13 February 2017

Townsville's clean energy war; $400 million solar energy investment set to divide interests

Image: Thanks to Townsville Bulletin
What feels like a drop of water on ancient stone carving out the future geometry of the earth's rivers and streams, the mass sum of Townsville's solar energy projects is making less than a drop in the national energy market even with the launch of the $155 million Sun Metals Solar Farm project, 15 km south of Townsville.

The Korean-owned Sun Metals project comes on the back of the $250 million solar farm announced for construction on a disused mango farm in the Upper Ross last year, about 20 km south-west of Townsville. A facility of this capacity is expected to add 450,000 photovoltaic modules, which will deliver clean energy to 50,000 households.

Over half a dozen clean energy power stations have been built across North Queensland in the past two years. Yet these power stations add less than 1% to the national energy market.

Combined with the existing small-scale 1350 residential and commercial installations (although not supplying wholesale spot prices) across the City, solar energy is boosting Townsville's electricity capacity steadily enough that the perceptions of victory by non-fossil fuel proponents could have inspired right-wing politics to parade a fist full of raw coal through federal parliament this week.

The additional solar capacity at Sun Metals will be connected to their existing 33/132 kV substation to supply power to their refinery, offering incidental net inflow capacity to the power network. However, their reliance on wholesale power will be reduced by up to 116 MWac as the extra one million solar panels being used will cover 130 hectares. This type of project is what is slowly reducing demand for consumption on the 540 trillion watts feed into the national energy market. 


Image: Thanks to Inhabitat

The real estate investors in Townsville have to be wondering what the impact of these larger scales energy projects will have on the economics of accommodation and the cost of power supply in the broader community. After all, households and small business that are impacted by energy prices are also critical players in the recovery of the property market more broadly.

The truth is these installations will have a negligible impact on retail power capacity and minuscule effect on prices. History might suggest that where a large investment in solar power equipment occurs, the retail price of electricity increases to make up for downward pressure on supplier cash flows. But while the demand for existing infrastructure maintenance overheads and replacement costs continues, prices have continued to rise in excessive of the annual Consumer Price Index (CPI).

The Queensland Energy Minister, the Hon. Mark Bailey has made his pitch for more renewable energy projects flying in the face of federal conservative politics and local Townsville business leaders calling for urgent action on building a coal-fired power station in the region.


Premier Hon. Annastacia Palaszczuk with Queensland Energy Minister, Hon. Mark Bailey
Image: Thanks CourierMail.com.au
Grandstanding on surpassing his election promise of supporting 40mW of renewable energy by announcing the fact that 300mW was delivered as part of his Solar150 policy, Mr Bailey is banking on competition and more solar production, the cost of which has reduced by as much as 80% since 2009 the State Minister claims.

Independent customer satisfaction researcher and rating business, Canstar Blue, said that location is a major factor in electricity pricing. "The amount (price) energy companies charge for power is dependant on a number of factors, the location being one of them."

The independent rating company also identified that the "Queensland Productivity Commission found that deregulation would boost competition and potentially lower electricity prices - and it's easy to see why when you compare average costs in Brisbane with those in Victoria, the most mature energy market in Australia. But so far overall prices show no sign of coming down, so it's important to find the best deal of the bunch currently on offer."

Queensland has the highest concentration of electricity suppliers in Australia, and over 50% of the capacity and demand is serviced by government-owned black coal-fired power stations. What's more, Queensland has a surplus of supply making the State a net exporter of electricity to other states.

Energy prices are set by the retailers and the free market. Energy is still regulated across the board in regional and rural Queensland. However, only if use is below 100mW. This stops in June this year and the $500 million Community Service Obligation (CSO) paid by the State government to subsidise distributors like Ergon and limit energy pricing will be passed on to consumers. South-east Queensland has had deregulated pricing since July 2016.

Although a federal labour's carbon price was to blame, the Newman government realised at the LNP election loss, increased electricity prices on households are political suicide, especially aggressive increases which putting a price on carbon caused.

The sensitivity of price increases in a recession-ridden economy like Townsville, quite possible under a utopian clean energy agenda, means catastrophe at the ballot box is inevitable for pro-futurist politicians like Mr Bailey. Unless the $500 million SCO subsidy is renewed, prices are indirectly regulated for the benefit of regional Queensland in addition to the regulations that end in this June.

However, Mr Bailey would find it difficult to justify politically why the $500 million CSO subsidy is renewed come July 2017. Because you would assume the government will be serving the people to keep retail prices down so Ergon need not increase their costs in regional Queensland.

Trusting deregulation and the influx of retailers in regional Queensland would reduce prices to offset the CSO cuts and increased competition to the majority government-owned power generators, is inconsistent and unlikely with location constraints reported by the independent rating company, Canstar Blue. Townsville is hotter than Brisbane and power leakage, being great distances from base-load generators, is costing the State $130 million dollars per year in lost energy.

But a $1 billion federal Northern Australia low-interest loan to a consortium of private and Chinese investors, who are now otherwise paying 6-10% interest on borrowings, would reduce the demand on taxpayers for government subsidies, practically eliminate wastage by power leakage, reduce the spot price of wholesale power by adding healthy spot price competition in the generator market, and serve the economic interests of North Queensland.

With a combined clean coal/carbon offset revegetation program to achieve carbon reduction targets, an additional 100-200 mW capacity could put downward pressure on electricity prices with a new base-load power station. But most importantly, it would deliver North Queensland the necessary industrial muscle needed to secure its economic prosperity and lessen the need for subsidies from taxpayers.

As the Upper Ross and Sun Metals investments and future clean energy investments like them continue, the clean energy sector will inevitably seek to protect not just their ideology but their growing investor cohort seeking to secure and protect their ROI in the energy markets. Demand for energy has been steadily reducing as residential and commercial solar projects like Sun Metals come online and the Australian manufacturing sector has dwindled.

The battleground between old money and new money (green certificates) is set to evolve into all-out warfare in the boardrooms and dare it to be said, in the unemployment centres of Townsville unless a sensible decision can be made by a rebellious climate industry to pragmatically serve the wellbeing of the entire community desperate for short-term mining and industrial jobs.

"The Sun Metal project is set to commence in April 2017 and create 250 jobs in the construction phase as one of the largest solar farms in Australia", winning contractor Dr Paul Dalgleish, Managing Director and CEO of RCR Tomlinson said. Sun Metals reports that an extra 100 jobs ongoing will be employed but this is due to the investment of another $150 million increasing zinc production capacity by 20 percent. Sun Metals currently employees a total of 300 locals. To put this into perspective, Townsville is seeking to create 20,000 new jobs in the next 5 years.

So Townsville is in a serious quandary on solar investment just as it is in big data, artificial intelligence and robotics, technologies that are likely to eliminate demand for processing labour despite the political headliners of job creation during construction.

It's like the people are constantly being sold a cute puppy; cuddly and soft at first but we never stop looking for the stolen shoes in the yard. And it has been recurring like a bad nightmare or the American "groundhog day" for the past 6 years. Some would argue longer as politicians have become experts at breaking promises and pulling the wool of over voter's eyes.

Further reading:
Turnbull trio caught with smoking gun

There is a growing sense with the rise of One Nation and Trump that the extreme left has deposited so much social progress in Melbourne, Sydney and Brisbane post the Howard-era, that the entire green movement in Queensland backed by Mr Bailey is selling Townsville a cuddly pup and the drip of small broadly dispersed solar farms as industrial power stations.

Employment for the construction of new technologies is temporary while skills and expertise in facilities maintenance, fossil fuel processing, business administration and technology programming are recurring and more sustainable. Not to mention however new skilled jobs that will be created in the digital economy offsetting industrial job losses. But these jobs are what is driving capital city growth and tearing the heart out of regional towns, where time and time again, talented trainees or graduate students move to the capital cities.

Townsville needs industry and business that creates sustained employment for existing residents and sufficient employment for population growth, but the clean energy campaigners and smart technology campaigners by their nature are ardent in their beliefs of saving the planet and rescuing ignorant climate change-denying people from themselves.

What the jealous and emotional teenager thinks and what the parents think are by nature two very different values, at least the circumstances are perceived differently, and the argument about right and wrong can become destructive and even threaten relationships.

Instead of finding common ground, the arguments are based on who has the higher moral ground. One being to feed and secure the entire family and the other resist and fight for the freedom of ideology, which less than a decade ago, had control of the balance of power in federal parliament with the independents.

And it all comes down to power and control of everything. With such utopian and extreme mindsets playing the game, the wellbeing of the people is being defined around electoral affluence and the movement of the lobbyist elite, as Mr Bailey felt the need to deny his association with "latte sippers" and "champagne drinkers" in a recent statement. This is not the identity of solar users as he defended. But the reality of green campaigners and protesters hanging out on Brunswick Street in Fortitude Valley, or trendy boutique villages around Yeerongpilly in their cycling paints to plot their next alliance is happening.

The opposition to these movements is bearing fruit in the United States where left-wing aggression is headline news. District and federal judicial officers are blocking the highest traditional authority in the system, the President of the United States. While in Australia the right-wing One Nation Party and Pauline Hansen may become a serious contender as the third major party in Australia the way things are going.

Moreover, Townsville has been blessed with both clean energy and cleaner fossil fuel resources on our doorstep yet the ideologies and political leveraging of fail-safe governance and political extremism are crippling the opportunities of the Townsville economy and the prosperity of this region's people.

Nearly 5.70-kilowatt hours per square metre of solar irradiation exists under the skies of Townsville producing practically zero CO2 into the environment. A massive asset to the local economy and the most abundant levels anywhere in the world. The sunshine state is alive and well. Of course a smart inclusion in any energy strategy for a nation and city over the next millennium.

The Galilee Basin is blessed with the best quality coal in the world and over fifteen mining companies actively seeking to bring it to the global market, including Adani's new Carmichael mine, whom by some accounts may be in receivership any day now due to excessive company debt through its Indian operations.

The CO2 emissions of the Galilee Basin coal are the best product compared to domestic and international standards, producing 1.1 tonnes of CO2 per megawatt hour of electricity generated, some 30% fewer emissions than Indonesian coal.


Image: Thanks to ABC

The fossil fuel industry, right-wing politics and Townsville's own News Ltd press, is lobbying for the $16.5 billion Adani coal mine project to proceed urgently along with a new coal-fired power station to be built in Northern Australia.

Meanwhile, the chief executive of the Clean Energy Finance Corporation (CEFC), Oliver Yates, says coal-fired power would be "an inappropriate investment in exposing taxpayers to". Even the rules governing the eligibility of clean coal as an investment for the CEFC makes coal an unacceptable risk to taxpayers. Yet the Australian Energy Regular confirms Queensland's fossil fuel power stations are keeping the lights and cooling systems going across the nation during peak hours and excessive heat waves.

While federal and local politicians are seeking to manage affordability and their appeal to the electorate, the increasing power of the anti-carbon emissions movement and clean energy capital raising bodies like the CEFC is overwhelmingly unfavourable to a politically dispensable economy like North Queensland.

Most credible scientists and commentators are saying the cost of building coal-fired power stations, even carbon capture plants, compared to solar and renewables far outweigh the economic benefit to the community.

But saying that to a jobs-hungry community like Townsville still getting used to being weaned off projects stimulation and a government funded economy, is nearly impossible. Just as the people of the rust belt of middle America gleefully elected the most unelectable President in Donald Trump, because they were sick and tired of becoming irrelevant to centralised control during an era of globalisation.

Lacking vision in energy policy, meaning supporting any form of coal production, is tantamount to threatening the entire nation's future. This is the rhetoric of southern splinter journalists, incensed with utopian climate protection ideology and a dogged determination to prove sympathetic scientists right.

And the reality of this point of view is that Townsville's economy, unfortunately, could reflect the experiences of the people of South Australia where "blackouts" and industrial scarcity is a way of life, while Townsville is promised jobs only to find out they are mostly casual, part-time or fixed-term contracts and perpetually being sold a cute puppy.

Further reading:
Industrial space critical to Townsville smart city future

Get used to the fact the attitude of the left and the environmental movement is here to stay. Just as the attitudes of the politically correct advocating on behalf of racism, feminism, socialism, capitalism, etc. are here to stay. Ideas and what we think is a god-given right. Anyone with a twitter account has political influence and there are plenty of authoritarian voices with scientific profiles in their resumes actively claiming an ology, ism, doctorate, ist to their name.

Perhaps a poor attempt at humour, but given a platform, conscientious people will continue to influence and disrupt politicians, courts, corporations and people seeking to derive their living from an industrial system built on fossils. For an ordinary family in Townsville seeking a good life, the fossil industry is their only prospect of income, which will continue to be the case for many decades to come despite technology advances.

A new global order is fighting for supremacy and Townsville is in the heartland of the battle for power and control over resources, even self-determination, futurist ideology and utopian safety and security, neither of which are disconnected from the immediate pain and suffering of the community.

Meanwhile, the paralysis of governments, institutions and agencies incapable of agility is likely to continue in the immediate future, impacting the certainty of jobs and economic opportunities for a bright City seeking to advance its claim as the largest economy in northern Australia.

With the prospect of further delays in all industrial fossil extraction projects - dam building ventures included, and any industry business dependent on fossil fuel energy, further protests, court action and political grandstanding will remain important tactics by highly organised and sufficiently funded clean energy campaigners.

Editorial attention by News Ltd supporting a coal-fired power station in the local Townsville Bulletin is a real measure of the frustration being experienced by a community with massive economic promise in what has become a perpetual "go and no-go" zone in the climate change and clean energy fight across the world.

With the question still open as to the future viability of all coal and fossil power energy solutions in North Queensland, Townsville's aspirations to develop industry and jobs will be plagued with further uncertainty unless the citizens rise up and get behind pragmatic political and business leadership seeking to secure the funding promise of the $5 billion Northern Australia development fund.

If recent history and events are anything to go by, it is difficult to see a strong, proud and caring regional community like Townsville lay down and let jobs and opportunities pass them over because of left-extremism has gained momentum with a green army under the stewardship of capital city elites dictating "it's the way things are around here."

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