Op-ed piece printed in The Australian 06 October 2008

Garnaut's 2020 targets not achievable in practical terms

CLIMATE scientists and conservationists have demanded we cut our emissions to 25 per cent below the 2000 level in absolute terms by 2020. Ross Garnaut agrees with this target if the rest of world supports such an ambitious agreement. But is it realistic? A 25 per cent cut means total emissions in 2020 need to be 415 million tonnes. This is a 290 million tonne reduction in emissions by 2020, about 40 per cent below business-as-usual emissions. Confused? Well, yes, a 25 per cent cut below 2000 levels really does mean a 40 per cent cut in total emissions from where we are heading, based on forecast population growth and without mitigation; in other words business as usual.

Two-thirds of our emissions come from the energy sector. If big cuts are to be made in emissions (and 40 per cent is a big cut), this is the sector that needs to be targeted. There are basically two ways we can reduce emissions. The first is by using less energy per person. The second is by reducing what is called the emissions intensity, that is the emissions per unit of energy used. This means improving energy efficiency in our homes, workplaces and factories and decarbonising our energy generation.

Let's deal with the easy one first: improving energy efficiency. Consultancy firm McKinsey, in the report An Australian Cost Curve for Greenhouse Gas Reductions, published in February 2008, estimated that energy-efficiency measures could contribute about 25 per cent to our target reduction by 2020. Most of these cuts are in commercial and residential buildings plus transport and can be achieved using existing technology at negative cost (they actually save money), so it makes sense to do them with or without a carbon pollution reduction scheme. Unfortunately, based on the past performance of energy-efficiency incentive schemes, we will have done extremely well if we achieve the full efficiency savings by 2020. That leaves us with three-quarters of the reduction target to come from decarbonising stationary energy, transport and industry plus rural land use.

These reductions will need a carbon price to make them happen. Below $40 a tonne, McKinsey sees a further 30 per cent potential reductions mainly from the rural sector and industry. At $50, there is an additional 15 per cent from avoiding deforestation. Note that below $40, very little mitigation is coming from decarbonising stationary energy. If everything goes to the McKinsey plan, we could save 200million tonnes of emissions below $50 a tonne by 2020. That leaves us 90 million tonnes to find from decarbonising stationary energy. This will mean a coal-to-gas shift, wind power and biomass. With only 12 years to go, carbon capture and storage, geothermal and large scale solar won't be available. Most of the decarbonising will come from replacing the worst polluters, brown and black coal, with gas, wind and biomass or other renewables if available. If we replaced some of the coal, half with gas and half with renewables, then we will need to replace all the brown coal and half the black coal to save 90 million tonnes of emissions. This would require almost tripling the present gas generation capacity and building close to 60,000 gigawatt hours of renewable capacity, about 20 times the installed capacity of wind and biomass, just to replace the coal generation. This will be on top of the increased capacity needed to service the increased population.

This raises the serious question of whether this is practical in the next 12 years. It's not difficult to see why the electricity generation industry is concerned about such targets in such a short time frame.

Op-ed piece printed in the Australian Financial Review 30 July 2008

Mix calls for nuclear genie touch

The Intergovernmental Panel on Climate Change in its Fourth Assessment Report, sees the OECD’s future electricity fuel mix somewhat differently to most environmentalists and possibly the Australian Government.

The IPCC sees 47 per cent of electricity in member countries of the Organisation for Economic Co-operation and Development still coming from fossil fuels (coal, oil and gas) by 2030, and only 11 per cent from the new renewables (wind, solar and geothermal). The balance would be made up of 24 per cent nuclear, 14 per cent hydro and 4 per cent biomass. Environmentalists have been very supportive of the IPCC in terms of emission reduction targets, yet they have been keen to get rid of fossil fuels and nuclear power as quickly as possible and replace them with renewable energy.

So is the IPCC realistic with its fuel mix forecast?

In Australia, coal plants provide most of our base-load power - that needed to meet minimum expected demand. It can be 70 to 80 per cent of the total required to supply industry, commercial and residential demand.

To use wind and possibly concentrated solar power (CSP) to replace existing coal power plants we need some way of storing the excess electricity generated during periods of good winds or sunshine for use in periods of inadequate power created by wide-area wind calms or cloudy days.

The only proven technology to do this on the gigawatt scale needed is pumped storage where surplus electricity is used to pump water from a lower reservoir to a higher reservoir. When there is an electricity shortage, the water can be released back into the lower reservoir through a hydro-electric plant. Given Australia’s water supply problems, it seems unlikely that we will build more hydro dams or new large pumped storage systems.

The CSP industry is working on ways of storing surplus heat to generate electricity during the night or on cloudy days. So far only small plants with eight hours of storage have been demonstrated. Even if this energy storage problem was solved it would take about 8,000 wind turbines or 400 sq kilometres of CSP collectors just to replace the Latrobe Valley brown coal power plants.

The other new renewable, geothermal, doesn’t have the same need for energy storage. Unfortunately, we don’t have the conventional geothermal hot water reservoirs in Australia used in the US, China and Iceland and the engineered geothermal systems being developed in the Cooper Basin may take a few more years before we see a significant quantity of base-load power.

Meanwhile nuclear power, seen by the IPCC as the largest contributor to OECD low-carbon electricity by 2030, appears to be still off the Australian agenda. I doubt we will be closing the coal-fired power stations any time soon. But if we can’t get carbon capture and storage (CCS) to work cost effectively we may just have to face the nuclear genie. Even the IPCC sees only 30 per cent of coal plant capacity using CCS by 2030.

It’s a pity that those that so readily accept what the IPCC scientists say about the dangers of climate change ignore what they say about mitigation solutions for electricity generation. Renewables are not a short-term replacement for fossil fuels and it may take decades before they are.

Welcome to Energy in a Changing Climate

This book is written for the non-technical reader who has an interest in acquiring a better understanding of energy and its impact on climate change. It provides some much needed background on energy sources and their limitations and describes the links between energy and climate change. It discusses various energy based solutions to climate change and considers the financial consequences of these solutions for both the economy and the energy consumer. It provides the reader with a clear understanding of commonly used (but often not clearly explained) terms like “renewable energy”, “base-load power”, “peak oil”, “biofuels”, “global warming”, “greenhouse gas emissions”, “energy security”, “emissions trading”, “carbon taxes” and “carbon offsets”. It offers practical solutions to ways that the energy consumer can save energy in the home, workplace and on the road.

There are widely differing views about solutions to energy and climate change. This book provides an unbiased look at both sides of this debate and addresses what still needs to be done before we can return to an all renewable energy economy. Some conservationists see the problem as relatively straight forward requiring deep cuts in emissions now by improving energy efficiency, energy conservation and using only renewable resources. Many energy industry engineers and scientists see the problem as being much more involved. This book looks at why using renewable energy sources is not quite as simple as it seems. It considers the impact of aggressive emission reduction targets that demand reductions before we have the technology in place and the possible risks of such a strategy.