Wednesday, 3 September 2014

UNSW Guest Lecture - The Benefits of Blending Engineering with Communication

This is adapted from a presentation given to UNSW students at the Climate Change Research Centre. Many, many thanks to them for asking me to come along. Universities are fun.



The Herald Sun has the highest circulation of any daily newspaper, in Australia. It has a daily readership of 1.5 million. Not too long ago, an economics writer working for the Herald Sun decided to publish an article about wind power. In it, he writes:

“On Monday, all the wind farms in Southern Australia, all the hundreds of turbines scattered across South Australia, Victoria, New South Wales and Tasmania, altogether produced exactly zero — nothing, nada, zip, zilch — power for two hours smack in the middle of the day……..That included those two hours, from 3pm to 5pm, of absolutely no power”

I work at a company called Infigen Energy, and part of my current job is assembling and disseminating articles that discuss renewable energy. This article came up in my media monitoring sweep, and I felt an instant thrill. It’s not often that you see articles in the media that attempt to discuss the actual operation of wind energy in this level of detail. So, did the author get it right? Did the entire Australian wind farm fleet simultaneously drop to zero megawatts of power output?

When you access wind farm generation data hosted by the east coast market operator, known as AEMO, you can see that the actual output of wind farm was around 20 megawatts. The total installed capacity of the wind farm fleet is around 3,000 megawatts, so it’s obviously quite low. But it’s not zero, so the content in the article in the Herald Sun was demonstrably false.

Here’s the other thing – even if the combined power output of all wind farms were to drop to zero, it doesn't really mean anything. There are two reasons for this.

First, wind farms are not distributed across all possible high-wind sites on the Eastern seaboard. Modelling commissioned for AEMO shows that there's a variety of locations in Australia you need to build your wind farms to ensure a proper spread. We're not there yet.

Obviously, this isn't modelling isn't 100% wind power. It’s mix. It’s assumed that there will be times when wind speeds are low across the fleet, and that we can account for these rare occurrences using other low-carbon or zero carbon technologies.

Even without considering the presence of other technologies, we can quantify the frequency with which our wind energy fleet sees periods at which the output is low. Here’s a chart of the percent of time, each month, that the fleet spent below 50 megawatts. As you can see, as the installed capacity of wind farms increased over the past three years, the amount of time that fleet-wide low-wind occurred was low.

This is a pretty interesting mistake. These articles tend to get re-blogged and tweeted and cited in a variety of places, meaning it has a real impact on how people view technology like wind energy. It’s pretty important to compare it to better, more accurate coverage of technology.


This article, published in The Australian, looks at the same month – July – but it reports on data for the entire month, rather than a single two hour period.

43% of South Australian electrical energy was sourced from wind power, for the month of July. This is the highest ever percentage of power from wind energy in a single state for a month.

This article considers the energy output of wind power, not the power output. Wind power varies when you examine it on a short time scale, but when you look at contribution over time, you can see that it contributes pretty significantly to the energy mix.

We have two articles here, about the same month, that seem to reach extremely different conclusions.

One decries wind energy as a useless, ideological totem – something that fails with obscene regularity. The other article, wielding the same month and the same data, declares that it’s the best performance of wind power in the history of the technology in the country. The fact that wind speeds change over time seems to be dealt with very differently, despite the facts being the same in each instance. 

There are a couple of clips I’d like to play here, to illustrate how engineering problems are understood by politicians. In this case, I’m going to instance a politician who currently holds the highest office in Australia. This is a clip of Tony Abbott talking to the Australian Steel Institute in 2011:

And, let’s follow up that clip with another clip.

Yep. You can use sunlight to melt steel. Whilst it's no steel mill, it's enough to demonstrate Abbott's hope and desires around the absence of clean tech in industry and manufacturing are false (incidentally, BMW will partly power their proposed electric car manufacturing plant with a wind farm) 

2011 wasn’t the last time he said it either. It’s become his favourite talking point when asked about the viability of renewable energy – a pithy phrase that’s summoned quite regularly.


The logic underpinning this sound bite is that if a resource varies over time, then it is disqualified from comprising any percentage of our national electricity grid. What do we do when the sun doesn’t shine, and the wind speeds are low? Don’t we want reliable baseload generation in the electricity market?

In a letter written by a wind farm opposition group in South Australia, we find traces of the article I mentioned in the Herald Sun, mixed in with Tony Abbott’s catch phrase – “When the wind doesn't blow, the power doesn’t flow”.

It’s pretty clear that media, politics and the public are intertwined. Within each of the three categories, there are times where people have a good understanding of the technicalities of renewable energy, and there are times where people have an extremely bad understanding of the technicalities of wind energy.

These three areas of public discourse have a shaky and fragile relationship with the hard engineering that underpins the coal face (excuse the term) of our efforts to decarbonise our energy system. The key to understanding why science and emotion collide in these worlds lies in an operational federal government scheme known as the renewable energytarget.


This policy was introduced by the Howard government in 2001, and since then, it’s been split into two parts – the LRET, or large scale renewable energy target, and the SRES, or small scale renewable energy scheme. Combined, these two schemes aim to ensure we get at least 20% of the total energy over the course of a year from energy sources that aren’t coupled to greenhouse gas emissions. These energy sources include hydro, wave, tide, ocean, wind, solar, energy crops, ag waste, food waste, black liquor and a range of others.

So, we started at a point where we had 0% of the total energy made by our machines from clean tech. We want 20% of electrical energy made by different machines – ones that aren't coupled to greenhouse gas emissions.

But if we build the machines, will we need the electricity? What if we have too much electricity?

An example of a 'bid stack', showing offers of generation at differing prices, stack from lowest price to highest price. 

This is what’s called a bid stack. Every five minutes, the market operator, AEMO, figures out exactly how much power it needs, measured in megawatts.

This is what’s called ‘dispatch’. One of AEMO’s responsibilities is the reliable supply of power to meet the demand we create when we turn on our TVs and laptops. They also need to ensure there’s extra capacity in case something goes offline – whether that’s a single power station or a transmission line transporting electricity from place to another.

But that’s not the only thing they do. They also need to deliver the power at the cheapest possible price.

So, every five minutes, each generator on the electricity market, regardless of fuel type, submits a bid – they offer a certain number of megawatts at a certain number of dollars. AEMO wants the final price to be as cheap as possible – so they fill up the stack of required megawatts from the cheapest to the most expensive. So coal, which is generally the cheapest, offers their megawatts at the lowest price. Gas is a bit more expensive, and so it fills the stack even further.

If demand is high enough, they'll call on diesel generators, which are expensive. The price is set by the generator that gets slotted in just before they hit the required amount of for demand.

Power output by fuel type in South Australia, over the past few days, showing wind crowding out generation from fossil fuels. 

Things get interesting when you add renewable energy. The RET scheme works by requiring retailers to purchase clean energy generation certificates, which are known as LGCs. They pass the cost of these through to the consumer – they make up about 3% of your electricity bill. I’ll come back to these a bit later. The certificates offset the expensive cost incurred by companies building wind farms and solar panels when building the machines. But once they’re built, the fuel is free. So when we submit our bid every five minutes, our bid more than just cheap – it’s zero dollars. However much renewable energy resource is available is dispatch first because we’ve submitted the lowest bid.

A snapshot of wholesale electricity prices on the 26th of August

Because we’re filling the stack with cheap clean energy, and because the cost of building expensive machines is offset through the certificate scheme, the price that ends being set by the last generator that slots into the stack is a lower price than it would have been, had there been no renewable energy. If prices are decreased more than 3%, then clean technology has already made up for the 3% price impact on retail electricity bills.

During the rare times when there’s no wind output or no solar output, things are just business as usual. So, prices are either normal, or lower - on average, that means prices end up lower. 

What I've just described is known as the merit order effect, and the heatwave we experienced during January this year is an excellent example of this effect at play. The chart shown here is the output of wind farms during the week. Because there were times where wind power pushed the bid stack upwards, it meant the slice of super-expensive generation at the top of the bid was cut out of the dispatch run. An energy retailer named Meridian energy analysed power output and wholesale price during the week, comparing actual price to what the energy market would look like without wind in the system.

Sinclair Knight Mertz, the modellers involved in this, found that wind contributed to 6% of volume in Victoria and South Australia, but reduced wholesale prices by 40%. When prices are already high due to extremely high demand, that reduction ends up being a very large dollar value, in the order of millions.

Another example of the actual outcomes of the addition of renewable energy technology to the grid – the crowding out effect of fossil fuel generation I cited above. The chart above shows output by fuel type in South Australia in the final weeks of July and early August. You can see, quite clearly, that there is less gas dispatched in South Australia during that week. The extent to which this occur depends on the output of wind farms. But because wind speeds are nearly always high enough to have some output, this effect is almost always occurring.

An example of cherry-picking in media discussion about power output - this instance occured during the heatwave in January. Source

Consistently, those opposed to wind power, whether they’re embedded in the media, politics or just public opinion, choose time periods where power output is low. It’s a meaningless assertion, but it’s a quick fix – it betrays a disconnect between the engineering of the electricity grid – in that the system can handle variable output technology quite easily.

“Based on experience to date and analysis of likely future outcomes, AEMO considers that it is technically feasible to integrate the renewable energy likely to emerge from the existing RET settings while maintaining the security of the power system”

AEMO state quite clearly in their RET submission that it doesn’t matter that when the wind don’t blow, the power don’t flow – the system is designed to absorb that variability. Additionatelly, AEMO uses an advanced wind power forecasting system.

It’s important to remember that communicating the science and engineering underpinning this particular aspect of our reaction to climate change requires a fairly dedicated effort not only to analytical honesty, but to finding the ability to communicate with the same passion that the doubters do.

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