Bil­lions needed to go green

The Weekend Australian - Review - - Clean Energy - Keith Orchi­son

TURN­ING Aus­tralia’s elec­tric­ity sup­ply a greener shade of black over the next 25 years could in­volve a cap­i­tal out­lay of al­most $ 80 bil­lion — and that’s only for new power sta­tions. Retrofitting ex­ist­ing coal- burn­ing plant to meet strin­gent fu­ture green­house gas emis­sions stan­dards could cost bil­lions more.

Elec­tric­ity pro­duc­ers are wrestling with a raft of com­pet­ing pri­or­i­ties as they strive to pro­vide na­tional sup­ply se­cu­rity, and a lower en­vi­ron­men­tal foot­print for the na­tion’s largest sin­gle source of green­house gases, while re­tain­ing their com­mer­cial bal­ance.

Power con­sump­tion has al­most dou­bled in the past 20 years and the in­dus­try is pre­dict­ing that it will rise an­other 67 per cent by 2030, even with a greater na­tional fo­cus on end- use ef­fi­ciency. Ac­tual elec­tric­ity gen­er­ated is higher still be­cause of power sta­tions’ own needs and trans­mis­sion losses in trans­port­ing it from plant to cus­tomer.

The En­ergy Sup­ply As­so­ci­a­tion has told the fed­eral Gov­ern­ment that meet­ing load growth with con­ven­tional tech­nol­ogy, and con­tin­u­ing to rely on coal and gas for 90 per cent of gen­er­a­tion, will re­quire spend­ing about $ 35 bil­lion on new power sta­tions.

But the cost will de­pend, in re­al­ity, on what pol­i­cy­mak­ers de­cide to do about green­house gas emis­sion tar­gets, and ESAA cal­cu­lates that sta­bil­is­ing 2030 emis­sions at 2000 lev­els will push up cap­i­tal out­lays by an­other $ 20-$ 30 bil­lion. Achiev­ing an emis­sions tar­get of 30 per cent be­low 2000 lev­els — a goal be­ing driven by the en­vi­ron­men­tal move­ment and in­her­ent in the fed­eral op­po­si­tion’s pledge to pur­sue a 60 per cent cut by 2050 — will re­quire the out­lay ris­ing to $ 70-$ 80 bil­lion.

Re­search un­der­taken for the Na­tional Gen­er­a­tors Fo­rum in­di­cates that retrofitting 60 per cent of coal ca­pac­ity by 2020 with car­bon cap­ture tech­nol­ogy would cost $ 883 per kilo­watt for 17,000 megawatts of plant — about $ 15 bil­lion. The sit­u­a­tion is also com­pli­cated by the fact that retro­fit­ted power sta­tions need to burn more coal to pro­duce the same amount of elec­tric­ity, and that not all their CO emis­sions are avail­able for cap­ture and burial.

Even at the higher tar­get, Aus­tralian gen­er­a­tion will not be ‘‘ green’’ — emis­sions from burn­ing fos­sil fu­els are now about 200 mil­lion tonnes of car­bon diox­ide a year and would be roughly halved in 2030 by a rad­i­cal change in the gen­er­at­ing tech­nolo­gies.

The prob­lem for the en­ergy sec­tor — and the power in­dus­try’s largest cus­tomers, the en­ergy- in­ten­sive man­u­fac­tur­ers who use a third of elec­tric­ity con­sumed here, em­ploy 1.1 mil­lion Aus­tralians and rely on se­cure sup­ply and low prices — is that, de­spite a decade of de­bate, task forces, gov­ern­ment an­nounce­ments, new re­search and sub­sidy pro­grams, and a fed­eral gov­ern­ment pol­icy white pa­per, there is huge un­cer­tainty over how Aus­tralia will pur­sue abate­ment goals. And no har­monised fed­eral/ state approach. The sit­u­a­tion is ex­ac­er­bated by the need to also en­sure that the power net­work keeps up with de­mand.

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