Good stuff Larry the train is getting closer the country would be better off if Genesis put the $200m battery budget towards another coal powered turbine thus releasing gas for industry 😀
As one who has spent time in Gippsland Victoria I see by Google search today that coal generated electricity is not only being phased out but the plant itself has become unreliable and often closed for repair - like the Ford acronym. NZ does not need coal when we have a surplus of reliable hydro electricity
Yes, the Australian media loves to get the knife and say "old and unreliable coal plants" at every chance. ... as opposed to the brand new and shiny unreliable solar and wind farms
The media in Australia have moved beyond fossil fuel die-hards like Shane Jones and Chris Bishop. Definitely agree with you Christian about wasting overseas exchange on unreliable solar and wind farms except they are an ideal solution for hydro poor desert nations
Hi Winston, I know and appreciate what you are saying. We would still have an issue with where that electricity is geographically located vs the under supplied segment of the demand. But you make a good point.
Tx for having. me Larry. I'm just a one trick pony compared to your expertise and knowledge. The solution to the geographical problem tho was solved by the 2 way cable 50 years ago and the opportunity to convert surplus generation capacity in Southland into gas obviously exists. NZ is blessed with hydro but cursed by imported products like windmills and solar panels which detract from the investment of our ancestors in the 1950/60s
Wind and solar are expensive and we need a storage technology that is low cost and long-term. It doesn't exist. The cheapest existing technology is pumped storage and that is impossibly expensive for more than a few days storage.
Meanwhile, the whole electricity industry from the Electricity Authority downwards seems to have its head buried in the sand.
Hi Bryan, I was recently at an energy forum and the message from the Mercury CE was that we will see the role of hydro change to being in support of wind and solar. My comment in response is that this will would increase the unit cost of electricity as it means a marginal increase in output but a huge increase in the asset base which directly translates to OPEX cost increases. This is the message I was trying to convey in my "hydro peaking" article a few weeks ago.
As I understand it, and you will have a much better handle on this, we don't actually have a lot of storage so there are limits to the utility of this plan even if in some parallel universe it actually made sense to curtail generation and spill water from the cheapest source of generation to create room for a more expensive and more complicated to manage source.
No government should make decisions without detailed analysis beforehand. Hopefully that lesson is imprinted in the minds of those who take the Chair on the ninth floor of the Beehive given the folly of the past.
Apparently the Germans built an LNG import facility in 6 weeks or so. Including permits and environmental approvals etc ... necessity being the mother of all inventions or something like that. Just saying.
Yes, this was based around FSRU (floating storage re-gasification units), basically a ship you tie up at a wharf that acts at a tank that can be re-filled by LNG carriers. The NZ problem is where do you park it? We need some specific marine conditions and pipes to discharge into. I'm planning to do a post on this as I'm increasingly thinking we have been too quick to dismiss this option.
Thanks for doing the analysis and writing this up.
Any small business in NZ that uses gas in its production processes would be well advised to get off that drug sooner rather than later. There’s no white knight charging over the horizon to save you and when the restrictions come the politicians will allocate 1st to voters then to big business so SMEs will get left in the cold - literally. If you can, follow Lion’s lead and put panels on your roof too as gas for electricity generation will also get squeezed.
Batteries! Batteries! Batteries! Combined with renewables these are technologies cheaply available NOW. Not some maybe possible fusion or safe nuclear technology still just over the horizon. Or some P3 or P4 gas that Shano ‘wants’ to be there but probably isn’t. Install a solar panel this morning and it’s producing this afternoon. Add a battery tomorrow & you have light the following night. Repeat! Repeat! Repeat.
The problem is which other drug do they move to? The gas problem is also an electricity problem. We steering down the barrel of losing the Stratford TCC unit ultimately due to a lack of fuel and loss of Fonterra co-gen due to electrification at Whareroa. We are lossing firm power and adding new loads. It's not a good recipe.
Larry, thanks very much for this. My question is that many other countries buy LNG and it's an industry that is healthy, with good supplies (I don't know about NZ delivery): why would we not? As a transition fuel, it seems to me it is worth considering - one large LNG tanker is over 3.5PJ and a wharf and pipes might be cheaper than more drilling and an easier political 'sell'.
Hi Clive, I agree and point you to my response to Christian above. It definitely deserves a closer look. It is a somewhat volatile global market. A couple of key things that it is sensitive to for example are Nordstream 2. There are some interesting moves happening with Nordstream which if restarted would reduce LNG demand to Europe and see the prices become very attractive. The other is the security of the middle east gas fields with tensions ramping up over there. Europe has been getting gas from the region as an alternative to Russia if this is compromised the inverse price swing would be dramatic.
What is frustrating for me is the huge amount going to Ballance and Fonterra. Hard to tell from the graph but the Kapuni Urea plant looks like one of the biggest users, so synthetic nitrogen to grow grass that cows eat and then piss 75% of the nitrogen straight out as reactive nitrogen to pollute our rivers lakes streams and groundwater. Fonterra uses the gas and coal to dry the milk to export to be a cheap protein input to global junk food (e.g. Mars bars). https://theconversation.com/11-000-litres-of-water-to-make-one-litre-of-milk-new-questions-about-the-freshwater-impact-of-nz-dairy-farming-183806
Hi Mike, the energy proposition posed by urea-based pasture production is an interesting question from an energy mass balance alone. The energy input is highly likely to be much higher than the energy output. In saying that urea has become so expensive I'm pretty sure there is a lot less of it being used and I'd need to check but I'm pretty sure the national herd has reduced quite a lot too. My farming friends are all looking at lower input models to try and respond to on farm inflation. Using a big picture lense perhaps this is the first signs of a simplification?
Here on our little pilot project, we have been experimenting with more regen based approaches. So far so good lower output possibly but also lower inputs.
If only!!!! dairy cow numbers and synthetic urea fertilser use are only very slightly down on exponential growth. 10,000 more cows planned for canterbury alone https://www.thepress.co.nz/nz-news/360701784/high-prices-see-more-dairy-conversions-canterbury. There is no hope for a transition to regen when there is no incentive to change. Dairy farmers are currently massively subsidised by not having to pay any of their externalities trying to compete with that kind of tilted playing field would be an economic disaster. Daiy is biggest GHG emitter (exempt from ETS) biggest freshwater polluter zero cost paid the rest of society cover all those costs. My farming friends who try to do what yours are get a call from the bank telling them to get mback to max input to get max outputs
Rod Drury was talking to Ryan Bridge on Herald Now this morning about the energy crisis. Hopefully more business people will come out of hiding and express concern about the situation and solutions found before the end of year.
I have been impressed with James Kilty (Transpower). I heard him speak this week and was pleased to hear some hard truths and practical reality. I think the shift you hope for is happening. There are a lot of increasingly frustrated people out there who want physics to prevail over platitudes.
Being tectonic deep sea is probably the only new big reserves but I don’t think anyone will risk investing in New Zealand. There was a discovery offshore Canterbury but not sure on the facts as a lot of the wells drilled in the South Island have some amazing discoveries but not proven data.
If rumors are true, which the seldom are, the Canterbury prospect has the potential to be very large. This would be a frontier development though and would take more than a decade to bring online as there is no infrastructure there to make the development easier. Our biggest problem now is a lack of time.
Appreciate your expertise and analytical skills, as always.
Many thanks for taking the time. Scrolling through the different formatting is rage inducing.
Gearing up for a train wreck with what you outline combined with the full spectrum ineptitude of the political class. 🥲
Thanks, time is certainly not on our side and the constant policy yoyoing back and forth just creates inaction.
Good stuff Larry the train is getting closer the country would be better off if Genesis put the $200m battery budget towards another coal powered turbine thus releasing gas for industry 😀
As one who has spent time in Gippsland Victoria I see by Google search today that coal generated electricity is not only being phased out but the plant itself has become unreliable and often closed for repair - like the Ford acronym. NZ does not need coal when we have a surplus of reliable hydro electricity
Yes, the Australian media loves to get the knife and say "old and unreliable coal plants" at every chance. ... as opposed to the brand new and shiny unreliable solar and wind farms
The media in Australia have moved beyond fossil fuel die-hards like Shane Jones and Chris Bishop. Definitely agree with you Christian about wasting overseas exchange on unreliable solar and wind farms except they are an ideal solution for hydro poor desert nations
Much of this "unreliability" is a function of cycling and under utilisation.
Hi Winston, I know and appreciate what you are saying. We would still have an issue with where that electricity is geographically located vs the under supplied segment of the demand. But you make a good point.
Tx for having. me Larry. I'm just a one trick pony compared to your expertise and knowledge. The solution to the geographical problem tho was solved by the 2 way cable 50 years ago and the opportunity to convert surplus generation capacity in Southland into gas obviously exists. NZ is blessed with hydro but cursed by imported products like windmills and solar panels which detract from the investment of our ancestors in the 1950/60s
It’s a pleasure to have you Winston!
Wind and solar are expensive and we need a storage technology that is low cost and long-term. It doesn't exist. The cheapest existing technology is pumped storage and that is impossibly expensive for more than a few days storage.
Meanwhile, the whole electricity industry from the Electricity Authority downwards seems to have its head buried in the sand.
Hi Bryan, I was recently at an energy forum and the message from the Mercury CE was that we will see the role of hydro change to being in support of wind and solar. My comment in response is that this will would increase the unit cost of electricity as it means a marginal increase in output but a huge increase in the asset base which directly translates to OPEX cost increases. This is the message I was trying to convey in my "hydro peaking" article a few weeks ago.
As I understand it, and you will have a much better handle on this, we don't actually have a lot of storage so there are limits to the utility of this plan even if in some parallel universe it actually made sense to curtail generation and spill water from the cheapest source of generation to create room for a more expensive and more complicated to manage source.
An important analysis, thanks.
No government should make decisions without detailed analysis beforehand. Hopefully that lesson is imprinted in the minds of those who take the Chair on the ninth floor of the Beehive given the folly of the past.
Thanks Peter
Apparently the Germans built an LNG import facility in 6 weeks or so. Including permits and environmental approvals etc ... necessity being the mother of all inventions or something like that. Just saying.
Yes, this was based around FSRU (floating storage re-gasification units), basically a ship you tie up at a wharf that acts at a tank that can be re-filled by LNG carriers. The NZ problem is where do you park it? We need some specific marine conditions and pipes to discharge into. I'm planning to do a post on this as I'm increasingly thinking we have been too quick to dismiss this option.
Thanks for doing the analysis and writing this up.
Any small business in NZ that uses gas in its production processes would be well advised to get off that drug sooner rather than later. There’s no white knight charging over the horizon to save you and when the restrictions come the politicians will allocate 1st to voters then to big business so SMEs will get left in the cold - literally. If you can, follow Lion’s lead and put panels on your roof too as gas for electricity generation will also get squeezed.
Batteries! Batteries! Batteries! Combined with renewables these are technologies cheaply available NOW. Not some maybe possible fusion or safe nuclear technology still just over the horizon. Or some P3 or P4 gas that Shano ‘wants’ to be there but probably isn’t. Install a solar panel this morning and it’s producing this afternoon. Add a battery tomorrow & you have light the following night. Repeat! Repeat! Repeat.
Watch this space Stephen. A piece on batteries coming up.
This might help. https://www.construction-physics.com/p/batteries-are-making-the-electrical
The problem is which other drug do they move to? The gas problem is also an electricity problem. We steering down the barrel of losing the Stratford TCC unit ultimately due to a lack of fuel and loss of Fonterra co-gen due to electrification at Whareroa. We are lossing firm power and adding new loads. It's not a good recipe.
Larry, thanks very much for this. My question is that many other countries buy LNG and it's an industry that is healthy, with good supplies (I don't know about NZ delivery): why would we not? As a transition fuel, it seems to me it is worth considering - one large LNG tanker is over 3.5PJ and a wharf and pipes might be cheaper than more drilling and an easier political 'sell'.
Hi Clive, I agree and point you to my response to Christian above. It definitely deserves a closer look. It is a somewhat volatile global market. A couple of key things that it is sensitive to for example are Nordstream 2. There are some interesting moves happening with Nordstream which if restarted would reduce LNG demand to Europe and see the prices become very attractive. The other is the security of the middle east gas fields with tensions ramping up over there. Europe has been getting gas from the region as an alternative to Russia if this is compromised the inverse price swing would be dramatic.
What is frustrating for me is the huge amount going to Ballance and Fonterra. Hard to tell from the graph but the Kapuni Urea plant looks like one of the biggest users, so synthetic nitrogen to grow grass that cows eat and then piss 75% of the nitrogen straight out as reactive nitrogen to pollute our rivers lakes streams and groundwater. Fonterra uses the gas and coal to dry the milk to export to be a cheap protein input to global junk food (e.g. Mars bars). https://theconversation.com/11-000-litres-of-water-to-make-one-litre-of-milk-new-questions-about-the-freshwater-impact-of-nz-dairy-farming-183806
Hi Mike, the energy proposition posed by urea-based pasture production is an interesting question from an energy mass balance alone. The energy input is highly likely to be much higher than the energy output. In saying that urea has become so expensive I'm pretty sure there is a lot less of it being used and I'd need to check but I'm pretty sure the national herd has reduced quite a lot too. My farming friends are all looking at lower input models to try and respond to on farm inflation. Using a big picture lense perhaps this is the first signs of a simplification?
Here on our little pilot project, we have been experimenting with more regen based approaches. So far so good lower output possibly but also lower inputs.
If only!!!! dairy cow numbers and synthetic urea fertilser use are only very slightly down on exponential growth. 10,000 more cows planned for canterbury alone https://www.thepress.co.nz/nz-news/360701784/high-prices-see-more-dairy-conversions-canterbury. There is no hope for a transition to regen when there is no incentive to change. Dairy farmers are currently massively subsidised by not having to pay any of their externalities trying to compete with that kind of tilted playing field would be an economic disaster. Daiy is biggest GHG emitter (exempt from ETS) biggest freshwater polluter zero cost paid the rest of society cover all those costs. My farming friends who try to do what yours are get a call from the bank telling them to get mback to max input to get max outputs
Rod Drury was talking to Ryan Bridge on Herald Now this morning about the energy crisis. Hopefully more business people will come out of hiding and express concern about the situation and solutions found before the end of year.
I have been impressed with James Kilty (Transpower). I heard him speak this week and was pleased to hear some hard truths and practical reality. I think the shift you hope for is happening. There are a lot of increasingly frustrated people out there who want physics to prevail over platitudes.
Being tectonic deep sea is probably the only new big reserves but I don’t think anyone will risk investing in New Zealand. There was a discovery offshore Canterbury but not sure on the facts as a lot of the wells drilled in the South Island have some amazing discoveries but not proven data.
If rumors are true, which the seldom are, the Canterbury prospect has the potential to be very large. This would be a frontier development though and would take more than a decade to bring online as there is no infrastructure there to make the development easier. Our biggest problem now is a lack of time.
Excellent analysis Larry
Thanks Winston much appreciated!