificates (RECs) that subsidise renewable energy producers.

 

RECs have been established to support the National Mandatory Renewable Energy Target (MRET) to 2030: ‘to encourage additional generation of electricity from renewable energy sources and achieve reductions in greenhouse gas emissions.’ It aims to meet a renewable energy target of 20% by 2020.

 
The National RET scheme:
 
  • places a legal liability on wholesale purchasers of electricity to proportionally contribute to an additional 17,150 gigawatt hours (GWh) of renewable energy per year by 2012 increasing annually until it reaches 45,000 GWh in 2020
  • sets the framework for both the supply and demand of renewable energy certificates (RECs) via a REC market.

 A REC is an electronic, tradable commodity similar to a share certificate as it represents a unit of value and may be traded for financial return. 1MWh of energy equals 1 REC. Electricity wholesalers need to buy RECs that are created by the accredited generators of electricity from renewable energy resources. Each calendar year wholesalers are required to surrender a number of registered RECs equal to their liability for the previous year; at an increasing rate (renewable power percentage (RPP)) each year.

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Following a politically driven debacle that gave small rooftop solar installations a fivefold REC allowance and temporally destroyed the REC market, in February 2010, the Australian Government announced changes to the national RET scheme, separating small-scale and large-scale renewable supply.  From January 2011, the scheme exists in two parts, the Small-scale Renewable Energy Scheme (SRES) and the Large-scale Renewable Energy Target (LRET). The SRES is a fixed price, unlimited-quantity scheme available only to small scale technologies such as solar water heating.

The LRET will retain the REC's existing floating price, fixed-quantity structure, and will be available only to large-scale power generation, such as wind, solar, biomass and geothermal energy. The LRET target will be 4,000 GWh less than the previous national RET scheme target, requiring the scheme to deliver 41,000 GWh of renewable energy by 2020.

The price of a REC fluctuates with supply and demand.

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The present price means that consumers presently pay around double the mean energy price for 'renewable' wind and solar energy. This cost of subsidising each MWh of renewable energy is passed on directly to the electricity consumer in their electricity bill.

 

Notwithstanding the subsidy the available, the economic wind resource in NSW is too limited and too small for wind to contribute more than a few per cent to projected NSW electricity needs. Consequently NSW wholesalers buy more RECs from Tasmania and South Australia than locally, even though the power can't practically be delivered to their customers due to very significant transmission costs and losses.

As will be seen later in this paper a significant issue is that the 20% renewables by 2020 target is a politically set  'stretch goal' - like 'no child to live in poverty by...'  It is extremely ambitious and very likely to be unachievable using current technology. 

It is important to realise that under the REC mechanism the price will continue to rise until the mandatory targets for renewable energy are met irrespective of the technical difficulties in delivering this power.  Thus if the proposed 'stretch'  targets are made mandatory it is quite possible for the subsidy to make the cost of renewable energy many times that of conventional , or nuclear, energy.  

 

As the REC price rises it might be reasonable to expect a significant increase in present wind generation in eastern Australia before resource limitations distance and demand management issues begin to limit further expansion. This additional capacity is more likely to be located in Victoria, Tasmania and SA than in NSW or Queensland. 
 
As discussed in more detail later, owners of existing accredited renewable power stations that are not located in new, more marginal locations, could then expect very substantial 'wind-fall' profits as the REC price is driven upwards.  Most hydro-power predated the REC arrangements and is excluded for these very reasons. 
 
To overcome this difficulty it was hoped that the REC scheme would be short lived and be replaced by a cap-and-trade emissions  trading scheme (ETS).  But this now appears to be politically untenable.   

 

 

 

 

 

 

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Travel

Ireland

 

 

 

 

In October 2018 we travelled to Ireland. Later we would go on to England (the south coast and London) before travelling overland (and underwater) by rail to Belgium and then on to Berlin to visit our grandchildren there. 

The island of Ireland is not very big, about a quarter as large again as Tasmania, with a population not much bigger than Sydney (4.75 million in the Republic of Ireland with another 1.85 million in Northern Ireland).  So it's mainly rural and not very densely populated. 

It was unusually warm for October in Europe, including Germany, and Ireland is a very pleasant part of the world, not unlike Tasmania, and in many ways familiar, due to a shared language and culture.

Read more: Ireland

Fiction, Recollections & News

The Meaning of Death

 

 

 

 

 

 

'I was recently restored to life after being dead for several hours' 

The truth of this statement depends on the changing and surprisingly imprecise meaning of the word: 'dead'. 

Until the middle of last century a medical person may well have declared me dead.  I was definitely dead by the rules of the day.  I lacked most of the essential 'vital signs' of a living person and the technology that sustained me in their absence was not yet perfected. 

I was no longer breathing; I had no heartbeat; I was limp and unconscious; and I failed to respond to stimuli, like being cut open (as in a post mortem examination) and having my heart sliced into.  Until the middle of the 20th century the next course would have been to call an undertaker; say some comforting words then dispose of my corpse: perhaps at sea if I was travelling (that might be nice); or it in a box in the ground; or by feeding my low-ash coffin into a furnace then collect the dust to deposit or scatter somewhere.

But today we set little store by a pulse or breathing as arbiters of life.  No more listening for a heartbeat or holding a feather to the nose. Now we need to know about the state of the brain and central nervous system.  According to the BMA: '{death} is generally taken to mean the irreversible loss of capacity for consciousness combined with the irreversible loss of capacity to breathe'.  In other words, returning from death depends on the potential of our brain and central nervous system to recover from whatever trauma or disease assails us.

Read more: The Meaning of Death

Opinions and Philosophy

The Origin of Life - according to God

 

 

 

Back in April 2013 I had another visit from our neighbourhood Jehovah's Witnesses,  a pretty young woman and her husband, recently married.   Like Daniel (mentioned elsewhere on this website) before them, they had brought copies of The Watchtower and Awake; which I agreed to read if they were prepared to read my paper: The Prospect of Eternal Life.

I keep a couple of copies of The Prospect of Eternal Life for just such occasions and have also given a copy to the local Anglican minister and to various other active proselytisers in the area; with similar conditions.  Of course I know it will not change their position but I do like to have the debate and amazingly so do they; it beats the usual reception they get; and they get some practice in trying to convert un-believers. 

When the couple asked my position I quickly summarised that in The Prospect of Eternal Life: 

Read more: The Origin of Life - according to God

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