Power shares

[Snoopy]

on last weeks Tesla earnings call, Tesla announced that their auto-bidder system will be expanding to consumer Powerwalls, which will enable owners to put there batteries into a battery pool that takes advantage of high & low spot power pricing to buy & sell power for profit via an automated software solution. Not sure when it will roll out in New Zealand, but hopefully it is coming.

In what country and what market does the 'auto-bidder' system operate? I imagine that such a system would require the local network and power seller to come on board. Last year Nissan got into the news with their "V2X vision" that was going to have Nissan Leaf cars plugged into the grid all over the country. The NZ press release that sparked the media stories seems to have been pulled from the Nissan NZ website. But the quote below is from the Nissan Leaf brochure on the Nissan NZ website

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V2X (Vehicle to Everything): The Nissan LEAF is one of the only EVs that comes capable of Bi-directional charging. This means that not only is the LEAF able to take on and store charge, but it is also able to provide charge back from the car to the home, business or electricity grid

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Vector seemed keen at one point, but the reference below is from September 2017

https://www.vector.co.nz/articles/gi...ectric-vehicle

Two years later it is still a research project

https://www.vector.co.nz/articles/tu...-power-sources

Northpower, based in Whangarei, has started a trial

https://www.scoop.co.nz/stories/BU20...ca-funding.htm

It is interesting that the University of Canterbury is supporting this project, rather than something more local to them. In fact, I can't find any reference to 'Vehicle to Grid' trials south of the Bombay hills. Anyone know of any? Having citizens via their own batteries, either house or car mounted, feeding power back into the local grid does seem to be off the radar of most lines companies and gentailers in NZ these days.

SNOOPY

[Jaa]

https://www.stuff.co.nz/national/300...to-hydro-power

Woods also announced $70m of investment to help pay for the electrification of industrial and process heat in the lower South Island. Most industrial and process heat is generated from non-renewable sources.

Upgrading lines and investing in transmission helps these processors connect to the grid, giving them access to renewable electricity. Some of that funding would also go to help industrial users convert coal boilers to electricity.

There is the answer to where some of Manapouri's power will go. Replacing the coal fired burners of the South Island will strengthen NZ Inc's key selling point of green, sustainable and safe food production. Will create some jobs too. Great move by the always impressive Megan Woods. Win-win.

[tango]

This plan was announced a year ago and supposedly would be investigated by the end of 2019 and dusted off again recently when the government went hunting for shovel ready projects. It has definite potential. I am wondering whether any of the listed power companies will benefit or be hurt by the project

[Snoopy]

This plan was announced a year ago and supposedly would be investigated by the end of 2019 and dusted off again recently when the government went hunting for shovel ready projects. It has definite potential. I am wondering whether any of the listed power companies will benefit or be hurt by the project

Marc England form 'Genesis Energy' is the only Gentailer CEO to have 'commented' on the project. So there is your answer. The gist of what Marc has said is that any pumped hydro system would be a very capital intensive project. It would be far cheaper to use clean(ish) natural gas in the existing thermal generation at Huntly to 'fill in any power generation gaps' to do the same job. Marc does have a point. But if the pumped hydro goes ahead Genesis will be the biggest loser.

SNOOPY

[fish]

In what country and what market does the 'auto-bidder' system operate? I imagine that such a system would require the local network and power seller to come on board. Last year Nissan got into the news with their "V2X vision" that was going to have Nissan Leaf cars plugged into the grid all over the country. The NZ press release that sparked the media stories seems to have been pulled from the Nissan NZ website. But the quote below is from the Nissan Leaf brochure on the Nissan NZ website

----------

V2X (Vehicle to Everything): The Nissan LEAF is one of the only EVs that comes capable of Bi-directional charging. This means that not only is the LEAF able to take on and store charge, but it is also able to provide charge back from the car to the home, business or electricity grid



It is interesting that the University of Canterbury is supporting this project, rather than something more local to them. In fact, I can't find any reference to 'Vehicle to Grid' trials south of the Bombay hills. Anyone know of any? Having citizens via their own batteries, either house or car mounted, feeding power back into the local grid does seem to be off the radar of most lines companies and gentailers in NZ these days.

SNOOPY

For a reason I not understand bi-directional charging is very expensive-I found a unit to do vehicle to home for $25,000
http://www.v2h.co.nz/vehicle-2-home/

[Snoopy]

For a reason I not understand bi-directional charging is very expensive-I found a unit to do vehicle to home for $25,000
http://www.v2h.co.nz/vehicle-2-home/

That $25,000 price does seem high. I wonder if it includes all the solar panels and all the associated installation with that as well?

There is an article here on V2G 'vehicle to grid' power installations in the Australian context.

https://thedriven.io/2020/06/12/what...-grid-options/

The comments at the end of the article by knowledgeable people are even more interesting than the article itself. The gist of the article is that nothing is commercially available to do 'V2G' because no-one has agreed on what electrical standards such devices must meet. However 'V2H' ('Vehicle to Home') might be a goer.

But just to give a snapshot of some of the points raised in the article.

"the inbuilt Tesla (Vehicle) AC charger does NOT have bidirectional capacity"

"Bidirectional charging is via the DC port and currently only the CHAdeMO standards include bidirectional charging protocols" (CHAdeMO is an abbreviation of "CHArge de MOve", equivalent to "move using charge" or "move by charge" or "charge 'n' go", a reference to the fact that it's a fast charger.)

"The 2018 LEAF uses the CHAdeMO connector for DC fast charging, which available as an option on the SV model."

But according to Wikipedia all of the second generation Nissan Leafs (from 2017) have this connector type 'built in'. Wikipedia also said the first generation leaf, from 2011/2012 in SL trim had a CHAdeMO port too.

Now from "Mark" down in the article comments section:

"For a start you can't buy cars that actually support bidirectional. Nissan says the existing Leafs will support it, but can't offer something to plug them into."

"In terms of what already exists and can be bought (in some jurisdictions) Mitsubishi offered a "power box", and Nissan offered a backup adapter un Japan after Fukushima, and these gave people a power socket run off the car that could be used as backup power. The first one was I think a glorified 12V inverter, Nissan's might have run direct from the high voltage battery. As far as I know neither were bidirectional, so you had to plug in a charger to top up, then swap to backup to draw down."

Hmm, I think I could put up with plugging in a separate 'discharge' cable into my EV if it saved me $25,000!

"A few years ago (and still today but less so) there was a lot more concern about the longevity of EV batteries. It was a reasonable argument that bi-directional charging would increase the degradation of the batteries, and cause a premature death of the battery. I think it's still a reasonable argument that the economics of bi-directional charging could be a bit marginal. The irony here is that Nissan is the only manufacturer to have apparently stated they would honour the battery warranty with bi-directional charging, and yet they seem to have the biggest problems with excessive battery degradation."

SNOOPY

[Davexl]

I guess there could be a market for a battery with artificial intelligence - being aware of the varying power prices during the day - that could decide when to charge / discharge, the latter not only for consumption but also for export to the net. I don't think it is available though, and doubt with the current cost structures it would be cost effective.

It seems that Vector and Amazon are going to be working on consumer metering analytics and Artificial Intelligence solutions together shortly:
Consumer products by 2021...

https://businessdesk.co.nz/article/v...f-new-platform (Possibly Pay-walled)

[k14]

Marc England form 'Genesis Energy' is the only Gentailer CEO to have 'commented' on the project. So there is your answer. The gist of what Marc has said is that any pumped hydro system would be a very capital intensive project. It would be far cheaper to use clean(ish) natural gas in the existing thermal generation at Huntly to 'fill in any power generation gaps' to do the same job. Marc does have a point. But if the pumped hydro goes ahead Genesis will be the biggest loser.

SNOOPY

To be honest, I think all large generators will be impacted. Genesis will be one of the lesser because whilst they will have to take a short term hit by closing thermal generation, at least the assets have a finite life and have high opex. Meridian, Contact and Mercury will have the value of all their hydro assets massively diminish, Meridian being the most impacted. If 5000 GWh of intra-year hydro storage is added to the NZ market, it stamps out the majority of volatility in the market. At the moment, the hydro asset owners make good margins during dry spells as the spot price can spike to over $1000, giving good returns on the assets. However, add in the big battery (Onslow) and all of a sudden the volatility range decreases from $1 (wet period) to $1000+ (dry period) to now probably being $100 (dry period) to $50 (wet period). In theory great for consumers (if the business case stacks up) but not very good for shareholders of the hydro companies.

I like the idea but think the economics are very marginal. A 24km tunnel through a mountain range, underground powerhouse and 3.8km dam, I think we are dreaming. Look at the Snowy 2.0 scheme. Touted in 2017 as costing $2B AUD, then up to $4B, current price I believe is $5.1B and they still need to build the transmission (expected to be $1-2B). It has some similarities to Onslow in having an underground powerhouse and 27km tunnel although far smaller reservoir (full to empty at max generation in ~7 days vs 170+ days for Onslow).

[Jantar]

To be honest, I think all large generators will be impacted. Genesis will be one of the lesser because whilst they will have to take a short term hit by closing thermal generation, at least the assets have a finite life and have high opex. Meridian, Contact and Mercury will have the value of all their hydro assets massively diminish, Meridian being the most impacted. If 5000 GWh of intra-year hydro storage is added to the NZ market, it stamps out the majority of volatility in the market. At the moment, the hydro asset owners make good margins during dry spells as the spot price can spike to over $1000, giving good returns on the assets. However, add in the big battery (Onslow) and all of a sudden the volatility range decreases from $1 (wet period) to $1000+ (dry period) to now probably being $100 (dry period) to $50 (wet period). In theory great for consumers (if the business case stacks up) but not very good for shareholders of the hydro companies.

I like the idea but think the economics are very marginal. A 24km tunnel through a mountain range, underground powerhouse and 3.8km dam, I think we are dreaming. Look at the Snowy 2.0 scheme. Touted in 2017 as costing $2B AUD, then up to $4B, current price I believe is $5.1B and they still need to build the transmission (expected to be $1-2B). It has some similarities to Onslow in having an underground powerhouse and 27km tunnel although far smaller reservoir (full to empty at max generation in ~7 days vs 170+ days for Onslow).

The Majeed thesis addresses the economics and overcomes the common fallacy of this just being a dry year storage facility.

Consider Onslow as being like a thermal power that has to buy its fuel. Combined cycle thermal plants like at Huntly or Stratford also have to buy their gas, but they buy it as they burn it. The older Rankine units at Huntly have to buy coal in advance just as Onslow would have to buy water in advance. The cost of gas to the CCGT plant varies but is often around $7 per GJ, and they need 8 GJ to generate 1 MWh of electricity. Thus their fuel cost alone is around $55 per MWh add on other OPEX costs and their SRMC is close to $70 per MWh. Onslow would need to buy 1.3 MWh of energy to pump enough water uphill to generate 1 MWh of energy back into to grid. The OPEX costs for hydro stations is quite low and usually less than $3 per MWh. So to be able to offer at an SRMC of $70 MWh it would need to buy energy at less than $51 per MWh. So already we see the initial bids and offers so as to align with the current market. First tranche of bids at $50 and first tranche of offers at $70.

The current market rules allow for bids to be made in up to 10 tranches, so 10 machines would effectively mean bidding into the market with 1 machine per tranche. Using that $50 figure arrived at earlier for tranche 1, a typical bid may be $50 for 120 MW, $45 for 120 MW, $40 for 120 MW etc until the last machine would would be $5 for 120 MW. As bids are cumulative then a nodal price of $30 would see a load dispatch of 600 MW, and would see a gain in storage in Lake Onslow of 461 MWh at a cost of $18,000.

The rules for generation are not quite so flexible and only allow for 5 offer tranches. Ideally the rules would be changed to allow for 10 tranches, the same as for bids, but for this calculation lets assume there is no change in the rules. Using the $70 offer figure for tranche 1 arrived at earlier a typical offer would be $70 for 105 MW, $80 for 105 MW, $100 for 105 MW, $120 for 210 MW, and $140 for 675 MW (The reason for desiring a rule change becomes obvious). The 105 MW figure is chosen as this would be close to the most efficient operating point for a 120 MW machine. As offers are cumulative a nodal price of $100 would see a dispatch of 315 MW for a loss of storage of 315 MWh per hour and a revenue of $31,500.

Thus Onslow is not just dry year storage, but is like a fast start thermal station that can buffer wind generation. Because of its swing from full demand to full load it could buffer an additional 2400 MW of installed wind capacity.

[Snoopy]

To be honest, I think all large generators will be impacted. Genesis will be one of the lesser because whilst they will have to take a short term hit by closing thermal generation, at least the assets have a finite life and have high opex.

Doesn't Genesis already have the biggest mismatch between retail customers and owned generation? If they closed Huntly, wouldn't they be reliant on buying power supply contracts on market?

Meridian, Contact and Mercury will have the value of all their hydro assets massively diminish, Meridian being the most impacted. If 5000 GWh of intra-year hydro storage is added to the NZ market, it stamps out the majority of volatility in the market. At the moment, the hydro asset owners make good margins during dry spells as the spot price can spike to over $1000, giving good returns on the assets. However, add in the big battery (Onslow) and all of a sudden the volatility range decreases from $1 (wet period) to $1000+ (dry period) to now probably being $100 (dry period) to $50 (wet period). In theory great for consumers (if the business case stacks up) but not very good for shareholders of the hydro companies.

The combined hydro storage capacity of Meridian, Contact and Mercury would dwarf Onslow would it not? If we got to the situation of calling in Onslow, then the total hydro storage capacity of the country would still be in trouble. So overall, would the spot hydro price fall? And isn't Onslow an upstream part of the wider Clutha catchment? So couldn't Contact use the Onslow outflow as Clyde dam inflow and so make more money than the other hydro system players in dry years?

I like the idea but think the economics are very marginal. A 24km tunnel through a mountain range, underground powerhouse and 3.8km dam, I think we are dreaming. Look at the Snowy 2.0 scheme. Touted in 2017 as costing $2B AUD, then up to $4B, current price I believe is $5.1B and they still need to build the transmission (expected to be $1-2B). It has some similarities to Onslow in having an underground powerhouse and 27km tunnel although far smaller reservoir (full to empty at max generation in ~7 days vs 170+ days for Onslow).

What company is it proposed would own and operate Onslow?

SNOOPY