1 electricity and gas market update - committee for ballarat daley presentati… · $2bn...
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1
1
Committee for Ballarat
Electricity and Gas Market
Update
6 April 2017Carl Daley
SavvyPlus Consulting Pty Ltd
2 Agenda
WHAT IS GOING
ON?
HOW DID THIS
HAPPEN
WHAT CAN WE
DO ABOUT IT?
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3 Agenda
WHAT IS GOING
ON?
HOW DID THIS
HAPPEN
WHAT CAN WE
DO ABOUT IT?
SavvyPlus Consulting Pty Ltd
4 Future power prices have taken off …
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5 and other States too!
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6 Power spot prices explained …
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7 Power spot prices have taken off …
Records …
• Highest Q1 average price on record in
Queensland, NSW and Victoria
• Highest March average price in Victoria
and NSW on record
• Second highest March and Q1 average
price for SA on record
• Second highest Tasmanian March and
Q1 average price on record, only
exceeded by last year when the
Basslink failed
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8 Gas spot prices have taken off …
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9 Victorian gas price history …
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10 Lights are going out ( or threatening) …
SA System Black NSW sheds Tomago smelter to
avoid load shedding
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11Record Energy Policies in 3 days
9thAEMO warns of blackouts
as gas runs out
NSW, Vic and SA face power shortages in the
next two years that may require LNG exports
to be diverted to maintain power reliability
standards, according to AEMO following
dramatic cut to domestic gas production
forecasts.
10thAEMO releases its Medium
Term Outlook
AEMO’s latest outlook predicts gas
shortages impacting power generation as
early as winter 2017, causing winter forward
prices to jump.
14th SA Energy Minister to be
given more control in state's $500m
plan to secure future
14thVictorian Government to
invest extra $20m in large-scale
energy storage
An extra $20m will be invested in Victoria's
large-scale energy storage, the State
Government says, as it works to address the
state's increasing energy needs.
15thCrisis meeting on gas as
Prime Minister fears winter chaos
Malcolm Turnbull met with gas company
executives to help secure manufacturing
jobs and provide low-cost heating for
families by bolstering domestic supply.
16thSnowy Hydro scheme
boosted by 2,000MW costing $2bn
The Federal Government announced a
$2bn intervention in Australia's electricity
supply debate, by expanding the Snowy
Mountains hydro scheme using pump
storage by 2,000MW.
March 2017
109
14 15 1615
The plan includes building, owning and
operating a $360m, 250MW gas-fired plant.
The private sector would also build Australia's
largest battery storage (100MW) before next
summer.
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12 Questions ?
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13 Agenda
WHAT IS GOING
ON?
HOW DID THIS
HAPPEN
WHAT CAN WE
DO ABOUT IT?
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14 Base supply has tightened …
5,700MW closed
since 2012
Recent closures
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15 Hazelwood Power Station closure …
Hazelwood generation March 2017 … the end of an era
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16 Demand has increased … Qld LNG driven
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17 NSW demand highest since 2011
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18AGL Vic has reduced low price generation
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19Snowy Vic has reduced low price generation
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20Hydro Tasmania has reduced low price generation
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21Substantial fuel switch across the NEM
Significantly less hydro, and gas running more often
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22 Domestic gas is being diverted to LNG
Santos reported
as acquiring 20%
of domestic gas
and diverting for
LNG exports
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23 Same demand, prices much higher
Q1 2017 vs Q1
2016
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24 Questions ?
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25 Agenda
WHAT IS GOING
ON?
HOW DID THIS
HAPPEN
WHAT CAN WE
DO ABOUT IT?
SavvyPlus Consulting Pty Ltd
26 Procurement Australia
• For customers with contract
expiring in 2017
• May be able to be rolled into a
lower price agreement struck
in late 2015
• Contact Carl Daley for further
information
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27 Behind-the-meter solutions
• Be careful about ‘promises’ from sellers
• Technology (and cost) is moving fast
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28 Knowledge Based Strategy
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29
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30 Agenda
WHAT IS GOING
ON?
HOW DID THIS
HAPPEN
WHAT CAN WE
DO ABOUT IT?
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31 Any further questions?
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32
32 Thank you
Carl Daley
Managing Director
SavvyPlus Consulting
03 9081 0480