SA will take top prize for Most Expensive Electricity from Denmark on July 1

South Australia has the largest uranium deposit in the world, which it digs up to sell to other countries to make electricity. It also has lots of sun and wind and empty space. If any state can make solar and wind power work, surely it’s there.

And renewables are working for SA, working to put it in top place for Global Electricity Bills.

South Australia power prices to rise to highest in the world on Saturday, energy expert warns

South Australia will overtake Denmark as having the world’s most expensive electricity when the country’s major energy retailers jack up their prices this Saturday.

AGL, EnergyAustralia and Origin Energy will all increase their electricity prices from July 1, adding hundreds of dollars to annual household bills. Residential customers will see an average rise of 18 per cent under AGL, 19.9 per cent from EnergyAustralia, 16.1 per cent with Origin Energy. Bruce Mountain, the head of a private energy consultancy firm, said the increases would see South Australia take the lead on world power prices — but for all the wrong reasons.

“After taxes, the [typical] household in South Australia will be paying slightly more than the [typical] household in Denmark, which currently has the highest prices in the world,” Mr Mountain said.

Naturally, though both Denmark, and SA have the highest percentage of “renewable” energy in the world, this has nothing to do with them also being number one and two for Global High Cost Electricity. It’s just really bad luck that there is no country anywhere in the world which has both wind and solar and cheap electricity.

Michael McClaren, interviews Bruce Mountain, expert:

From commenter Pat: “…he exonerates wind and solar early in the piece, but it’s enough to listen from 11 mins in where he says (paraphrasing) – “…renewables have nothing to do with electricity price rises. wind & solar now cheaper at an average cost than coal or gas. transformation in energy, old world vs new world (of renewables). Mountain finally admits he doesn’t know if the total cost of the new world is higher than the total cost of the old world, but simply saying wind & solar are driving up our costs is not right.

AUDIO: 13mins29secs: 29 Jun: 2GB: Michael McClaren: Power prices highest in the world

Poor governance and market oversight is to blame for power prices soaring out of control, says energy expert Bruce Mountain.

http://www.2gb.com/podcast/power-prices-highest-in-the-world/

Bruce Mountain blames bad governance, which is also surely true, but alas, a confounding problem. Which state with a free market in electricity could also have a high uptake of wind and solar? Mountain thinks it’s worth mentioning that the marginal cost of wind and solar when they are producing is zero (as if the aim of an electricity grid was to provide random spikes of electricity “as the wind blows”. He doesn’t think it’s worth mentioning the 24 hours demand for spinning inertia to stabilize the grid, which coal and gas provide “for free”).

He argues that the zero cost nature of wind and solar depresses the wholesale price of electricity, and then people play a lot of games with electricity pricing (which I’m sure is true). He doesn’t say that in the old electricity market, there were less games, because it was a lot less complicated, and it didn’t need so much “governance” and “regulation”.

Ignoring the extra grid costs, transmission lines, and the devastating effect the intermittency and instability of wind and solar power Mountain claims a lot of wind and solar has a cheaper average cost than coal or gas. Yet even he has to concede that he “doesn’t know if the total cost of the new world is higher than the cost of the old world”.

Given that grid scale electricity is so difficult to estimate costs for surely the only marker that counts is the actual consumer price (plus taxpayer subsidies). If solar and wind are so cheap where is the key observation — the wealthy state running on wind and solar that attracts new businesses because of its cheap electricity?

h/t David B, pat

UPDATE: There’s more here on electricity price comparisons around the world.

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