It’s becoming increasingly clear that the only likely outcome of the current manoeuvrings over the Rudd government’s Emissions Trading Scheme is that it will either be rejected by the Senate or so drastically watered down as to be almost entirely useless.
If (like me) you accept that the likely correctness of the consensus of reputable climate scientists that human-generated global warming is a reality which is likely to have major real world impacts within the next 50 years, you would have to be worried.
Moreover, a new paper by the Australia Institute’s Richard Denniss suggests that, even without emasculation by Coalition amendments, the government’s current ETS model results in little or no reduction in greenhouse emissions from power stations (by far the largest source of Australia’s total greenhouse emissions) until at least 2033. And even then, as Glenn Milne observes in today’s Oz based on Denniss’s paper:
And the reason emissions from black and brown coal-fired power stations plummet in 2033 also has nothing to do with the CPRS. According to Denniss, Treasury has simply assumed that in 2033 we will invent clean coal and that, having invented it, it will turn out to be cheap. Further, it assumes that between 2033 and 2043 we can replace or retrofit every coal-fired power station in Australia. Despite the fact that it takes five years to plan and build a normal one, Treasury seems to think we can replace them all in 10 years.
Denniss’s paper is based on a close analysis of the calculations and assumptions underpinning Rudd/Wong’s ETS scheme projections, gleaned from FOI applications.
I’ve been wondering for a while how Rudd/Wong’s scheme could effect any meaningful reductions in existing greenhouse emissions from power generating plants, when permits to continue polluting at current levels are to be given away free. Power utilities therefore have little or no commercial incentive to replace existing coal-fired generators with zero emission renewable alternatives (assuming that viable baseload alternatives can be found, other than nuclear which Rudd/Wong won’t countenance). Even if they have to begin paying for their permits after the first few years, permit pricing would have to be very high to create a significant incentive for power utilities to decommission existing coal-fired generators and replace them with new low or zero emission ones. Power companies have every incentive under Rudd’s ETS to continue operating their existing dirty coal-fired generators until they reach the end of their scheduled operating lives. Hence the projections showing little reduction in greenhouse emissions before at least 2033.
Since Rudd’s ETS is a dud, with or without Turnbull’s additional emasculation, what can be done?
Power generation creates around 50% of Australia’s total greenhouse emissions, transport another 15%, agriculture another 15%, with the rest from a variety of smaller sources. It makes obvious sense in those circumstances to focus first on power generation, especially given that a significant proportion of power utilities are still government-owned in most States and Territories. Surely they can be induced by a combination of carrot and stick to convert to cleaner generation technologies much more quickly, and by a variety of strategies.
Current mandatory clean renewable energy targets (20% of the total by 2020) are a good start, but only deliver a total reduction of 5% by 2020 which is nowhere near enough to achieve anything meaningful.
We need a scheme to ensure that all new baseload power generators are fuelled by zero or low emissions sources, with short-term progressive retrofitting/conversion of existing coal-fired stations to natural gas to achieve even greater reductions. Natural gas is neither renewable nor a zero emission technology, but it emits less than 50% of the greenhouse gases of black coal and only about a third of brown coal so it’s an obvious and relatively painless way of reducing Australia’s greenhouse “footprint” quickly.
WA Premier Colin Barnett proposed a scheme recently for building a new gas pipeline from the North-West Shelf to the pipehead of the existing east coast gas network at Moomba. The rapidly expanding Timor Sea gas fields could also easily and relatively cheaply be connected to that pipeline from the existing NT pipehead at Palm Valley near Uluru. Barnett argues that requiring 50% of new power generators built between now and 2030 to be gas-fired would reduce Australia’s total greenhouse emissions by 5%. Assuming his figures are correct, that presumably means that requiring ALL of them to be gas-fired (or better still fuelled by a zero emissions technology) would result in a 10% reduction.
Clearly even that is not enough but it’s a very good start, and embarking on progressive conversion of existing coal-fired stations to gas should allow Australia to reach a very respectable 25-30% reduction in greenhouse emissions by 2030 without a general/broad-based ETS or carbon tax. I’m in no sense an expert on the technology, but some quick Googling suggests that, for at least small-medium sized coal-fired power stations (say up to 500MW) conversion to gas can be effected for around $200-300 million. Why not cancel some of the seemingly wasteful Stimulus Package expenditure on pink batts and unnecessary school assembly halls and divert the funds to subsidising conversion of coal-fired power stations to natural gas? Why not compel power generators by federal legislation to embark on a progressive gas conversion programme, with punitive taxes as the penalty for non-compliance and generous subsidies and tax concessions as the reward?
However, I haven’t been able to find any examples of conversion to gas of a large coal-fired power station (1000MW or more). This rather suggests that the only viable way of reducing emissions from these large power stations, which comprise the bulk of power generation in the larger States, will be to completely replace them with brand new low or zero emission facilities. Given that the need for reliable baseload power appears to mean that the maximum proportion of clean renewable sources like wind and solar in any network is around 20% of the total, that unavoidably implies nuclear power in the current state of technological knowledge. Solar thermal or geothermal may have some promise but aren’t yet at a large-scale commercial development stage, and “clean coal” may or may not ever reach that point. Thus nuclear power must be embraced as a matter of urgency. It takes around 5-10 years for any new large power station to reach production, and perhaps even longer for a large nuclear station.
I don’t understand why Malcolm Turnbull isn’t out there pushing this sort of message aggressively right now, instead of trying to negotiate amendments to make a fatally flawed scheme even weaker because he’s scared of being decimated in a double dissolution election in which Rudd and Wong get away with cynically pretending that their own ETS is going to have any meaningful effect at all on greenhouse gases.