They’re a common sight in industrial areas.

Their orange glow shining onto locked up warehouses.

From atop power poles.

But with no power meter to be found anywhere.

And an answer

Well, I finally found the backstory to these lights in the State Electricity Commission of Victoria’s 1989 annual report, under their list of electricity tariffs – it was a fixed service charge.

Security Lighting (Watchman Floodlighting)

Generally available to all customers, except private domestic premises, for all night security floodlighting of buildings, property, etc.

Initial charge per lamp
$150.50

Charge per month according to Lamp type/size as follows:

125W mercury
$8.75

250W mercury
$15.05

400W mercury
$21.30

150W sodium
$15.00

250W sodium
$18.00

400W sodium
$22.05

*Initial charge covers the provision, erection and eventual removal of the lamp.

The difference between sodium vapour and mercury vapour lamps is the colour temperature – yellow versus blue.

And that led me to Ergon Energy in Queensland, also uses the ‘Watchman’ lighting brand.

Watchman lights are different to street lights. Street lights are used to illuminate public thoroughfares such as streets and roads. Watchman lights can be used for security or safety to illuminate areas such as public parks, private car parks, and pathways.

Watchman lights are installed and maintained by us. We will be able to advise you on the type and size of watchman light you might need once we receive your connection enquiry or application.

Watchman lights are usually connected to our network via an unmetered supply (UMS) connection, meaning it doesn’t need an electricity meter. This is because the electricity usage is predictable or can be accurately calculated without a meter.

And despite the privatisation of Victoria’s electricity network, the ‘Watchman Floodlighting’ name is still used today by Powercor.

Agreement for the Installation of (Watchman) Security Floodlighting

An Installation Charge will be payable for each light prior to installation. This installation charge applies to
each light and excludes ongoing charges applied by the electricity Host Retailer.

LED medium output
$ 2,597.10

LED high output
$ 3,115.20

That’s some massive cost inflation!

So who foots the power bill?

Officially, these lights are considered a “franchise unmetered load“:

electrical installations that are connected to the distribution network without an energy meter and must purchase the energy through the respective local retailers. Examples include bus shelter lights, public phone booths, traffic lights and some public electric barbecues.

Or an “unmetered supply“:

The power supply to lighting is not metered. Instead, distributors bill Council with an estimated average of energy consumption per light multiplied by total number of lights and hours of usage. The estimated average is a scientifically determined standard for each light type, agreed to by the regulator and published in ‘load tables’

So the beneficiary of the watchman lighting has to pay a monthly charge, but can’t choose their energy retailer.

In most cases, you can’t switch retailers with an unmetered supply.

Most unmetered supplies (UMS) are linked to a specific retailer based on location and the distribution patch you’re in. There are some exceptions, for some devices. You’ll need to ask your retailer about your particular UMS device.

But there is an incentive to audit these lamps, as sodium vapour and mercury vapour fixtures are costly to run. In 2020 the City of Merri-bek audited the ‘watchman’ lights paid for by Council, upgrading some lights while removing those no longer needed, achieving estimated savings of $30,000 a year and 100 tonnes of carbon emissions.

Further reading

The ‘Flood Lighting’ section of the Queensland Public Lighting Construction Manual has examples of ‘watchman’ floodlight installs.

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In the beginning, the State Electricity Commission of Victoria (SECV) was responsible for the generation, transmission and distribution of electricity over the entire state of Victoria.^*

(Well, *almost* all of it.)

SECV annual report 1972

But then in the 1990s Jeff Kennett carved up the SECV into a web of different generation, transmission and distribution business – ready for privatisation.

The responsibility for the distribution of electricity to individual consumers was split into five geographic regions – CitiPower supplying the Melbourne CBD; United Energy and Jemena the middle suburbs; and Powercor and SP AusNet from outer suburbs of Melbourne and into the Victorian countryside.

Essential Services Commission diagram

But how do you draw the line between the different electricity distribution businesses?

Map from www.energy.vic.gov.au

You follow the power lines.

Based on how the SECV originally structured their distribution network.

Essential Energy diagram

Zone substations convert electricity at 66kV down to 22kV, and you can hide one on a suburban street – there would be about a hundred of them scattered around Melbourne alone.

But zone substations need to be supplied with power, which comes from much larger terminal stations. You can see their massive 220 kV transmission lines from a mile away, so there are only a dozen around Melbourne.

Which leads us back to the “this pole belongs to [power company]” signs…

Turns out some zone substations have 66 kV power lines that pass pass through areas that belong to other distribution companies on their way to the nearest terminal station, so the signs are needed so the two companies know who is responsible for maintaining a given pole.

And another mess

In the Victorian electricity industry the 1990s reforms there is a second market subject “competition” – multiple energy retailers all competing to sell you the exact same electrons to you, but at wildly different prices.

All electricity retailers in Victoria are required to give consumers a “Default Offer” – a fixed price set by the government which is considered to be reasonable to both parties.

Unfortunately there is one part you don’t get a choice in – each of the five energy distributors set their own ‘daily supply charge’ which all retailers have to pass on to you.

As of 2023 people living in the United Energy region only pay $1.0753 per day to have an electricity connection, while those in the Powercor area get slugged $1.3102 per day.

You’d hate to be right on the boundary of two distributors, and living on the side that has to pay more!

As for a real solution?

The other solution would be to ditch this whole charade of “competition” and just nationalise this mess of separated distribution and retail electricity utilities.

When I first tweeted this back in mid-2022 I was hoping we’d eventually see a political party with the guts to do that, and a few months later, one came close – promising to deliver “government ownership of energy generation”.

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Down on Spencer Street

For Melbourne Open House 2010 CitiPower opened ‘JA’ zone substation – a key part of the power supply to the Melbourne CBD.

For historical reasons the substation was divided into two – the State Electricity Commission of Victoria who generated electricity controlled the 66kV input.

While the Melbourne City Council Electrical Supply Department (MCCESD) controlled the 11kV output to consumers.

The operations of the substation were merged following the breakup of the SECV – generation, transmission, distribution and retail being the current segments of the electricity industry.

Outside the substation was a big hole – the site of the former Spencer Street Power Station.

Ready for the ‘Upper West Side’ development, which had already erected an elevated display suite.

The heritage listed cast iron water tank being the only remnant of the old power station.

The $550 million development was completed in 2016, containing 2,207 apartments across four towers.

Trains around Melbourne

Metro Trains Melbourne was busy promising more staff on the network, with ‘despatch paddles’ rolled out at City Loop stations during morning and afternoon peak to indicate that the doors were clear.

But the experiment was short lived – abandoned by 2012.

On 27 July a faulty overhead wire cut power between Southern Cross and Flinders Street stations, severely limiting the amount of trains that could move through that section, and causing crowds across the network.

As ‘compensation’ passengers were given a free travel day on Friday 30 July.

Since then, only the 2016 V/Line VLocity train issues have result in free travel as compensation to passengers.

A happier note was early works for Regional Rail Link, with construction of Southern Cross Station platforms 15 and 16 moving along slowly.

2020 marks five years since V/Line trains from Geelong started using the completed corridor.

And out at the Yarra Valley Railway was an even happier day, with local MP Ben Hardman and Minister for Tourism and Major Events Tim Holding attending the launch of regular heritage train services on the line.

Since then the railway has gone from strength to strength, with government grants allowing the line to be progressively restored from Healesville to Yarra Glen.

V/Line services extended to Maryborough

July 2010 also saw the ribbon being cut on the extension of V/Line rail services from Ballarat to Maryborough. The project was announced in December 2008 as part of the Victorian Transport Plan, at a cost of $50 million.

Public Transport Minister Martin Pakula, Premier John Brumby, and Member for Ballarat East Geoff Howard rode the first train.

Creswick was the only station to be reopened in this first stage, with a new platform constructed opposite the heritage listed buildings.

Clunes following in December 2011.

And Talbot in December 2013.

As part of the project flashing lights and boom barriers were installed at level crossings.

And level crossings on minor roads were closed.

The increasing size of trucks presenting difficulties at other level crossings.

But one unwanted ‘upgrade’ was the removal of passing loops at Sulky, Tourello and Talbot – leaving a 60 kilometre long section of single track between Ballarat and Maryborough, and crippling the ability to run freight services along the corridor.

The recent Murray Basin Rail Project attempted to rectify this at a cost of $440 million, but has left the corridor in even worse condition.

Rail freight

On the standard gauge mainline between Melbourne and Adelaide, a new passing loop was being built outside Lara.

Giving a slight reduction in travel times and increase in efficiency for freight trains on the corridor.

However plenty of freight trains were still being hauled by 60 year old antique locomotives.

Such as those moving grain from the wheat belt.

To the Port of Geelong

The intent of the Murray Basin Rail Project was to convert Victoria’s orphan broad gauge network to standard gauge, allowing the use of locomotives from anywhere in Australia, but with the project stalled, today broad gauge freight services still rely on similarly aged rolling stock.

Finally, I headed out to Waurn Ponds, where loaded cement hoppers were sitting in the sidings ready for despatch.

Alongside B-double cement trucks.

In the end the trucks almost won, with the final cement train ran from Waurn Ponds in December 2015 – but in a surprising move, Qube Logistics returned cement traffic to Victorian tracks in September 2019.

And road freight

‘High Productivity Freight Vehicles’ became widespread at the Port of Melbourne in 2010.

These ‘super’ B-double trucks took the place of port rail shuttles, a project forever proposed but yet to be implemented.

These new bigger trucks serve container parks in the western suburbs of Melbourne, with projects such as the $48.5 million Kororoit Creek Road duplication project in Altona North making road transport more convenient.

Work on the project was completed in December 2011, including the removal of a level crossing on the Werribee line.

Another gift to road freight was the $200 million Anthony’s Cutting upgrade on the Western Freeway between Melton and Bacchus Marsh.

Requiring a massive cutting west of Bacchus Marsh, and new bridges across Djerriwarrh Creek.

The upgraded freeway opened in June 2011, making it even easier for trucks to replace trains on the Melbourne-Adelaide corridor.

One step forwards, two steps back?

Footnote

Here you can find the rest of my ‘photos from ten years ago‘ series.

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In the beginning

The very first power stations in Victoria were small affairs, operated by an multitude of private companies, burning black coal imported from New South Wales.

City of Melbourne Art and Heritage Collection – image 1088291

But as the reliable supply of electricity grew more important, this reliance on imported fuel became untenable, so the State Electricity Commission of Victoria was established to exploit the brown coal reserves of the Latrobe Valley for base load power generation.

Photo via Yallourn Association

With additional peak load capacity provided by hydro-electric generation – first from Kiewa and Eildon, and later the Snowy Mountains hydro-electric scheme.

While at the same time, the scale of brown coal fired power stations also grew, leading to bigger and bigger holes in the Latrobe Valley.

Hunting hydrocarbons in Bass Strait

The hunt for offshore oil in Australia commenced in 1960, when BHP started exploring the waters of Bass Strait, but it was natural gas they found in February 1965. Development of the offshore platforms commenced.

And by March 1969 the first gas arrived at the onshore gas processing plant

Minister for Fuel and Power, George Oswald Reid, was excited about the new fuel.

The discovery of natural gas opens up far-reaching possibilities for Victoria, but it would be premature for me to forecast its precise effect at this stage. Natural gas is a very attractive fuel for power generation because it is clean and convenient to use. Natural gas could be used by burning the fuel in gas turbines in which the turbine is turned by hot gases instead of steam in the same way as in a jet aircraft engine. This type of machine is particularly suitable for quick starting and short period running.

And saw it’s limits.

I have already explained its possible use for peak load generation, and it will suffice here for me to mention the tremendous quantity of gas which needs to be proved before it can be effective for base load use. To supply a station of 600 to 700 megawatts capacity, it would be necessary to have available reserves of 150 million cubic feet a day for 30 years or 1.5 million million cubic feet in all. This represents about five times the present consumption of manufactured gas in Victoria and is more than the total capacity for the first Gippsland shelf field.

But the State Electric Commission of Victoria was facing a different problem – peak load capacity.

For the past ten years and up to 1974, most increments to peak load capacity have been provided by hydro-electric generation, first from Kiewa and Eildon, and more recently from the Snowy Mountains hydro-electric scheme.

The planned development of the Snowy project is due to be completed in 1974 and, as there is limited scope for further hydro development in Victoria and at Snowy, except perhaps for pumped storage type schemes, it will be necessary to consider installing thermal plant to meet this section of the demand.

So the discovery of natural gas had come at an opportune time.

Enter Newport Power Station

With an existing briquette fired power station at Newport reaching the end of its economic life, and abundant natural gas now available, the State Electricity Commission had a plan – build a 1,000 MW gas fired power station on the site.

SECV artists impression – NAA item ID 8295158

It would be flexible enough to follow the load curve compared to the brown coal fired power stations, and adaptable from peaking to near base loads. Authorisation was given in 1971, with completion expected by 1976 for the first 500 MW unit, and 1978 for the second.

SECV artists impression – NAA item ID 8295157

But the usage of ‘premium’ natural gas to generate electricity was attacked by many, including Val Doube, Member for Albert Park.

Many examples show that human beings are inclined to rush into situations and then find that they must take the most expensive steps to repair the damage they have done. In Victoria we have a new toy – natural gas – and we propose to burn it in the most wasteful fashion to manufacture electricity.

In this power station it is proposed to burn more of this precious resource than is burnt in all the factories and homes in Victoria. This is a most wasteful proposition. It is not as though the sources of energy available to use were inexhaustible. Many countries are confronted with severe problems because of the obvious limits to the energy available from fossil fuel. Even though we appear to be rich in resources for the moment, it is our duty to use them carefully.

If natural gas were properly used, there would be a much better return from its energy. Only 38 per cent of the potential energy of natural gas will be available as electricity from Newport. Much of the rest will be wasted in that it will be used for cooling and similar purposes.

If natural gas were used directly in homes and factories, 70 per cent of its potential energy could be used. There is a potential shortage of fuel in the world, and the energy and heat potential of natural gas should be used in the way I have suggested. That would extend the life of the existing wells.

But the State Electricity Commission had a bigger problem with their Newport project – an emerging green movement opposed the construction of a power station in the middle of Melbourne, and sympathetic trade unions placed green bans on the project, stopping construction.

To resolve the deadlock, in 1973 state government tasked the newly-formed Environmental Protection Authority to conduct a public inquiry into the project. After a number of public hearings and appeals, in April 1977 the Newport Review Panel submitted a final report, concluded that only one of the two 500 MW units should be built.

Work on the power station was restarted by union workers, despite the work bans still being in place, with the project completed by mid-1980, and delivering power later that year.

Emergency generation at Jeeralang

With construction of Newport Power Station delayed, the supply of electricity to the growing state of Victoria was placed at risk. In mid-1977 the State Electricity Commission recommended the installation of 200 MW of gas turbines in the Latrobe Valley, with a new power station able to be imported and assembled within two or three years, despite their smaller capacity and higher fuel costs meaning they were best suited to supplying short duration peaks.

The four Siemens Industries V93.1 open-cycle gas turbines entered service in early 1979 at a cost of around $30 million.

But with power shortfalls still forecast, in 1977 the State Government convened the Emergency Gas Turbines Inquiry, which recommended a second batch of gas turbines should be installed at the Latrobe Valley site, but equipped with water injection equipment to reduce emissions. This block of three Alstom Atlantique MS-9001 open-cycle gas turbines went into service in 1980 at a cost of around $35m

Today known as the Jeeralang Power Station, the gas turbine are used as a peaking facility during periods of peak demand, as well as a black start facility to restore power to the grid in the event of major system failure.

Towards a coherent policy

In 1985 the Victorian Government released a policy statement titled ‘Victoria’s Energy: Strategy and Policy options’, which touched on the use of natural gas for electricity generation.

Victorian Government policy at present prohibits the use of natural gas for electricity generation in the new power stations. However, SECV has proposed that new gas turbine generators be considered for use as a contingency measure if electricity load growth is higher than planned for.

In considering the mid-term options for power development, the Government has re-affirmed its desire to avoid planning on the basis of commitment to new gas fired power stations. The use of additional gas turbines beyond those already installed at Jeeralang should also be unnecessary if present efforts to more flexibly program construction have the desired result. Should an unexpected surge in demand or delay in construction emerge, then the Government would re-examine this issue.

Major expansion of the usage of natural gas would have significant impacts on the lifetime of gas supply developed from reserves in Bass Strait. While it is not possible to quantify impacts, one general effect will be to provide encouragement for gas explorers to discover and prove up further deposits of natural gas. The Victorian region. generally acknowledged to have a good prospectivity for gas, but most exploration at present is concentrated on oil because the existing gas market is well supplied by known gas fields.

A position reinstated by the Natural Resources and Environment Committee in their April 1988 report “Electricity Supply and Demand Beyond the Mid-1990’s“, who examined the use of natural gas for power generation in great detail.

The supply options originally proposed by SECV for consideration by this Inquiry for the period beyond the mid-1990’s did not include gas fired developments. Present Victorian Government policy prohibits the use of natural gas for electricity generation in new power stations. The Committee wrote to SECV requesting that information on gas fired options be included in SECV evidence.

Additional gas fired generating plants could be of the open cycle combustion turbine type (like Jeeralang), or combined cycle plants where the high temperature exhaust gases from one or more combustion turbines are fed into a heat recovery boiler driving an additional steam turbo-generator. SECV evidence indicated that gas fired steam cycle plant (like Newport D) has neither cost nor efficiency advantages over the newer technology combined cycle plant, so this plant configuration was not pursued further.

The location of gas fired plant is more flexible than that of brown coal fired power stations which are normally sited close to their associated mines because of costs and difficulties associated with long distance transport of brown coal. Suitable gas turbine sites would normally be located in the vicinity of an existing gas pipeline and high voltage transmission line.

The capital cost per unit of output capacity of open cycle gas turbine driven generating plant is substantially lower than that of other forms of thermal power generating plant. SECV’s estimates indicate that the capital cost per unit of power generated for gas turbines would be about half that of a Loy Yang B or Oaklands unit and less than a third of the cost of any other brown coal fired unit.

When used for peak and intermediate load duty, gas turbines are more economic than the higher capital cost coal fired plants. The addition of further gas fired plant to the Victorian system to meet future load growth, could therefore be economically desirable, subject to the future cost and availability of natural gas.

Nevertheless, it could be expected that some reductions in the cost of electricity supply would be available from 100-200 MW of additional gas fired capacity, even at significantly higher gas prices. This possibility deserves further attention from SECV, whose evidence has concentrated on large (500 MW) blocks of gas fired plant.

A spanner in the works

In the 1980s the focus switched to the Loy Yang complex – the biggest project the State Electricity Commission ever attempted, with a total of 4,000 MW in brown coal fired generating capacity spread over four 500 MW stages, at a cost of around $5.5 billion in 1984 prices.

The first power at Loy Yang ‘A’ was generated in 1984, with the last of the units being brought online by 1988. By this time the electricity industry in Victoria had changed, and work on the next stage at Loy Yang ‘B’ stalled for a number of years, as a new focus on energy conservation reduced overall electricity demand, and questions were asked in government as to the cost efficiency of the SECV and brown coal power generation in general.

It took until 1993 for this situation to be finally resolved, when 1000 MW of the Loy Yang ‘B’ plant was cancelled, in the midst of the Kennett Government breakup of the State Electricity Commission into an array of distribution, retail, power generation and transmission companies.

David White, Shadow Minister for Energy and Minerals, attacked the disaggregation of the generating system in a 1995 debate.

Former SEC executives have said that the lack of overall planning for the expansion of the generation system would leave consumers at the mercy of the private entrepreneurs, who may or may not respond to pricing signals in the marketplace. They were referring to the major issue of security of supply. Under the government’s proposal the brown-coal fired power stations, the hydro stations and the gas-fired power stations will be broken up and sold at some stage in the future.

At some stage in the future we will need further generating capacity. For 75 years planning for the emergence of the new generation capacity has rested with the SEC. It has planned and submitted to various parliamentary committees its proposals for the expansion of the generation system. In the past the SEC submitted plans for consideration by the former Public Works Committee prior to environmental effects statements and prior to the establishment of a new brown-coal fired station.

Landing some prophetic words.

The retired SEC engineers are saying that there is no provision under the state-owned enterprise model for the emergence of the prospective brown-coal fired power station but there might be the prospect of the emergence of a natural-gas fired power station similar to Jeeralang and Newport if BHP or CRA or a similar company is so moved.

However, there is nothing intrinsic or evident in the government’s proposals to suggest how a new brown-coal fired power station might emerge, given that the gestation period from initial planning and design through to construction, completion and operation could be a period of not less than 5 and probably up to 10 years. The government is saying that the free play of market forces will see the emergence of that investment and that prospect. At the moment there is no evidence to support that proposition.

And something that only rusted on fossil fuel proponents would say today.

At some stage in the future Hazelwood will be retired – it is not far away – and there will be a need for an additional prime brown-coal capacity.

Into the new world

In 2001 the first new power station opened in Victoria under the new structure – the 300 MW Valley Power Peaking Plant. Located next door to Loy Yang power station with six 50 MW open-cycle gas turbines, the plant is now owned by Snowy Hydro.

Google Maps

The same year the 94 MW Bairnsdale Power Station opened, with two GE LM6000PD open-cycle gas turbines owned by Alinta Energy.

AGL opened the 160 MW Somerton Power Station in 2003, with four 37.5MW GT-1 Frame 6B open-cycle gas turbines.

Snowy Hydro opened the 320 MW Laverton North Power Station in 2006, equipped with two Siemens V94.2 open-cycle gas turbines.

Origin Energy opened the 556 MW Mortlake Power Station in 2012, featuring two Siemens SGTS 4000F open-cycle gas turbines.

Origin Energy photo

And the what-ifs

In 2008 Santos proposed a 1500 MW combined-cycle gas turbine power station at Shaw River, north of Port Fairy, but cancelled the project in 2010 following the cancellation of Australia’s emissions trading scheme.

AGL proposal for a 500-600 MW open-cycle gas turbine peaking power station at Tarrone in Western Victoria was approved in 2012, but has been paused due to a lack of certainty in the electricity market.

And finally, in 2019 APA Group had their 220 MW gas turbine plant at Dandenong underwritten by the Federal Government’s Underwriting New Generation Investments (UNGI) program. Stage 1 comprises 12 fast start gas-fuelled reciprocating engines, with stage 2 proposing an additional six generating units.

Sources

• HR Nicholls Society – The Newport Power Station: A History of Conflict (Jack Johnson, OBE)
• Natural Resources and Environment Committee – Electricity Supply and Demand Beyond the Mid-1990’s: part 1, part 2
• SECV annual report – 1972
• SECV annual report – 1977
• SECV annual report – 1978
• SECV annual report – 1979
• SECV – Report on Proposed Extension to the State Generating System – Yallourn W Power Station units 3 and 4
• SECV – Report on Proposed Extension to the State Generating System – Loy Yang Project

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So what am I even on about?

ABC News looked into the topic of grid stability back in 2017.

Power grids are complex machines, dependent on the laws of physics. The national grid is designed to operate at a consistent frequency of 50 Hertz, or 50 cycles a second.

Traditional coal, gas and hydro power stations are considered “synchronous” because they use turbines or spinning wheels to produce electricity. Those spinning parts need to stay close to 50Hz to help keep the grid in synch.

But most of Australia’s installed wind and solar systems are not considered to be. That’s because they use inverters to connect to the grid, rather than spinning wheels.

If too much power is fed in relative to demand, the frequency will increase. If demand outstrips supply, the frequency drops. Regulators rely on a suite of technologies to help keep the grid frequency close to 50Hz.

Synchronous condensers are one of the technologies used to maintain the frequency of the grid, with Energy Networks Australia explaining the technical details in their piece, The age of the syncons.

What is system strength?

System strength is important as it relates to the ability of the power system to withstand changes in supply or demand while maintaining stable voltage levels.

When system strength is low, generators may not be able to remain connected to the grid, control of the power system voltage level becomes more difficult and protection systems (which control and maintain the safe operation of the network) may not operate correctly. This can result in supply interruptions to customers.

System strength is typically provided by synchronous generation such as coal or gas-fired generation or pumped hydro.

What are synchronous condensers?

Synchronous condensers are an old technology, commonly used as far back as the 1950s to stabilise power systems.

They are large machines which spin freely and can absorb or produce reactive (Alternating Current – AC) power in order to stabilise and strengthen a power system.

Synchronous condensers help when there are changes in load as they increase network inertia. The kinetic energy stored in a synchronous condenser contributes to the total inertia of the power system and is beneficial from a frequency control perspective.

What is inertia?

Inertia in the energy system refers to the continuous momentum of energy typically provided by the large spinning turbines of synchronous generators like large coal-or gas-fired power stations. This type of generation helps withstand changes in generation output and load levels to keep the system stable.

The retirement of synchronous power plants and more renewable generation coming into the energy system means there is less inertia available, so flexibility or stability must be found elsewhere in the system to back it up.

And their usage in Victoria

Until the 1990s the electricity network in Victoria was managed by a single government entity – the State Electricity Commission of Victoria.

Brown coal from the Latrobe Valley was their fuel of choice.

But despite all of the old fashioned spinning metal in their power stations, in 1966 the SECV installed a 750 rpm +125 -75 MVar at 22 kV capacity synchronous condenser at the Templestowe Terminal Station in north-east Melbourne.

Photo by Mriya, via Wikimedia Commons

A few years later a second synchronous condenser was installed at the Fishermans Bend Terminal Station, south of the Melbourne CBD.

And in 1971 a third unit at Brooklyn Terminal Station, in Melbourne’s west, with a salient pole design rotating at 750 rpm, with a rating of +110 -64 MVar at 14.5 kV, and a short time overload rating of 140 MvAr (10 min).

Following privatisation the reliability of the synchronous condensers declined, with availability falling below the 91% target in 2003. As a result network operator SP AusNet launched a refurbishment program to address degradation of stator winding sidewall and rotor pole insulation, but by 2013 only the unit was Brooklyn had been upgraded.

As a result reliability declined, with the end coming in October 2016.

AusNet Services and AEMO agreed in October 2016 that it was prudent to retire, rather than replace, these three synchronous condensers on the transmission network. These assets were in extremely poor condition and studies confirmed that their replacement would not have provided a net market benefit.

Since the agreement to retire the synchronous condensers, all three units have failed due to their poor condition. Given that the synchronous condensers were due to be retired by 1 April 2017, AusNet Services and AEMO agreed that it was not efficient to repair and return the synchronous condensers into service.

With SP AusNet realising an additional $7.0 million depreciation charge in their 2017 annual report.

Everything old is new again

In 2017 synchronous condensers hit the news, when AGL flagged them as one part of their transition away from coal fired power.

Liddell Power Station is a 2000 MW black coal fired thermal power station, commissioned between 1971-73. The site also includes associated infrastructure required for power generation, including water, coal and transmission plant.

In April 2015 AGL released a revised Greenhouse Gas Policy. The Policy outlined AGL’s commitment to the decarbonisation of our electricity generation portfolio, confirming closure dates for our coal-fired power stations. The announced closure date for Liddell is the end of 2022.

AGL believes that the installed capacity and energy output from Liddell is best replaced with lower emissions and more reliable generation, with a longer lifespan.

As part of our NSW Generation Plan we are investigating the use of one Liddell generating unit as a synchronous condenser.

As part of new solar farm proposals.

Many other wind and solar projects in Victoria and elsewhere are having to go back to the drawing board because of connection requirements the developers either ignored, or didn’t know about.

The issue is most acute in western Victoria, but is also being felt in northern Queensland and south-west NSW.

Many new projects are being told that they face significant curtailment without either adding battery storage or old-style machinery known as synchronous condensers to deal with system strength issues.

Both options are causing headaches for developers, because either way they are trashing their financial models, and could cause extensive delays to projects that many expected would begin construction anytime soon.

As a high cost fix for system flaws.

RenewEconomy has been told that a synchronous condenser could add $8-$10 million in costs to projects already tight on margins. A group of solar farms in north-west Victoria have been told, RenewEconomy understands, that their additional costs could total $60 million.

And to reinforce the South Australian power grid.

As more energy sources such as wind and solar are connected to the grid, traditional power generation sources such as gas-fired units, operate less often. This has created a shortfall in system strength which was declared by the Australian Energy Market Operator (AEMO) on 13 October 2017 and a shortfall in inertia which was declared on 24 December 2018.

A secure power system needs adequate levels of system strength and inertia, which to date have been provided by traditional synchronous generators.

Following an analysis of these options, the installation of synchronous condensers on the network was determined to be the most efficient and least cost option to ensure there is adequate system strength and inertia.

On 20 August 2019, the AER approved $166 million to fund the capital cost of delivering the synchronous condenser solution.

The first two of four planned synchronous condensers will be installed at the Davenport substation in mid-2020 and the second two will be installed at the Robertstown substation by the end of 2020. They will be commissioned by early 2021.

How things change in the course of two years!

Update for 2022

In July 2022 a 60Mvr synchronous condenser supplied by GE has been switched on at the Murra Warra wind farm in the West Murray region, enabling the project to increase export capacity to 150MW, before moving towards full capacity of 209MW.

The synchronous condenser was required as part of the since abandoned “do no harm” rules that required new generation projects to address system strength issues in the transmission network. This is now the responsibility of network operators.

Footnote: alternate sources of voltage support

Static VAR compensators are another way of stabilising the electricity grid.

A static VAR compensator (SVC) is a set of electrical devices for providing fast-acting reactive power on high-voltage electricity transmission networks. SVCs are part of the Flexible AC transmission system device family, regulating voltage, power factor, harmonics and stabilising the system.

A static VAR compensator has no significant moving parts (other than internal switchgear). Prior to the invention of the SVC, power factor compensation was the preserve of large rotating machines such as synchronous condensers or switched capacitor banks.

Four SVC units are installed on the SP AusNet Network in Victoria – two +100 -60 MVar capacity units at Rowville Terminal Station, and one +50 -25 MVar unit at each of Kerang Terminal Station and Horsham Terminal Station.

Installed by the SECV during the mid-1980s and with a technical life of between 40 and 60 years, the control systems are now obsolete technology unsupported by the manufacturer, so an upgrade program is underway to replace them with modern equipment.

Footnote: and something really fruity

Down at Wonthaggi is a real power hog – the Victorian Desalination Plant.

It is supplied with electricity by a 88 kilometre long twin circuit 220 kV AC underground transmission line – the longest of its type in the world.

With the underground cable run requiring something odd at the halfway point – a ‘reactive compensation station’.

The yard full of high voltage switchgear contains three 52 MVAr oil-filled shunt reactors to compensate for the capacitance of the underground cables.

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Running south-west from Coldstream to Templestowe, via Chirnside Park, Wonga Park and Warrandyte, I was first tipped off to the existence of the transmission line by someone who lives in the area.

The path taken was quite easy to see on the Melway – the eastern end is located at tower T293 in Coldstream.

While the western end terminates at tower T342 in Templestowe.

Eventually I paid a visit in person, and the dead-end nature of the transmission line was easy to see.

The northern end at Coldstream is located alongside two 500 kV transmission lines.

While the Templestowe end is located among the transmission lines that serve the Templestowe Terminal Station.

But unfortunately I was no closer to finding the reasons for the lines laying abandoned, until my recent post on transmission line crossovers. What started with an exploration of power lines in Sydney, expanded to Rowville Terminal Station in Melbourne, and then down a rabbit hole of State Electricity Commission of Victoria reports.

I eventually landed on a 1983 report on transmission lines serving Melbourne by the Natural Resources and Environment Committee. The purpose of the report was as follows:

This report specifically addresses the SEC’s proposal for a 500 000 volt transmission line from Coldstream to South Morang and in particular:

(i) The need for reinforcing transmission to the 500 000 volt terminal stations in the outer metropolitan area;
(ii) The feasible route to be subjected to detailed examination of environmental issues; and
(iii) The recommended process for assessment and approval of the route in this instance.

The report detailed the current state of the high voltage transmission lines linking the power stations of the Latrobe Valley to Melbourne.

The existing transmission system from the Latrobe Valley to the Melbourne metropolitan areas consists of three 220 kV double circuit lines and three 500 kV single circuit lines.

Two of the 500 kV lines were established in the late 1960s on a northern easement in conjunction with the Hazelwood Power Station and supply the western metropolitan area from the Keilor Terminal Station (KTS). The lines were routed via Coldstream and South Morang with one line being on a direct Coldstream to South Morang easement and the other routed via Templestowe to provide for later development of supply for the north-eastern metropolitan area. The easements from Coldstream to South Morang were each approved with capacity for a second circuit, thereby providing for the four incoming 500 kV lines to South Morang.

The third 500 kV line was established in late 1982 on a southern easement via Cranbourne, Narre Warren and Templestowe, in conjunction with commercial service of the completed Yallourn W Power Station and in preparation for service of the initial Loy Yang A units. The planning permission for the section of this line between Hazelwood and Cranbourne included easement provision for two further 500 kV lines. The section between Cranbourne and South Morang was established on an existing easement.

As well as how the SEC planned to add a fourth 500 kV transmission line into the system:

The further 500 kV line from Hazelwood to Melbourne is planned to be established on the southern 500 kV easement adjacent to the existing 500 kV line from Hazelwood to Templestowe. The section of the line between Narre Warren and Templestowe has already been constructed and the Rowville to Templestowe part of this section is temporarily in service at 220 kV.

And the interesting bit – the abandonment of the transmission line between Coldstream and Templestowe.

To achieve connection of the fourth 500 kV transmission line into South Morang, the SEC propose to take the existing second 500 kV line (the southern circuit on the northern easement) directly into South Morang from Coldstream, so as to free up the section between Templestowe and South Morang for inclusion as part of the fourth 500 000 volt line.

The short section on the northern easement between Templestowe and Coldstream would then be left out-of-service until the future establishment of new 500 kV switching stations at Templestowe and Coldstream.

If that wasn’t clear as mud, this diagram depicted the current state, as well as three proposals for adding a fourth 500 kV circuit between Hazelwood and Melbourne.

Abandoning a section of high voltage transmission line sounds like an odd thing to do – something which Mr. R.F. English, resident of the Bend of Islands Environmental Living Zone immediately adjacent to the proposed transmission line easement, pointed out in his submission to the Natural Resources and Environment Committee.

The decision to take the Coldstream to Templestowe 500 kV line out of service until at least the fifth 500 kV line is constructed and required – this would probably be in at least 25 years or more.

As the Coldstream to Templestowe line is approximately 20 kilometres long, and based on $470,000 per km, this would mean a $9 million asset would remain idle and depreciating for 25 years.

This appears to me to reflect a gross planning error in the SEC’s long term plans “to scar the landscape with 500 kV power lines”.

So what ended up happening?

And you guessed it – State Electricity Commission of Victoria got their way, with the fourth 500 kV transmission line being pushed through the Bay of Islands bushland along the “LV1: second Coldstream to South Morang line” route, and the transmission line from Coldstream to Templestowe abandoned.

But will it be used in the future?

Back in the 1980s the SECV believed that a fifth 500 kV transmission line would be required by 1990 to serve the increasing energy demand of Melbourne.

But this prediction was overly optimistic – development of the massive 4,00 MW Driffield Project west of Morwell was abandoned follwing a change of government, and the Loy Yang power station petered out at 3,250 MW of the 4,400 MW capacity originally planned.

In 2009 Victorian energy network operator VENCorp dusted off the old SEC plans, in their ‘Vision 2030’ document:

Development of eastern corridor distribution

A new (fifth) 500 kV power line from the Latrobe Valley to Melbourne via the Northern easement terminating at Templestowe via Coldstream, and establishment of new 500 kV switching stations at Coldstream and Templestowe (140 km). This line would incorporate the currently unused 500 kV line between Coldstream and Templestowe.

Cost: $460 million

But with the decommissioning Hazelwood power station, no new coal fired power stations on the horizon, and the rapid growth of distributed rooftop solar and battery storage, the need for additional capacity between Melbourne and the Latrobe Valley seems redundant.

And another example

Sent in by a reader – a dead end transmission line outside the Geelong Terminal Station.

The transmission line runs north towards the Moorabool Terminal Station, but terminates a short distance to the south.

My guess – the original 220 kV circuit to Geelong was replaced by parallel 220 kV circuits on a new set of pylons, with a 220 KV circuit to Terang taking over the northern-most part of the easement.

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In the case of the state of Victoria, the current favourite way to get finance is via Public Private Partnerships: the government contracts a private consortium to build a piece of infrastructure, then pays them an exorbitant sum over a defined period to operate the facility, before it finally gets handed back to the taxpayer at the end of the term. The best known examples in Melbourne are the CityLink and Eastlink tollways – the desalination plant and the Royal Children’s Hospital are others.

The government says Public Private Partnerships work out cheaper for the taxpayer in the long run, and push the risk onto the private sector – but in reality we end up with socialised losses and privatised profits – greedy bankers making off with the loot when they succeed, and when they fail they sue the government claiming they were misled. In the case of the state of Victoria, we are currently paying a equivalent interest rate of 10 per cent to service PPPs, when the government could borrow money directly for just 3.5 per cent. (see this piece by The Age columnist Kenneth Davidson)

So how the governments fund infrastructure in the old days? When I was looking a newspaper advertising from the early 1980s I found the answer – government bonds. The way they work is simple: an investor loans money to the government, who in return receives a regular stream of interest over the term of the bond, and once the term is up, the investor gets their money back.

So what parts of the government issued bonds?

Telecom Australia was one, with their loans being backed by the Commonwealth Government. This was the “The Telecom Phone Loan” No. 17 from 1982 – as for what Telecom Australia intended to do with the money? They probably installed the now clapped out copper wires Malcolm Turnbull and the Coalition wants to reuse for their FTTN version of the National Broadband Network!

Another government-owned utility to issue bonds was the State Electricity Commission of Victoria. Responsible for the electricity supply to almost all of Victoria (more about the sole exception), back in the early 1980s the SECV was in the middle of building the massive Loy Yang power station and open cut brown coal mine in the Latrobe Valley.

The other big state-owned energy utility was the Gas and Fuel Corporation of Victoria – and they were no stranger to selling government backed debt to the public. With natural gas connected to metropolitan Melbourne by the early 1970s, by the time of their 1983 bond issue they were probably in need of funds to extend their gas pipelines to the smaller regional centres.

Another pillar of Melbourne before the changes of the Kennett years was the Melbourne and Metropolitan Board of Works (MMBW). Responsible for water supply and sewers in the city, as well as town planning, management of parkland and other open space, maintenance of metropolitan highways and bridges, and foreshore protection and improvements – the board was another government authority that needed big money to fund capital works.

Victoria wasn’t the only state to have state owned agencies issue bonds: over in Tasmania the Hydro-Electric Commission also ran adverts to gain investors. Given the early 1980s timing, the loan money was probably intended for the Franklin River Dam!

And if you throught public utilities were the only ones to offer loans to the public, the Australian National Railway Commission advertised their Public Loan No. 4 in 1981. Responsible for operating the railways lines inside South Australia, as well as over to Western Australian and the Northern Territory, they probably spent the money on their new fleet of BL class diesel-electric locomotives which were delivered a few years later.

However, I’ve saved the most interesting public loan advertisement for last – that of the Melbourne Underground Rail Loop Authority (MURLA). Established by the government to fund and build what is now known as the City Loop, in 1978-79 it decided to raise $30 million in funds through bond sales to the public, raised further money in the same way in the years to follow.

“Leaving your mark on Melbourne forever” – can you imagine today being able to invest your money in the infrastructure that Melbourne needs, and get paid handsomely for doing so?

Unfortunately it no longer works that way – the proposed Melbourne Metro tunnel is using $3 billion in funding committed by the Gillard government, but it is contingent on $3 billion from an unwilling state government, and another $3 billion via another sketchy Public Private Partnership.

Footnote

If you think interest rates of 10 to 15 per cent are high, you probably didn’t have had a home loan during the 1980s. Back then, high interest rates were the norm.

Further reading

• Need roads and rail? Then borrow and build by The Age economic editor Tim Colebatch
• Hospital PPPs show no signs of good health by Kenneth Davidson, The Age

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The oldest one belongs to the Melbourne Hydraulic Service Power Company. The company was established in 1887 by George Swinburne (namesake of Swinburne University) to supply high pressure water to buildings around the CBD to operate hydraulic lifts, and enabled the construction of Melbourne’s first multi-storey buildings.

The legislation that enabled the construction of the high pressure pipe network also allowed the Melbourne City Council to take over the system at a future date, which they did in 1925. Renamed the Hydraulic Service Power Department, in later years electric power took over the task of powering lifts, but the hydraulic system remained operating until 1967.

Another public utility provider was the Melbourne and Metropolitan Board of Works (MMBW), established by the state government in 1891 to manage Melbourne water supply and sewage systems. In the following decades their responsibilities grew to cover more of the city, the Board being given town planning responsibilities in 1949, and the power to construct and maintain metropolitan highways and bridges in 1956.

Infighting between the MMBW and local government saw the powers of the Board slowly reduced, when road responsibilities were passed to the Country Roads Board in 1974, the town planning responsibilities were passed to the Ministry for Planning and Environment in 1985. The end came in 1991 when the Board was merged with a number of smaller urban water authorities to form Melbourne Water.

Next up is the Melbourne City Council Electrical Supply Department (MCCESD), which was a Municipal Electricity Undertaking established in 1897 to supply electricity to the City of Melbourne, generated at a power station located on the corner of Spencer and Lonsdale Streets.

With the establishment of the State Electricity Commission of Victoria in 1921, the role of the MCCESD declined into a distributor and retailer of electricity to customers inside the council area, but took until the 1994 reforms of the Victoria electricity industry for the Department to disappear.

Also related to electricity was the Melbourne and Metropolitan Tramways Board, which was established by the State Government in 1919 to take over the existing private and council operated tramways in Melbourne. As well as expanding the network into the expanding suburbs, the MMTB was also responsible for the conversion of Melbourne’s cable tramways network to electric traction.

It took the passing of the Transport Act 1983 to dissolve the MMTB, when it was merged with the suburban rail operations of the Victorian Railways to form the Metropolitan Transit Authority, which was tasked with operating the public transport network of Melbourne.

A second reorganisation of Melbourne’s trams occurred 1989 when country and metropolitan operations were merged into the Public Transport Corporation, only to be again split up in 1999 as part of the privatisation of public transport by the Kennett Government.

Continuing on the privatisation theme, we find the Gas and Fuel Corporation of Victoria, the former monopoly supplier of household gas in Victoria. It was established by the state government in 1951 to take over a number of private town gas companies in Victoria, later developing a brown coal fuelled gasification plant at Morwell, only to have to made redundant after the discovery of natural gas in Bass Strait in 1965.

In 1997 the Gas and Fuel Corporation under the Kennett Government saw the same fate as the State Electricity Commission of Victoria: split up into retail, distribution and transmission companies that were sold off, with the remaining regulatory responsibilities being placed under a State Government-owned entity.

Making a change from state level entities, we now jump to the federal government with the Postmaster-General’s Department. Created at Federation in 1901 to control all postal (and later, telecommunications) services within Australia, in 1975 it was disaggregated, with the telephone side becoming known as Telecom Australia.

Telecom Australia was renamed to Telstra in 1995, and then privatised by the Federal Government in three share issues made in 1997, 1999 and 2006.

The final and possibly least understood manhole cover is this one from the Road Traffic Authority. When most people hear ‘RTA’ they think of the New South Wales road authority that manages the bumpy concrete monstrosities they call ‘motorways’ on the north side of the Murray River, but for almost a decade, Victoria also had a government entity by that name. Our version was established under the Transport Act 1983, which if you were paying attention earlier, also shook up the public transport operators in the state of Victoria.

Tasked with accident prevention and road safety, as well as transport regulation, driver licensing and the registration of motor vehicles, the Victorian version of the RTA only existed for six years – it was merged with the Road Construction Authority in 1989 to form the Roads Corporation, which still exists today under the VicRoads trading name.

Next time you are out, how many of these manhole covers can you spot?

Further reading

• A slightly less intense look at the names of Melbourne’s manhole covers
• A good read about the Melbourne Hydraulic Service Power Company

Sources

• Melbourne Hydraulic Service Power Company history at the White Hat Guide to Melbourne
• Melbourne and Metropolitan Board of Works history at The Encyclopedia of Melbourne Online
• Melbourne City Council Electrical Supply Department in an earlier post of mine
• Melbourne and Metropolitan Tramways Board history at Wikipedia
• Gas and Fuel Corporation of Victoria history at Wikipedia
• Postmaster-General’s Department history at Wikipedia
• Road Traffic Authority overview at the Public Records Office of Victoria

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First off is a photo from December 1947, showing both office and operational staff heading out of the main gate at knock off time. In the background is the original power station at Yallourn, with an array of short chimneys belching coal dust into the air, in the days when filtration devices were extremely primitive.

Fast forward 60 years, we are at the same location but the scene is very different. The power station was decommissioned in 1989 and was listed on the Victorian Heritage Register in 1994, but due to the amount of asbestos inside it was demolished between 1997 and 1999. All that remains on the site today is the concrete foundations, a gatehouse to nowhere, and the former administration building.

This 1961 photo shows the extent of the original complex at its peak (you can find the full sized version here), with the main gate being to the middle right: before demolition the power station had consisted of five separate units: ‘C’, ‘B’, ‘A’, ‘D’ and ‘E’.

Photo via Yallourn Association

As for the administration building, it was built in 1922 in the inter-war Academic Classical style, the two storey “Yallourn Production Centre” building features a portico with giant order Ionic columns, and was designed by the SECV architectural department under the direction of chief architect AR La Gersch. With privatisation of the power station the building was sold in 1996 and is now used as a pub, with the building being listed on the Victorian Heritage Register.

Further reading

• Former Yallourn Power Station Adminstrative Building: entry H1054 on the Victorian Heritage Register.
• Virtual Yallourn: more photos of the old Yallourn power station.

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Considered the lowest grade of coal, the brown coal found in abundance in the Latrobe Valley has an extremely high moisture content of 60 to 70 percent, compared to the 10 percent found in NSW black coal, resulting in a much larger quantity of coal needing to be burned to produce a given energy output. This moisture content also results in higher carbon dioxide emissions then comparable black coal plants, which has attracted the attention of modern environmentalists.

With no economic deposits of black coal found in Victoria, the use of brown coal for power generation commenced in 1924 under the auspices of the State Electricity Commission of Victoria, with the opening of their first power station at Yallourn in the Latrobe Valley. With the low energy density making brown coal expensive to transport, the power station was built beside the open cut mine and fed with coal by a conveyor belt, in a model which is still used throughout the Latrobe Valley. The SECV went on to use their position as the monopoly electricity generator and supplier to drive aggressive growth in electricity usage, assisting electricity hungry industries such as aluminium smelting to become established in the state, and planning new open cut mines and power stations years in advance to cater for the ever growing demand.

While the widespread use of brown coal for power generation enabled Victoria to become self sufficient in energy supplies and encouraged the growth of heavy industry, this was achieved during a period when the costs of pollution were not a mainstream concern and the environmental movement was still to emerge. It took until the late 1980s for the SECV to change direction towards a less energy hungry future, but it was Jeff Kennett and his privatisation bandwagon that dismantled the Commission, breaking it up into the current collection of generation, transmission and retail companies during the 1990s.

Today the oldest baseload power station in Victoria is the 1,600 MW capacity Hazelwood Power Station. Located just south of Morwell, Hazelwood and the neighbouring open cut coal mine that fuels it were constructed on a greenfields site between 1964 and 1971.

Planning at the site commenced in 1949 for both power generation and briquette production, with the SECV starting construction in 1959 on the first of six 200 MW generating units. With increasing electricity demand in Victoria by 1963 it was decided to add two more generating units, taking the total to the eight. 40 years after opening Hazelwood is now a polluting dinosaur, but at the time of opening it was the first of Victoria’s “modern” power stations, being both cleaner and cheaper to operate than anything that had come before due to the then-massive scale, with each generator having four times the capacity of the largest previously used in the state.

With privatisation of the SECV, Hazelwood was sold to the UK based International Power plc in 1996 for a massive $2.35 billion. If this sale price is not unbelievable given the age of Hazelwood, at the time of the sale the associated open cut mine that fuelled it had only 10 years of coal left inside the approved mining licence boundaries, effectively placing a closure date on the plant. However this was not to be, when the State Government approved the Phase 2 “West Field” development in 2005, expanding the mining area across the Morwell River to secure a coal supply until 2030. At least with the introduction of the carbon tax it appears that the power station will never reach age 60, with Hazelwood a frontrunner to be included in the 2,000 MW of generating capacity paid to shut down. Not a bad deal for the private owners, eh?

The next oldest power station in the Latrobe Valley is the 1,450 MW Yallourn Power Station, located between Moe and Morwell on the banks of the Latrobe River. Commissioned between 1973 and 1981, Yallourn is the site of Victoria’s first brown coal fired power stations.

The open cut mine at Yallourn commenced operations in the 1920s supplying brown coal for both electricity generation and briquette production, with employees living in the neighbouring company town of Yallourn. In the decades that followed more power stations were built and the open cut continued to expand towards the town, so in 1969 the SECV announced that Yallourn would be cleared to make way for further expansion of the mine. With all of the land in the town owned by the SECV and rented out to tenants, demolition commenced soon after, with the entire town wiped off the map by 1982.

With privatisation of the SECV Yallourn was sold a consortium of companies in 1996 for $1.55 million, who onsold it to the Hong Kong-based CLP Group, operating as TRUenergy. As the lifetime of the power station is dependant on coal from the neighbouring open cut, with various expansions of the mine having been carried out in recent years to secure the supply. With the coal beneath the former township of Yallourn exhausted by the 1990s, the East Field expansion opened on the other side of the mine, requiring a diversion of the Morwell River. With further diversions carried out in 2007, the coal supply at Yallourn is now secure until 2032, when the oldest generator will be 59 years old.

The final and largest brown coal fired power station is the Loy Yang complex, located south-east of Traralgon beside yet another open cut mine, with a total of 3,300 MW generating capacity spread across two power stations, commissioned between 1984 and 1996.

With Victoria’s electricity demand growing throughout the 1970s and the output of the existing open cut mines at Morwell and Yallourn fully committed to the power stations mentioned earlier, the SECV looked for new brown coal reserves to exploit for power generation, setting on a location outside Traralgon. The initial plans for Loy Yang made it the biggest project ever attempted by the SECV, with a total of 4,000 MW in generating capacity spread over four 500 MW stages, forming the Loy Yang ‘A’ and ‘B’ stations at a cost of around $5.5 billion (in 1984 prices).

The scale of the plant at Loy Yang was driven by the State Government chasing the electricity hungry aluminium industry, with discounted electricity rates leading Alcoa to sign a contract in 1979 for the construction of a 480,000 tonne/year smelter at Portland on the state’s south-west coast. Finally opened in 1986 after many disputes and a downsizing in capacity, the 300,000 tonne/year capacity smelter requires 700 MW of power after transmission losses are taken into account – around half of the output from the ancient Hazelwood power station.

The first power at Loy Yang ‘A’ was generated in 1984, with the last of the units being brought online by 1988. By this time the electricity industry in Victoria had changed, and work on the next stage at Loy Yang ‘B’ stalled for a number of years, as a new focus on energy conservation reduced overall electricity demand, and questions were asked in government as to the cost efficiency of the SECV and brown coal power generation in general. It took until 1993 for this situation to be finally resolved, when 1000 MW of the Loy Yang ‘B’ plant was cancelled, and the two unfinished units being sold for $2.3 billion to a private owner, who completed them in 1996. One year later in 1997 Loy Yang ‘A’ was also sold to private enterprise, with the 10 year old power station fetching $4.75 billion.

Fifteen years since Loy Yang ‘B’ opened, Victoria has not gained any new baseload generating capacity, despite an extra 4.5 million residents moving to Victoria, and air conditioners popping up in every household. With privatisation power generation is now the domain of risk adverse investors, who are not excited by the huge upfront costs and low return on investment associated with a new power station. Of the investments in generating capacity that have made, ~500 MW gas powered peaking plants dominate, followed by wind farms chasing government mandated renewable energy targets, and rooftop solar panels heavily subsidised by feed-in tariffs and government grants.

So how much generating capacity is needed to replace a baseload coal power station?

For the non-coal options detailed above:

• Mortlake Power Station is a $640 million, 550 MW capacity gas powered “peaking” plant, that only operates in times of high electricity demand.
• Waubra Wind Farm is the largest source of renewable energy in Victoria, with 128 wind turbines providing a total capacity of 192 MW for $450 million.

As you can see by the graph, Victoria has a long way to go if we want to eliminate the use of brown coal completely. Getting rid of Hazelwood will require $1.5 billion of new gas powered generators to be built, and replacing Yallourn and Loy Yang will as well take another $6 billion of plant. The wind equivalent will require a minimum $15 billion capital investment, and this is ignoring the difference between ‘sticker’ capacity and actual output of wind turbines.

With a few hundred years of brown coal left under the Latrobe Valley (cite), who knows what the future will hold: at least the carbon tax will give us a little bit more certainty for long term investors. If only the SECV still existed, one does wonder what an organisation with a long term outlook would have done in this situation…

Further reading

• Gill, Herman (1949). “Three Decades: The story of the State Electricity Commission of Victoria from its inception to December 1948” – corporate history of the SECV
• Edwards, Cecil (1969). “Brown Power: A jubilee history of the SECV” – a sequel to the above book, but still misses the later years
• Malcolm Abbott (March 2006). “The performance of an electricity utility: the case of the State Electricity Commission of Victoria, 1925–93” – journal article covering the SECV from formation to breakup (behind a paywall)

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