Investor News

Soaring power bills a key election issue

You can tell we're heading toward a state election.

Opposition leader Matthew Guy is seizing upon unprecedented power price hikes as he pitches his case to be the next to lead the state of Victoria.

The fallout from the closure of Hazelwood continues as power prices triple for energy users like Doyle's Bridge Hotel in Mordialloc.

This is a logical platform for Guy. Energy policy is in crisis, directly threatening jobs.

Victoria has gone from having the cheapest power in Australia to the second most expensive, behind South Australia.

Source: AEMO data

On this topic, it appears Guy can't lose.

The Age reports that Doyle's monthly power bill has jumped from $8,000 to $24,000.

For those new to the topic, the key issue is the 'energy trilemma': Reliable, affordable or low emissions... pick any two.

Reliable and affordable power comes from coal.

Gas can be reliable but is not currently affordable.

Wind and solar power have no emissions but aren't reliable or affordable despite $30 billion in subsidies over the past couple of decades.

Hydropower is the only renewable source that is dispatchable, but as a relatively dry country, it is finite.

And nuclear power, the ultimate zero-CO2 baseload source, is not even on the table.

The challenge is to find a balance.

In the proverbial 'pub test', The Age article highlights the plight faced by the hospitality industry.

To cover that cost, publican Robbie Beaton says he needs to sell an extra 120 pots a day. He's already let two employees go.

Imagine if they actually made something! Running a pub is hardly an energy-intensive industry, yet the price impact is huge.

We've seen similar price hikes emerging across a range of Victorian industries.

This has created a tremendous opportunity in the local market for our Coldry process.

Industries that rely on process heat switched to gas several years ago following the closure of the Morwell briquette plant.

These industries have been dealt a double blow under the current energy policy, suffering hikes in both the cost of electricity and gas.

At present, we can't do much to help relieve pressure on the electricity price, but Coldry is an ideal solid-fuel alternative to gas.

Further, we don't step on the toes of Wind or Solar because neither are suitable for providing industrial heat.

Our plan:

  • Ramp up production at our Coldry High-Volume Test Facility at Bacchus Marsh to 35,000 tonnes per year
  • Complete the feasibility study for our proposed large-scale (170,000 tonnes per annum) Coldry demonstration plant at Yallorn
  • Explore opportunities to reduce emissions from existing brown coal power generation, providing affordability, reliability and reduced CO2 intensity

Current energy policy is driven by the Green's preference deals with Labor.

The Greens have a zero-coal policy. It's well-intentioned but economically reckless, as the current energy crisis demonstrates.

Call us biased, but we think Coldry, applied to existing brown coal power stations, could provide a transitional solution, reducing emissions intensity while maintaining reliability and affordability.


Publican Robbie Beaton says he needs to pour 120 more pots of beer each day to keep pace with power bills.
Photo: Eddie Jim

Guy declares energy crisis as bayside bar takes potshot at soaring bills

6 June 2018 | The Age | Noel Towell

One of Melbourne’s landmark bayside pubs has been forced to ration its heating and cooling and cut down on staff as it faces power bills that have soared to $24,000 a month.

The owners of Doyle’s Bridge Hotel in Mordialloc say they will have to pour more than 120 more pots of beer each day just to keep pace with power bills that have tripled from $8000 a month in the wake of last year’s closure of the Hazelwood power plant in the Latrobe Valley.

Source: Guy declares energy crisis as bayside bar takes potshot at soaring bills