FactCheck: does coal-fired power cost $79/kWh and wind power $1502/kWh?

80% of Australian energy comes from coal, coal-fired power, and it’s about $79 a kilowatt hour. Wind power is about $1502 a kilowatt hour. That is unaffordable. If you take that power and feed it into the grid, then every person watching this program has electricity bills going through the roof. – Broadcaster Alan Jones, panel discussion on Q&A, ABC TV, July 20, 2015

Alan Jones has told The Conversation by email he acknowledges this comment was made in error and is not correct, saying:

I think you have rightly highlighted a ridiculous mistake that I made… why I said kilowatt-hours and not megawatt-hours and where the 1502 comes from, I have absolutely no idea. What I can tell you is that I’ve used figures for some time now on this issue to merely confirm that renewable energy is many multiples dearer than coal-fired power[…] I previously used that $79 figure but as you can imagine, it’s based on the price of coal. Wind has always been, in my words, three or four times dearer than that.

Electrical energy is usually measured in kilowatt-hours (kWh) or megawatt-hours (MWh). Kilowatt-hours are the unit generally used for metering and charging residential electricity consumption, and represents the amount of energy a device drawing one kilowatt of power would use in an hour. A megawatt-hour is 1000 times larger, and is typically used to measure large loads or generators. The price quoted (A$79/kWh) is about 300 times more expensive than the typical retail price of electricity paid by residential customers around Australia (and about 2000 times more than current wholesale prices).

Mr Jones' error in saying kilowatt-hours instead of megawatt-hours is an easy mistake to make.

A$79 per megawatt-hour is consistent with the range of costs reported by the Electric Power Research Institute for new coal-fired electricity in 2010, without carbon capture and storage or a price on emissions.

However, even with the right units, the figure of $1502 for wind power did not make sense. Mr Jones was not able to say from what source he got that figure of $1502 for wind power. So I decided to investigate.

The claim that coal-fired power energy costs $79 a kilowatt-hour and wind power costs $1502 a kilowatt-hour pops up a few times on websites of groups opposing the renewable energy target, climate sceptics, and even in Hansard. Mostly, this claim is referenced to an unnamed Productivity Commission report released in 2010.

The source of the $1502 figure on sceptic sites may be a now-corrected Paul Sheehan opinion piece published by Fairfax in 2011. The correction there reads:

So what did the Productivity Commission actually say?

The 2011 Productivity Commission report that the Fairfax correction appears to refer to was titled “Carbon Emission Policies in Key Economies”.

Box 4.1 of that report, titled “The costs of electricity sources” is about the “levelised cost of electricity” (LCOE), a widely-used measure of the cost of electricity generation technologies energy that includes all lifetime costs and factors in the lower utilisation rates of wind power. Box 4.1 says:

The Electric Power Research Institute (2010) reported estimates of the LCOE of various sources of electricity in Australia, including:

• coal-fired electricity (without carbon capture and storage) — A$78–91/MWh
• combined-cycle gas turbines (without carbon capture and storage) — A$97/MWh
• wind — A$150–214/MWh
• medium-sized (five megawatt) solar PV systems — A$400–473/MWh.

Without being certain, my best guess is that some of the groups or websites using the figures of $79 per kilowatt-hour for coal-powered energy and $1502 per kilowatt-hour for wind powered energy may have based their figures on the now-corrected Paul Sheehan opinion piece.

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The price of coal power of course does not include all the subsidies that this industry has received over the many years of its existence. Nor does it include the COST OF THE CO2 which is inducing global warming. 

The ABC has had to correct two statements made by Alan Jones on Q&A last week, including one that put the cost of wind power 10 times higher than it actually is.

“Eighty per cent of Australian energy comes from coal, coal-fired power, and it’s about $79 a kilowatt hour,” Jones said on Q&A on 20 July. “Wind power is about $1,502 a kilowatt hour. That is unaffordable. If you take that power and feed it into the grid, then every person watching this program has electricity bills going through the roof.”

Jones also made an incorrect claim connecting the former leader of the National Party John Anderson with mining companies.

Both statements made by Jones were sourced from newspaper articles – in the Australian in 2011 and the Sydney Morning Herald this year – which have since been corrected online.

read more http://www.theguardian.com/australia-news/2015/jul/30/abc-corrects-alan-joness-qa-claim-that-boosted-cost-of-wind-power-tenfold

PLEASE NOTE THAT CORRECTIONS ONLINE IS NOT ENOUGH... A correction should be made on air... Reason?: On air gets about one million viewers; online gets about 20,000 visitors... See the dif? Understood?