Within days of its release, the Treasury modelling of the economic implications of the Rudd Government’s emissions trading scheme has come under attack.
The impact of an estimated weekly increase in energy price of about $7 for domestic consumers has been criticised as being too great for the poorer sectors of the Australian community. And energy experts and engineers claim that the economic penalties of the scheme on both domestic and industrial energy users have been grossly underestimated.
At the heart of the criticism is the controversial issue of basing Australia’s future energy supply on ”clean coal” and ”renewables”. Associated with both these technologies are a massive uncertainty and risk factors relating to their economic, technical and environmental credentials.
Ever since Climate Change and Water Minister Penny Wong in February 2008 made a populist and ”politically correct” case for their introduction, Australians have been denied realistic practical data relating to their capital and operating costs, technical parameters and national energy security implications.
It is clear to energy experts and engineers the Garnaut-Treasury model underestimates the capital cost of new power stations operating with carbon capture and sequestration. If this technology proves successful, it will presumably have to replace many of Australia’s brown-coal fuelled and older obsolescent power plants.
Treasury estimates that carbon capture and sequestration in Australia can be deployed at a carbon price of about $45 a tonne is contrary to an internationally accepted figure about twice that value.
Under such circumstances Australia’s stated carbon reduction targets for 2020 and 2050 unambiguously call for the phasing in of nuclear power over the period. This is the only way the nation will have internationally competitive energy prices in the 21st century.
Today the new paradigm in clean energy technology for planet Earth is nuclear power. Already Australian uranium supplied to 11 nuclear-powered trading partners provides them with low-cost energy security and is destined to avert about 15billion tonnes of greenhouse gas emissions over the next 20 years. Fifteen of the 16 countries that attended the recent G8 summit in Japan already have, or are in the course of planning, a major domestic nuclear power industry.
Remarkably, and sadly, the sole exception to this happens to be Australia.
Professor Ross Garnaut’s final report released at the end of September 2008 concedes that, in Australia, nuclear power could supply more than one-quarter of Australia’s electricity needs by 2050 if a proposed policy based on ”clean coal” and ”renewables” fails. However, he questions the technology on economic grounds and restates his earlier conviction that Australia is ”not the logical first home of a new nuclear capacity”.
This is one of the many areas in which he and the Rudd Government are at odds with expert world opinion.
The Rudd Government should take a special interest in the energy policy ”backflip” just announced by Italy’s Minister of Economic Development. He has stated his country’s 1987 referendum to phase out nuclear energy was a ”terrible mistake” that has damaged the nation’s economy.
He attributed a loss of more than 50 billion euro ($A93 billion) to the unavailability of nuclear power in Italy over the past 20 years and pointed out that energy costs in Italy had been at least 33 per cent higher than in Europe and 60 per cent higher than in France.
New nuclear plant construction will start in 2013 leading to a 25 per cent reliance on nuclear electricity from 10 power stations by 2036.
Earlier this year, in Barcelona, the European Union’s electricity industry executives held a conference on De-Carbonising Europe Trading Scheme.
Of the delegates, 49 per cent chose nuclear power as the key technology to lower carbon emissions, 24 per cent chose carbon capture and sequestration, and 6 per cent chose ”renewables”.
The carbon capture and sequestration advocates recognised this technology still did not exist and must not be mandated for new or existing plant. For energy security and lowest-cost emission trading the Rudd Government should follow the European example.
The Australian Government should heed the call to informed realism made at a conference of the Australian Industry Group in Canberra.
Here, BHP chairman Don Argus exhorted delegates to ”start talking seriously about using the country’s vast uranium resources for domestic use” and ”to engage in a debate about nuclear energy”.
Without nuclear power Australia will face a century of environmental, economic and geopolitical disadvantage and will miss out on the optimal technology for electricity, water and hydrogen production.
As well, the group has expressed grave concern Australia may ”move too fast and too far ahead of the rest of the world” on emission reductions. It proposed that emission caps for the initial years of an emissions trading scheme should not be more stringent than Australia’s Kyoto Protocol commitments: 108 percent of 1990 levels by 2012. The group’s Peter Byrne pleaded the pivotal role of nuclear power for achieving energy security as well as an economic and environmentally optimal energy strategy for emissions reduction.
The introduction of nuclear power and a nuclear industry into Australia is now a matter of great urgency. From the point of view of global warming, it would be desirable to have our first five nuclear power stations operating by 2020.
Without such a provision there will be little hope of meeting our stated emission reduction targets.
Australia’s efforts could well be guided by the comment made by Yvo De Boer, executive secretary of the United Nations Intergovernmental Panel on Climate Change at last December’s Bali climate conference. It was here that Australia’s Prime Minister signed the Kyoto Protocol. De Boer said, ”I have never seen a credible scenario for reducing emissions that did not include nuclear energy.”
By Leslie Kemeny (an Australian Foundation Member of the International Nuclear Energy Academy, who is also a visiting professorial research fellow and internationally acknowledged consulting nuclear scientist and engineer)
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