Archive for category: News

In his ‘Opinion’ piece in December AMT, the magazine for all the AMTIL members and really anyone who has a passion for manufacturing and technology, the CEO Shane Infanti uses the ubiquitous coffee bean to explain how machine tools are the “Mother of all products”. Machine Tools helped produce the whole machinery set involved in delivering coffee from plant to the cup. And these machines and processes are being increasingly automated. I can vouch for this personally as some coffee aficionados I know used to hand grind their own beans – the only way – but they have even moved to the latest automatic grinder! My reference to this move into automation is exactly the point that Shane makes; we are accelerating into a totally automated world and machine tools, in their many forms of innovation and advancement will continue to underpin this automation. This is the first message in Shane’s piece – that our manufacturing companies “need to continually invest in manufacturing technology if we are to call ourselves an advanced manufacturing industry”.

He then makes another important point to all AMT readers about rejuvenation in this accelerating world of change that is very pertinent to Vernier. It was Tom Peters book in the 1990’s that first introduced me to the statement “If it is not broke – break it!”. In other words, change and adaptation need to be an essential part of business planning today. This is why, I assume, Shane has shared the AMTIL Board’s revised Vision and Mission statements. It was the last part of AMTIL’s mission that resonated with me “ensuring advanced manufacturers [although I think it should be all manufacturers] have access to the latest manufacturing technology through promotion, networking, collaboration and advocacy” [my italics]. These four words are relevant because the Vernier Society’s purpose (or mission) strongly focuses on the first two ‘promotion’ and ‘networking’. And the Vernier Foundation is really in the advocacy business, advocating for careers in manufacturing and engineering to the next generation.

Each of these words is a noun but they can also be a verb. So, I am sure the CEO is now looking at actions as to, ‘how does AMTIL fulfil its mission statement’? What are the exciting things AMTIL can do to adapt the organisation to further deliver advancing technologies to the industry? This is a question Vernier are currently asking themselves and in early February next year, the executive members will meet to review their strategies and propose ideas of how to increase our collaboration, both within Vernier and with other industry associations? One of AMTIL’s excellent promotions is the “Australian Manufacturing Week” to be held again in Melbourne in early May 2023. Vernier through the Foundation is pleased to have been invited to participate in the event, adding an embryonic ‘Education’ focus into the advocacy armament of AMTIL mission and allowing Vernier a great promotion opportunity.

Collaboration is all about the sharing of ideas and inspirations and I am sure both the Society and the Foundation would welcome any member who wishes to participate in the Vernier Strategy meeting or increase participation in Vernier’s mission in any way!

Jack Parr Vernier Society member and Foundation Coordinator
December 2022

Before his election, Anthony Albanese made encouraging statements about manufacturing. “We need to make more things in Australia … have advanced manufacturing … boost vital skills by investing in education and training … and supercharge productivity”. At that point I was enthusiastic; this new government will make rejuvenating manufacturing a real and successful project. But I was also cognizant of the classic stage descriptions of how many projects go.

My initial enthusiasm (I could really never have ‘wild enthusiasm’ (1) where a Labour government is involved) was boosted by the announcement of a “Jobs and Skills Summit”. I hoped this would be a strategic meeting, where a small number of skilled and knowledgeable people would thrash out a real plan for Manufacturing. A plan for long term investment in skills, training and STEM in schools. But when it was announced it would have 100 delegates and last but two days, ‘creeping doubt’ (2) sprang to mind. How could 100 people over two days, really tackle manufacturing’s revitalization? But doubt did not come creeping, it jumped in loudly when the Treasurer’s 14 page “Issues Paper”, released to quell the already conflicting attendant voices. did not even have the word ‘manufacturing’ in it, let alone as a major ‘issue’.

The list of delegates swelled officially to 142, and I saw my local MP Zoe Daniel (not on the list) had, not only got a seat but a speaking role, so every man and his dog had got a guernsey. But one man not worthy of an invite, it seems, was the ‘Minister for Manufacturing’ Senator Tim Ayres. His boss the ‘Minister for Industry’ was there, but according to the one real manufacturing representative, Ben Eade of ‘AuManufacturing’, the industry minister did not mention the word manufacturing at all either!

Stage 3 ‘disillusionment’ came as I witnessed a cleverly orchestrated event. The solutions were announced before the event; the government and the unions had already resolved how to solve Australia’s huge capability deficit. Were the inputs from the delegates just to be seen as cheers for the “emperor’ showing off his new clothes”? The solution was to raise wages, increase the number of women in, and diversify the workforce – it is that simple! Yes, while this is being achieved, we need to recruit the necessary skills from overseas because we are really short of nurses, (agreed), construction people and managers (definitely required if they know how to build to budget), IT people (really?), childcare workers (more men for equity balance?) and chefs (to feed the increasing workforce)! The revelation is that wage growth is held back by the weakness and confusion in the Enterprise Bargaining System! (Not the underpinning totally unrealistic Awards system itself). This was confirmed by pre-summit announcements of ‘Understanding Agreements’ made by CBA and COSBOA with the ACTU. Westmacott’s CBA, representing the ‘Big End of Town’ (and grossly overrepresented at the summit) agreeing with the Unions; Bill Shorten must be turning in his parliamentary retirement home at the irony of such an agreement!

We have truly entered stage 4 ‘descent into chaos’, if ‘multi-employer bargaining EBA’s are believed to be even part of an appropriate solution to the challenge! Real wage growth can only be driven by productivity improvements in both labour and capital. Increasing inputs through increasing female participation will increase output but that is not productivity, what has to change is the ratio. Yes, skilled migration produces efficiency but only if the mechanisms for work are more productive. Bargaining for higher wages will only produce higher costs that will be passed on in prices, further driving inflation! Productivity improvement through better skills and innovation is what feeds wage growth!

The next stages in the project progression, if you remember, are ‘punishment for the innocent’ (5), ‘search for the guilty (6)’ and ‘promotion for the non-participants (7)’. Will Manufacturing be punished? Probably no more than they are now! The increase in Tafe places may be appropriate for chefs and hairdressers but it is well accepted that Tafes cannot cater to the skills and future needs of the manufacturing industry! Maybe the newish ‘Tech Centre’s can but not without substantial investment in the latest technologies and people but these good people are zealously held on to by companies themselves. The industry can keep on investing in automation, particularly while money is so cheap. But what of the long term vision and growth? Another ‘innocent’ in all this is STEM in schools! Our national proficiency in Science and Mathematics is falling further behind the OECD countries but is this recognized? It seems more important to teach diversity than literacy in Victoria!

Why am I writing this? It is definitely GOMS – “grumpy old man syndrome. I hope it is amusing but it is more than that. It is still the passionate belief in innovation as a driver for manufacturing; in the conviction that manufacturing things through skills, ingenuity, drive and collaboration are essential to future prosperity. It is also a call to arms! The members of the Vernier Society over the last 80 years were convinced of that.

— Written by Jack Parr and moderated by the Vernier Committee

On the 25th of May at 1:45pm  Queensland Coal and gas were generating about 5,300 MW out of a total of 7,500 MW. Then Unit 2 at Callide C exploded taking 400 MW of generation off the Queensland grid. Immediately its twin also disconnected, whether due to damage or safety reasons is not clear.  However the total loss was still only 800 MW or just over 10% of Queensland supply at the time. Over the next few minutes Queensland swapped from exporting about 400 MW to importing 200 MW so theoretically recovereing 2/3rds of the lost generation

However twenty minutes later another nearby unit, in a different building went offline, together with a transmission line and at least another 7 coal and gas generators. Then due to lack of inertia, wind and solar plants in North Queensland were immediately limited to 50% of peak (not actual) output. This resulted in 400,000 customers temporarily losing power.  According to some expert observers AEMO did a sterling job preventing the state going black. Probably having learnt some lessons from SA.

Now although Queensland has 12.8 GW of dispatchable capacity of which probably 11 GW was available after allowing for the first Callide outage and maintenance, it ramps up so slowly that it could not meet 4.6 GW of net demand (after allowing for wind and solar generation and swap from exports to imports at the time). In fact the coal plant disruption effectively managed to drive half the wind and solar offline as well.

Since recovery, spot power prices have remained high, averaging $296/MWh in the 21 days since the incident. At the same time last year they were averaging $39. Almost every evening QLD prices have peaked to between $2,500 and $14,000.  These price effects spread throughout the grid as Queensland exported less and imported more power, although still remaining a net exporter, For example NSW has averaged $196/MWh so far in June vs $48 last June even though renewable output is up significantly. Victoria is up from $48 to $65

Contrast the fallout from this event with the relatively mild effects of the flood at Yallourn in Victoria. Yallourn output on last Saturday at 2PM was about 700 MW which was then ramped down to 200MW as the threat of a mine flood became apparent. That was 14% of Victoria’s fossil fuel generation or about 10% of total generation at the time. It also corresponded to a period of very low wind. Yet there were no blackouts and prices only moved up briefly. Since then average prices only reaching $100 and peak prices rarely went above $300 in spite of still, overcast conditions and continuing lack of output from Yallourn.

Now a key difference is that Victoria ramped down gradually instead of in two big steps so one would have expected a more benign response. However Queensland has only been running its remaining 6.6 GW of coal and 1.2GW of base load gas plants at 65% and 45% of capacity respectively, with maximum coal output of 4.9 GW. Seven of its 22 coal generators have been offline for at least the last week, so either the remaining coal plants are off line for service and are nowhere near the 24/7 availability that their proponents claim, and therefore can’t be brought online or, the owners are withdrawing capacity from the market to force prices up. Such behaviour is more difficult in Victoria because renewables supply (30%) almost double Queensland’s share of 18% and Victoria has a theoretical maximum import capacity of about 2,600 MW vs Queensland’s 450 MW. 

If Queensland had followed SA and Victorian practice of installing batteries, somewhere between 300 and 600 MW of batteries would have supplied sufficient reserves to limit voltage and frequency instability so the second trip would almost certainly not have happened. This week, with 7 coal units offline and wind and solar still limited, Queensland manages to export power every day. Therefore it has plenty of capacity to recharge batteries and pumped hydro to meet the evening peak without requiring huge jumps in prices. Even if batteries had only reduced the jump in spot prices by one third and spot prices only account for 15% of Queensland power trade, sufficient batteries would have saved Queensland and NSW customers $60-100m in the last three weeks, not including the costs of the blackouts. Almost every day they would reduce peak prices and improve the operating efficiency of remaining coal and gas by absorbing power when demand is low and releasing it when demand is high. Alternatively, additional coal and gas plants would only add to the surplus capacity and do little or nothing to improve grid reliability in a case such as this.

The superiority of renewables/gas /storage has been clearly demonstrated in SA where prices this financial year are down 62% since the peak year in 18/19, whereas NSW is only down about 20%. The SA renewable/gas grid is not only cheaper to run but has at least twice survived generation/transmission losses of 30%+ of load, a feat totally unimaginable in Queensland or NSW.

It is not as though Queensland has not had warnings, on 9th of October 2019 Kogan Creek coal power plant tripped and caused small blackouts in southern Queensland and NSW. On 25th of August 2018 a lightning strike on the 800 MW inter-connector between NSW and Queensland caused short localised blackouts in Queensland, NSW and Victoria, and almost caused the entire NSW system to go black.

A system black in NSW in the middle of the grid is a far more serious issue than the last one in SA. It could quite easily have cascaded into Victoria and because of NSW reliance on coal, it would not have recovered in 6 hours like most of SA, it would have taken days and maybe weeks. The Texas power authorities estimated that it would have taken months if their system had gone offline in February to bring everyone back and Texas has a far more flexible generating fleet than NSW.

In conclusion, both reliability and economic competitiveness of coal fired power stations has been vastly exaggerated by their proponents and even if there were no such consideration as pollution, water use etc. a renewable grid backed by gas and storage is a a far more reliable and economical system at today’s state of the technology. 

While I am not attempting to downplay findings that sea level rise is happening faster than expected, last year was yet another equal hottest year, methane emissions are climbing etc, here are some things that are happening which are hopeful signs;

1. Regenerative or restorative agriculture is already a major priority in China and is becoming a priority in the new Biden administration and in the EU’s Green recovery and has even been given a higher priority in the Morrison government with an office and budget for the Soils Advocate. Done well, regenerative agriculture could sequester almost as much carbon as emitted by coal generation, but we have to both reduce emissions and sequester carbon.
2. In almost all northern hemisphere regions reforestation is accelerating, sometimes not perfectly but in more and more cases using better techniques to increase biodiversity and resilience. Since 1990 forests in Europe have increased by almost 100,0000 square km. In the US it is slightly increasing and China is expanding forest by about 70,000 square km every year
3. Renewable generation in the US passed coal for the year; In the UK, Germany, Spain, France, Sweden, and a number of smaller countries, renewables passed all fossil fuels combined.
4. In Australia in the last 12 months, renewables have passed brown coal and gas combined. This summer wind and solar alone have provided 24.5% of electricity, gas and brown coal combined at 22.4%. On current trends more than one third of the electricity generated in Australia this year will come from renewables and we should hit 50% renewables by H2 2024. The southern states Victoria, SA and Tasmania combined use as much electricity as NSW. They will probably achieve a combined 50% renewable share for this year, while prices in Victoria and SA have crashed. SA wholesale spot prices have fallen from $110 in the 18/19 year to $33 so far this financial year while demand has increased marginally but renewables have increased from 53% to 60% of supply. Victoria price has fallen from $109 three years ago to below $40 this financial year while renewables have increased from 20% of supply to 30%.
5. Examination of the data in Germany, the UK, Spain and Australia shows that as the technology improves and geographic dispersion of renewables widens, the need for storage and backup falls. For example in the last 6 months minimum whole day renewable share on the NEM was 25.2% vs an average of 30.1%. In other words if we wanted to maintain 30% renewables every day for the past 6 months we would only needed storage for about 5% of average demand for one day and less than 3% of demand for three days. To cover 3% of demand for three days we would need 50 GWh of storage. If announced battery storage projects are all built they will provide 25 GWh, Snowy II averaging 60% capacity for 3 days will provide 90 GWh
6. Renewable installations are increasing even faster than predicted even three months ago. The world is now expected to install between 150 and 190 GW of solar (some say 200 GW) and 70-90 GW of wind this year. Even at the lower figures this will generate as much electricity as Germany and France combined or three times as much as the entire Australian electricity demand.
7. China added 48 GW of solar and 71 GW of wind last year. Installations in the last quarter were enough to meet Australia’s entire annual electricity demand. Overall renewable output in China rose by 16.6% for solar and 15.1% for wind contributing to a total 2,082 TWh from all renewables (Australia’s total demand is 235 TWh) Unfortunately Coal and gas rose by 2.5%. Overall China reached 27.3% renewable share slightly ahead of Australia on 26% and well ahead of the US on 22%. It expects to install another 140 GW of renewables this year.

In India combined wind and solar capacity reached 78 GW ( Australia is about 21 GW) and the government is pressing on with its target of 175 GW by the end of next year, although it will almost certainly fall short. Prime Minister Modi laid the foundation stone for a combined 30 GW wind and solar park in Kutch i.e. a single renewable park with double the combined current capacity of every wind and solar farm in Australia.

In Korea the Government initiated the commencement of an 8.2 GW offshore wind park, which will supply the equivalent of Victoria’s entire electricity consumption,

In the UK another 8 GW of offshore leases were approved with the aim to increase the UKs offshore wind to 30GW by 2030. Based on the productivity of latest wind turbine models, 30 GW of offshore wind will supply almost 60% of current UK electricity demand. The UK now has a development pipeline of 14 GW of batteries which combined with hydro, biomass, imports and minimum wind could supply 60% of UK night-time minimum

The Danish government was approved the largest construction project in its history- a wind island which will serve as a base for enough offshore wind to supply 125% of Denmark’s current electricity supply. The energy will be used to supply data centres, transport and heating electrification, hydrogen production and export power to Germany etc.etc.

8. Floating solar particularly on hydro dams is becoming a thing. Covering 1-10% of a hydro dam with floating solar doubles the annual energy production of the dam with no new transmission infrastructure and reduces evaporation from the dam. The absence of shading and the cooling effect of the water increases the annual output of the solar panels by about 7-12% compared to nearby land based units
9. Outside Australia electric vehicle sales are exploding in China and Europe. Q4 sales were more than double the same time last year even though the overall market was down. Growth has continued in January, with Norway at 81% EV, Sweden 31%,  and 21% Germany. This is in spite of a shortage of stock for the two top sellers the Tesla model 3 and Volkswagen ID3. GM has announced plans to eliminate ICE light vehicles by 2035. With new medium sized electric SUVs coming to market from Volkswagen, Nissan, Ford, Mercedes, BMW, Peugot/Citroen/Fiat, Volvo and many Chinese brands this year as well as the opening of two Tesla factories EV deliveries could grow by 3m vehicles this year. Citroen is selling a basic city EV car in Europe for €6,000 and GM is selling one in China for about US$4,500 ($5,000 with air-conditioning) . They are very basic but flying out the door as fast as they can be built. Indian electric motorbikes are now available for around A$2,000
10. Finally for those who worry about what will happen when the wind doesn’t blow and the sun don’t shine. As you can see below renewable generation on the NEM is never zero and as newer wind and solar technology become more dominant, the wind and solar curves will be smoother allowing the hydro share to be more spiky to fill many of the remaining gaps. New storage and demand response will be needed but in far smaller quantities than most people imagine.

Peter Farley

1. By the end of March next year there will be only be about six major economies, Saudi Arabia, Poland, Brazil, Mexico, Russia and Australia, which do not have a net zero pledge by 2050 or 2060 in the case of China. 

2.About 150 GW of solar PV and 80 GW of wind will be installed around the world next year.. There will be about 20 GW of hydro, biomass, geothermal and solar thermal as well. Just the wind and solar is enough to supply the combined load of Germany and Switzerland or more than the total electricity generation in Australia, New Zealand and Indonesia. Every year that will increase. To put that in context, the best ever year for nuclear power installations was about 15 GW which would have supplied 1/5th of the energy that next year’s wind and solar will provide.

3. According to the International Energy Agency who have in the past been way too low in their forecasts of renewable volumes, generation from renewables will pass coal by 2025. It has already in the US, Germany, Russia, the UK, Spain, Turkey, Italy, France and Denmark, not to mention high hydro countries such as Canada, Norway, Sweden, Austria, Switzerland and Brazil.  

4. Assuming NSW REZ plan is 25% complete by mid 2025, 90% of currently financed renewable projects are completed and rooftop solar continues at its current installation rate, the NEM will be more than 55% renewables by spring 2025.

5. Spring this year is on track for 30% renewables on the NEM and the full year will crack 26%, proving my “wildly optimistic” forecast from 2014 of 24% in 2020 to be somewhat pessimistic 

5. Fortescue Metals has announced a plan to become a major wind/solar/hydrogen company building 235 GW of wind and solar around the world. Assuming a 40/60 split between wind and solar that will provide almost as much electricity as Britain, Spain and Italy combined.

6. Shell, BP and Ineos (a US$60bn per year chemical company) have all committed to large renewable powered hydrogen electrolysers. The bad news is that the market for export hydrogen from Australia is not likely to be as big as we would like if Europeans and by extension, Asia can make their own

7. The anti domestic gas coalition is growing, 40 cities in California including San Francisco have put a moratorium on connecting gas to new houses as has the Netherlands and gas free subdivisions are opening up in the ACT and Victoria. Commercial buildings with gas connections can no longer granted the highest green ratings.

8. The Halliade X wind turbine prototype produced 312 MWh in one day. That is enough to power 90 Australian households for a year or drive a fleet of Tesla Model 3 vehicles 2,600,000 km. At the Australian average of 13,000 km/ year, the annual output of one such wind turbine at an average 185MWh/day would power 43,000 EVs for a year.

650 of them would power the entire Australian road transport fleet, cars, trucks, buses the lot. This turbine is running at 13 MW. Siemens Gamesa has already announced a 14 MW machine

8. To the end of October 2018 in Germany plug-in car sales were 54,000 for the year. In October 2020 there were 48,000 for the month. Next year the Volkswagen ID 3  (Golf sized) will be at full production the ID 4 (RAV4 sized) will be available and the German Tesla factory producing Model 3 and Model Y will be up and running so it is possible that EVs will achieve 30% market share in Germany and exceed 20% for the whole of Europe by Q4 2021.

 9. During the past three weeks, in the USA seven utilities have announced plans to close or convert almost 9,500 megawatts (MW) of coal-fired generation across the U.S.* At the same time, the U.S. Energy Information Administration estimated that a record 23 gigawatts (GW) of new wind generation capacity will come online this year, shattering the previous record of 13.2 GW set in 2012.

10. At the end of 2019 there were about 600 GW of new wind and solar proposals in the queue for grid connection approval in the US and about 60 GW of gas, 2GW of nuclear and no coal. Not all of these plants will actually be built because some are competing for the same market, but there is good reason to believe that the failure rates in gas will not be much different to wind and solar. If 70% of the wind and solar plants are built, they will account for 35% of the US current electricity demand to bring renewables to a55% rate.