A lunch meeting on Friday, 18 March 1960 in Melbourne changed Australia’s economic history. The Chairman of BHP, Ian McLennan, had lured the famed US geologist, Lewis Weeks, out of retirement to help him find oil in Australia.
Ian asked Lewis a simple question, where is the best place to find oil in Australia. Lewis answered – after extracting an agreement for a royalty – of the Bass Strait.
Lewis was right. He and BHP made a fortune and Australia became self-sufficient in petroleum production. But over the past 20 years the oil of the Bass Strait has dried up. Australia has gone from producing almost 100 per cent of our petroleum needs in 2000 to producing less than half that amount today.
Nowadays instead of opening up new sources of energy we are shutting them down. This week the first of the Liddell coal fired power station’s three remaining units will shut. Over the following 10 days the other two will be turned off for good too.
Liddell provides 10 per cent of NSW’s energy needs. Our energy experts claim that everything will be fine. We have been building lots of solar and wind!
But solar and wind is not an orange for an orange when it comes to electricity. Coal fired power can remain on most of the time. Whereas solar and wind power depend on the weather. People still want to heat their home and work in a factory when it is cloudy and not very windy.
At least Australia has not been alone in madly shutting down its reliable power with no like-for-like replacements. This week Germany switched off its last three remaining nuclear power plants. Things are immediately not looking good.
On the first night of no nuclear for Germany, wind production was just 7 per cent of its capacity. Germany only kept its lights on thanks to coal energy and France. Germany has re-opened 24 coal fired power stations since the Ukraine war started. Germany now produces a lot of power by burning corn. In fact 13 per cent of its farmland is now used for this purpose. As if food prices were not high enough.
But even this would not be enough without Germany importing nuclear energy from France. The problem for us is we do not live in Europe and we can’t get our power from elsewhere. NSW increasingly relies on Queensland for its power but our power stations are ageing (two units at Callide are currently offline), and we are not building reliable power either.
Even though the experts assure us things are fine today, that is what they said when the Hazelwood power station shut in 2017. Power prices surged (and but for a brief relief during COVID lockdowns) they have stayed high.
The experts do admit that we need to build 8000 megawatts of new reliable power (that is not solar or wind) over the next decade. That is a gap of 6 Liddell coal fired power stations to cover in just a decade.
We are told we cannot build 6 coal fired power stations because that would cause the planet to blow up. But how does that make any sense while China builds 2 coal fired power stations a week. They are even buying our coal again to fuel them.
We need to return to the “get it done” attitude of Australians like Ian McLennan and Lewis Weeks. Let’s build reliable energy in Australia for Australians again.
