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Govt's local power warning as supply crunch continues


The Malinauskas Government says the state has enough electricity to meet demand amid ongoing warnings of lack of supply, but “market failure” could invoke powers legislated after the 2016 blackout to stop local generators sending power interstate.

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The Australian Energy Market Operator (AEMO) has issued a “Lack of Reserve Level 3” (LOR3) notice that signals South Australia will experience an energy supply crunch tomorrow between 7am and 12pm, and 1.30pm and 2.30pm.

A LOR3 notice that was in place for tonight has been cancelled.

The status means there are no reserve energy supplies available and controlled load shedding may be required as a last resort to ease pressure on the system.

“This condition exists when the available electricity supply is equal to or less than the operational demand. This means there are no reserve supplies available,” AEMO states.

“Controlled load shedding may be required as a last resort to protect system security and prevent long-term damage to system infrastructure.”

AEMO warns several suburbs, particularly in Adelaide’s north west, should prepare for blackouts lasting 45 minutes.

Areas most likely to be impacted include Woodville, Woodville Gardens, Wingfield, Pennington and Rosewater.

AEMO regularly updates its warnings on its website.

State Energy Minister Tom Koutsantonis told InDaily the energy crunch being experienced across Australia was “not a supply issue, it’s a market failure issue”.

He said invoking the LOR3 status gave the AEMO powers to direct generators on, ensuring adequate supply.

“There is adequate generation to meet supply, but generators are not bidding, so AEMO issued a Lack of Reserve notice 3, which gives them the level of authority to direct generation on,” he said.

“This isn’t like summer where everything is on and there’s no more power to give.

“We have enough supply to meet demand, it’s just not being made available.”

The last time manual load shedding occurred in South Australia was in February 2017, when more than 90,000 homes and businesses experienced power outages.

Following a statewide blackout and a subsequent inquiry in 2016, the SA parliament amended legislation to give the Energy Minister powers to instruct electricity generation on or off, or to control where electricity is exported.

Koutsantonis said if shortfalls occur in South Australia as a result of the current energy crisis, Premier Peter Malinauskas had instructed him to stop generators from exporting power interstate.

“This (power) was put in place in 2016 because when the statewide blackout occurred AEMO did not order on generation and on that day the state government was powerless to do anything,” he said.

“We just reinstated the powers we had before the privatisation of ETSA (Electricity Trust of SA).”

It comes after the AEMO yesterday took full control of directing supplies from energy generators, and set prices for every state in the market until further notice.

AEMO CEO Daniel Westermann said yesterday that the unprecedented move was not expected to increase power prices or lead to blackouts.

He said the drastic intervention was a “temporary measure” which would be “reviewed daily”, saying the operator would “return the market to its normal state once AEMO is confident” it could operate properly.

Federal Energy Minister Chris Bowen says the AEMO taking control of the market has provided the best chance of it functioning properly for consumers.

“It means that the operator is effectively determining the best way for Australia’s energy to be generated and paid for and provided to consumers while the market simply wasn’t functioning,” Mr Bowen told reporters on Thursday.

Mr Bowen said while the government is working on short, medium and long-term solutions to strengthen the grid and reduce energy prices, an under-investment in infrastructure had made the market susceptible to pressure points.

“The problem is there is not enough investment in renewable energy. There hasn’t been enough investment in storage,” he said.

“Yes, you can say the wind doesn’t always blow and the sun doesn’t always shine. The rain doesn’t always fall either, but we can store the water, and we can store renewable energy if we have the investment.”

Federal Energy Minister Chris Bowen and Prime Minister Anthony Albanese speaking to reporters in Canberra this morning. Photo: Lukas Coch/AAP

Prime Minister Anthony Albanese added that under-investment in transmission infrastructure had also created a problem.

“Ownership is just one factor and I don’t think it can be viewed in isolation from regulation and other matters,” he said.

“Part of the problem was over-investment in poles and wires. Some of the structures that were in place, that didn’t drive the investment to where it needed to go.”

While the market regulator has been tasked by the government to establish gas reserves to help avoid future supply constraints, Bowen was less committal when asked about coal reserves as Europe seeks to increase its imports, with an embargo on Russian coal coming into effect in August.

Asked about the measure to avoid future energy supply constraints, Bowen said there is currently no legislative or legal basis through which the government can force exporters to stockpile domestic reserves.

“At the moment, we are dealing with pressures because of coal-fired power outages,” he said.

“The coal market itself has been tight, but it hasn’t been caused by coal shortages.”

Opposition Leader Peter Dutton said Labor was rushing into putting renewables into the system.

“You can’t firm up renewable energy the way in which people would want to at the moment,” he said on 2GB radio.

“Labor at the moment is rushing towards the new system, when frankly it’s not at a sensible pace.”

– with AAP

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