Two Australian States Are At Risk Of Blackouts This Summer

Victoria and South Australia risk power outages this summer, which begins in a few months, due to lower hydrocarbon generation capacity.

This is what the Australian Energy Market Operator warned in a report, joining U.S. grid operators that this summer sounded the alarm on blackouts.

"We're expecting an elevated level of risk compared to recent years, mostly due to hotter and drier conditions, and coal-fired generation reliability is at historic lows," the chief executive of AEMO, Daniel Westerman, said, as quoted by Reuters.

Since coal power plants do not depend on the weather to generate electricity, it is quite likely Westerman referred to the rate of retirement for such plants in the context of alternative additions such as wind and solar.

Indeed, Reuters noted in its report that AEMO plans to retire as much as 62% of currently operating coal power plants in Australia by 2033.

Because of these plans, "To ensure Australian consumers continue to have access to reliable electricity supplies, it's critical that planned investments in transmission, generation and storage projects are urgently delivered," Westerman also said.

In the U.S. this year, Texas was the state with the most blackout warnings due to a spike in demand in the hottest months of the year, coupled with a sharp increase in the population. Generation capacity, meanwhile, only rose in the wind and solar segments.

Last week, however, the Midcontinent Independent System Operator, or MISO, also warned of potential outages.

"Due to the extreme heat creating near-record electricity demand and unplanned generation outages over the last 12 hours, MISO has declared (an energy emergency alert)," a spokesman for the operator said.

Earlier in the year, NERC warned that the premature retirement of coal and gas generation capacity could backfire as wind and solar were not being added fast enough and they had inherent flaws, chief among them the dependence on specific weather conditions.

By Irina Slav for Oilprice.com

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