POL­I­TICS OF CAR­BON

Re­new­able en­ergy is back in fo­cus as Aus­tralia pre­pares for a car­bon- con­strained world, writes Matthew War­ren

The Weekend Australian - Review - - Clean Energy -

THE de­bate on whether Aus­tralia will have a na­tional emis­sions trad­ing scheme ended last week with the Howard Gov­ern­ment’s com­mit­ment to a na­tional scheme from 2012. But the de­bate on how to power the econ­omy in a car­bon con­strained world is just be­gin­ning. Fos­sil fu­els have un­der­writ­ten growth across the global econ­omy cheaply and ef­fi­ciently for the past two cen­turies, help­ing to fund the in­vest­ment in tech­nolo­gies that will ul­ti­mately re­place them. But which ones and when?

Jock­ey­ing has al­ready be­gun to in­flu­ence the two key pol­icy set­tings that will in­flu­ence this tran­si­tion in Aus­tralia: the de­tailed con­struc­tion of an emis­sions trad­ing scheme and the de­sign of the sup­port­ing strat­egy to help pull through new low emis­sions tech­nolo­gies. Busi­ness is rel­a­tively un­fussed about how the en­ergy is gen­er­ated so long as it is cheap and abun­dant. They also favour a tran­si­tion path that is smooth and pre­dictable. Shocks and spikes are highly un­de­sir­able.

This means in the tran­si­tion to a near zero emis­sions en­ergy sup­ply by the end of this cen­tury, re­new­able en­ergy tech­nolo­gies in Aus­tralia will be com­pet­ing with gas — and pos­si­bly clean coal, sub­ject to its suc­cess­ful de­vel­op­ment — and nu­clear power.

Whether this is a sprint or a marathon de­pends on what tech­nol­ogy you are try­ing to sell. As the cur­rent low­est cost large scale re­new­able en­ergy provider, the wind in­dus­try favours pol­icy set­tings that drive rel­a­tively im­me­di­ate de­ploy­ment of re­new­able en­ergy sources as the most di­rect way of pulling tech­nolo­gies through at scale.

Auswind chief ex­ec­u­tive Do­minique La­fontaine says emis­sions trad­ing on its own will not be enough to get the re­new­ables sec­tor on line in the scale re­quired for deep longer term cuts by 2050.

‘‘ By sup­port­ing in­creased de­ploy­ment of cost ef­fec­tive zero emis­sion en­ergy tech­nolo­gies such as wind power, the Aus­tralian econ­omy can be con­fi­dent that it is grow­ing the very sec­tor that will pro­vide clean power for the best price in or­der to se­cure our in­ter­na­tional com­pet­i­tive­ness,’’ she said.

The wind in­dus­try sup­ports and is the pri­mary ben­e­fi­ciary from the fed­eral Gov­ern­ment’s 2 per cent manda­tory re­new­able en­ergy tar­get. They would like it hiked to 5 per cent or more, claim­ing in­creased de­ploy­ment is the best way to drive down costs.

Aus­tralia has been a world leader in so­lar tech­nol­ogy, driven orig­i­nally in the 1970s by the com­bi­na­tion of a sun­burnt coun­try and wide brown land — the prac­ti­cal need to sup­ply a host of small and re­mote lo­ca­tions with elec­tric­ity. The Univer­sity of NSW and Aus­tralian Na­tional Univer­sity are in­ter­na­tion­ally recog­nised hot­beds of so­lar tech­nol­ogy de­vel­op­ment, with grow­ing frus­tra­tion that most of th­ese ideas end up be­ing com­mer­cialised over­seas.

They ar­gue this is be­cause of a lack of gov­ern­ment sup­port at crit­i­cal stages of the re­search and de­vel­op­ment cy­cle cou­pled with weak ven­ture cap­i­tal mar­kets in Aus­tralia com­pared with many coun­tries over­seas.

Many ex­perts in the so­lar sec­tor were crit­i­cal of the Howard Gov­ern­ment’s re­cent $ 150 mil­lion dou­bling of re­bates for in­stal­la­tion of pho­to­voltaic ( PV) cells on do­mes­tic rooftops. While PV elec­tric­ity works to off­set de­mand at ex­pen­sive peak load times, it is still some of the most ex­pen­sive elec­tric­ity in the mar­ket with the full cost of the cells of­ten not re­cov­ered over their en­tire 30- year- plus life­time. Crit­ics of this scheme ar­gue it is great for re­tail­ers and some man­u­fac­tur­ers, but is still largely sym­bolic stim­u­lat­ing im­ports of PV cells more than a dy­namic so­lar in­dus­try in Aus­tralia.

They will be en­cour­aged to see greater recog­ni­tion of the key steps in the in­no­va­tion cy­cle dis­cussed in the Prime Min­is­ter’s Task Group re­port re­leased last week.

The re­port ex­plic­itly rec­om­mended that rev­enue from sell­ing emis­sion per­mits un­der an emis­sions trad­ing scheme be ploughed back into in­vest­ing and ac­cel­er­at­ing th­ese tech­nolo­gies at the crit­i­cal pre­com­mer­cial­i­sa­tion stages. The cost of PV does con­tinue to fall as man­u­fac­tur­ers learn how to slice the su­per ex­pen­sive high grade sil­i­con ever thin­ner, but cheaper so­lar is more likely to come in the medium term — by as early as 2025 — from large scale so­lar ther­mal and so­lar con­cen­tra­tors.

A trial so­lar ther­mal project us­ing par­a­bolic mir­rors to mag­nify the sun’s en­ergy is un­der de­vel­op­ment by a com­pany, So­lar Sys­tems, near Mil­dura in Vic­to­ria, helped by $ 450 mil­lion from the Bracks Gov­ern­ment and $ 75 mil­lion from the Howard Gov­ern­ment’s Low Emis­sions Tech­nol­ogy De­vel­op­ment fund.

In the shorter run, one of the big­gest po­ten­tial sources of clean en­ergy in Aus­tralia may come from tap­ping the heat of hot rocks deep un­der the earth’s sur­face. As with wind and so­lar, Aus­tralia is blessed with some world class geo­ther­mal en­ergy re­sources cen­tred around the Cooper Basin in north- east­ern South Aus­tralia. Early tri­als have been en­cour­ag­ing but have also demon­strated the prac­ti­cal dif­fi­culty of pump­ing wa­ter more than 4km un­der­ground to cre­ate steam which can power tur­bines. New drilling tech­nol­ogy due to be in­stalled next month may lead to a trial of a 40 megawatt power plant which will con­firm whether the tech­nol­ogy can ful­fil its po­ten­tial as one of the low­est cost sources of re­new­able en­ergy.

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