Australia’s Grand Plans to Export Solar – A Lesson from the ‘Gas Crisis’

By John McGregor, a translator and political violence researcher

As perverse as it seems, achieving the dream of linking Australian renewable energy to Asian energy buyers may generate a household electricity crisis as artificial as the current gas crisis. As with LNG, large scale solar projects are set to largely, perhaps even entirely, bypass domestic demand.

The increase in energy prices in recent months has hurt individuals and larger economies. Explanations from politicians and oil and gas companies for this rapid price rise include the pandemic to supply chain issues, although the conflict in Ukraine is probably the number one culprit.

The press and public should seriously question these excuses. In Australia they are nakedly laughable. That doesn’t mean, however, that Australian business ‘leaders’ and politicians haven’t tried them on.

Australian LNG exports increased radically in the 2010’s, although not as quickly as American exports. Australia now vies for the title of largest exporter of LNG with Qatar and the USA.

Even with this abundance of gas, the price of gas in Australia has skyrocketed, with wholesale gas prices in the first quarter of 2022 up 141% from the same period last year.

Not only have prices gone up, but there is even talk of a gas shortfall next year. To protect against this, the Australian Competition and Consumer Commission (ACCC) recommended in its 1 August 2022 report that the government initiate the first steps of the Australian Domestic Gas Security Mechanism, the so-called ‘gas trigger’.

The ACCC forecast a 56 petajoule (PJ) shortfall in domestic gas supply in 2023 “if LNG exporters decide to export all the gas that they expect to have in excess of their contractual commitments (167 PJ) as they did in 2021”. The ACC then proposed a radical measure to address the issue:

It is very likely that to avoid the forecast shortfall in the east coast gas market in 2023, LNG producers will need to divert a significant proportion of their excess gas into the domestic market.

The Australian Financial Review provided the argument from gas producers: “Surely the first response to forecasts of a shortage of gas in Australia should be: let’s get more gas out of the ground!”

Appealing as this might sound, Richard Denniss explained the simple but sad reality of the Australian gas market in the July edition of The Monthly:

Ironically, until 2016 Australians could already rely on relatively cheap gas to heat their homes and fuel their factories. Then the gas industry spent $80 billion on infrastructure, making it possible to start exporting gas from our east coast, and now the Australian gas industry, which is actually 95 per cent foreign-owned, can sell our gas overseas at the world price rather than to Australians at the cost of production. Unsurprisingly, it has been putting the interests of shareholders first ever since.

As the Australian electricity market is so heavily reliant on coal and gas, which contributed 54% and 20% respectively to Australia’s total electricity generation in 2020, it is not insulated from these same forces. In June, the Australian Energy Market Operator (AEMO) suspended the National Energy Market, which provides electricity to most Australian consumers. AEMO argued its hand was forced: “….it has become impossible to continue operating the spot market while ensuring a secure and reliable supply of electricity for consumers.”

The case for renewable energy itself is strong enough that it hardly needs personal financial stress as an additional justification. However, much of the renewable energy investment is designed to maintain the same economic pressures on Australian residents.

In Australia, the uptake of rooftop solar is high, with 30% of houses using solar, and it has received support from government at various levels. According to the Clean Energy Council, the industry body representing the renewable energy sector, small-scale solar accounted for 8.1% of electricity generated in 2021.

Large scale solar, defined as systems larger than 5MW, is still in its infancy as an industry. It only accounted for 4% of electricity generated in Australia in 2021 but is growing rapidly. In 2012, producers installed 10MW of large-scale capacity; in 2021, they added 1,249MW of large-scale solar capacity.

Sun Cable, an Australian company founded by David Griffin and backed by celebrity investors Andrew “Twiggy” Forrest of Forestcue Metals and Mike Cannon-Brookes of Atlassian, is entering this large-scale solar market. In March 2022, the two invested A$210m in Series B capital raising. In parallel, Cannon-Brookes announced in May that he had bought an 11.28% share in AGL Energy Ltd, Australia’s largest electricity generator. He campaigned against a planned demerger that would have seen the company split its generation and retail arms. Cannon-Brookes was ultimately successful when the plan was withdrawn by the end of the month.

Sun Cable plans to add the largest solar plant in Australia, with a total capacity of 17-20GW. This single project would be nearly three times larger than the total currently installed large-scale solar. This enormous solar farm will be installed near the town of Elliott in the Northern Territory. With a population of 339, Elliot clearly won’t need all that power, but nor will the other residents of the NT, some 250,000 people.

The stated plan is to export this power via 4,200 km of submarine cables to Singapore. The name of the proposed Australia link, the Australia-Asia PowerLink (and sometimes Australia-ASEAN PowerLink) shows their larger ambitions. A 2020 document that was part of Environment Protection Act compliance outlined the company’s plans:

The company vision is to establish a high-voltage direct current (HVDC) transmission network across the Indo-Pacific region supplied by large-scale solar and storage facilities utilising the abundant high-quality solar resource in northern Australia.

As it is currently forecast, the solar plant will provide power to residents in the Northern Territory, but will not be connected to the National Energy Market, a unified power network that provides electricity to most Australians outside Western Australia and the Northern Territory.

Experts have posed technical questions about the buildout, which needs to run the world’s longest power cable through busy Indonesian waters to Singapore, as well as about the financial viability of the reportedly A$30b project. Even though Sun Cable has announced plans to sell electricity to Singapore, Singapore has not announced any plans to buy electricity from Sun Cable. Singapore’s dependence on imported gas and high electricity prices might make it an appealing beacon for Sun Cable, but its neighbors in Malaysia and Indonesia have far greater national energy resources.

Despite these somewhat fundamental issues, Cannon-Brookes outlined his long-term hopes to the Washington Post in 2020:

I am hopeful we will build 50 cables to Asia, but the first one is always the hardest to get done…We can show the world, ‘Look what Australia can do.’ We can export sunshine to Asia.

Both the NT government and the federal government have been enticed by this idea and have granted “major project status” to the plan.

Former Minister for Energy and Emissions Reduction Angus Taylor, announcing this elevation, was equally explicit about Australia as an energy exporter:

Australia has long been a world leader in energy exports. As technologies change, we can capitalise on our strengths in renewables to continue to lead the world in energy exports.

There are currently 31 projects with Major Project Status at the federal level in Australia. Of these, only two are focused on renewable power. Aside from Sun Cable, the Asian Renewable Energy Hub, now 40.5% owned and operated by BP, plans to install 26GW of solar and wind generation capacity, some of which will be used locally. The majority of this capacity will be used, however, to produce green hydrogen and green ammonia for export.

On 8 June 2022, recently elected Labor PM Anthony Albanese reported that he had engaged in discussions with Cannon-Brookes and others connected to Sun Cable. On 24 June 2022, the government agency Infrastructure Australia announced that the AAPL had achieved ‘investment ready’ status.

As solar power production and storage in Australia transforms from small-scale, roof-top, and domestic towards a large-scale corporate investment model, business and Australian governments on both sides of politics are clearly in alignment that this must be export driven, whatever the obvious geographic and technological hurdles. Despite the new Labor government currently legislating to raise Australia’s emissions reduction target, the largest planned solar plant in Australia will do little to reduce direct emissions in Australia.

Government decisions at the territory and federal level are designed to force the majority of Australians to compete with increasingly larger markets over the price of energy, turning solar energy into just another extractive industry.

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  1. Synoia

    Not a base load system, because of night.

    Because solar electricity generation is not 24 x 7, it raises the questions of value and utility, and possible price.

    1. Rodeo Clownfish

      Using the energy to synthesize fuel (hydrogen) and other commodity(s) like ammonia can at least partially address the concern of intermittent generation. Now they just need a way for the fuel to feed back into the grid power generation.

      1. rhodium

        There are specialized fuel cells that strip the nitrogen from ammonia before using the hydrogen to produce power. The total process is not as energy efficient as dealing with straight hydrogen but since ammonia can easily be compressed into a liquid, the storage and transportation side of it is cheaper and safer.

        As long as your marginal intermittent electricity costs are cheap enough, ammonia becomes a good candidate for long-term energy storage.

        1. Tom Pfotzer

          This is the conclusion I keep returning to as I review the various storage options.

          For a place like Germany, for ex – plenty chem engineers, got wind and solar, got downstream uses for ammonia…could locate these synthesis plants in industrial centers who can use the waste heat the synthesis plants generate…seems like a pretty good fit.

          Also could use methane (CH4) as the carrier molecule, and Germany (any industrial country, actually) already has big-time downstream users for methane, in addition to the electricity users.

        2. drumlin woodchuckles

          5 or 10 or so years ago, a commenter wrote here in these threads about how the Atlantic Richfield Corporation ( an oil company existing in the past), spent some of its money and its scientists’ and technicians’ time researching things to do with the petcoke left behind after every possible volatile hydrocarbon had been refined out of petroleum.

          One of the things this commenter claimed these researchers discovered ( and patented) was a way to superactivate the petcoke into a super-adsorber with nanillions of nanopores all through itself. The surface of each nanopore could adsorb hydrogen gas and the super-activated petcoke could overall adsorb so much hydrogen onto all its nanopore surfaces as to approach the amount of hydrogen which would otherwise have to be compressed to many hundreds of atmospheres of pressure . . . . but at almost no overpressure at all. And the hydrogen could all be taken back off its adsorption-positions on all that petcoke nanopore surface whenever wanted. And this could be done over and over and over.

          If that’s not just a happy myth, if that was actually done, the patents may exist somewhere to be consulted, and may have even run out in legal enforceability terms. If so, there is perhaps another solution to the problem of storing hydrogen gas.

      2. drumlin woodchuckles

        Well, just set up twice as much solar electric generating capacity per export project as is needed to export a market-load of solar power during the daytime. And during the very same daytime, use the “other half” of that twice-as-much solar electric generating capacity to electrolyze water and save the hydrogen right there on site in appropriate storage methods. When night begins, burn that stored hydrogen to generate electricity to export through those same cables all through the night.

        And when the next day begins, send daylight-generated power through those same cables all through the next day.

        And when the next night begins, burn the next-day’s-generated hydrogen in the on-site power plant to make and send the same amount of power through those same cables for yet another night.

        And so on and so forth, day by day and night by night. And the “no sunlight during the night-time” problem is solved.

    2. PlutoniumKun

      The term ‘base load’ is overused and not well understood. Anyway, there is no true 100% baseload provider as all power sources need downtime and back-up at various temporal scales. There is no true baseload provider and no true on-demand source of power, all are relative. All grids are a mix of power sources – but the bigger the network the easier it is to balance supply. In general, the bigger the network the less need for storage – this is why the US is so far behind with storage/balancing technology. Small grids have been dealing with this for the best part of a century.

      Australian solar is perfectly capable of providing long term daily and seasonal loads if you mix in CSP with molten salt storage (this is not a new technology, its well proven). You also have the advantage that maximum output matches maximum demand (daytime).

  2. The Rev Kev

    There are two things that can rile people across the country here in Oz and that is high fuel prices and high electricity costs. As both are rapidly rising and the government seen to be only wringing their hands it will not end well for the government if they do not act on these issues. The gas industry for example. If they are told that they have to set aside ‘x’ amount of gas for local consumption or else there may be penalties that they may incur, what are they going to do? Take their corporations and infrastructure overseas? Then they will learn that they can’t take the gas with them as it is still underground.

    1. Steven

      Do a search for australia “gravity storage” and you get 30,300 hits. That’s just for Australia. If governments throughout the Western world were serious about combating global warming instead of sucking up to their respective vested interests, they would pick a few winners and invest what it takes to make renewable energy viable, ending once and for all the old tropes about ‘intermittent’ and base load energy. Back in the day when the US had real leaders as opposed to career politicians, the government had no qualms about buying enough dams to electrify the country. If today’s politicians had been in charge, WWII may well have had a different outcome.

      While I am at it, a different rant – economies of scale as an excuse for loading the financial dice against rooftop, customer-owned solar. What are the real numbers when you factor in transmitting the electricity hundreds or even thousands of miles as proposed here? Next year tax credits for little guys go away. What’s the story for ‘rent seekers’ after you factor in business credits and accelerated depreciation?

      1. drumlin woodchuckles

        If you assassinate enough real leaders . . . . Kennedy, X, King, Kennedy, George Hampton, Paul Wellstone, etc. etc. . . . you are left with career politicians.

        Perhaps people can find real microleaders and nanoleaders at the microscale and the nanoscale to lead micro-bunches and nano-bunches of people to find and apply a million tiny solutions to a million tiny problems in a million separate tiny places. A million microleaders is too many microleaders to kill them all, or even know which ones to kill to stop the micro-leadership micro-followership swarm movement.

        So maybe that is how a hundred million people can diffusely undermine and tear down the system from below.

        1. Tom Pfotzer

          You can plug a rivulet. You can dam a river. You can install levees to direct a Mississippi.

          Pretty darn hard to destroy a monsoon. Which rain-droplet do you wreck?

      2. Tom Pfotzer

        Well-done Steven. Gravity storage makes a lot of sense, and may be quite efficient – I’m assuming electric motor / dynamo provides motive/lift force. Maybe 90+ percent efficient, pretty good. Probably not a lot of friction-loss, given that the load is moving vertically. Might never even touch anything except air.

        I also really like the point about “getting serious”. This is _not_ a technological-risk problem, this is a bust-the-rent-seeker-logjam problem – which also has an extra layer of societal change-resistance glue that binds the logs together.

        I want to find an analog to this idea that I can use at my farm to store energy. Pumped storage (got hills) could work, but it’s a lot less efficient than this gravity-well idea.

        We need to keep talking about this, and keep using our purchase dollars to lever the log-people out of the way, and move ahead.

      3. tindrum

        Hi Steven,
        back-of-envelope calculation – 1000 ton mass at a height of 1km (deep mine shaft) PE = m.g.h.= 1E10 J
        discharging this in 1 hour gives 2.2MW of electrical power assuming 80% efficiency.
        NSW seems to need about 2TW on average between midnight and 07:00 so you need 7000 mine shafts which sounds like a lot.

        1. Savita

          Ah ha, an Australian perpetrating the assumption of prior knowledge, which they’re normally on the receiving end of,via US posters :-) In this example, ‘NSW’ stands for New South Wales being the most populated State in Australia. Mentioning only because its a bit technical and context might be helpful for someone

    2. heresy101

      This project sounds similar to proposals over the years to build large solar projects in northern Africa that would ship the electricity to Europe on cables under the Mediterranean.

      As far as gas and coal, the Electric Viking in Melbourne has reported about the AEMO plans and prediction for the end of coal and gas in Australia:

      Also, a report of the increasing use of renewables was note
      Ember report:

      Ignoring the fossil fuel propaganda, the question is whether the 25 million Australians will beat 40 million Californians to 100% clean energy by 2030?

  3. Synoia

    The preposed cable has all the risk of single point of failure.

    Which leads to management relying on “then a miracle occurs” and “Who could; have known.”

    1. PlutoniumKun

      Its not a single cable, as the article states, they are proposing a network.

      Undersea cables are very reliable – there are many in the North Sea, Baltic and Irish Sea – as they are in a cool, stable environment they are not subject to the same environmental stresses as overground cables.

      There is at present no additional capacity in manufacturing for undersea cables and associated infrastructure, so a separate manufacturing base would have to be built for a proposal like this. The up front capital cost would mean that it would make more sense to continually lay a network of underground cables over the course of a decade or more. This would strengthen, not weaken network capacity in the region.

  4. ThePodBayDoorsAreClosed

    This “country” is run as a colony, and with a colony you extract the resources at the lowest possible cost. As the world’s largest LNG exporter we receive +/- $300M in royalties, whereas #2 Qatar receives $22B.

    For 15 years the government have done everything possible to tell fossil fuel operators they will be run out of business, so guess what, they did not invest in exploration or maintenance. The grid has kept falling over on nights with no wind, and today they are paying big businesses not to operate. The bill for that, in the billions, will soon appear on residential power bills.

    Insane Green ideologues hold the new already far left government hostage since the government is in the minority in the Senate and needs 12 senators from other parties to pass any legislation. The head of the Greens, who refuses to appear in front of an Australian flag, is faced with a dilemma. Since he is dead set against ANY coal being used domestically, he either has to convince people that its okey dokey to burn Australian coal overseas but not here, or he needs to shut Australian coal entirely (he has stated that’s his goal) and replace the income from our #1 or #2 export. It will not be remotely possible to replace that income (+/- $160B) with a few thousand solar panels installers so he will have to justify a giant drop in the standard of living. So basically a carbon copy (pun intended) of Germany.

    At least a few of these Green and Labor geniuses have taken a pen to the back of a napkin enough to do these maths so their latest deus ex machina scheme is “hydrogen storage”. LOL. Ungodly quantities of energy used to break down water into the smallest molecule known in the universe, so small it enters the crystalline structure of metals and absolutely eats them so it needs very very special brand new steel for all storage and distribution pipes, LOL. I assume Twiggy Forrest has lots of that new steel to sell at bargain prices to the hapless Australian taxpayer.

    Then there are the “Teals”, a cute term the media invented during the last election. Here in AU conservatives are “blue” and this references “blue plus green”. This was electoral strategy brilliance: run attractive middle aged women as “independents” who tell voters they are “conservative adjacent plus climate”. Starting three years ago they were heavily funded on this mission by billionaire heir Simon Holmes a Court, a huge renewables investor. 7 Teals won, all replacing reality-anchored moderates or conservatives. Holmes was 100% invisible behind the scenes, LOL the day after the campaign the MSM started running stories about him and how he did it.

    This “country” is absolutely stuffed to the gills with energy resources of all kinds and we should all be as wealthy as Saudis or Norwegians. But we’re run as a resource extraction scheme by tax-free billionaires in London, New York, Geneva, Aspen, Shanghai, and The Caymans.

  5. Tom Pfotzer

    Just taking a look around to see what undersea power cable costs.

    It’s about $750K per kilometer for a cable that can transmit 2000MW. That’s about what an average nuke power plant would produce

    And here’s what a 1000MW solar plant, built in India, would look like, just to give you and idea of how much area a 2000MW solar plant might cover (about 10 acres).

    Hopefully this helps give you some idea of what it costs to move how much power, how far, undersea.

    Clearly, these cables are monstrously expensive, especially in contrast to the cost of the land to produce the power.

    Just for cable-cost comparison, it costs about $30K per kilometer to lay undersea fiber optic cable.


    1. heresy101

      If I haven’t made a math bust, that $750,000 per kilometer is cheap (using 3281 feet per km).
      A proposal for a 23,000 foot, 230kV AC line in southern California (Riverside) is about $1.6M / km for an overhead line and $11.3M / km for undergrounding the line. See the below construction estimate from 2015. The costs are at the end:
      The underwater line will probably be DC but the costs would be comparable, or higher, to AC.

  6. Jason

    Sun Cable is working with Betchel, Hatch, Marsh, PwC Australia and Singapore’s Surbana Jurong group on the project, so the export market to Singapore is almost a certainty. The plant will also provide all the electricity for the Northern Territories. Presumably much of Sun Cable’s capital expenditure will be funded by foreign investment. I don’t see any problems with it being catered to the export market. Australia has plenty of solar-suitable land, so it can easily build more such large-scale solar plants for domestic consumption if it wants to. Obviously the politically influential coal and gas industries will need to be defeated or bought.

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