Words and Pictures

with Elizabeth Walton

The Big Switch


The power struggle behind the electricity industry

If you’ve ever felt you had the right ideas on clean energy, but you needed documented evidence to support your argument, have a look at Gavin Gilchrist’s new book The Big Switch. It’s packed with facts, names, and figures, and a blow by blow description of every thwarted attempt to get renewables up and running in this country.

Speaking at the ABC TV studios in Sydney where he is the national science and health reporter, Gilchrist is ever the optimist and remains convinced that Australia is ready for renewables, despite his potentially disheartening analysis in The Big Switch:”In this country, we are so blessed with amounts of sunshine and wind – and now we’re seeing that we’re blessed with large amounts of geo-thermal energy as well. We’ve got it all sitting there just waiting to be tapped into.”

Gilchrist says the only thing that’s needed to connect the consumer to the green producer is a distributor with vision: “If that green producer can just find one electricity distributer, which is sympathetic to these things, and realises that this is where the market will be, then it will be up and running within six months.” Electricity companies can work very fast when they want to because their structure is very hierarchical, he says. This means that if the CEO says jump, the employees ask ‘how high?’: “If the head of Pacific Power said we’re building a solar power station at Cobar, it will be gas boosted, it will feed into the grid, and construction will begin in a year and a half, it will happen – it’s as simple as that.”

The problem is that regressive directives from industry heads are also approached with blind dedication. One poignant example is the abandonment of a plan to upgrade fourteen remote Torres Strait Islands with solar technology, which would have replaced many aging, noisy, polluting and expensive diesel generators on the Islands. Solar was originally chosen for the upgrade because it was found to be the cheapest option. Problems began to emerge however, when the Queensland Electricity Commission (QEC) took control of the project. This is discussed in the chapter entitled “electricity from light” in “The Big Switch”: “As a result, the [solar network] was never built. Instead, the QEC installed diesels on all fourteen islands, conventional systems with no advanced batteries or electronics, just diesels chugging away 24 hours a day.” What should have become a leading example for renewable technology in Australia became nothing other than more of the same. “It’s appalling, isn’t it.” Gilchrist says. “It’s a tragedy.”

It is a tragedy, not only in just what happened, but in lost opportunity: “This whole industry is riddled with case study after case study of lost opportunities. It’s a shame.” Gilchrist took six months leave from the ABC to write the book, after he realised that renewable energy had quietly matured into a cost effective, commercially viable industry during the 1980′s: “Suddenly it became clear to me that these things were cost effective – now!”

In a sun drenched country like Australia, you would think that makes sense. “But not if you compare the cost of electricity at the power station with the cost of solar electricity where it’s produced”, Gilchrist says. “All the figures are rigged.” The Big Switch explains how traditional ways of calculating electricity production costs have excluded the price of delivering electricity back to the consumer. “If you look at the consumer and work backwards”, Gilchrist says, “rather than starting at the power stations and going forwards, then you realise that the economic formula is quite different.” Distribution of electricity produced by large, remote power stations means that up to two thirds of energy created in burning coal is lost. It is vital that the method of calculating costs includes the cost of distribution, as discussed in the book, so that smaller producers can compete. This is the only way to create a level playing field, which would be expected, if not demanded, in any other industry.

While it’s true there has been countless instances of lost opportunities in this industry, Gilchrist hastens to add that there are many positive developments as well, such as a proposal to install solar collectors along a Victorian freeway, similar to a system in Switzerland: “Citipower in Melbourne [have been] working with the old Brunswick Electricity, which is now part of Citipower, to put in quite a large solar system along the Tullamarine freeway…it will feed into the grid.” he said. Other promising developments have been the result of Dr Andrew Blaker’s research at the Australian National University (ANU): “The ANU announced about 1 month ago that they had the world’s most efficient thin film technology”, Gilchrist said, and Andreas Luzzi, another ANU researcher, is looking at ways of storing solar energy to delay use: “…he’s hoping to make an announcement early next year, that he’s actually done it – that it does work. ”

Gilchrist says Pacific Power conducted studies five years ago, which reflect the general public’s enthusiasm for converting to clean power: “That enthusiasm spills over into a desire to actually cough up.” The results of this study however, have never been publicly released. Gilchrist’s book and the ensuing publicity, which includes radio interviews; a Four Corners program; and newspaper feature articles, may help to prompt the industry into action. If the industry or the government did respond to his work, it would not be the first time that Gilchrist had received such attention – his expose of the Medicare industry in 1986 lead to a Federal Inquiry into Medicare fraud. Gilchrist says there has already been some interesting activities which appear to be linked to the publication of The Big Switch: “All I can say is that the Electricity Supply Association brought out an open letter to the Federal Minister for Primary Industries and Energy the day the Four Corners program went to air, which seemed interesting timing, and Pacific Power announced their large injection of money into Martin Green’s solar cell research the day after my book launch – they were desperately trying to get it announced before the book launch.”

Publicity may prove to be the catalyst for change in the industry, but it’s going to take a visionary leader to put those changes into action, someone who has experience and dedication, such as David Freeman, who transformed a US power company from a nuclear producer to a clean producer in just four years. Freeman’s key to success was in changing the company’s focus from being an electricity producer to being an energy service. This included creating a high profile energy advisory service, which changed the face of the electricity company profoundly. Gilchrist’s book says: “Sacramentans had by March 1993 received 21,000 home energy audits, had 758 solar hot water heaters installed and had 72,000 shade trees planted. They had traded in 46,500 clapped-out, energy wasting fridges.” The only thing stopping a similar attempt in Australia he says, is the lack of a leader with the conviction to take on the role, save for one person: “The only person who I think has any idea about these sorts of issues is Owen [Peake] who’s the head of the Power and Water Authority in the Northern Territory. Now, he’s lived in a solar powered house, and he understands the technology.” Gilchrist says. “He knows it’s small scale not large scale, he knows it’s modular and it doesn’t come in big chunks… he understands that you can’t just encourage people to use more and more… and he understands that buying more and more of it will drive the price down. You can make the price whatever you want. The industry is so big that it has the capacity to pool supply and demand to such an extent, that in the end, they can create whatever price they like.” Peake is the only industry leader at the current time who has the capacity to take the challenge, and move us towards green power. “He could do it.” Gilchrist says. “He’s the only one. He’s head of the smallest power generating company in Australia. And the fastest moving.” “It’s not as though anyone has to create a market”, he continues: “The market is there.”

True enough, the market may well be there. But that doesn’t mean green power producers have any easier job of convincing the Government that it’s time to change. Gilchrist says Australian Governments have a preference for implementing seemingly fail-safe recommendations from the traditional power producers, and disregarding innovations from all other sources. This occurs both at State and Federal levels: “I’ve tried to document right through the book the appalling quality of advice that State and Federal Energy Ministers have been getting through the years,” he said. “I think if the [Federal] Minister realised that his department has what the Auditor General described as an ‘incredible malaise in energy efficiency’, then he would fix that.” Gilchrist says there is little potential for fixing the problem at present though, since other important issues such as the drought are higher on the Minister’s agenda: “It’s the classic case of the short term being more important than the long term – obviously the drought is very important – but the long term is important too.”

While it is a difficult task for the Minister to manage such a large portfolio, Gilchrist says satisfying short term needs should never occur at the expense of the long term: “They should not be mutually exclusive – and if he can’t handle it, then someone else should.” Gilchrist’s frustrations in dealing with the Government came to a head recently when he went to Canberra to discuss the findings of his book, and found a distinct lack of interest in what he had come to say: “When I went to give a briefing to Parliament, the senior greenhouse advisor fell asleep – let me put it this way, his eyes were closed – this was only a 15 minute briefing…and even before his eyes were closed, his whole body language said ‘I’m not interested’.” “Can you believe that?”, Gilchrist says. “I was so incensed!”

If the Australian Government does not hastily administer a solution, then the country may come under increasing international pressure from countries who have signed the climate convention, which Australia has also signed. “There’s obviously going to have to be a phase 2 strategy” Gilchrist says. “We can’t seriously go to Berlin to the convention next March with what we’ve done so far.” Gilchrist hopes he has helped to remove the catch cry perception that because Australia is a remote and diffusely populated, it is difficult for the country to clean up its act: “I hope I’ve blown that argument out of the water. There’s no evidence for it. Just because we’re a far flung country, it’s got nothing to do with our emissions, the simple fact is we are hopelessly inefficient in our energy standards, and we clear far too much land every year.” “The point is”, he continues, “we have signed this convention. Other countries have signed and are moving ahead…we’re going to have to do things…a lot of European countries have committed themselves to targets much more difficult than our own.”

Gilchrist says we may soon find ourselves in a situation where we have specific CO2 restrictions imposed on us, as well as formal international monitoring to ensure that those restrictions are strictly observed: “The targets are not going to get easier, they are going to get harder…Whereas there were vague references to cut backs and stabilisation before, probably within a year or two, there will be actual real cuts with specific deadlines and there will be an international police force that will enforce that.”

According to Gilchrist, Australia could easily meet the Toronto Convention goals within five years, just by following overseas examples. For instance, The Big Switch mentions California, which has over ten years experience in producing cost effective, green power. “In California they built 80mw in ten months”, he said. “We could have each state generation company, all building similar power stations, each building 100mws per year for the next 5 years, plus they could be putting in solar panels on the roofs, plus having massive energy efficiency campaigns – so we would easily make the Toronto goals.

“But don’t take my word for it”, he says. “The SEC said that they could meet the target by 2005 with a 2.1% increase in power prices each year, above business as usual…and the technology has improved significantly since then – so if they reckon we could do it, why wouldn’t I?” Green technology in Australia has suffered it’s share of setbacks and disappointments during its’ quiet development. But Gilchrist firmly believes the industry has flourished in adversity. He believes Australians are ready to take the plunge, and he’s optimistic the technology is ready to take them into the next century: “I think we can make The Big Switch by the turn of the century without any trouble at all.”

The Big Switch by Gavin Gilchrist is published by Allen and Unwin, retailing at AUD$16.95.

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