Last week Malcolm Turnbull addressed the National Press Club where he proclaimed “the battlelines have been drawn: it is clear that the Coalition stands for cheaper energy.”
No doubt mindful of Abbott’s successful campaign to “axe the tax”, Turnbull is now dishing up his version of the same thing, calling on all governments to co-operate on achieving the trifecta of affordable, reliable and secure electricity.
What Mr Turnbull studiously ignores is the fourth, and arguably most important part of the equation – sustainability.
The Australian Energy Market Operator (AEMO) is the body responsible for national transmission planning for electricity. In December last year they published the NATIONAL TRANSMISSION NETWORK DEVELOPMENT PLAN, “an independent, strategic assessment of an appropriate course for efficient transmission grid development in the National Electricity Market (NEM) over the next 20 years. This assessment balances reliability, security, and cost considerations while meeting emissions reduction targets.”
The report makes the stunning admission that the government has no plan for reducing emissions in the electricity sector.
“All studies in the 2016 NTNDP assume that the NEM achieves at least a proportionate share of the COP21 commitment (28% emissions reduction). The mechanisms to meet the target, and any targets beyond 2030, have not yet been specified. The review of Australia’s climate change policies in 2017 should provide more information on the potential mechanisms that will be applied to achieve it.”
So, bereft of government direction, the AEMO went on to suggest what they believe needs to be done.
AEMO projects Australia’s 2030 emissions reductions target will be met mostly by large-scale renewable generation with coal generation reducing from 74% of NEM generation in 2016–17 to 24% in 2035–36.
AEMO’s 2016 National Electricity Forecasting Report (NEFR) projected grid demand growth to be flat over the next 20 years but concedes it could, in fact, be much lower than current forecasts for reasons including the following:
- Rapid growth of rooftop photovoltaic (PV) – projected to represent between 34% and 60% of new generation installations. Installed capacity is projected to exceed 20 GW by 2036, becoming the technology with most generation capacity in the NEM. Uptake could accelerate faster than projected if a variety of factors, such as further cost breakthroughs or material rises in electricity prices, combine to improve the economics of PV ownership. The recent launch of Tesla’s Powerwall 2 represents a further step down the cost curve for residential battery storage. Tesla’s website indicates that a fully installed 14-kilowatt hour (kWh) system with integrated inverter is expected to cost $10,150.
- Declining electricity-intensive manufacturing operations in the NEM regions. Sectors with projected growth, like services, use comparatively little electricity.
- Energy efficiency initiatives, combined with more efficient appliances. The 2016 NEFR projects that energy efficiency will reduce grid demand by 27,082 GWh in 2035–36 (greater than the projected generation from rooftop PV of 25,442 GWh in the same year). Further emphasis on energy efficiency, as a relatively cheap form of abatement to meet emissions reduction targets, could reduce grid demand by more than current expectations.
- Changing consumer behaviour.
Of the existing coal generation fleet, almost 70% of the generation capacity will exceed 50 years from first operation by 2036, indicating that a large proportion of the fleet is approaching the end of its intended life. The 2016 NTNDP projects that up to 63% of the fleet (15.5 gigawatts (GW)) may withdraw from service in the next 20 years under a Neutral economic growth scenario, of which 9 GW is projected to be withdrawn in the 2030s. Whether coal generation is refurbished or replaced will depend on future climate change policy.
They suggest that any medium-term gap in energy production whilst renewables ramp up would probably be better filled by gas-powered generation (GPG) rather than coal and warn that these decisions need making now.
“The timing and location of coal generation withdrawals will impact when and where new generation and transmission development is required over the next 20 years. Limited notice of withdrawals at such a scale would not allow for coordinated planning and could compromise efficient NEM development.”
In his address, Malcolm Turnbull said, “We’ve invested $590 million since 2009 in clean coal technology research and demonstration and yet we do not have one modern high-efficiency low-emissions coal-fired power station, let alone one with carbon capture and storage.”
The pompous gall of Turnbull defies belief. There is a good reason we don’t have working CCS technology.
In the 2014 budget the Abbott government cut $459.3m over three years from its carbon capture and storage flagship program, leaving $191.7m to continue existing projects for the next seven years.
In addition, the coal industry “paused” a levy on black coal producers, which was supposed to build a $1bn industry fund to also finance research and demonstration into clean coal technology. It cited low coal prices for the halt.
The objectives of Coal21, set up in 2006, were also changed to allow the industry to use funding already collected to promote the use of coal. Its constitution now allows money to be spent on “promoting the use of coal both within Australia and overseas and promoting the economic and social benefits of the coal industry.”
At the time, Tony Abbott said “For now and for the foreseeable future, the foundation of Australia’s energy needs will be coal. The foundation of the world’s energy needs will be coal.”
Tony Wood, the energy program director at the Grattan Institute, said: “CCS is the only way Australia, and the world, can keep using coal and also do what it needs to do about climate change, but neither industry nor government seem to be serious about doing anything about it.”
John Connor, the chief executive of the Climate Institute, said CCS “has to be one of the clean energy options available because all the modelling says that to avoid temperature rises of more than two degrees, we have to take carbon dioxide out of the atmosphere”.
It costs several billion to build a new coal-fired power station. Instead, we could:
- Increase the quota of gas retained for domestic use and fix it at an affordable price – after all, we own the stuff.
- Subsidise the installation of roof top solar as the Coalition promised they would do in the 2013 election.
- Stop indiscriminate large-scale land-clearing and plant more trees.
- Invest in wind energy instead of inquiries into whether or not it makes you sick – we know coal is killing us.
- Electricity is an essential item whose price could be reduced by 10% by not charging GST (a price signal has been effective in reducing demand but this could be an option if necessary).
- Stop guaranteeing profits when privatising our services.
Turnbull pontificated “We are approaching this issue clear-eyed, pragmatic and objective. Labor’s approach is driven simply by ideology, heedless of cost or the thousands of jobs that it will destroy.”
I thought removing the carbon tax was supposed to make electricity cheap and provide thousands of jobs?
Malcolm perhaps revealed his true motivation when he said, “as Australia is a big exporter we need to show we are using state-of-the-art clean coal-fired technology.”
Trick the world into thinking coal is clean to keep profits up for a few more years for your billionaire mates?
There is nothing pragmatic about destroying the planet.
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