- Email: [email protected]
Hidden biases in Australian energy policy
Renewable Energy 34 (2009) 456–460
Contents lists available at ScienceDirect
Renewable Energy journal homepage: www.elsevier.com/locate/renene
Hidden biases in Australian energy policy August Schla¨pfer School of Engineering and Energy, Murdoch University, Murdoch, Western Australia, Australia
a r t i c l e i n f o
a b s t r a c t
Article history: Available online 17 July 2008
The challenges in developing technology for the capture and storage of CO2 from coal, oil and gas power generation, as well as those associated with the storage of nuclear waste, are widely regarded as solvable. According to proponents of clean coal, oil and gas technologies, as well as the proponents of nuclear technology, it is only a matter of time and resources to find a solution to their waste problems. Similarly, the Australian Government argues that our main efforts need to be concentrated on clean coal technologies, as well as considering the nuclear option. However, when it comes to the challenges associated with renewable energy technologies, like intermittency of wind generated grid power, storage of electricity from renewable energy and so on, there seems to be an attitude amongst Australian energy planners that these challenges represent insurmountable technical and financial problems, and will, at least in the short to medium term, prevent them from becoming a viable alternative to coal, oil, gas and uranium based energy technologies. Ó 2008 Elsevier Ltd. All rights reserved.
Keywords: Energy policy Climate change Fossil fuel technologies Nuclear technologies Renewable energy technologies Energy storage
1. Introduction In its World Energy Outlook for 2006 the International Energy Agency (IEA) suggests that meeting the world’s growing hunger for energy requires massive investment in the energy-supply infrastructure. A cumulative investment of just over US$20 trillion (in year-2005 Dollars) over 2005–2030 is the figure put forward by the IEA [18]. This growing demand for energy, combined with growing concerns about climate change, has opened up an interesting debate about how these two major issues should be addressed. The debate is no longer so much focused on whether human activity is causing climate change, but rather on the possible impacts of climate change and how the world will cope with an average warming of around 3 C, even if the issue is tackled promptly, by the end of this century. The debate has shifted from whether the production of energy derived from underground sources of fossil fuels causes climate change, to how best to combat climate change and at the same time meet the world’s growing energy demand. Recognising the fact that stationary energy production based on fossil fuels like coal and gas is a major contributor to CO2 emissions, the Australian Government has acknowledged the need to find solutions to address these issues. The main focus of the Australian Government is to find technological solutions that will provide the base-load electricity to meet growing industry and community demand whilst reducing greenhouse gas (GHG) emissions into the Earth’s atmosphere. Federally funded effort and resources are being allocated to the tasks involved in solving the technical issues
E-mail address: [email protected] 0960-1481/$ – see front matter Ó 2008 Elsevier Ltd. All rights reserved. doi:10.1016/j.renene.2008.05.010
associated with low emission coal and gas, as well as promoting nuclear power as a safe alternative. However, whilst acknowledging some role for renewable energy technologies (RETs) in its 2004 White Paper on Australia’s energy future, it is clear that the Government is not convinced that RETs will play a major part in that future. Prime Minister Howard argues that, ‘‘(y)ou can’t run power stations on solar and wind, let’s be realistic, you can only run power stations in a modern Western economy on fossil fuel, or in time, nuclear power’’ [12]. The Government demonstrated its lack of commitment to renewables when it refused to extend the successful Mandatory Renewable Energy Target (MRET) scheme, despite the recommendations by the MRET review committee in 2004 to expand the modest target of generating 9500 GWh per year to 20 000 GWh per year [2]. In this paper I will argue that this curious double standard as it is applied to the technical ability to solve the challenges associated with renewable versus fossil fuel technologies has imposed a major distortion on energy policy in Australia and has produced an inherent bias towards fossil fuel based power generation. 2. Australia’s position After some initial reluctance, the federal government has acknowledged that climate change is a serious issue and needs to be addressed. At a recent speech presented to the Business Council of Australia Prime Minister Howard pointed out that ‘‘the weight of scientific evidence suggests that there are significant and damaging growths in the levels of greenhouse gas emissions and that unless we lay the foundation over the years immediately ahead of us to deal with the problem, future generations will face significant
¨pfer / Renewable Energy 34 (2009) 456–460 A. Schla
penalties and will have cause to criticise our failure to do something substantial in response’’ [13]. Despite the change in rhetoric, the Australian Government still shows some reluctance to tackle these issues in a serious way. For example, in November 2006 Prime Minister Howard argued that it was pointless for Australia to take expensive steps to curb its own emissions, ‘‘(i)f we stopped them tomorrow, it would take all of nine months for China’s additional emissions to equal what we’ve withdrawn by stopping ours’’ [11]. However, the Australian Government also claims that ‘‘although Australian greenhouse gas emissions are about 1.6% of world emissions and are too small for Australia to make a difference on its own, Australia is committed to pursuing an effective global response to climate change’’ [7]. On the question of how Australia should address the issues of climate change and energy security, Prime Minister Howard argues that, ‘‘(w)e need to maintain the profitability that our great abundance of fossil fuels has given us, we need to accelerate the development of clean coal technologies, and the like, that were identified two and a half years ago in the Energy White Paper, we need to recognise that at the purifier, but not as a contributor to base power load generation, renewables, such as solar and wind can make a valuable contribution’’ [15]. In addition, the Australian Government has put forward the nuclear option as a possible way to reduce GHG emissions and increase Australia’s capacity for uranium mining and exports. The Switkowski report suggests that ‘‘(n)uclear power supplies base-load electricity – something that key renewables like wind and solar energy cannot do economically until practical and affordable energy storage systems are available’’. Clearly, the Australian Government is of the opinion that modern Western economies have to continue to be based on fossil fuel and/or nuclear power. 3. Energy technology options In this part of the paper, I will briefly outline the technical options for clean coal and nuclear power generation and some renewable energy options, as well as taking a look at the maturity and availability of these options. 3.1. Clean coal technology ‘‘Clean coal’’1 technologies aim to reduce the overall emissions resulting from coal utilisation. Globally, the role of coal as a stationary energy producer continues to expand. Between the mid 1970s and 2000 global coal consumption expanded by about 47% [16]. In Australia, coal produced 78% of electricity in 2000–2001 [7] and consequently, clean coal with geosequestration2 continues to dominate government priorities. Large amounts of resources are allocated to finding cost-effective solutions to mitigate the environmental cost of using dirty coal. Public and private sector coinvestment in developing clean coal technologies is a key element of Australia’s response to climate change. Clearly, the Australian Government is convinced that this is the most sensible approach, given that Australia is not only dependent on coal for its stationary electricity generation, but just as importantly, because Australia is a large exporter of coal. Let us briefly examine the current state of technology of clean coal and geosequestration. According to the Australian Coal Association [4], the following research design and development (RD&D) projects are either underway or are being assessed:
1 CO2 abatement in such plant concentrates on increasing plant efficiency and improving maintenance and fuel handling so that emissions are minimised [16]. 2 Geosequestration is the capture of CO2 gas from a large point source, such as a power station, and its storage deep underground.
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coal gasification with carbon capture and storage (CCS); oxy-fuel combustion with carbon capture and storage; post-combustion capture and storage, including retrofitting of existing stations; coal to liquid fuels and power generation, with carbon capture and storage; clean coal preparation technology; further measures to reduce fugitive emissions (emissions from coal production); and synergistic use of renewable energy which may be integrated with coal-fuelled power generation (examples being cogeneration with biomass and solar thermal technology). The inferences are that CO2 emissions from conventional coalfired power generation can be reduced significantly by introducing these new technologies and go a long way towards achieving significant emission reductions. However, at best, these technologies have the potential to generate base-load electricity with a CO2 intensity approximately 80% less than conventional coal-fired plants [27]. Whilst this would present a significant reduction of GHG emissions, it would not eliminate emissions altogether. However, the questions that need answering are, how feasible are these technologies, when will they be ready, what are the financial costs, as well as the energy and environmental costs associated with them, and last, but not least, what are the future risks associated with proposed technological solutions such as geosequestration? Opponents of geosequestration argue that the geological storage of CO2 carries with it a range of environmental, technological, social and economic risks; it is an end-of-pipe response that raises issues of intergenerational equity [5]. Proponents suggest that geosequestration will benefit the environment, but will increase the cost of electricity. Not only will it be an expensive exercise to capture the CO2, in most cases it is also necessary to transport the CO2 to the injection site. Once stored, the CO2 will need to be monitored. CANA argues that even if all the uncertainties and problems of geosequestration were to be successfully overcome, geosequestration in coal-fired power stations will not be widely available until 2015 at the earliest. According to Cooke [8, p. 34], it will not be before 2055 that all electricity generation and transportation in Australia could potentially be ‘‘geosequestration enabled’’. A life cycle analysis of the proposed technologies comparing all tangible and less tangible costs of energy production from the initial project conception to the final step of returning the land to its original form and the ongoing costs of storing of wastes generated during the process needs to be conducted in order to provide policy makers with the required information to be able to make an informed decision on future energy technology options. 3.2. Nuclear power According to the World Nuclear Association (WNA), 28 power reactors were being constructed in 11 countries, notably China, South Korea, Japan and Russia in 2006 [6]. The IEA estimates that by 2030 installed nuclear power capacity worldwide could be between 416 GW and 519 GW.3 Nuclear power has the potential to play a much bigger part once governments of countries where nuclear power is acceptable play a stronger role in facilitating private investment. Nuclear power plants are capital-intensive,
3 The reference scenario assumes that current government policies remain broadly unchanged. The alternative policy scenario assumes the adoption of policies to promote nuclear power.
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requiring an initial investment of approximately US$2 billion to US$3.5 billion per reactor [26]. Nuclear proponents consider nuclear a proven technology for base-load electricity generation, and argue that it has the potential to make a major contribution to a reduction in fossil fuel dependency as well as lowering CO2 emissions. Furthermore, the proponents suggest that the nuclear power industry has been developing and improving reactor technology for five decades. The much promoted next generation of reactors is expected to be built in the next 5–20 years [6]. In other words, the earliest that nuclear electricity could be delivered to the grid would be in 10 years, with 15–20 years more probable. In 2006 the Australian Government commissioned a Review of Uranium Mining Processing and Nuclear Energy in Australia. The reason for the Review was based on the assumption that Australia’s demand for electricity is expected to more than double before 2050. Over the same period, more than two-thirds of existing electricity generation will need to be upgraded or replaced. This additional capacity will need to be near-zero GHG emitting technology [6]. The government is convinced that nuclear power will be able to provide the energy required and at the same time reduce GHG emissions. In addition, Australia has the world’s largest collection of low-cost uranium reserves4 and has the capacity to expand its production and exports of uranium. Global growth in uranium demand provides a timely opportunity for Australia [6]. In 2006 the Australian Finance Minister Minchin suggested Australia should consider a wide range of activities within the nuclear fuel cycle, including mining, enriching, using and storing waste products from uranium [28]. The Review Taskforce argues that based upon full costing (which includes the cost of waste management and plant decommissioning)5 nuclear electricity generation would be about 20–50% more expensive than coal. If power plants using fossil fuels are required to pay for their emissions, this cost differential will disappear [6]. There are, however, lingering concerns about nuclear safety, as well as waste storage and decommissioning costs. The Review Taskforce argues that ‘‘(t)here is an international consensus at the scientific and engineering level that high-level radioactive waste, including spent nuclear fuel can be safely disposed of in suitable deep geological formations’’ (p. 170).6 In contrast, a study by MIT suggests that nuclear power has unresolved challenges in the long-term management of radioactive waste. There are further concerns about the construction cost of nuclear power plants and some suggest that nuclear power has only survived for as long as it has because its true costs have been hidden from the scrutiny of the general public. Before embracing the solutions put forward by nuclear proponents it would be prudent to ask ourselves questions such as, when will the new generation nuclear power plants come on line, what are the actual GHG savings over the full life cycle of a nuclear power plant, what will be the financial costs, what are the energy7 and environmental costs associated with them, and last but not least, what are the future risks associated with proposed technological solutions like nuclear waste storage and
4 Australia has 38% of the world’s low-cost reserves of uranium with most in a small number of deposits [6]. 5 It is unclear from the report on what the cost estimations are based on. Over 50 countries have spent fuel stored in temporary locations, awaiting reprocessing or disposal [23]. 6 The first European facility is still some way off and not likely to come on stream before 2020. In the USA 55,000 metric tons of high grade nuclear waste are waiting to be stored in the as yet not approved storage facility in the Yucca Mountain. Currently, Nuclear waste is kept in 131 temporary U.S. sites in 39 states, as Yucca is not to be opened for real permanent storage until 2017 [14]. 7 It costs energy from other source, predominantly from burning fossil fuels to generate nuclear energy [24].
decommissioning costs of nuclear power? In addition to waste and decommissioning issues, the nuclear option also raises questions of proliferation and national security which must be taken into consideration.8 The argument that nuclear energy will be the solution to climate change, because nuclear powered electricity generation power plants do not emit any CO2 does not stand up to closer scrutiny. If the lifetime pollution input/output is included in the analysis, these claims simply do not stack up. Opponents argue that there are in fact large amounts of fossil fuel energy required to produce electricity from nuclear power, resulting in considerable CO2 emissions. They consider nuclear energy with the real costs of insurance, construction, security and waste disposal to be amongst the most expensive forms of energy in the world. Furthermore, the energy costs incurred become apparent only after a nuclear power plant has stopped producing electricity, and these costs, like the nuclear waste, will be passed on to future generations. Again, a full life cycle analysis, a cradle to grave assessment, including a fair estimate9 of decommissioning and waste storage costs needs to be prepared to inform the public and the policy makers of the true costs and benefits, associated with nuclear power generation. 3.3. Renewable energy Traditionally, the Achilles heel of renewable-generated electricity has been the variable output and low load factor, which means that if there were ever to be a high degree of replacement of conventional means of generation, some means of storage would be required [21]. Proponents of fossil and or nuclear power argue that those technologies have the ability to provide base-load electricity, and that this is something that RETs based on wind and solar energy cannot do economically until practical and affordable energy storage systems are available. There is a widely held belief within the Australian Government and elsewhere, that a solution to the question of intermittency remains a long way off, whereas the solutions for the storage of nuclear waste and CO2 are considered to be only a question of time. This is despite the fact that energy storage systems do, in fact, exist in Australia. One such example is the Vanadium Redox Flow Battery (VRB), which was developed and commercialised by the University of New South Wales (UNSW). It has shown to have high energy efficiencies between 80 and 90% in large installations and is low cost for large storage capacities. The cost per kWh decreases as energy storage capacity increases, existing systems can be readily upgraded and additional storage capacity can be easily installed by changing the tanks and volumes of electrolyte [22]. The primary problem facing the renewable energy industry in Australia is the refusal of the government to create a framework that allows the environmental savings of these technologies to be presented as a market price factor or offset [17]. There is also a real concern that the displacement of conventional fossil fuel based generation by renewable energy like wind and solar will increase the cost of electricity. These two factors combined with a lack of understanding of what R&D is required by many of the small renewable energy companies in Australia are some of the reasons why in 2004–2005, 93% of electricity was still generated from fossil fuels (coal, oil and gas), and only 7% from renewables such as hydro, wind, biomass and biogas [1].
8 Iran, Korea, just to name two of the most prominent cases that have raised concerns about nuclear proliferation. 9 The potential cost of anything that requires storage for thousands of years because of the potential harm to humans and the environment can only be estimated.
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When the Australian Government introduced the MRET scheme in 2001 it was widely applauded. However, the Government’s 2%10 target and the oppositions 5% target are simply inadequate to encourage a larger uptake of RETs. In 2003, approximately 15% of the target was met by solar water heaters, rising to 25% in 2004 [1]. In response to the MRET review in 2004 [2], the Government declared that it would not extend or increase the target, thus further decreasing the incentives for investment and R&D in the renewable energy sector11. Government spending on RETs in Australia is mainly focused on demonstration and commercialisation projects. Unlike clean coal technology, there is very little money spent on RD&D for RETs. This lack of investment has led to an exodus of Australian expertise to European and Asian countries where governments are providing a framework that encourages investment and innovation in the renewable energy sector.12 The EU’s 27 Member States in contrast, have agreed on a binding target to have 20% of the EU’s overall energy consumption coming from renewables by 2020 and to cut GHG emissions by at least 20% compared with the 1990 levels. For example, by 2006 installed wind capacity in Germany amounted to 16 500 MW and is expected to reach as much as 29 000 MW by 2012 [20]. As a result considerable R&D is currently being undertaken in Germany on how to address issues associated with future grid operation with a high renewable energy component, particularly wind, and including those challenges associated with grid integration, grid coupling and so on. The aim is to change the energy supply into a more decentralised energy system to accommodate renewable energy sources in the supply grid. Countries like Germany, for example, have recognised the need to integrate an ever increasing amount of renewable energy into the energy-supply system in order to address climate change issues as well as issues associated with energy security and finiteness of fossil fuel based energy generation and are providing a framework (feed in tariff) that encourages the uptake of renewable energy on a large scale. The European Renewable Energy Council (EREC) suggests that renewable energy, combined with the smart use of energy, can deliver half of the world’s energy needs by 2050. Clearly, renewable energy is not just a dream of tomorrow – it is real, mature and can be deployed on a large scale today. Within a relatively short time frame it could provide as much as 35% of the world’s energy needs by 2030, given sufficient political will to promote its large-scale deployment [9]. 4. Conclusion Policy makers in Australia appear to believe unreservedly that we can only find solutions to the technical challenges associated with fossil fuel and nuclear technologies and equally believe that we cannot find similar solutions to the technical challenges associated with RETs. This is akin to arguing that we can be clever on Thursdays but not on Fridays. Both geosequestration and nuclear waste storage are end-of-pipe responses to the problem of GHG
10 In fact the mandatory target is 9500 GWh, which is less than 2%, because the forecast electricity consumption for 2010 has increased significantly. 11 Like other renewable energy businesses in Australia, Roaring 40s, a company specialising in wind farm development, was struggling to survive after the Australian government pulled the rug from under the rapidly expanding industry with its decision not to extend the MRET target in 2004. Instead, the company has found more lucrative offers in China, and is now part of a $300 billion joint venture with the power utility China Datang Corporation [3]. 12 Of the Australian Stock Exchange-listed companies involved in large-scale renewable energy projects, Novera Energy saw the writing on the wall early and turned its back on Australia in 2003, Pacific Hydro is placing increasing emphasis on its international projects, and Babcock & Brown’s soon to be spun out Global Wind Ventures’ latest acquisition was the 158 MW Olivo Wind Farm portfolio in Spain [19].
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emissions and climate change. They do not eliminate the problem of the production of toxic waste and the risks associated with finite fossil/uranium based power-generating technologies and suggest we ought to leave the problem as a potentially harmful legacy for future generations to endure. These end-of-pipe solutions do not fit in a finite environment with finite resources, and a finite atmosphere. Instead of focusing on polluting fossil fuel and nuclear energy technologies Australia’s policy makers need to start facilitating the transition from fossil to truly sustainable energy sources in a meaningful way. As discussed earlier, some RETs are already mature and their potential for harnessing the renewable energy sources is almost unlimited. Some, but by all means not all RETs, like VRB storage technologies and enlarged grid integration of wind energy have been discussed briefly in this paper and serve as an example of technologies that are available now, that provide solutions that eliminate the problem at the source (cradle) and unlike coal and nuclear based power generation do not leave a toxic legacy for future generations. Therefore I suggest that a life cycle analysis of all potential energy technologies based on a comprehensive accounting from ‘‘cradle to grave’’ of all energy and material flows associated with a proposed energy technology is required to inform policy makers.13 I believe that the window of opportunity is shrinking and that the consequences of not addressing climate change issues as a matter of urgency will have severe impacts, both economic and environmental in the near future. If we accept that the only sustainable solution is to eliminate the toxic emissions at the source, then RETs, relying on non-polluting energy sources that have ongoing supplies provided by the natural environment combined with energy efficiency measures provide the answer. Currently in Australia, the absence of a clear vision and the lack of a framework for investors in RETs, combined with a hidden bias that favours fossil fuel and nuclear, is compromising the needs of future generations.
References [1] ABARE. Research report 06.26, Australian energy – national and state projections 2029–2030. ABARE; 2006. [2] AGO. Government response to tambling MRET review recommendations. Available from: http://www.greenhouse.gov.au/markets/mret/pubs/mret-response.pdf; 2004 [accessed 10.01.07.]. [3] Wahlin W. Powering up a nation: energy security in Japan and Australia. APRA (Australian Review of Public Affaires). Available from: http://www.australianreview.net/digest/2006/11/wahlin.html; 2006 [accessed 10.01.07.]. [4] Australian Coal Association. Coal industry committed to support for clean coal research, development and demonstration. Media Release. Available from:, http://www.australiancoal.com.au/Pubs/ACA_Media_Release_250207.pdf; February 25, 2007 [accessed 8.03.07.]. [5] Climate Action Network Australia (CANA). Geosequestration Policy. Available from: http://www.cana.net.au/documents/CANA_position_geoseq_.pdf [accessed 10.01.07.]. [6] Commonwealth of Australia. Uranium mining, processing and nuclear energy – opportunities for Australia. Report to the Prime Minister by the uranium mining, processing and nuclear energy review taskforce, December 2006. [7] Commonwealth of Australia. Securing Australia’s energy future. Department of the Prime Minister and Cabinet, ISBN 0 646 43547 7; 2004. [8] Cooke PJ. House of representatives science and innovation committee inquiry into geosequestration. Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC). [9] EREC (European Renewable Energy Council). Energy revolution – as sustainable world energy outlook. Available from: http://www.erec-renewables.org/ documents/energy_revolution/energy_revolution.pdf; 2007 [accessed 12.03. 07.]. [11] Four Corners. What price global warming?. ABC TV. Available from: http:// origin.abc.net.au/tv/guide/abc2/200608/programs/ NC0604H009D30082006T190000.htm; 2006 [accessed 10.09.06.]. [12] Howard, J. Reported in The Age Newspaper, February 3rd 2007. [13] Howard J. Address at the Business Council of Australia Annual Dinner Sofitel Wentworth, Sydney; 2006.
13 When full life cycle environmental costs are considered, neither coal nor nuclear technologies appear to meet the criteria of sustainability.
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[14] Malone R. Nuclear hot spots: unsafe anywhere?. Forbes. Available from: http:// www.forbes.com/managing/2007/03/07/nuclear-hot-spots-biz-logistics-cx_ rm_0307nukes.html; 2007 [accessed 12.03.07.]. [15] Marohasy J. Australian PM rolls over on carbon trading. The Age Newspaper February 2006. [16] McMullan T. The role of coal in achieving energy sustainability, before the wells run dry. Available from: http://www.feasta.org/documents/wells/contents.html?one/mcmullan.html [accessed 10.02.07.]. [17] Mills DR. Solar energy options for renewable energy economies. Int J Global Energy Issues 2000;13(1–3). [18] OECD/IEA. Energy technology perspectives scenarios and strategies to 2050, summary; 2006. [19] RENergy. The grass is greener overseas. Australia’s alternative energy news report. Available from:, http://www.renergy.com.au/energycurrents.htm; 2005 [accessed 10.02.07.]. [20] Schulz D. Integration von Windkraftanlagen in Energieversorgungsnetze – Stand der Technik und Perspektiven fu¨r die dezentrale Stromerzeugung. Forschungs Report. Berlin: VDE Verlag GmbH; 2006.
[21] Slesser M. Using the net energy concept to model the future. Available from: http://www.feasta.org/documents/wells/contents.html?two/slesser.html [accessed 10.02.07.]. [22] Skyllas-Kazacos M. An historical overview of the vanadium redox flow battery development at the University of New South Wales, Australia. UNSW. Available from: http://www.vrb.unsw.edu.au/; 2007 [accessed 10.02.07.]. [23] Uranium Information Centre. International nuclear waste disposal concepts. Available from: http://www.uic.com.au/nip49.htm; 2006 [accessed 10.02.07.]. [24] Van Leeuwen JWS, Smith P. Nuclear power: the energy balance. D:\Nuclear\Power\Website documents\Introduction_summary_of_costs_ref3.doc 4; August 2005. [26] IEA. World energy outlook. Summary. Available from: www.iea.org; 2006 [accessed 20.01.07.]. [27] ZeroGen. Stanwell Corporation Limted. Available from: http://www.zerogen. com.au/about/mark2; 2006. [28] Lloyd. Introduction to: the Debate on Nuclear Power Policy, 2005-2006, Parliamentary Library Service, Northern Territory Library; 2006.
Contents lists available at ScienceDirect
Renewable Energy journal homepage: www.elsevier.com/locate/renene
Hidden biases in Australian energy policy August Schla¨pfer School of Engineering and Energy, Murdoch University, Murdoch, Western Australia, Australia
a r t i c l e i n f o
a b s t r a c t
Article history: Available online 17 July 2008
The challenges in developing technology for the capture and storage of CO2 from coal, oil and gas power generation, as well as those associated with the storage of nuclear waste, are widely regarded as solvable. According to proponents of clean coal, oil and gas technologies, as well as the proponents of nuclear technology, it is only a matter of time and resources to find a solution to their waste problems. Similarly, the Australian Government argues that our main efforts need to be concentrated on clean coal technologies, as well as considering the nuclear option. However, when it comes to the challenges associated with renewable energy technologies, like intermittency of wind generated grid power, storage of electricity from renewable energy and so on, there seems to be an attitude amongst Australian energy planners that these challenges represent insurmountable technical and financial problems, and will, at least in the short to medium term, prevent them from becoming a viable alternative to coal, oil, gas and uranium based energy technologies. Ó 2008 Elsevier Ltd. All rights reserved.
Keywords: Energy policy Climate change Fossil fuel technologies Nuclear technologies Renewable energy technologies Energy storage
1. Introduction In its World Energy Outlook for 2006 the International Energy Agency (IEA) suggests that meeting the world’s growing hunger for energy requires massive investment in the energy-supply infrastructure. A cumulative investment of just over US$20 trillion (in year-2005 Dollars) over 2005–2030 is the figure put forward by the IEA [18]. This growing demand for energy, combined with growing concerns about climate change, has opened up an interesting debate about how these two major issues should be addressed. The debate is no longer so much focused on whether human activity is causing climate change, but rather on the possible impacts of climate change and how the world will cope with an average warming of around 3 C, even if the issue is tackled promptly, by the end of this century. The debate has shifted from whether the production of energy derived from underground sources of fossil fuels causes climate change, to how best to combat climate change and at the same time meet the world’s growing energy demand. Recognising the fact that stationary energy production based on fossil fuels like coal and gas is a major contributor to CO2 emissions, the Australian Government has acknowledged the need to find solutions to address these issues. The main focus of the Australian Government is to find technological solutions that will provide the base-load electricity to meet growing industry and community demand whilst reducing greenhouse gas (GHG) emissions into the Earth’s atmosphere. Federally funded effort and resources are being allocated to the tasks involved in solving the technical issues
E-mail address: [email protected] 0960-1481/$ – see front matter Ó 2008 Elsevier Ltd. All rights reserved. doi:10.1016/j.renene.2008.05.010
associated with low emission coal and gas, as well as promoting nuclear power as a safe alternative. However, whilst acknowledging some role for renewable energy technologies (RETs) in its 2004 White Paper on Australia’s energy future, it is clear that the Government is not convinced that RETs will play a major part in that future. Prime Minister Howard argues that, ‘‘(y)ou can’t run power stations on solar and wind, let’s be realistic, you can only run power stations in a modern Western economy on fossil fuel, or in time, nuclear power’’ [12]. The Government demonstrated its lack of commitment to renewables when it refused to extend the successful Mandatory Renewable Energy Target (MRET) scheme, despite the recommendations by the MRET review committee in 2004 to expand the modest target of generating 9500 GWh per year to 20 000 GWh per year [2]. In this paper I will argue that this curious double standard as it is applied to the technical ability to solve the challenges associated with renewable versus fossil fuel technologies has imposed a major distortion on energy policy in Australia and has produced an inherent bias towards fossil fuel based power generation. 2. Australia’s position After some initial reluctance, the federal government has acknowledged that climate change is a serious issue and needs to be addressed. At a recent speech presented to the Business Council of Australia Prime Minister Howard pointed out that ‘‘the weight of scientific evidence suggests that there are significant and damaging growths in the levels of greenhouse gas emissions and that unless we lay the foundation over the years immediately ahead of us to deal with the problem, future generations will face significant
¨pfer / Renewable Energy 34 (2009) 456–460 A. Schla
penalties and will have cause to criticise our failure to do something substantial in response’’ [13]. Despite the change in rhetoric, the Australian Government still shows some reluctance to tackle these issues in a serious way. For example, in November 2006 Prime Minister Howard argued that it was pointless for Australia to take expensive steps to curb its own emissions, ‘‘(i)f we stopped them tomorrow, it would take all of nine months for China’s additional emissions to equal what we’ve withdrawn by stopping ours’’ [11]. However, the Australian Government also claims that ‘‘although Australian greenhouse gas emissions are about 1.6% of world emissions and are too small for Australia to make a difference on its own, Australia is committed to pursuing an effective global response to climate change’’ [7]. On the question of how Australia should address the issues of climate change and energy security, Prime Minister Howard argues that, ‘‘(w)e need to maintain the profitability that our great abundance of fossil fuels has given us, we need to accelerate the development of clean coal technologies, and the like, that were identified two and a half years ago in the Energy White Paper, we need to recognise that at the purifier, but not as a contributor to base power load generation, renewables, such as solar and wind can make a valuable contribution’’ [15]. In addition, the Australian Government has put forward the nuclear option as a possible way to reduce GHG emissions and increase Australia’s capacity for uranium mining and exports. The Switkowski report suggests that ‘‘(n)uclear power supplies base-load electricity – something that key renewables like wind and solar energy cannot do economically until practical and affordable energy storage systems are available’’. Clearly, the Australian Government is of the opinion that modern Western economies have to continue to be based on fossil fuel and/or nuclear power. 3. Energy technology options In this part of the paper, I will briefly outline the technical options for clean coal and nuclear power generation and some renewable energy options, as well as taking a look at the maturity and availability of these options. 3.1. Clean coal technology ‘‘Clean coal’’1 technologies aim to reduce the overall emissions resulting from coal utilisation. Globally, the role of coal as a stationary energy producer continues to expand. Between the mid 1970s and 2000 global coal consumption expanded by about 47% [16]. In Australia, coal produced 78% of electricity in 2000–2001 [7] and consequently, clean coal with geosequestration2 continues to dominate government priorities. Large amounts of resources are allocated to finding cost-effective solutions to mitigate the environmental cost of using dirty coal. Public and private sector coinvestment in developing clean coal technologies is a key element of Australia’s response to climate change. Clearly, the Australian Government is convinced that this is the most sensible approach, given that Australia is not only dependent on coal for its stationary electricity generation, but just as importantly, because Australia is a large exporter of coal. Let us briefly examine the current state of technology of clean coal and geosequestration. According to the Australian Coal Association [4], the following research design and development (RD&D) projects are either underway or are being assessed:
1 CO2 abatement in such plant concentrates on increasing plant efficiency and improving maintenance and fuel handling so that emissions are minimised [16]. 2 Geosequestration is the capture of CO2 gas from a large point source, such as a power station, and its storage deep underground.
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coal gasification with carbon capture and storage (CCS); oxy-fuel combustion with carbon capture and storage; post-combustion capture and storage, including retrofitting of existing stations; coal to liquid fuels and power generation, with carbon capture and storage; clean coal preparation technology; further measures to reduce fugitive emissions (emissions from coal production); and synergistic use of renewable energy which may be integrated with coal-fuelled power generation (examples being cogeneration with biomass and solar thermal technology). The inferences are that CO2 emissions from conventional coalfired power generation can be reduced significantly by introducing these new technologies and go a long way towards achieving significant emission reductions. However, at best, these technologies have the potential to generate base-load electricity with a CO2 intensity approximately 80% less than conventional coal-fired plants [27]. Whilst this would present a significant reduction of GHG emissions, it would not eliminate emissions altogether. However, the questions that need answering are, how feasible are these technologies, when will they be ready, what are the financial costs, as well as the energy and environmental costs associated with them, and last, but not least, what are the future risks associated with proposed technological solutions such as geosequestration? Opponents of geosequestration argue that the geological storage of CO2 carries with it a range of environmental, technological, social and economic risks; it is an end-of-pipe response that raises issues of intergenerational equity [5]. Proponents suggest that geosequestration will benefit the environment, but will increase the cost of electricity. Not only will it be an expensive exercise to capture the CO2, in most cases it is also necessary to transport the CO2 to the injection site. Once stored, the CO2 will need to be monitored. CANA argues that even if all the uncertainties and problems of geosequestration were to be successfully overcome, geosequestration in coal-fired power stations will not be widely available until 2015 at the earliest. According to Cooke [8, p. 34], it will not be before 2055 that all electricity generation and transportation in Australia could potentially be ‘‘geosequestration enabled’’. A life cycle analysis of the proposed technologies comparing all tangible and less tangible costs of energy production from the initial project conception to the final step of returning the land to its original form and the ongoing costs of storing of wastes generated during the process needs to be conducted in order to provide policy makers with the required information to be able to make an informed decision on future energy technology options. 3.2. Nuclear power According to the World Nuclear Association (WNA), 28 power reactors were being constructed in 11 countries, notably China, South Korea, Japan and Russia in 2006 [6]. The IEA estimates that by 2030 installed nuclear power capacity worldwide could be between 416 GW and 519 GW.3 Nuclear power has the potential to play a much bigger part once governments of countries where nuclear power is acceptable play a stronger role in facilitating private investment. Nuclear power plants are capital-intensive,
3 The reference scenario assumes that current government policies remain broadly unchanged. The alternative policy scenario assumes the adoption of policies to promote nuclear power.
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requiring an initial investment of approximately US$2 billion to US$3.5 billion per reactor [26]. Nuclear proponents consider nuclear a proven technology for base-load electricity generation, and argue that it has the potential to make a major contribution to a reduction in fossil fuel dependency as well as lowering CO2 emissions. Furthermore, the proponents suggest that the nuclear power industry has been developing and improving reactor technology for five decades. The much promoted next generation of reactors is expected to be built in the next 5–20 years [6]. In other words, the earliest that nuclear electricity could be delivered to the grid would be in 10 years, with 15–20 years more probable. In 2006 the Australian Government commissioned a Review of Uranium Mining Processing and Nuclear Energy in Australia. The reason for the Review was based on the assumption that Australia’s demand for electricity is expected to more than double before 2050. Over the same period, more than two-thirds of existing electricity generation will need to be upgraded or replaced. This additional capacity will need to be near-zero GHG emitting technology [6]. The government is convinced that nuclear power will be able to provide the energy required and at the same time reduce GHG emissions. In addition, Australia has the world’s largest collection of low-cost uranium reserves4 and has the capacity to expand its production and exports of uranium. Global growth in uranium demand provides a timely opportunity for Australia [6]. In 2006 the Australian Finance Minister Minchin suggested Australia should consider a wide range of activities within the nuclear fuel cycle, including mining, enriching, using and storing waste products from uranium [28]. The Review Taskforce argues that based upon full costing (which includes the cost of waste management and plant decommissioning)5 nuclear electricity generation would be about 20–50% more expensive than coal. If power plants using fossil fuels are required to pay for their emissions, this cost differential will disappear [6]. There are, however, lingering concerns about nuclear safety, as well as waste storage and decommissioning costs. The Review Taskforce argues that ‘‘(t)here is an international consensus at the scientific and engineering level that high-level radioactive waste, including spent nuclear fuel can be safely disposed of in suitable deep geological formations’’ (p. 170).6 In contrast, a study by MIT suggests that nuclear power has unresolved challenges in the long-term management of radioactive waste. There are further concerns about the construction cost of nuclear power plants and some suggest that nuclear power has only survived for as long as it has because its true costs have been hidden from the scrutiny of the general public. Before embracing the solutions put forward by nuclear proponents it would be prudent to ask ourselves questions such as, when will the new generation nuclear power plants come on line, what are the actual GHG savings over the full life cycle of a nuclear power plant, what will be the financial costs, what are the energy7 and environmental costs associated with them, and last but not least, what are the future risks associated with proposed technological solutions like nuclear waste storage and
4 Australia has 38% of the world’s low-cost reserves of uranium with most in a small number of deposits [6]. 5 It is unclear from the report on what the cost estimations are based on. Over 50 countries have spent fuel stored in temporary locations, awaiting reprocessing or disposal [23]. 6 The first European facility is still some way off and not likely to come on stream before 2020. In the USA 55,000 metric tons of high grade nuclear waste are waiting to be stored in the as yet not approved storage facility in the Yucca Mountain. Currently, Nuclear waste is kept in 131 temporary U.S. sites in 39 states, as Yucca is not to be opened for real permanent storage until 2017 [14]. 7 It costs energy from other source, predominantly from burning fossil fuels to generate nuclear energy [24].
decommissioning costs of nuclear power? In addition to waste and decommissioning issues, the nuclear option also raises questions of proliferation and national security which must be taken into consideration.8 The argument that nuclear energy will be the solution to climate change, because nuclear powered electricity generation power plants do not emit any CO2 does not stand up to closer scrutiny. If the lifetime pollution input/output is included in the analysis, these claims simply do not stack up. Opponents argue that there are in fact large amounts of fossil fuel energy required to produce electricity from nuclear power, resulting in considerable CO2 emissions. They consider nuclear energy with the real costs of insurance, construction, security and waste disposal to be amongst the most expensive forms of energy in the world. Furthermore, the energy costs incurred become apparent only after a nuclear power plant has stopped producing electricity, and these costs, like the nuclear waste, will be passed on to future generations. Again, a full life cycle analysis, a cradle to grave assessment, including a fair estimate9 of decommissioning and waste storage costs needs to be prepared to inform the public and the policy makers of the true costs and benefits, associated with nuclear power generation. 3.3. Renewable energy Traditionally, the Achilles heel of renewable-generated electricity has been the variable output and low load factor, which means that if there were ever to be a high degree of replacement of conventional means of generation, some means of storage would be required [21]. Proponents of fossil and or nuclear power argue that those technologies have the ability to provide base-load electricity, and that this is something that RETs based on wind and solar energy cannot do economically until practical and affordable energy storage systems are available. There is a widely held belief within the Australian Government and elsewhere, that a solution to the question of intermittency remains a long way off, whereas the solutions for the storage of nuclear waste and CO2 are considered to be only a question of time. This is despite the fact that energy storage systems do, in fact, exist in Australia. One such example is the Vanadium Redox Flow Battery (VRB), which was developed and commercialised by the University of New South Wales (UNSW). It has shown to have high energy efficiencies between 80 and 90% in large installations and is low cost for large storage capacities. The cost per kWh decreases as energy storage capacity increases, existing systems can be readily upgraded and additional storage capacity can be easily installed by changing the tanks and volumes of electrolyte [22]. The primary problem facing the renewable energy industry in Australia is the refusal of the government to create a framework that allows the environmental savings of these technologies to be presented as a market price factor or offset [17]. There is also a real concern that the displacement of conventional fossil fuel based generation by renewable energy like wind and solar will increase the cost of electricity. These two factors combined with a lack of understanding of what R&D is required by many of the small renewable energy companies in Australia are some of the reasons why in 2004–2005, 93% of electricity was still generated from fossil fuels (coal, oil and gas), and only 7% from renewables such as hydro, wind, biomass and biogas [1].
8 Iran, Korea, just to name two of the most prominent cases that have raised concerns about nuclear proliferation. 9 The potential cost of anything that requires storage for thousands of years because of the potential harm to humans and the environment can only be estimated.
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When the Australian Government introduced the MRET scheme in 2001 it was widely applauded. However, the Government’s 2%10 target and the oppositions 5% target are simply inadequate to encourage a larger uptake of RETs. In 2003, approximately 15% of the target was met by solar water heaters, rising to 25% in 2004 [1]. In response to the MRET review in 2004 [2], the Government declared that it would not extend or increase the target, thus further decreasing the incentives for investment and R&D in the renewable energy sector11. Government spending on RETs in Australia is mainly focused on demonstration and commercialisation projects. Unlike clean coal technology, there is very little money spent on RD&D for RETs. This lack of investment has led to an exodus of Australian expertise to European and Asian countries where governments are providing a framework that encourages investment and innovation in the renewable energy sector.12 The EU’s 27 Member States in contrast, have agreed on a binding target to have 20% of the EU’s overall energy consumption coming from renewables by 2020 and to cut GHG emissions by at least 20% compared with the 1990 levels. For example, by 2006 installed wind capacity in Germany amounted to 16 500 MW and is expected to reach as much as 29 000 MW by 2012 [20]. As a result considerable R&D is currently being undertaken in Germany on how to address issues associated with future grid operation with a high renewable energy component, particularly wind, and including those challenges associated with grid integration, grid coupling and so on. The aim is to change the energy supply into a more decentralised energy system to accommodate renewable energy sources in the supply grid. Countries like Germany, for example, have recognised the need to integrate an ever increasing amount of renewable energy into the energy-supply system in order to address climate change issues as well as issues associated with energy security and finiteness of fossil fuel based energy generation and are providing a framework (feed in tariff) that encourages the uptake of renewable energy on a large scale. The European Renewable Energy Council (EREC) suggests that renewable energy, combined with the smart use of energy, can deliver half of the world’s energy needs by 2050. Clearly, renewable energy is not just a dream of tomorrow – it is real, mature and can be deployed on a large scale today. Within a relatively short time frame it could provide as much as 35% of the world’s energy needs by 2030, given sufficient political will to promote its large-scale deployment [9]. 4. Conclusion Policy makers in Australia appear to believe unreservedly that we can only find solutions to the technical challenges associated with fossil fuel and nuclear technologies and equally believe that we cannot find similar solutions to the technical challenges associated with RETs. This is akin to arguing that we can be clever on Thursdays but not on Fridays. Both geosequestration and nuclear waste storage are end-of-pipe responses to the problem of GHG
10 In fact the mandatory target is 9500 GWh, which is less than 2%, because the forecast electricity consumption for 2010 has increased significantly. 11 Like other renewable energy businesses in Australia, Roaring 40s, a company specialising in wind farm development, was struggling to survive after the Australian government pulled the rug from under the rapidly expanding industry with its decision not to extend the MRET target in 2004. Instead, the company has found more lucrative offers in China, and is now part of a $300 billion joint venture with the power utility China Datang Corporation [3]. 12 Of the Australian Stock Exchange-listed companies involved in large-scale renewable energy projects, Novera Energy saw the writing on the wall early and turned its back on Australia in 2003, Pacific Hydro is placing increasing emphasis on its international projects, and Babcock & Brown’s soon to be spun out Global Wind Ventures’ latest acquisition was the 158 MW Olivo Wind Farm portfolio in Spain [19].
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emissions and climate change. They do not eliminate the problem of the production of toxic waste and the risks associated with finite fossil/uranium based power-generating technologies and suggest we ought to leave the problem as a potentially harmful legacy for future generations to endure. These end-of-pipe solutions do not fit in a finite environment with finite resources, and a finite atmosphere. Instead of focusing on polluting fossil fuel and nuclear energy technologies Australia’s policy makers need to start facilitating the transition from fossil to truly sustainable energy sources in a meaningful way. As discussed earlier, some RETs are already mature and their potential for harnessing the renewable energy sources is almost unlimited. Some, but by all means not all RETs, like VRB storage technologies and enlarged grid integration of wind energy have been discussed briefly in this paper and serve as an example of technologies that are available now, that provide solutions that eliminate the problem at the source (cradle) and unlike coal and nuclear based power generation do not leave a toxic legacy for future generations. Therefore I suggest that a life cycle analysis of all potential energy technologies based on a comprehensive accounting from ‘‘cradle to grave’’ of all energy and material flows associated with a proposed energy technology is required to inform policy makers.13 I believe that the window of opportunity is shrinking and that the consequences of not addressing climate change issues as a matter of urgency will have severe impacts, both economic and environmental in the near future. If we accept that the only sustainable solution is to eliminate the toxic emissions at the source, then RETs, relying on non-polluting energy sources that have ongoing supplies provided by the natural environment combined with energy efficiency measures provide the answer. Currently in Australia, the absence of a clear vision and the lack of a framework for investors in RETs, combined with a hidden bias that favours fossil fuel and nuclear, is compromising the needs of future generations.
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13 When full life cycle environmental costs are considered, neither coal nor nuclear technologies appear to meet the criteria of sustainability.
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