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BHP issues jobs warning after another SA blackout

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South Australia’s electricity system separated from the national power grid overnight, prompting a stern warning from BHP Billiton about threats to Australian jobs and investment.

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About 200,000 homes and businesses lost power for over an hour, but BHP’s Olympic Dam operations in the north of the state were interrupted for about four hours.

The Australian Energy Market Operator (AEMO) confirmed today that the disconnection happened at 1.33am, due to “an issue on the Victorian transmission network, impacting the flow via the Heywood Interconnector to South Australia”.

AEMO said power was restored at 2.45am, while South Australia was reconnected with the national grid at 5.11am.

The “root cause” is under investigation.

“Approximately 220 megawatts was lost in South Australia (equating to approximately 200,000 customers) due to the need to balance the frequency of the network,” AEMO said in a statement.

The operator said the incident had nothing to do with South Australia’s state-wide blackout in September. That incident was caused by an overload on the Victorian interconnector after storms brought down powerlines, causing wind farms to disconnect from the grid.

“AEMO is working closely with Victorian transmission network service provider AusNet Services to identify the cause of the fault,” AEMO said.

“Further details will be supplied following further investigation, however it is important to note that this event was not related to the Black System event in South Australia on 28 September 2016.”

BHP CEO Andrew Mackenzie issued an urgent warning to policy-makers after the latest incident, which comes two months after the statewide blackout led to about two weeks of lost production at Olympic Dam.

“Olympic Dam’s latest outage shows Australia’s investability and jobs are placed in peril by the failure of policy to both reduce emissions and secure affordable, dispatchable and uninterrupted power,” he said in a statement.

“The challenge to reduce emissions and grow the economy cannot fall to renewables alone.

“This is a wake-up call ahead of the COAG meeting and power supply and security must be top of the agenda and urgently addressed.”

The incident also cut power to a Victorian smelter for about three hours.

Energy Minister Tom Koutsantonis said the problems were on the Victorian side of the border and “South Australia’s grid operated effectively as an island and load began to be restored within half an hour”.

He said BHP built back-up power at its mines across the world.

“Why they haven’t done so at Olympic Dam is a matter for them,” he said.

Large industrial players knew that when load shedding had to occur – as it did last night – they were the first to lose power.

He insisted South Australia had enough thermal (conventional) power generation to manage the system and that wind power played a role in stabilising the grid in SA.

However, the incident highlighted the need for a second interconnector to the eastern states.

He also used the incident to hit out at the state Liberals.

“While the grid acted as it should to protect itself from damage, this event has once again reveals just how devastating the decision by Rob Lucas and the Liberals to scuttle a proposed interconnector to NSW was when they sold ETSA,” Koutsantonis said.

“The event also emphasises just how important it is to supply our local generators with affordable gas. The Liberal gas moratorium (announced this week) will make gas expensive in this state, and will make it harder, and more expensive, for generators to manage local demand in the future.”

However, Opposition Leader Steven Marshall said Labor had “chased cheap and reliable power out of South Australia”.

“South Australians are now saddled with the most expensive and least reliable electricity system in Australia,” he said.

“The statement from BHP this morning demonstrates how dangerous this situation has become. The CEO of the world’s biggest mining company has singled out South Australia’s fragile electricity system as a threat to mining in Australia.

“Affordable and reliable power is critical to running a business – it’s not a luxury, it’s an essential!”

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