Energy pain in Spain should ring alarm bells in Australia

On 16 April, Spain achieved an electricity landmark: 100% renewable energy penetration.  Twelve days later, its entire electricity grid collapsed, plunging all of Spain and Portugal into a complete blackout that took `more than 12 hours toovercome.

While the precise cause of the perturbation on the Spanish grid that caused the grid to teeter at 12:35 on 28 April might still be unknown, there is little doubt about why the grid lacked stability; and one fault caused a cascade that ended in catastrophic failure minutes later.

As explained by Daniel Westerman, CEO of the Australian Energy Market Operator in October 2024:

“Traditionally, that stability has been provided by the big heavy generators spinning at the same frequency as the grid, acting like a pacemaker for the grid to make sure the heartbeat remained stable.”

Ironically, it was Westerman on 21 July 2021 who set the same goal for Australia to achieve what Spain did, at the same time:

“So, the goal that I’m setting for us, Australia’s independent system operator, is to harness the talents, capabilities, experience and know-how across the industry, to engineer grids that are capable of running at 100% instantaneous penetration of renewable energy. And do this by 2025!”

If we were to be generous to Westerman, we should admit that he was aiming for what we now know Spain did not achieve: a system that remains stable with high penetration of renewables.

But it is at least a timely point for us to reflect on how AEMO — and with it Australia — is progressing towards achieving what he called “uncharted territory for a large, independent grid anywhere in the world”.

We can certainly inspect AEMO’s charts.  There was a new one issued in December 2024, called the Transition Plan for System Security, or TPSS.  This newly-minted analysis confirms the worst. Instead of being ready in 2025, we haven’t moved past the head-scratching stage.

In maze of bureaucratic buzzwords, AEMO reveals that we’re really just “progressing understanding of what is needed”.  It’s really a plan to make a plan.  In fact, it’s a plan to plan some studies to inform what a viable plan might look like.

The fact that there’s a ‘structured approach’ involving several ‘Procurement Frameworks’ to obtain ‘Transition Services’ of two ‘Types’ and an ‘Objective’ over three different ‘Horizons’ did not impress the Australian Energy Market Commission, which passed the rule recently to require this more holistic plan to be produced.

On 23 April, the day after the Spanish press were praising the recent accomplishment of 100% renewables, AEMC’s Reliability Panel wrote one of the most damning assessments of AEMO’s plan one could imagine, which it clearly thought was far too little, too late.

“Security needs must be identified earlier so that timely investments can occur,” it said.

The Reliability Panel struggled to conceal the fact that AEMO’s plan was really just hand-waving and hope written down, dismissing “trade-offs between timeliness and accuracy” as no reason to setting “direct requirements” which the report doesn’t even attempt.

It suggests AEMO should “identify the post-transition state of the power system” and urge market operator to “reconsider the current horizons approach” in favour of a “future-back” system.  In other words, AEMO has openly admitted it has no idea where the destination is, and is making up the plan as it goes.

Scarcely has a bureaucratic language so thinly veiled an instruction to tear it up and start again.

If we had a few spare years to figure this out, this would still be alarming. But AEMO’s report dashes any hope that we do.  There’s a section called “Spring 2025 – minimum demand thresholds reached in multiple regions”.

The concrete operational activities needed to help manage these conditions — in six months time — include “backstop capabilities” for all rooftop solar.  Which means all our solar panels could be switched off by the operator to stabilise the grid.

But not all measures are so concrete.  Under sub-headings like “frequency control”, “system strength”, “transient and oscillatory stability” and “voltage control” are a plethora of statements like “further assessments are needed”.

Anyone uncertain about whether we’re on top of the homework that Spain skipped need just continue reading the section: “Spring 2026 – minimum demand thresholds reached NEM wide”.These confessions come at a time when the mask is slipping from the entire energy transition.  We were told to “trust the experts”, who have given repeated assurances that everything was in hand.  We were told that renewables were reliable.  We were told that they were affordable.

But behind the curtain, the experts are still figuring out what’s required to make this grand experiment work. They still don’t know what that looks like, and certainly don’t know what it will cost.

Many informed and concerned Australians are calling for a course-correction in our energy policy and debate. Just like former British prime minister Tony Blair, who has pointed out how the debate is “riven with irrationality”, it’s clear that the rush to meet arbitrary targets in Australia has meant serious costs and risks have been ignored.