2. The Application: Form and content.(censored)

3. Network access experience: the perspective of a small renewable Generator

4. Industry-speak, or English?: Distribution Loss Factors (example).(also censored)

5. The Public Interest: Is "Good electricity industry practice" compatible with commercial imperatives? example: voltage regulation for franchise customers.

(NB: power is proportional to voltage-squared, this is important later), and the simplest of the relationships:

The Victorian electricity system can be represented as a very simple "equivalent" circuit:

Any generator is basically a magnet spinning inside a coil of wire, just like a bicycle dynamo.The fact that the industry can deliver six million kilowatts of electrical energy all around the state into combined loads with an effective resistance of one hundred-thousandth of an ohm is indeed an amazing feat of electrical engineering. And not a superconductor in sight! It is all made possible by the use of alternating current and transformers to transport the electrical energy at high voltage, but at a manageable current level. It is the real-time changes in the resistance of the combined loads which determine the system demand at any instant in time. Thus, ultimately the industry is controlled by the power switches of all the customers throughout the system. All the generators and "control" systems are designed to react and respond to the changing customer demands in real-time.

In perspective: The average Victorian electricity output of 4,700,000 kilowatts requires three times that much combustion energy from brown coal in order to produce it. This is the heat energy produced by exploding 2,500 tonnes of TNT every hour, or putting it another way, four Hiroshima bombs every day. Among other by-products, sixty million tonnes of carbon dioxide are produced every year in the process.

Rapid technological change already gives consumers with access to capital the choice of being electrically self-sufficient and helping the environment. As Victorian network connection charges escalate, the possibility of cost-effective renewable power migrating from rural back-blocks to the suburbs in the next decade is very real.

Traditional industry participants (and the new industry bodies representing them) also have a choice, to respond to these new technological, social and market forces by joining in, or by trying to resist them: the National Electricity Code as presented to the ACCC would appear on balance to take the latter position. Salvation for nearly-new coal plant in the Latrobe Valley over its projected lifetime may only come in the form of a rapid development of an electric vehicle industry, the only application that readily comes to mind where there is at least the potential to improve the greenhouse situation by displacing another fossil fuel.

Below is the text of a fax that was recently sent to the Victorian Power Exchange, the Office of the Regulator-General, and Powercor Australia. Copies (for their information only) were also sent to CitiPOWER Pty and the ACCC. The three addressees have chosen not to respond as of 19th December. This is only the latest attempt in an ongoing saga of unanswered correspondence, although at times it has been possible to have telephone conversations with representatives of the three bodies concerned. These phone conversations have never been followed up with "hard copy" responses.

After over two years of this sort of treatment, firstly as the Alternative Technology Association's representative, and for the last 12 months as the owner of the generator, one begins to feel like a lone voice in the wilderness.

Fax Communication:

From: Michael Gunter, owner of the Breamlea wind generator

To: Office of the Regulator-General, VPX, Powercor Australia

Re: Status of the Breamlea Wind Generator (BWG), & energy traded from it

Background: BWG was sold by Generation Victoria on 30 September 1994 to the Alternative Technology Association (ATA). The ATA had a prior exchange of letters with the former MEU, Brunswick Electricity Supply, to the effect that BES would buy all the sent out energy from BWG. Subsequently BES was taken over by CitiPOWER Ltd (later to become CitiPOWER Pty.), and on 1 December 1995 the BWG was sold to me. However, the ATA has a buyback option in the contract of sale.

Current situation: CitiPOWER Pty and myself both wish to honour the previous contract: energy from BWG is currently the major input to CitiPOWER's EcoPower initiative. CitiPOWER has been regularly paying for BWG energy since 8 December 1994. The ORG has previously advised me that I as a GenCo am covered by the general exemption from the requirement to obtain a Generation Licence under Section 160 of the EIA. Thus it appears that the BWG's connection to the grid has been and remains legal. Rated at only 60 kW, with an average power output of only 12 kW, the BWG clearly falls outside the definition of an Embedded Unit, although it is an embedded generator. VicPool rules indicate that BWG is not required to sell its sent-out energy through VicPool (Pool Rules, clause 50.1 (a)) and is specifically excluded from Participant status (50.1 (c)).

Repeated representations from both myself and CitiPOWER to Powercor Australia have so far not brought any satisfactory conclusion to the two main issues of a network connection agreement and cross-border energy trading.

Future status under National Electricity Law/ National Electricity Code, and applicable regulatory instruments: Discussion today with Mr David Strong from VPX leads me to believe that, since I have "signed over" all BWG sent out energy to CitiPOWER, CitiPOWER becomes the entity (Code Participant) who on-sells that energy into Powercor's distribution system. CitiPOWER could conceivably choose to become a Market Generator at that connection point, although metering costs and meter reading fees would seem to make this inadvisable, unless it were the only way to force Powercor to pay for that energy by trading it through the National Market. (There would be very little change left over, but perhaps the principle is important!)

It would seem much more sensible for CitiPOWER at Breamlea to claim the status of Non-Market Generator (see National Electricity Code clause 2.2.5 (a)) and negotiate with Powercor a fair and reasonable price for the energy being traded. Analysis of half-hourly BWG energy export data in 1995 indicates that (system demand) volume-weighted SMP is very close to Breamlea-export-volume-weighted SMP, and consistently more than time-weighted SMP when averaged over long time intervals e.g. 12 months (details available on request).

The only unresolved questions would then be whether CitiPOWER or myself would be liable for the network connection charge, and whether Powercor persists with its previous assertions that energy fed into the distal end of a long feeder is costing Powercor 1.2 cents per kWh. My view is that the depreciation and maintenance costs of the 9-year-old 100 kVA pole transformer would be almost completely offset by the savings gained to the network accruing from reduced network losses in the 10 km of 22 kV feeder between the Drysdale substation and Barwon Water's sewage treatment works, a continuous large load adjacent to the BWG.

Questions for ORG/VPX:

1. Is there any possibility that the existing arrangement between BWG and CitiPOWER would be invalid or illegal under existing VPX rules or proposed National Electricity Law/Code?

2. Will ORG and/or VPX use any powers of persuasion or threat of sanctions to induce Powercor to enter into meaningful negotiations in good faith to resolve outstanding issues as outlined above?

Authorisation of National Electricity Code process/ acceptance of Code Participant undertakings under Section 44ZZA of the Trade Practices Act 1974:

Submissions to the ACCC have to be in by 20th December 1996. The ACCC had indicated its interest in looking at the BWG as a test case of market access for renewable generators. The wording of Schedule 6.3.3(iii) and the fact that Distribution Companies are joining the Cogeneration Association in large numbers makes the whole issue of fair access for non-participant non-market embedded generation a hot topic for ACCC consideration. Responses to this communication will determine the position I take in my submission to the ACCC. I ask that you reply by Monday 16th November: apologies for the limited time.

Yours sincerely,

(signed, Michael Gunter)

cc: Alan Tacey, CitiPOWER Pty

Joe Dimasi, ACCC

Admittedly the industry probably has a lot of much bigger issues on its plate. However, this degree of neglect of a potentially significant new sector of the industry could signify a disturbing scenario: the ORG, having been lobbied by the current VPX Code participants, is actively seeking to suppress new players in the generation market. Existing Latrobe Valley generators need new embedded generation like a hole in the head. On the other hand, existing DistCos seem rather keen to corner the cogeneration market in their franchise area: they are joining the Cogeneration Association in a big way, and as I mentioned in the above fax, there is a particularly pernicious clause 3(iii) in Schedule 6.3 of the Code, which will allow the DistCos to cream all the network augmentation-deferral benefits of cogeneration, while pretending that there are no such benefits. This one clause in Schedule 6.3 is, in my opinion sufficient grounds for the ACCC to reject outright the whole Code, as it is indicative of an absolute lack of good faith by at least some of the powerful industry players who have had such a "heavy-handed" approach to the drafting of the Code.

Frankly, there are other clauses in Schedule 6.3 which make absolutely no sense to me whatsoever, but I strongly suggest that the ACCC closely scrutinise this Schedule, and obtain full and frank disclosure from the DistCos as to who drafted it, and what each particular clause will mean in practice for budding non-participant generators.

Application-Chapter 5.5.8 (e) states:

(e) Requirements of the Code imposed on participants

The Code incorporates the electricity supply industry's collective experience and wisdom on the matter of appropriate standards including network connection requirements that should be applied in the overall public interest insofar as safety and security of supply are concerned. The Code change process will allow adaptation to changes in standards that might be suggested by further experience and technological developments over time.

The technical requirements of connection equipment design controls, and testing procedures, in the Code have been included so that customers, generators and network owners may reasonably rely on the efficacy of the Code to deliver safety and security of electricity supply. A similar case may be made for metering.

Voltage regulation for residential franchise customers: In the past week I have been monitoring a domestic single phase "240 volt" supply in suburban Melbourne. The key data is set out in the chart below. The test circuitry was less than ideal, but I present the findings in the public interest, believing them to be accurate to about 1%. A moving coil voltmeter, which had been calibrated the week before against a digital RMS voltmeter at Melbourne University was in turn used to calibrate the DC voltage output of a bridge rectifier and voltage divider circuit. Such a circuit will be non-linear, but the errors here were minimised by driving the bridge rectifier from a transformer with a nominal 50 volt AC output, and using a high stability smoothing capacitor on the DC side. A data logger was used to sample the voltage every second, and calculate an average every half-hour. The maximum and minimum voltage for each half hour interval was also recorded (but not charted).

This time of year admittedly has mild weather, and the system is obviously only lightly loaded. The local LV network does not have long runs or lots of "shoestring" copper wiring dating from the early part of this century (a possible reason for needing a supply voltage on the high side of normal). However, none of the LV circuits in the vicinity have been "paralled-up", rather all the interconnecting links have been left open, so that each customer is effectively supplied by only one transformer. This is referred to as a "radial" supply in the industry. Radial supplies are not as robust as parallel supplies when a heavy load occurs in one street or local area, so this may be one possible reason (not necessarily a valid one!) for the high voltage setting in my suburb.

If distributors are generally supplying residential areas with voltages which average over 250 volts for most of the year, several significant public interest issues arise:

• resistive loads can be expected to overheat, and have a shortened lifespan, e.g. lightglobes. This would also apply to many appliances with an apparent "thermostat" control: stove elements run from a time-cycle switch, not a true thermostat; hot water service elements typically operate for several hours each night, and the thermostat of course monitors the water temperature, not the temperature of the heating element.

• Many inductive loads, such as transformers, fluorescent light ballasts, and the stator windings in induction motors have the potential to respond badly to overvoltage: as the inductor (usually a heavy lump of laminated iron) approaches electromagnetic saturation, the effective resistance of the windings reduces and severe overheating can ensue.

• A cursory inspection of the Metropolitan Fire Brigades Board annual report shows that Sunday mornings between 2am to 4am, and again between 6am to 7am are a rather bad time for fires. Indeed the whole of Sunday has a rather high rate of fires. The reason that this may be relevant to the electricity industry, is as follows: as far as I am able to determine, the HV feeder voltages are automatically controlled at the zone substations, using technology going back several decades. However there is no feedback in the system to dynamically regulate the LV power line voltages: that voltage depends on the voltage tap setting on the pole transformers, and on the load applied to the LV side. If a lot of domestic customers turn on their fan heaters and electric stoves, then the voltage will drop. If you live close to a transformer, the drop will be small. If you live at the end of the line, the voltage drop may be considerable. However, all customers will experience overvoltage most of the time if the distribution company sets the transformer voltage taps for a "worst case" heavy-load scenario. The time of highest voltage will be when the overall demand in the LV circuits is at its lowest: in the pre-dawn hours when the storage water heaters finish their reheat cycle, and of course most of the time on Sundays. Unfortunately the Fire Investigation Unit of the MFB Board has been unable to supply me with the breakdown by day-of-week and time-of-day for electrical fires, but they have been made aware of my voltage data (and concerns related to it), and may be able to provide the ACCC with some data upon formal request.

With all the Christmas lights presently strung up on volatile, resinous, dehydrating Pinus Radiata in living rooms around the country, I think it is a brave or foolhardy industry that can allow voltages to stabilise so close to the upper limit of acceptable, while we all wait around for the next heatwave to arrive. The problem extends especially also to electrical appliances with a "standby" function, and plugpacks-for-everything (eg modems, walkmans, battery rechargers, answering machines, etc.) many of which do seem to get quite warm under light- or no-load situations, and which seem to be multiplying at a great rate in the gadget-conscious 90's.

Finally on the voltage issue, I return to the relationship power is proportional to voltage-squared. I have demonstrated that my present household electricty voltage is averaging over 250 volts. If I were to ring up my DistCo and ask them to reduce the average voltage by 4%, their potential loss of revenue may approach 8% because of the square relationship. It is clearly in the public's interest to run our appliances on the lowest practicable voltage. It is worth noting in passing that the radial supply to my house appears to come from the substation in a block of Housing Commission flats (56 Derby Street) at the end of my street: these customers are the people in society least able to afford new lightglobes, and as high-rise residents are rather more vulnerable than the rest of us to domestic fires. It would appear that they may also be the unwitting participants in "loophole gaming". I'm just an unwilling participant in the gaming. Why is it gaming when it is within the industry's own definition of good electricity industry practice? Because we have a nominal 240 volt supply, and it should average 240 volts (over long time intervals) for 90% of customers in any radial or parallel LV circuit. The plus-or-minus 6% voltage figure was never intended to be abused by giving everybody on an LV circuit 254.4 volts all the time and expecting them to put up with it. There is no good reason why the existing system cannot be regulated a little more dynamically on the HV side to shave the voltage peaks off the LV circuits. Also, one suspects that many pole transformer voltage settings have not been changed for years, despite the known drift of consumers from electricity to gas (water heaters, space heaters, cookers): the voltage settings should be regularly reviewed in the field to take account of these trends.

The new voltage standard emerging in Europe is 230 volts (everywhere except the United Kingdom of course!). I will be certainly leafletting all the residents of Kensington on my radial LV line suggesting they demand 230 volts average supply, and who would not want to, knowing the immediate benefits of reduced power bills, increased appliance life expectancy, and reduction in greenhouse gas emissions? I think we will all sleep better at night. By the way 250 to 230 volts is an 8% voltage drop, which translates to a 15.36% drop in power consumption (read revenue).

Now re-read Application-Chapter 5.5.8(e) and see if you agree with the patronising sentiments expressed in it. And they want "light-handed" regulation as well!

Conclusion: As an individual with other pressing commitments, I cannot hope to provide a comprehensive analysis of the Code and application. Just about every area of the Code that I have managed to read and make any sense of, has left me with a deep sense of unease about the ability of the Participants to make any honest undertaking to any Federal or Jurisdictional regulatory body that has real teeth. As the owner of the Breamlea wind generator I have been treated like some kind of disease by everybody except CitiPOWER Pty. If this is the reception to be meted out to prospective participants in the renewable sector (remember the the Breamlea wind generator actually pre-dates the Victorian carve-up), frankly they haven't got a chance, if the situation in the State of Victoria is any indication.

Michael Gunter, Melbourne, Australia 20 December 1996

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