Sydney’s closer to being a zero-carbon city than you think


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The potential clean energy sources are all around Sydney, just waiting to be harnessed.
Author provided

Rob Roggema, University of Technology Sydney

You live in one of the sunniest countries in the world. You might want to use that solar advantage and harvest all this free energy. Knowing that solar panels are rapidly becoming cheaper and have become feasible even in less sunny places like the UK, this should be a no-brainer.

Despite this, the Australian government has taken a step backwards at a time when we should be thinking 30 years ahead.


Further reading: Will the national energy guarantee hit pause on renewables?


Can we do it differently? Yes, we can! My ongoing research on sustainable urbanism makes it clear that if we use the available renewable resources in the Sydney region we do not need any fossil resource any more. We can become zero-carbon. (With Louisa King and Andy Van den Dobbelsteen, I have prepared a forthcoming paper, Towards Zero-Carbon Metropolitan Regions: The Example of
Sydney, in the journal SASBE.)

Enough solar power for every household

Abundant solar energy is available in the Sydney metropolitan area. If 25% of the houses each installed 35 square metres of solar panels, this could deliver all the energy for the city’s households.

We conservatively estimate a total yield of 195kWh/m2 of PV panel placed on roofs or other horizontal surfaces. The potential area of all Sydney council precincts suited for PV is estimated at around 385km2 – a quarter of the entire roof surface.

We calculate the potential total solar yield at 75.1TWh, which is more than current domestic household energy use (65.3TWh, according to the Jemena energy company).


Further reading: What’s the net cost of using renewables to hit Australia’s climate target?


Wind turbines to drive a whole city

If we install small wind turbines on land and larger turbines offshore we can harvest enough energy to fuel our electric vehicle fleet. Onshore wind turbines of 1-5MW generating capacity can be positioned to capture the prevailing southwest and northeast winds.

The turbines are placed on top of ridges, making use of the funnel effect to increase their output. We estimate around 840km of ridge lines in the Sydney metropolitan area can be used for wind turbines, enabling a total of 1,400 turbines. The total potential generation from onshore wind turbines is 6.13TWh.

Offshore turbines could in principle be placed everywhere, as the wind strength is enough to create an efficient yield. The turbines are larger than the ones on shore, capturing 5-7.5MW each, and can be placed up to 30km offshore. With these boundary conditions, an offshore wind park 45km long and 6km wide is possible. The total offshore potential then is 5.18TWh.

Altogether, then, we estimate the Sydney wind energy potential at 11.3TWh.

Around 840km of ridge lines (marked in yellow and red) in the Sydney metropolitan area can be used for wind turbines.
Author provided

Further reading: FactCheck Q&A: is coal still cheaper than renewables as an energy source?


Turning waste into biofuels

We can turn our household waste and green waste from forests, parks and public green spaces into biogas. We can then use the existing gas network to provide heating and cooling for the majority of offices.

Biomass from domestic and green waste will be processed through anaerobic fermentation in old power plants to generate biogas. Gas reserves are created, stored and delivered through the existing power plants and gas grid.


Further reading: Biogas: smells like a solution to our energy and waste problems


Algae has enormous potential for generating bio-energy. Algae can purify wastewater and at the same be harvested and processed to generate biofuels (biodiesel and biokerosene).

Specific locations to grow algae are Botany Bay and Badgerys Creek. It’s noteworthy that both are close to airports, as algae could be important in providing a sustainable fuel resource for planes.

Using algae arrays to treat the waste water of new precincts, roughly a million new households as currently planned in Western Sydney, enables the production of great quantities of biofuel. Experimental test fields show yields can be high. A minimum of 20,000 litres of biodiesel per hectare of algae ponds is possible if organic wastewater is added. This quantity is realisable in Botany Bay and in western Sydney.

Biomass fermentation of household and green waste and wastewater treatment using algae arrays can generate biogas, biodiesel and biokerosene.
Author provided

Further reading: Biofuel breakthroughs bring ‘negative emissions’ a step closer


Extracting heat from beneath the city

Shallow geothermal heat can be tapped through heat pumps and establishing closed loops in the soil. This can occur in large expanses of urban developments within the metropolitan area, which rests predominantly on deposits of Wianamatta shale in the west underlying Parramatta, Liverpool and Penrith.

Where large water surfaces are available, such as in Botany Bay or the Prospect Reservoir, heat can also be harvested from the water body.

The layers of the underlying Hawkesbury sandstone, the bedrock for much of the region, can yield deep geothermal heat. This is done by pumping water into these layers and harvesting the steam as heat, hot water or converted electricity.

Sydney’s geology offers sources of both shallow and deep theothermal heat.
Author provided

Further reading: Explainer: what is geothermal energy?


Hydropower from multiple sources

The potential sources of energy from hydro generation are diverse. Tidal energy can be harvested at the entrances of Sydney Harbour Bay and Botany Bay, where tidal differences are expected to be highest.

Port Jackson, the Sydney Harbour bay and all of its estuaries have a total area of 55km2. With a tidal difference of two metres, the total maximum energy potential of a tidal plant would be 446TWh. If Sydney could harvest 20% of this, that would be more than twice the yield of solar panels on residential roofs.

If we use the tide to generate electricity, we can also create a surge barrier connecting Middle and South Head. Given the climatic changes occurring and still ahead of us, we need to plan how to protect the city from the threats of future cyclones, storm surges and flooding.

I have written here about the potential benefits of artificially creating a Sydney Barrier Reef. The reef, 30km at most out at sea, would provide Sydney with protection from storms.

At openings along the reef, wave power generators can be placed. Like tidal power, wave power can be calculated: mass displacement times gravity. If around 10km of the Sydney shoreline had wave power vessels, the maximum energy potential would be 3.2TWh.

In the mouths of the estuaries of Sydney Harbour and Botany Bay, freshwater meets saltwater. These places have a large potential to generate “blue energy” through reverse osmosis membrane technology.

To combine protective structures with tidal generating power, an open closure barrier is proposed for the mouth of Sydney Harbour. The large central gates need to be able to accommodate the entrance of large cruise ships and to close in times of a storm surge. At the same time, a tidal plant system operates at the sides of the barrier.

An artist’s impression of the Sydney Harbour surge barrier and tidal plant.
Drawing: Andy van den Dobbelsteen, Author provided

Further reading: Catching the waves: it’s time for Australia to embrace ocean renewable energy


Master plan for a zero-carbon city

All these potential energy sources are integrated into our Master Plan for a Zero-Carbon Sydney. Each has led to design propositions that together can create a zero-carbon city.

The Zero-Carbon Sydney Master Plan maps out how the city can be fossil-free.
Author provided

The ConversationThe research shows there is enough, more than enough, potential reliable renewable energy to supply every household and industry in the region. What is needed is an awareness that Australia could be a global frontrunner in innovative energy policy, instead of a laggard.

Rob Roggema, Professor of Sustainable Urban Environments, University of Technology Sydney

This article was originally published on The Conversation. Read the original article.

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Time for a global agreement on minerals to fuel the clean energy transition


Damien Giurco, University of Technology Sydney; Nicholas Arndt, Université Grenoble Alpes, and Saleem H. Ali, The University of Queensland

Representatives from around the world are meeting in Bonn this week to discuss progress towards the goals of the Paris climate agreement. A large part of this challenge involves rapidly scaling up the deployment of renewable energy, while curbing fossil fuel use – but little attention has been paid to the minerals that will be needed to build these technologies.

Wind and solar infrastructure, batteries and electric vehicles all require vast amounts of mined (and recycled) resources. These range from copper for wires and electric motors, to lithium and cobalt for batteries, to smaller amounts of rare metals like indium and gallium for solar cells.


Read more: Mining for metals in society’s waste


The problem is that the current system for mining these minerals is not always efficient; it’s polluting and is subject to increased social pressure and public protests. Instead, we need a new international mechanism to coordinate global mineral exploration that looks to our future supply needs.

As technology advances, more and different metals are needed.
Zepf V, Reller A, Rennie C, Ashfield M & Simmons J, BP (2014): Materials critical to the energy industry.

Challenges for minerals supply

While the Paris agreement has created a global framework for managing carbon, nothing similar exists for minerals. This leaves the pursuit of sustainable resource development largely in the hands of mining companies and state-owned enterprises.

Mining these resources generates significant water and air pollution. This problem is increasing: for example, global copper ore quality is declining over time. That means that copper mining now requires excavating twice as much ore as ten years ago to yield the same amount of copper, creating much more mine waste.


Read more: Treasure from trash: how mining waste can be mined a second time


Lower commodity prices have meant that investment in exploring new mine sites has fallen. But it takes a long time to develop new mines – it can often take 20 years to go from finding a metal deposit to beginning mining, and only around 20% of discoveries since 2000 have led to an operating mine.

Lack of investment in exploration is driven by short-term thinking, rather than a long-term plan to supply rising demand.

In parallel, resistance to mining, often at a local level, is increasing worldwide. Environmental catastrophes, of which there have been many examples, erode social trust, often delaying or stopping mine development.

A new global mechanism to more effectively plan resource supply could help rebuild trust in local communities, limit price spikes to ensure equitable access to metal resources, and balance the international tension which arises as industries and governments compete for minerals from a shrinking list of countries able to tolerate and profit from sustaining a mining industry.

A global agreement on mineral resources

Developing a global mechanism will of course be difficult, requiring substantive dialogue and strong leadership. But there are organisations that could step up, such as the United Nations Environment Assembly, or the newly established Intergovernmental Forum on Mining Metals and Sustainable Development.

The global community is well aware of the threat that rising sea levels pose to low-lying countries. We need similar awareness of the crucial role minerals are playing in the energy transition, and the risk that supply problems could derail sustainability goals.

To that end, we need to globally coordinate several crucial aspects of mineral development. To start with, while most detailed information on where minerals are mined and sold is privately held, there is publicly available data that could be used to predict possible imbalances in supply and demand internationally (for example copper, iron, lithium, indium). Publicly-funded institutions have an important role here. They can assess how known supply will meet future demand, and deliver insight into the changing environmental impact.

It should also be entirely possible to develop inventories of recyclable metals, which can be an important supplement to large mining operations.

Compiling inventories of recyclable metals is underway across Europe as part of a move towards a circular economy (where as much waste as possible is repurposed).


Read more: Explainer: what is the circular economy


While recycling for for metals like lithium for less than 1%, around 40% of steel demand is met from scrap recycled during manufacturing and from end-of-life products and infrastructure. Thinking smarter about eventual dismantling of buildings at the time when they are built, can support better use of recycled resources.

Geoscience agencies already offer maps of underground minerals, demonstrating that this kind of co-ordinated perspective is feasible. Extending this approach to recyclables can mitigate environmental impact and ease the social objections to new mines.

A global mechanism for mineral exploration and supply could also be an opportunity to promote best-practice for responsible mining, with a focus on social license and fair and transparent royalty arrangements.

Overcoming resistance

It’s a challenging proposition, especially as many countries display less enthusiasm for international agreements. However, it will be increasingly difficult to meet the Paris targets without tackling this problem.

In the decades ahead, our mineral supply will still need to double or triple to meet the demand for electric vehicles and other technologies required by our growing global population.

In short, resource efficiency and jobs of the future depend on an assured mineral supply. This should be a nonpartisan issue, across the global political spectrum.


The ConversationThe authors gratefully acknowledge the contribution of Edmund Nickless, Chair, New Activities Strategic Implementation Committee, International Union of Geological Sciences to this article.

Damien Giurco, Professor of Resource Futures, University of Technology Sydney; Nicholas Arndt, Professor of Geosciences, Université Grenoble Alpes, and Saleem H. Ali, Distinguished Professor of Energy and the Environment, University of Delaware (USA); Professorial Research Fellow, The University of Queensland

This article was originally published on The Conversation. Read the original article.

Forget turning straw into gold, farmers can turn trash into energy


Bernadette McCabe, University of Southern Queensland and Craig Baillie, University of Southern Queensland

Mention agriculture to many Australians and it conjures up images of mobs of cattle in the dusty outback, or harvesters gobbling up expanses of golden wheat. In reality, much of our high-value agriculture is near the coast, and close to capital cities. Think of the Adelaide Hills, the Lockyer Valley west of Brisbane, Victoria’s Gippsland region and Goulburn Valley, and Sydney’s Hawkesbury Valley.

These centres are where a lot of our agricultural processing happens – near big, eco-conscious populations ready to put their hands in their pockets for quality products.


Read more: Why consumers need help to shift to sustainable diets


But besides feeding us, farming can also potentially help us with the move towards cleaner energy. While it’s unclear how agriculture will factor into the federal government’s proposed National Energy Guarantee, it’s obvious that the farming sector can do plenty to reduce Australia’s emissions. An Industry Roadmap released this week by the Carbon Market Institute forecasts that by 2030 carbon farming will save the equivalent of 360-480 tonnes of carbon emissions, generate between A$10.8 billion and A$24 billion in revenue, and create 10,500-21,000 jobs.

One extremely promising area is turning agricultural waste and by-products into energy. This reduces emissions, makes farmers less vulnerable to variable energy prices, and adds value for consumers.

Using waste for energy

In Queensland and northern New South Wales, some sugar mills are making electricity by burning bagasse (sugarcane waste) as a biomass energy source. Other plants in Victoria, like Warrnambool Butter & Cheese, are using whey to produce biogas, thus reducing their spending on natural gas.

Other kinds of waste from viticulture and horticulture are also potentially useful. Even the trash produced when cotton lint fibres are removed from the seed is a largely untapped source of environmentally friendly energy.


Read more: Explainer: why we should be turning waste into fuel


The agricultural sector should be aiming to close the loop: to reclassify waste as a resource. Turning trash into treasure is a step towards energy independence, an idea that is gaining momentum overseas. An energy-independent farm seeks to cater for its own energy needs, creating a self-sustaining environment that buffers against fluctuating energy prices.

Australian farms should largely be able to achieve this. The trend towards renewable energy sources, and equipment that can run on biofuels, demonstrates an appetite for sensible, sustainable technology.

Biodiesel, wind and solar energy, and electricity and gas generated from biogas are being implemented globally. From an international perspective, farmers’ consideration for using or increasing renewable energy seems to be independent of the size of their operations but rather stem from their desire for farms to be energy-independent.


Read more: Biogas: smells like a solution to our energy and waste problems


La Bellotta farm in Italy, a mixed-energy farm, is a prime example. It’s using a concept tractor powered by methane generated from on-farm waste.

Closer to home, Westpork, WA’s largest pork producer, is about to add wind power and battery storage to its existing solar arrays, and possibly biogas too, as part of a plan to go 100% renewable energy and slash production costs.

The right policy settings

Agriculture was responsible for about 16% of Australia’s greenhouse gas emissions in 2013, trending down to 13% in 2015.

The National Farmers Federation is looking to the Government’s 2017 Review of Climate Policy to deliver policy settings that will enable the sector to remain competitive and grow production at the same time as meeting international obligations.

We particularly need policy to encourage investment in agriculture research. Climate-smart practices and technologies can simultaneously reduce emissions and improve productivity and profitability.

Meanwhile, improving the design of carbon-offset markets (like the federal government’s Emissions Reduction Fund) to make them more accessible to farmers could unlock the full carbon potential of Australian farms.


Read more: Farming in 2050: storing carbon could help meet Australia’s climate goals


A recent report from Powering Agriculture, produced with international backing, showed that while food production across the world is increasing, the energy required for each unit of food is falling.

With Australia’s relatively small population, huge area and extreme temperatures, it’s hard to compare apples with apples, but the adoption of renewable energy in Australian agriculture is helping to make us look like more efficient food producers too.

Mixing renewable energy sources gives farmers a plausible path to becoming energy independent. Bioenergy, such as biogas, gives flexibility to intermittent power like solar and wind, while reducing waste and creating a home source of biofertiliser.

When you boil it down to basic science, food and fibre are just stored energy. Beyond the animals and crops farmers bring to market, the Australian agricultural sector produces massive amounts of energy – they just need the tools to monetise it.


The ConversationThe topic of Farm Energy Independence will be discussed at the upcoming TropAg Symposium.

Bernadette McCabe, Associate Professor and Principal Scientist, University of Southern Queensland and Craig Baillie, Director (National Centre for Engineering in Agriculture), University of Southern Queensland

This article was originally published on The Conversation. Read the original article.

Can two clean energy targets break the deadlock of energy and climate policy?



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Climate policy has become bogged down in the debate over a clean energy target.
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Bruce Mountain, Victoria University

Malcolm Turnbull’s government has been wrestling with the prospect of a clean energy target ever since Chief Scientist Alan Finkel recommended it in his review of Australia’s energy system. But economist Ross Garnaut has proposed a path out of the political quagmire: two clean energy targets instead of one.

Garnaut’s proposal is essentially a flexible emissions target that can be adapted to conditions in the electricity market. If electricity prices fail to fall as expected, a more lenient emissions trajectory would likely be pursued.

This proposal is an exercise in political pragmatism. If it can reassure both those who fear that rapid decarbonisation will increase energy prices, and those who argue we must reduce emissions at all costs, it represents a substantial improvement over the current state of deadlock.


Ross Garnaut/Yann Robiou DuPont, Author provided

Will two targets increase investor certainty?

At a recent Melbourne Economic Forum, Finkel pointed out that investors do not require absolute certainty to invest. After all, it is for accepting risks that they earn returns. If there was no risk to accept there would be no legitimate right to a return.

But Finkel also pointed out that investors value policy certainty and predictability. Without it, they require more handsome returns to compensate for the higher policy risks they have to absorb.


Read more: Turnbull is pursuing ‘energy certainty’ but what does that actually mean?


At first sight, having two possible emissions targets introduces yet another uncertainty (the emissions trajectory). But is that really the case? The industry is keenly aware of the political pressures that affect emissions reduction policy. If heavy reductions cause prices to rise further, there will be pressure to soften the trajectory.

Garnaut’s suggested approach anticipates this political reality and codifies it in a mechanism to determine how emissions trajectories will adjust to future prices. Contrary to first impressions, it increases policy certainty by providing clarity on how emissions policy should respond to conditions in the electricity market. This will promote the sort of policy certainty that the Finkel Review has sought to engender.

Could policymakers accept it?

Speaking of political realities, could this double target possibly accrue bipartisan support in a hopelessly divided parliament? Given Tony Abbott’s recent threat to cross the floor to vote against a clean energy target (bringing an unknown number of friends with him), the Coalition government has a strong incentive to find a compromise that both major parties can live with.


Read more: Abbott’s disruption is raising the question: where will it end?


Turnbull and his energy minister, Josh Frydenberg, who we understand are keen to see Finkel’s proposals taken up, could do worse than put this new idea on the table. They have to negotiate with parliamentary colleagues whose primary concern is the impact of household electricity bills on voters, as well as those who won’t accept winding back our emissions targets.

Reassuringly, the government can point to some precedent. Garnaut’s proposal is novel in Australia’s climate policy debate, but is reasonably similar to excise taxes on fuel, which in some countries vary as a function of fuel prices. If fuel prices decline, excise taxes rise, and vice versa. In this way, governments can achieve policy objectives while protecting consumers from the price impacts of those objectives.

The devil’s in the detail

Of course, even without the various ideologies and vested interests in this debate, many details would remain to be worked out. How should baseline prices be established? What is the hurdle to justify a more rapid carbon-reduction trajectory? What if prices tick up again, after a more rapid decarbonisation trajectory has been adopted? And what if prices don’t decline from current levels: are we locking ourselves into a low-carbon-reduction trajectory?

These issues will need to be worked through progressively, but there is no obvious flaw that should deter further consideration. The fundamental idea is attractive, and it looks capable of ameliorating concerns that rapid cuts in emissions will lock in higher electricity prices.

The ConversationFor mine, I would not be at all surprised if prices decline sharply as we begin to decarbonise, such is the staggering rate of technology development and cost reductions in renewable energy. But I may of course be wrong. Garnaut’s proposal provides a mechanism to protect consumers if this turns out to be the case.

Bruce Mountain, Director, Carbon and Energy Markets., Victoria University

This article was originally published on The Conversation. Read the original article.

A cleanish energy target gets us nowhere



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Alan Pears, RMIT University

It seems that the one certainty about any clean energy target set by the present government is that it will not drive sufficient progress towards a clean, affordable, reliable energy future. At best, it will provide a safety net to ensure that some cleanish energy supply capacity is built.

Future federal governments will have to expand or complement any target set by this government, which is compromised by its need to pander to its rump. So a cleanish energy target will not provide investment certainty for a carbon-emitting power station unless extraordinary guarantees are provided. These would inevitably be challenged in parliament and in the courts.


Read more: Turnbull is pursuing ‘energy certainty’ but what does that actually mean?


Even then, the unstoppable evolution of our energy system would leave an inflexible baseload power station without a market for much of the electricity it could generate. Instead, we must rely on a cluster of other strategies to do the heavy lifting of driving our energy market forward.

The path forward

It’s clear that consumers large and small are increasingly investing “behind the meter” in renewable energy technology, smart management systems, energy efficiency and energy storage. In so doing, they are buying insurance against future uncertainty, capturing financial benefits, and reducing their climate impacts. They are being helped by a wide range of emerging businesses and new business models, and existing energy businesses that want to survive as the energy revolution rolls on.

The Australian Energy Market Operator (AEMO) is providing critically important information on what’s needed to deliver energy objectives. The recently established Energy Security Board will work to make sure that what’s needed is done – in one way or another. Other recommendations from the Finkel Review are also helping to stabilise the electricity situation.

The recent AEMO/ARENA demand response project and various state-level energy efficiency retailer obligation schemes and renewable energy targets are examples of how important energy solutions can be driven outside the formal National Energy Market. They can bypass the snail-paced progress of reforming the NEM.

States will play a key role

State governments are setting their own renewable energy targets, based on the successful ACT government “contracts for difference” approach, discussed below. Victoria has even employed the architect of the ACT scheme, Simon Corbell. Local governments, groups of businesses and communities are developing consortia to invest in clean energy solutions using similar models.

Some see state-level actions as undermining the national approach and increasing uncertainty. I see them as examples of our multi-layered democratic system at work. Failure at one level provokes action at another.

State-level actions also reflect increasing energy diversity, and the increasing focus on distributed energy solutions. States recognise that they carry responsibilities for energy: indeed, the federal government often tries to blame states for energy failures.

There is increasing action at the network, retail and behind-the-meter levels, driven by business and communities. While national coordination is often desirable, mechanisms other than national government leadership can work to complement national action, to the extent it occurs.

Broader application of the ACT financing model

A key tool will be a shift away from the current RET model to the broader use of variations of the ACT’s contract for difference approach. The present RET model means that project developers depend on both the wholesale electricity price and the price of Large Generation Certificates (LGCs) for revenue. These are increasingly volatile and, over the long term, uncertain. In the past we have seen political interference and low RET targets drive “boom and bust” outcomes.

So, under the present RET model, any project developer faces significant risk, which makes financing more difficult and costly.

The ACT contract for difference approach applies a “market” approach by using a reverse auction, in which rival bidders compete to offer the desired service at lowest cost. It then locks in a stable price for the winners over an agreed period of time.

The approach reduces risk for the project developer, which cuts financing costs. It shifts cost risk (and opportunity) to whoever commits to buy the electricity or other service. The downside risk is fairly small when compared with the insurance of a long-term contract and the opportunity to capture savings if wholesale electricity prices increase.

The ACT government has benefited from this scheme as wholesale prices have risen. It also includes other requirements such as the creation of local jobs. This approach can be applied by agents other than governments, such as the consortium set up by the City of Melbourne.

For business and public sector consumers, the prospect of reasonably stable energy prices, with scope to benefit if wholesale prices rise and limited downside risk, is attractive in a time of uncertainty. For project developers, a stable long-term revenue stream improves project viability.

The approach can also potentially be applied to other aspects of energy service provision, such as demand response, grid stabilisation or energy efficiency. It can also be combined with the traditional “power purchase agreement” model, where the buyer of the energy guarantees a fixed price but the project developer carries the risk and opportunity of market price variations. It can also apply to part of a project’s output, to underpin it.

The ConversationWhile sorting out wholesale markets is important, we need to remember that this is just part of the energy bill. Energy waste, network operations, retailing and pricing structures such as high fixed charges must also be addressed. Some useful steps are being taken, but much more work is needed.

Alan Pears, Senior Industry Fellow, RMIT University

This article was originally published on The Conversation. Read the original article.

Finkel’s Clean Energy Target plan ‘better than nothing’: economists poll


Bruce Mountain, Victoria University

Few topics have attracted as much political attention in Australia over the past decade as emissions reduction policy.

Amid mounting concern over electricity price increases across Australia and coinciding with blackouts in South Australia and near-misses in New South Wales, the Australian government asked Chief Scientist Alan Finkel to provide a blueprint for reform of the electricity industry, in a context in which emissions reduction policy was an underlying drumbeat.

In a new poll of the ESA Monash Forum of leading economists, a majority said that Finkel’s suggested Clean Energy Target was not necessarily a better option than previously suggested policies such as an emissions trading scheme. But many added that doing nothing would be worse still.


Read more: The Finkel Review: finally, a sensible and solid footing for the electricity sector.


The Finkel Review’s terms of reference explicitly precluded it from advising on economy-wide emissions reduction policy, and implicitly required it also to reject emission reduction policies such as an emissions tax or cap and trade scheme.

One of the Finkel Review’s major recommendations was a Clean Energy Target (CET). This is effectively an extension of the existing Renewable Energy Target to cover power generation which has a greenhouse gas emissions intensity below a defined hurdle. Such generation can sell certificates which electricity retailers (and directly connected large customers) will be required to buy.

The ESA Monash Forum panel was asked to consider whether this approach was “preferable” to an emission tax or cap and trade scheme. As usual, responses could range from strong disagreement to strong agreement with an option to neither agree nor disagree. Twenty-five members of the 53-member panel voted, and most added commentary to their response – you can see a summary of their verdicts below, and their detailed comments at the end of this article.

https://datawrapper.dwcdn.net/Kzu9L/2/

A headline result from the survey is that a large majority of the panel does not think the CET is preferable to a tax or cap and trade scheme. None strongly agreed that the CET was preferable, whereas 16 either disagreed or strongly disagreed, and four agreed.

Of the four who agreed, three provided commentary to their response. Stephen King preferred the CET on the grounds of its ease of implementation but otherwise would have preferred a tax or cap and trade scheme. Michael Knox agreed on the basis that the CET was preferable to the existing Renewable Energy Target. Harry Bloch unconditionally endorsed the CET.

Of the five who neither agreed nor disagreed, three commented and two of them (Paul Frijters and John Quiggin) said there was not much to distinguish a CET from a tax or cap and trade scheme. Warwick McKibbin, who disagreed with the proposition, nonetheless also suggested that the CET, tax and cap and trade scheme were comparably effective if applied only to the electricity sector.

However, closer examination of the comments suggests much greater sympathy with Finkel’s CET recommendation than the bare numbers indicate. Even for those who strongly disagreed that the CET was preferable, none suggested that proceeding with a CET would be worse than doing nothing. But eight (Stephen King, Harry Bloch, Alison Booth, Saul Eslake, Julie Toth, Flavio Menezes, Margaret Nowak and John Quiggin) commented that proceeding with the CET would be better than doing nothing. Interestingly none of these eight explained why they thought doing something was better than doing nothing. Does it reflect a desire for greater investment certainty or a conviction that reducing emissions from electricity production in Australia is important?

Seven respondents (Stephen King, Alison Booth, Saul Eslake, Julie Toth, Gigi Foster, Lin Crase and John Quiggin) alluded to the political constraints affecting the choice, of which several drew attention to Finkel’s own observations. None of these seven suggested that the political constraint invalidated proceeding with the CET.

Of the 19 economists who provided comments on their response, 16 thought a tax or cap and trade scheme better than a CET. Numbers were equally drawn (three each) as to whether a tax or cap and trade was better than the other, with the remaining 10 invariant between a tax or cap and trade.

My overall impression is that in judging Dr Finkel’s CET recommendation, most of the panel might agree with the proposition that the “the perfect is the enemy of the roughly acceptable”. I surmise that in a decade past, many members of the panel would have held out for greater perfection, but now they think prevarication is more cost than benefit, and it is better to move on and make the best of the cards that have been dealt.

In emissions reduction policy the mainstream advice from Australia’s economists has not been persuasive. But this is hardly unique to Australia, as the pervasiveness of regulatory approaches in other countries shows. Perhaps an unavoidably compromised policy that is nonetheless well executed may be better than a brilliant policy that is poorly executed. Even if they could not have been more persuasive in design, Australia’s economists should still have much that is useful to contribute in execution. Hopefully more can be drawn into it.

Read the panel’s full responses below:

https://cdn.theconversation.com/infographics/115/8c22ecaf49b3a727fb96e8c3b50da37fd0c28f49/site/index.html


The ConversationThis is an edited version of the summary of the report’s findings originally published by the ESA Monash Forum.

Bruce Mountain, Director, Carbon and Energy Markets., Victoria University

This article was originally published on The Conversation. Read the original article.

Critical backbenchers push back on Finkel clean energy target plan



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Josh Frydenberg’s task of garnering broad support for the Finkel scheme is proving to be more difficult than expected.
Lukas Coch/AAP

Michelle Grattan, University of Canberra

A sizeable slice of his backbench has sent Malcolm Turnbull a forceful message that his road to implementing the clean energy target (CET) proposed by the Finkel inquiry will be rocky even within his own ranks.

After Energy Minister Josh Frydenberg gave an extensive briefing on the Finkel plan to the Coalition partyroom on Tuesday morning, MPs later reconvened for nearly three hours of questions and debate.

About one-third of the 30-32 who spoke expressed misgivings, according to Coalition sources. There was broad support from another third. The rest didn’t express a firm view, asking questions and seeking more information.

The report from the panel led by Chief Scientist Alan Finkel says a CET “will encourage new low emissions generation [below a threshold level of carbon dioxide per megawatt hour] into the market in a technology neutral fashion”.

A key issue will be where the government, which is disposed to adopt the Finkel plan, sets the threshold. It is clear that to accommodate the Nationals and a section of the Liberal Party it will have to be at a level that allows for the inclusion of “clean” coal.

The meeting was to gauge backbench views ahead of cabinet considering the report. Ministers, apart from the minister with carriage of the issue, don’t speak on these occasions.

Tony Abbott, who had publicly flagged his belief that the Finkel scheme represents a tax on coal, spoke strongly at the meeting.

The degree of pushback against a CET was stronger than had been anticipated, given the intense lobbying of the backbench that Frydenberg had done ahead of the meeting.

Frydenberg said afterwards: “I want to emphasise that this meeting was not making any decisions about Dr Finkel’s proposal. Rather, it was an information-gathering session.”

A common theme from backbenchers was that it was vital to be able to be confident the Finkel plan would make energy more affordable. A number of MPs, especially from outer suburban and regional areas, said affordability was what mattered most to their electorates.

Some questioned the Finkel modelling showing that prices would fall. The chairman of the backbench environment committee, Craig Kelly, said: “If you believe that you can lower prices by replacing existing coal-fired generation with higher-cost renewables, then I have a harbour bridge to sell you.”

Concern was expressed about the place of coal, and there was criticism of Finkel’s projection of an effective renewable energy target of 42% by 2030. Some backbenchers believed it would take the Coalition too close to Labor, which has a 50% target. There were also queries about the status of the Paris targets.

But Frydenberg told the ABC: “There was an overwhelming feeling among those in the party room tonight that business-as-usual is not an option.”

Asked on 7.30 “are you going to be able to get your colleagues to agree to support a clean energy target?,” Frydenberg replied: “It is too early to say.”

Finkel met with the government’s backbench environment committee on Tuesday to explain his plan and answer questions.

Frydenberg conceded that backbenchers “are concerned about the future of coal”. But he flatly rejected the Abbott suggestion that the Finkel plan amounted to a tax on coal, saying it was “absolutely not”.

“Dr Finkel has made it very clear he is not putting in place any prohibitions on coal or any form of generation capacity. He is putting in place incentives for lower emission generation. It is not a price on carbon or a tax on coal.”

The CET had “similarities to what John Howard put forward back in 2007”, Frydenberg said – a point he made in his briefing to the party meeting.

Deputy Prime Minister Barnaby Joyce also slapped down Abbott’s proposition that the CET amounted to a tax on coal, telling Sky that “Mr Abbott’s entitled to his opinion” but “there is no penalty placed on coal.

The Conversation“There is an advantage that is placed on those that are below the line. An advantage, because they get a section of a permit, which is like a payment. Those above the lines don’t … I suppose ipso facto it could be seen as not having the same advantage.”

https://www.podbean.com/media/player/icjdu-6b9a25?from=site&skin=1&share=1&fonts=Helvetica&auto=0&download=0

Michelle Grattan, Professorial Fellow, University of Canberra

This article was originally published on The Conversation. Read the original article.