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Sunday, July 6, 2014

How policy choices accidentally killed off fossil fuels

In 1974 Arthur C. Clarke predicted that Australians in 2001 would have access to the internet from their homes. His prediction envisioned central mainframe computers accessed from terminals. This was a reasonable assumption as companies such Intel, Microsoft and Apple - the creators of low-cost personal computers - could not have been imagined.

The fossil fuel industry fobs off competition from renewable energy with comparisons to "grid-parity" pricing: claiming that the cost of solar energy is greater than the cost of energy produced at a coal-fired power station.

The problem the fossil fuel industry faces in Australia is a decade of unfortunate government policy choices that has resulted in one of the most expensive electricity distribution grids in the world and soaring natural gas prices.

So-called "cheap" fossil energy that costs a few cents per kilowatt-hour to produce in central power stations has a retail price of between 20 cents and 50 cents for Australian households and business.

Against this background Australian researchers are at the forefront of solar photovoltaic technology and have invented two of the four leading energy storage technologies in the world.
Four of the world's 6 largest solar panel manufacturers maintain close research links with their technology developers at the University of NSW.

The University of NSW is also the inventor of the vanadium redox flow battery that Prudent Energy is developing and marketing. The CSIRO is the inventor of the UltraBattery being developed and marketed by Ecoult.
In just 6 years - from 2008 to 2014 - the price of a solar power systems suitable for producing electricity where it is consumed has fallen to almost one-sixth of its 2008 value. A 1 kilowatt system could be installed for $8,000 in 2008. In 2014 a 6 kilowatt system can be installed for $8,500. The notion of "grid-parity" the fossil fuel industry talks about is irrelevant when you don't need an electricity grid to move electricity produced on your roof to a battery and into your home or business.
Personal power stations and the high retail cost of energy in Australia have made central fossil fuel power stations obsolete. 


Lars Boelen said...

Very interesting read. Europe with its high population density will probably not go that way, even though we are also in the situation where "grid transported" electicity cost 4-5 times the price of what it cost she it left the coal plant. Here the reason is "taxes". Because "solar" will
eventually be so cheap that everybody will produce what he needs in his house, the government will probably prohibit disconnecting from the grid for tax purposes. Spain already has taken such measures.