Solar, wind, and to some extent, wave energy generators can be scaled to suit local demand and located very close to where the need exists; reducing the need for costly distribution infrastructure such as long distance power lines and transformers etc.
Battery storage can be centrally placed, to supply into the peaks in demand for the whole network, or locally placed on site, to allow steady low level feed in from the network, with the battery supplying site peak demand. This also allows the site, even a domestic dwelling, to manage their power consumption efficiently.
All of this reduces the need for transmission lines; and the size of them. Thus, for Western Australia, the value of Western Power, the network utility, may already have been in decline, but not obvious to Government or the public; yet. If so, its sale now, which the former Government intended, would have put money into the public purse and left the purchaser with a stranded asset. But, now, it may become a stranded asset for the new Government, elected as it was on the basis of retaining Western Power. Presumably, retention was to retain the cash flow from the business.
However, this leaves the Government in a better strategic position to determine energy policy for WA than if the central transmission lines were privately owned.
A very complex, interesting, and challenging set of circumstances for the new Government. It will be fascinating to see how it plays its hand.
CCE Price at posting:
6.0¢ Sentiment: Hold Disclosure: Held
