Temco
This informative observation was first posted as Comment 12 on this thread here, Cliched, populist drivel … and incomprehension. Temco woe:
#10 I don’t know for certain what price they are paying, rumor suggests 8c / KWH, but around 4 cents is the price you’d expect in other Australian states and which is internationally competitive. 8c is just a rip off, no doubt about it.
Consider for a moment that here in Tasmania we have:
1. A hydro resource of about 1850MW constant baseload, about 63% of which is actually developed.
2. A national subsidy scheme which enables us to develop wind energy with other states footing half the bill. Also, we have amongst the best conditions for wind energy on earth.
The economic potential of wind is about 350 MW average output at present, rising to about 550 MW if we fully developed the hydro resources (due to the integration of the two).
3. Enough black coal to support an average output of 550 MW for 60 years whilst still leaving enough coal for the paper mill, cement works etc. And that’s despite the fact that there has been relatively little exploration for coal in Tasmania (due to the adequacy of current known reserves).
4. Enough brown coal to support 150 – 200 MW.
5. A sawn timber industry that necessarily produces significant quantities of legitmate waste timber (as distinct from the woodchipping industry).
6. Sufficient natural gas offshore to meet current non-electricity demand for around 50 years. We also have very good prospects for discovering onshore gas and more offshore gas too.
7. In the future we have reasonable prospects for geothermal, tidal, wave and solar power in Tasmania, particularly given the potential for integration with hydro. We also have numerous known small deposits of oil shale which may be useful at some future date.
8. We have numerous known deposits and several working mines producing various metallic ores.
9. There is a global bull market in energy and some metallic minerals.
10. All up, we’ve got access to about 3000 MW baseload from hydro, wind and coal versus current load (including TEMCO) of 1250 MW (some of which is supplied from imports). We’ve got enough gas for 50 years’ of non-electricity use and a fair chance of finding more.
How much energy we could sensibly get from wood I’m not sure (I’m talking about using actual waste, not clearfelling to feed power stations). But there’s certainly some potential for wood energy in a sensible manner that’s for sure.
A rational person would note the very obvious opportunity to export energy not directly, which creates virtually no employment or other benefits, but indirectly via manufacturing industry. And yet here we are with the 3rd largest metal smelting industry in the state shutting down whilst everything from that to the health system falls apart. Something is very, very wrong with this picture.
In short, the bursting of the credit bubble in 2008 and the global energy situation has reversed the economics of the past generation as they apply to Tasmania. Consumer discretionary spending is the new “sunset industry” and we are once again in a position to benefit from energy.
The situation is ridiculous in the extreme. The state ought to be booming not going broke. There’s a bull market in energy, we’ve got energy, and we’re practically broke. Go figure.
Imagine if the Saudi’s couldn’t afford petrol? There’s a lot in common with that analogy and the situation in Tasmania. Those with an eye on what’s going on will know that the Saudis are losing interest in simply selling the oil, instead using the resource as a means of building up petrochemical industries etc within their own country which return far greater profits.
Why aren’t we doing the same with Tasmania’s energy resources? Why are we even thinking of exporting raw materials whilst local heavy industry goes to the wall? Please explain…
I should add that I’ve only focused on energy and minerals here given the current situation with TEMCO but that’s not to in any way ignore the potential in all sorts of other areas.
