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Saturday, May 7, 2011
Staff Writer: Colin Dunstan
The carbon tax debate in Australia is simply a distraction that stands in the way of changes to energy supply that will lower the cost of electricity.
No carbon tax is incurred by idle power stations. The interest charges on these idle investments are a far greater contribution to rising electricity costs than the carbon tax.
However, on just 8 occasions demand exceeded 12,000 megawatts and on 3 of these 8 occasions demand peaked above 14,000 megawatts.
On only 7 occasions the wholesale price of electricity exceeded $50 per megawatt-hour or 5 cents per kilowatt-our. On each of these 7 occasions the price jumped to well in excess of $1,000 per megawatt-hour or 100 cents per kilowatt-hour, and on 2 of these 7 occasions the price rose above $10,000 per megawatt-hour or $10.00 per kilowatt-hour!!!
This seems to explain the reports above -
No matter what the unexplained cause of these extreme and rare market failures, two things are clear:
The result - electricity prices can fall.