Each Saturday where we catch up with Leith van Onselin, chief economist at the NB Fund NB Super from Macrobusiness dot com dot au. We are asking of late Leith to come up with a economic clown or economic champion each week. We've had a couple of clowns. We're about to get to a champion in a moment or two, but not before we get to talk about Australia facing energy armageddon. How am my friend? I hope you will Yeah?
Did I work? Yeah? Well? Or go down at yourself?
Yeah? Not too bad at all, not too bad at all. Look the question of our energy crisis, and it is I think in the minds of many a crisis. I don't know where it was during the election campaign. I don't want to revisit that at all, but I mean, what's going on here? Is it simply the fact that the government collects tax from workers and gives it back to workers in the way of some kind of assistance to pay their power bills? Is that why people don't
see the train coming? Or what is it? Because we're in an ale of the miss Oh?
Absolutely mate. So anyone who pays an electricy bill or a gas bill knows that, that knows that your bills have surged. And the only reason why we've had any relief is because the governments doled out billions of dollars of our own money, like basically returned our taxes in short term subsidies. But it's not fixing the underlying problem. Now, as we all know, the Albanese governments set a ridiculously unreal realistic target of having eighty two percent of Australia's
electricity generated by renewables by twenty thirty. Now, if we're going to do that, it means we obviously need to shut down a qualifire generation pretty much now. Some of Australia's states have gone even further. So, you know, while I live in then the clown state of Victoria, Victoria's legislator ninety five percent renewal easy target by twenty thirty five, so that's just in a decade. South Australia has set a one hundred percent renewable energy target by twenty twenty seven,
so that's in two years right now. These targets are completely you know, a logical They defy reality. And the reason for that, Luke, is that renewable energy is whether dependent and it's intermittent and it cannot be relied upon to provide power whenever it's needed. And we actually witness that this week because Eastern Australia, as is so often
during winter. It happened last year in New South Wales, the entire Eastern Australia, so talking you know, Brisbane, New South Wales, Victoria, South Australia and act it experienced a wind drought and it lasted for days on end. Now what a wind drought is, As I said, this often happens during winter. It's when you basically have very low wind, which means you get very low wind wind generation from
wind turbines. And this is coincided with obviously being winter where you got shorter days and you get less sunshine, so you obviously get less solar. Now let's you get some data here which have pulled off the National Energy Market, which is basically you know, the Federal Government's website which tracks where all energy comes from, and it showed it in the forty eight hours between eleventh and twelfth for June. And to be honest with that, I could have picked
the twelfth or thirteenth of June. But you know when I was writing this up, I could have replaced this with another set which said exactly the same thing. The wind and solar combined over that forty eight hours provided only fourteen percent of Australias electricity generation because we had the windrow and battery storyge only provided one percent, right,
so it's fifteen percent if you count batteries now. Fossil fuels, on the other hand, because we are in the middle of the winter, provided seventy four percent of Eastern Australias electricity generation and the forty eight hour period, now that that is coal sixty percent and gas. I've left hydra out of there because hydro can't we can't scale it up.
It's just basically it's there every day. But the fact matter is that the federal government wants to get rid of our coal and gas, well coal through to predominantly in the next few years, replace it with this renewable stuff. But the renewable stuff doesn't supply when we need it. And this was shown this week and for example, at seven to fifty pm on Thursday night, when obviously the sun had gone down, only three percent of it the
whole Eastern Australia's electricity generation was came from wind. The solar was zero obviously because there's no sun, and batteries only provided two percent. This is a seven fifty. This is a snapshot. Meanwhile, coal fifty four percent, gas twenty three percent combined to contributed seventy seven percent of Eastern Australias generation. So theilarious thing here, Luke is earlier this week in Victoria. I'm using Victoria obviously not talking to
Victorian audience, but this is relevant. Victoria experienced and aren't expected outage at one of its old coal fire generators and it basically led to the renewables lobby coming out saying, see Cole's unreliable. Therefore we need to expand renewables to get off coal because coal cannot be trusted because there was a breakdown. Right, so that there's this outfit I call them a propaganda said renew economy. They just write less garbage about renewables all the time and just integrate
any sort of fossil fuels good. And they and they wrote an article which said, quote that the your lawn coal plant outage quote underscores the urgent need to build enough solar, wind and storage to replace them and highlights the folly of sweating aging coal assets past the years
by dates. That's a direct quote. Now. Hilariously, when this article came out, the muppet who wrote this wrote it during a wind rout when the renewables clap crashed almost zero, and they couldn't see they they couldn't see the irony that they're calling coal unreliable because there was a out each one of the generators. When literally we had a wind drout and coal and win the solar combined, we're
providing bugger or electricity. And the reality here, Luke, is that the most unreliable part of the energy system is actually intermittent where the dependent renewables because the only work when the sun shines, the wind blows, and we never know when the wind's going to blow, and the sun only shines through the middle of day injury, and if
it's overcast you get very little of it. Yet yet the government and these lobby groups and everyone are trying to say we need to get rid of stable baseload power and just basically rely on the wind which may or may not arrive and the sun, which obviously during winter is pretty unreliable. And these same people won't admit it that aging coal fire power plants remain the foundation
of the country's electricity supply. And that was proven this week when renewables failed and they could not cover the gap. So it's crazy stuff, mate. And so it's what I've been saying over and over again is instead of going down this road, we need reliable baseload power, otherwise we will literally face blackouts and soaring energy prices. Now the way I see, we've got two options. First of all, we could replace or refurbish the existing coal fire generators.
So they obviously do need renovation. They're very old, et cetera. But they're already all the transmissions already built, right, so all the infrastructure is already there. But yes, they do need some work, and that, honestly is my favorite option.
Look, I'm with you. I you know, I was drinking the I don't want to say the nuclear kool aid, but I will because I understand. Then you can just go your hardest and have generation knowing it to missions free if that's a thing, had that everywhere. But look, I think that argument, that argument was probably lost. It was probably lost on misinformation and poor salesmanship. It seems to me, our only option, and again you know the mother law scare campaigns, but you don't have to do
much high efficiency, lower mission coal. And if people are so worried about the emissions that come from coal, then whatever we burn here reduce what will reduce what we export by that and that might even touch asides, but that we don't have to rewire anything that's a trillion dollars potentially. This to me is a no brainer.
I'm with you, yea one hundred percent. So the second member is, yes, toll is carbon intensive one hundred percent. Is that Australia exports five times as much coal as as we can shoot in domestically, So why not just export a little bit less and burn more ourselves and the world's climate would be no worse off? Right, No, But but then again I actually think we should probably
go down the nuclear road as well. You know, but it'll take a while, but do obviously, because you know, nuclear is the only way to achieve lower missions and stable reliable power, Like the only way you can get both is through nuclear, because you can run a twenty
four to seven it's not whether dependent, it's zero emission. Yes, the upfront costs are very high, but so renewables and storage, and renewables and storage storage are making batteries and you know, building pump high dress stations and that sort of stuff. That stuff is completely unreliable and intermittent, and it's going to cost a bomb, whereas we could actually just build some nuclear generators where some of the old coal fired
generators were, where there's transmission lines and that sort of thing. Yes, it will cost a lot of money, but you know it's going to be stable. It'll give you a sixty year lifespan. Is renewables have to be replaced, you know, fifteen to twenty years, so you have to keep replacing them. Batteries you've got to turn over all the time, you know when a solar and wind turbines don't last more than twenty years, So that the environmental footprint of nuclear
is way better. You know, one bunton sized warehouse sized generator can create the same amount of energy is probably you know, four hundred plus wind turbines which are spread out all over the place and need concrete footings, You need to clear a whole bunch of land. All the resources that go into that is insane. Now, it was very interesting this week Luke so UK has gone down the same zero delusion as US, and they've got a guy called Ed Milliband who's their Energy minister, who's just
like Chris Bowen, he's an absolute zealot. But even the UK came out at the start of the week and they said that the renewables aren't working properly, it's not reliable, so we're going to build out nuclear. So even the UK has gone down this road. And Ed Millerban, who's just as much of a zelot as Chris Bowen said, he declared quote a golden age for British Britain's nuclear industry.
So so how is that Australia, that holds the world's largest deposits of uranium, has banded nuclear power in banded nuclear is the source of generation when these other countries, like pretty much everywhere else in the world bar Us in New Zealand, are going down to the nuclear roid.
We literally have the world's biggest deposits of uranium, so we could go down this road and we've got the we're the second biggest, so we're the biggest coal exporter in the world, so we could be doing that as well, and we're obviously one of the biggest, the second biggest gas exporter. But we think there's stupid thing here is that we deny our cells access to our own energy, our own coal, our own gas, and our own uranium, and we'd sell this stuff to the rest of the world.
We give the rest of the world cheap energy, and then we starve ourselves and then we you know, and then we say, oh no, no, we know we can't burn this stuff. We've got to go down this renewables road, which which in times of winter when there's not much sun or we have these winds routs which happened regularly, they just don't work.
Yeah, it's crazy, It is crazy. It is crazy. And the best of interests and the you know, the people with Daddy's billions who get the government subsidies in the billions and just make the easy ride. I mean, there'll be a day. Tell me who the champion of the week is. I think we've got some champions time views at Who have you gone with.
Mate, mate, I've gone with journalist Chris Willman. Yes, now, now you know former ABC. Now he does some stuff with Sky and some others. But the yeah, mate, Christian Wilman gave a fantastic he's been right on this energy stuff and he's done excellent work, done a great documentaries,
et cetera. And anyway, it was on the John Anderson podcast a week ago and I watched the whole thing and it was fantastic and he actually predicted pretty much what happened this week, right, So literally a week before it happened, he said that the He said, basically, I tell you what's going to happen to the East Coast energy market. We are running our last coal fire power plants about as hard as we can, is what he said.
He said, one day, when the sun's not shining and the wind's not blowing, and probably in the middle of winter when it's really quite cold, one of those big coal fire power plants is going to give out. It will break because the stress it's under. And then we'll see the energy ministers come out and say, see we told you old power break down. You know, we need more renewables, that sort of thing. And that is exactly
what happened this week, all right. So one of you know, as I said, Victoria's coal generators went down the renewables lobby came out and said straight away. See coal's unreliable. This is why we need more renewables. And this is exactly what Chris Juman predicted a link before it happened,
and it has played out exactly as he said. And you know, anyone who wants to learn more on this topic, I highly recommend that you go on YouTube, for example and search for Chris Juhlman and renewables and power and energy and that sort of things. He's done some fantastic work in the day.
Yeah, he really has, right, I mate, have a great weekend, take care and talk to you in a week's time. Thank you. Lead fan ONNSOLIN Chris the Juelman. Big fan of his work, as you well know.