Energy superidiot needs bigger bill subsidies


Albo’s energy superidiot is drooling in the corner.

Gas prices are rising again:

We’re going to need bigger bill subsidies. The current batch only covers the price hike to about $100Mwh:

There are only signs that it will get worse:


Proposals to increase natural gas supplies for the nation’s most populous state are being assessed and welcomed as renewable projects come online, NSW Energy Minister Penny Sharpe says.

“We don’t want to see price spikes and we don’t want to see uncertainty for industry,” she told a Committee for Economic Development of Australia event on Tuesday.

A tight balance between supply and demand was a “new normal” NSW did not like.

More gas-powered plants would be needed to cope with peak demand during the transition to renewable energy sources, she said.

“More and more renewable energy is entering the system, but it’s always happening more slowly than we would like,” Ms Sharpe said.

Really? Do you want even higher power prices? That’s what more gas will bring.

NSW has about 1.7GW of gas power output, which is about half of what it will need to carry its weight in the renewable NEM.

ScoMo is building another in the hunter now. Building two more gas speakers is a small undertaking. It is not the problem.


The issue is the price of gas. At $13Gj today, with zero security of supply, nobody is going to build any gas power.

Except for governments. More:

AGL’s Damien Nicks told the same event the electricity supplier focused on renewable generation and storage.

“AGL’s generation portfolio will look completely different by 2035, when we’re no longer generating electricity from coal,” he said.

That will be news to the Victorian ALP, which is quietly bribing AGL to keep Loy Yang open.

VIC has about 2.3GW of gas power capacity so it is better placed than NSW to build its share of dispatchable power.


However, again, who will build and convert the remainder? Nobody while the gas price is uneconomic and there is no security of supply.

Never fear, the answer is already here:

Viva Energy has submitted updated environmental studies to secure Victorian governmental approval for its proposed LNG import terminal.


It’s an application which could test what industry sources say has been a recent softening of Labor’s attitude towards gas after years of opposition to the fuel source.

If Viva secures support from the Victorian government, it could emerge as a viable solution to a looming eastern seaboard gas shortfall.

This guarantees Australia will have the highest gas and electricity prices in the world, unless something is done to divert QLD LNG at local prices.

That might be export levies or some kind of new domestic reservation system with somebody willing to use it.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.