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*Pic: This incredibly stark photo illustrates Hydro’s problem ... Taken March 5 by Isla MacGregor of Lake Burbury. Part of the flooded Crotty settlement is now exposed and water levels are down to just over 6 metres ...

... and a single, solitary engineer ... ? Check out the Board HERE A retired energy industry insider who spent more than a decade working with Hydro Tasmania has blown the whistle in The Examiner on the extraordinary gambles taken by Hydro Tasmania, no doubt pushed by 2012/2013 Lara Giddings and now-Treasurer Peter Gutwein …

EXCERPTS from this article ...

… The carbon tax became effective in Australia on 1 July 2012 and operated until repealed in July 2014. During this period, Hydro Tasmania ruthlessly ran down the storages.

It exported as much electricity over Basslink as it could, running the link flat out in export 24 hours a day for months at a time.

Of course, this generated very strong profits for Hydro Tasmania and it was able to pay very large dividends to the government from the cash it generated.

In effect, and apparently without much regard for Tasmanian’s future energy security, Hydro Tasmania made hay while the sun shone, converting water in its dams and lakes into cash.

Hydro Tasmania generated cash from operations of $262 million in 2012-13 and $243 million in 2013-14. …

The latter half of the year is typically the period when the storages build - historically from June to November the storages rise to their peak; they then usually run down during the drier months to their low around the middle of June before the cycle repeats.

But this didn’t happen in the latter half of 2015. Rainfall and inflows from about August 2015 onwards have been among the lowest on record. Apparently targeting storages at 30 per cent, Hydro Tasmania progressively cranked up the level of imports over Basslink.

In the later months of 2015, Basslink was running flat out 24 hours a day in import - operating like a 470 MW power station. With average electricity demand running at about 1065 MW during summer, this meant that Basslink was supplying about 44 per cent of all of Tasmania’s electricity needs.

To put this in perspective, in recent weeks, wind has supplied about 145 MW on average and hydro the rest. Bizarrely, in the week before Basslink failed (which occurred on 20 December), Hydro Tasmania used Basslink to export some electricity - about 9.3 GWHrs, equivalent to average capacity of about 55 MW.

What were they thinking? Even more bizarrely, Hydro Tasmania took an incredible decision announced in August 2015. They decided to dismantle and sell the big machine at TVPS - the 205 MW Mitsubishi Combined Cycle machine.

One can only shake one’s head in disbelief that the Hydro Tasmania Board could have made this decision. Having apparently decided on a strategy of managing the storages to 30 per cent, this meant that their only protection against a period of drought was Basslink.

But Basslink could never be fully relied upon - cables fail from time to time, a risk that was well understood within Hydro Tasmania. Indeed, the contractual arrangements between Hydro Tasmania and Basslink provide that in the event of a cable fault Basslink is obligated to fix it within 60 days (or presumably pay financial penalties if it takes longer as is now apparent)

So, Hydro Tasmania has known all along that a cable failure was always a possibility. It beggars belief that Hydro Tasmania was apparently prepared to wing it and dispose of TVPS - the only generation capacity that was available to cover the loss of the Basslink cable during a period of drought and low storages.

This decision is all the more outrageous considering that TVPS had been given to Hydro Tasmania for nothing and the associated debt taken off its hands. Hydro Tasmania says that the government approved the disposal of the TVPS Combined Cycle unit.

If this is true, one wonders what is wrong with the government’s advisers. In industry parlance, a Basslink failure is a “credible contingency”. Standard risk management practice is to have a back-up in the event of a credible contingency.

In a time of low storages, with Basslink out of service, the only back-up available was TVPS. How could any well informed person think it was a sensible idea to dismantle and sell it?

Read the full article in The Examiner, HERE

• Luigi in Comments: The end result of Hydro becoming a money spinner - rather than the custodian of our power generation and energy security - is that all its dividends have been squandered on Hobart’s bloated bureaucracy and wasteful projects like a new parliament house, rather than being reinvested in new generation technology. South Australia now generates over 800MW of electricity with wind power.  If we had matched that, we would be self-sufficient WITHOUT any reliance on our now-depleted water resource. The Tamar Valley Station and 800MW of wind power would exceed our needs.

• This graphic relates to Comments 21-24 by Vanessa Goodwin: Two years of Hodgman majority Liberal Government: A brighter future for Tasmania ...

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