Emis­sions con­trol may cost bil­lions be­fore 2050

The Weekend Australian - Review - - Investments - Keith Orchi­son

THE enor­mous op­por­tu­ni­ties in sus­tain­able in­vest­ment have been high­lighted by the In­ter­na­tional En­ergy Agency in a new re­port that es­ti­mates $ 47,000 bil­lion needs to be spent on al­ter­na­tive en­ergy tech­nolo­gies be­tween now and 2050 to pre­vent global car­bon emis­sions more than dou­bling.

This is equiv­a­lent to 47 times the en­tire Aus­tralian econ­omy’s an­nual worth.

Re­leas­ing its En­ergy Tech­nolo­gies Perspectives re­port in Tokyo, the IEA — the prin­ci­pal en­ergy ad­viser for 27 na­tions, in­clud­ing Aus­tralia — has called for an in­vest­ment of 1.1 per cent of pro­jected av­er­age an­nual global gross do­mes­tic prod­uct over four decades in low or zero emis­sion en­ergy tech­nolo­gies.

Un­less this hap­pens, says IEA ex­ec­u­tive di­rec­tor Nobuo Tanaka, world CO emis­sions will be 130 per cent higher in 2050.

The IEA re­search warns that the cur­rent record crude oil prices will, para­dox­i­cally, con­trib­ute to a sharp rise in car­bon emis­sions be­cause they will drive con­sumers away from oil and gas sup­plies for power gen­er­a­tion to cheaper coal.

The re­port, which has been pro­duced in re­sponse to a re­cent call by the lead­ers of the G8 na­tions for ideas on how best to de­velop a sus­tain­able en­ergy fu­ture, rec­om­mends that in­vest­ment in clean tech­nol­ogy be in­creased by $ 105 bil­lion to $ 210 bil­lion an­nu­ally in the next 10 years — and then driven up to as much as $ 2,100 bil­lion a year af­ter 2020.

A key con­tri­bu­tion, the re­port urges, is a ma­jor in­crease in en­ergy R& D — it calls for a rise of be­tween $ 11 bil­lion and $ 110 bil­lion an­nu­ally next 15 years.

The IEA says the most im­por­tant ini­tial fo­cus should be on en­ergy in­ten­sity — re­duc­ing the amount of en­ergy needed per unit of pro­duc­tion — fol­lowed by a huge in­crease in spend­ing on re­new­able en­ergy and car­bon cap­ture and se­ques­tra­tion sys­tems for fos­sil- fu­elled power sta­tions. Global en­ergy ef­fi­ciency needs to be dou­bled by the mid­dle of the cen­tury.

In sharp con­trast to the Rudd Gov­ern­ment’s new fo­cus on man­u­fac­tur­ing

green’’ cars in Aus­tralia, the Paris- based agency warns that the rel­a­tively slow rate of clean tech­nol­ogy de­vel­op­ment in the trans­port sec­tor — cou­pled with soar­ing global use of cars — means that gov­ern­ments need to give pri­or­ity to the vir­tual de­car­bon­i­sa­tion’’ of power sup­ply if a tar­get of cut­ting green­house gas emis­sions in half by 2050 is to be re­alised.

How­ever, it ac­knowl­edges that a shift from petrol- fu­elled to elec­tric ve­hi­cles is an im­por­tant step over time, not­ing that there should be a fo­cus on rapid progress in bat­tery tech­nol­ogy as well as a shift to biomass- to- liq­uids fuel for trucks, air­craft and ships.

Pur­suit of this goal, it adds, re­quires an av­er­age of 35 coal and 20 gas- fired power sta­tions to be fit­ted with CO cap­ture and stor­age tech­nol­ogy ev­ery year un­til 2050, for 32 new nu­clear plants to be built an­nu­ally, for wind power to be in­creased by 17,500 tur­bines per year and for a bil­lion square me­tres of so­lar pan­els to be rolled out an­nu­ally. ( France, Europe’s big­gest nu­clear power, cur­rently has 58 ura­nium- fu­elled power sta­tions.)

A key change fac­tor, says the agency, will be over­com­ing NIMBY at­ti­tudes to in­fra­struc­ture de­vel­op­ment.

Tanaka says this pro­gram re­quires im­me­di­ate pol­icy ac­tion’’ and tech­nol­ogy tran­si­tion on an un­prece­dented scale’’. It also needs, he adds, a huge in­crease in the world’s en­gi­neer­ing and tech­nol­ogy grad­u­ates.

The truth about the present sit­u­a­tion, Tanaka says, is that we are very far from sus­tain­able de­vel­op­ment de­spite wide­spread recog­ni­tion of a long- term prob­lem.’’ Car­bon diox­ide emis­sions from en­ergy use have ac­cel­er­ated this decade, he points out, partly be­cause higher oil and gas prices are driv­ing a switch to coal and partly be­cause of rapid eco­nomic growth in China and In­dia.

Step 1 into a brave new world,’’ the IEA di­rec­tor says, re­quires a car­bon charge of about $ US50 per tonne to drive a wide range of tech­nol­ogy and con­sump­tion changes — start­ing with end- use en­ergy ef­fi­ciency. Step 2, Tanaka says, is to wean the world off oil. And he warns that the IEA modelling shows that this might take car­bon charges of be­tween $ US200 and $ US500 a tonne.

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