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112 responses to “Should gas fired power be part of the transition to green power? Guest post by John Davidson”

  1. billie

    John, Thanks for this post, your graphs have not been embedded in the post.

    As you said, at the moment half our carbon emmissions come from stationary energy, do the growth projections assume that our energy consumption per capita will remain static or continue to grow at the same rate as currently.

    I am keen that we take the interim steps to reducing our dependence on coal fired power stations.

  2. billie

    John, Thanks for this post, your graphs have not been embedded in the post.

    As you said, at the moment half our carbon emmissions come from stationary energy, do the growth projections assume that our energy consumption per capita will remain static or continue to grow at the same rate as currently.

    I am keen that we take the interim steps to reducing our dependence on coal fired power stations.

  3. Salient Green

    I think this plan would raise the price of gas rather steeply. Best we use our gas sparingly for energy generation and save it for the other vital uses it has.

    Here is a better plan from Zero Carbon Australia. http://media.beyondzeroemissions.org/ZCA-Stationary_Energy_Synopsis_20June10.pdf

  4. Salient Green

    I think this plan would raise the price of gas rather steeply. Best we use our gas sparingly for energy generation and save it for the other vital uses it has.

    Here is a better plan from Zero Carbon Australia. http://media.beyondzeroemissions.org/ZCA-Stationary_Energy_Synopsis_20June10.pdf

  5. pablo

    Your Tallawarra example is well taken and my assumption is that the gas would be sourced from Bass Strait. NSW is about to embark on construction of two 1000Mw stations with the option of coal or gas fired to be determined between now and 2014 completion. I am curious if your figures for CCGT at Tallwarra would hold for coal seam gas in the Hunter and Lithgow region. The prediction that coal seam gas from Queensland’s Seurat Basin would be needed suggests some considerable price premium would apply in NSW

  6. pablo

    Your Tallawarra example is well taken and my assumption is that the gas would be sourced from Bass Strait. NSW is about to embark on construction of two 1000Mw stations with the option of coal or gas fired to be determined between now and 2014 completion. I am curious if your figures for CCGT at Tallwarra would hold for coal seam gas in the Hunter and Lithgow region. The prediction that coal seam gas from Queensland’s Seurat Basin would be needed suggests some considerable price premium would apply in NSW

  7. Sam

    Where is the gas going to come from to fire up all these CCGT generators? There’s not nearly enough in the Cooper and Gippsland Basins. There might be enough Queensland coal seam gas, but that has been earmarked for LNG exports, at three times the domestic price.

  8. Sam

    Where is the gas going to come from to fire up all these CCGT generators? There’s not nearly enough in the Cooper and Gippsland Basins. There might be enough Queensland coal seam gas, but that has been earmarked for LNG exports, at three times the domestic price.

  9. dave

    Interesting post but I echo Sam’s response, ie replacing our coal-fired plants with gas means burning a lot more gas. However there is still merit in providing transitional stationary power plant that dovetails into existing infrastructure and produces less carbon emissions while we get our act together on so-called green power. That is assuming we are working towards green power.

  10. dave

    Interesting post but I echo Sam’s response, ie replacing our coal-fired plants with gas means burning a lot more gas. However there is still merit in providing transitional stationary power plant that dovetails into existing infrastructure and produces less carbon emissions while we get our act together on so-called green power. That is assuming we are working towards green power.

  11. Fran Barlow

    John

    In order to avoid revisiting old ground I’m going to put to one side

    a) my general preference for an ETS/effective cost on emissions to found the transition
    b) my preference for nuclear power as the greenest solution (since it seems unlikely that this will occur within the gas takeup window you are discussing). I would prefer that a tender process for replacing one or two of Australia’s dirtiest coal plants with green plants, should include a dummy bid from nuclear power operators, just to see what could be done comparatively

    That said:

    It seems to me that while CCGT is the best option that will be politically acceptable here within the next five years, it will probably be necessary to substantially augment our pumped storage capacity on the mainland if we are to make best use of what is, after all a fossil fuel resource. As much as possible, we want to avoid cycling these plants up and down, and given that we are likely to have coal plants for a very long time in this cycle and also to have a fair bit of intermittent capacity (mostly wind but perhaps a fair bit of solar thermal) that it makese sens to have more pumped storage on tap, so to speak. I’d like to see at least 2 days (i.e. 48 hours) of new peak capacity pumped hydro storage in every significant demand centre if we are going to be phasing out coal in favour of gas. That would allow sufficient scope to manage the plants and the expensive intermittents that we are going to be stuck with without serious damage or significant loss in efficiency.

    I should point out though that this does increase our exposure to loss if there is significant upward movement in gas prices, as I expect over the next 15 years.

  12. Fran Barlow

    John

    In order to avoid revisiting old ground I’m going to put to one side

    a) my general preference for an ETS/effective cost on emissions to found the transition
    b) my preference for nuclear power as the greenest solution (since it seems unlikely that this will occur within the gas takeup window you are discussing). I would prefer that a tender process for replacing one or two of Australia’s dirtiest coal plants with green plants, should include a dummy bid from nuclear power operators, just to see what could be done comparatively

    That said:

    It seems to me that while CCGT is the best option that will be politically acceptable here within the next five years, it will probably be necessary to substantially augment our pumped storage capacity on the mainland if we are to make best use of what is, after all a fossil fuel resource. As much as possible, we want to avoid cycling these plants up and down, and given that we are likely to have coal plants for a very long time in this cycle and also to have a fair bit of intermittent capacity (mostly wind but perhaps a fair bit of solar thermal) that it makese sens to have more pumped storage on tap, so to speak. I’d like to see at least 2 days (i.e. 48 hours) of new peak capacity pumped hydro storage in every significant demand centre if we are going to be phasing out coal in favour of gas. That would allow sufficient scope to manage the plants and the expensive intermittents that we are going to be stuck with without serious damage or significant loss in efficiency.

    I should point out though that this does increase our exposure to loss if there is significant upward movement in gas prices, as I expect over the next 15 years.

  13. wilful

    Can I suggest that we completely steer away from nuclear in this thread? I think everyone’s positions on the matter are rather well known, it’s been done to death a thousand times, it will be done to death many more times yet here on the site.

    That said, from reading the above it’s not clear to me what ‘green power’ is that exists (or will exist) that can produce those levels of electricity at those prices. I don’t think solar plants can be built anywhere near the locations of existing coal or gas plants.

  14. wilful

    Can I suggest that we completely steer away from nuclear in this thread? I think everyone’s positions on the matter are rather well known, it’s been done to death a thousand times, it will be done to death many more times yet here on the site.

    That said, from reading the above it’s not clear to me what ‘green power’ is that exists (or will exist) that can produce those levels of electricity at those prices. I don’t think solar plants can be built anywhere near the locations of existing coal or gas plants.

  15. Robert Merkel

    Fran, I’m not sure how much additional pumped storage capacity could be added in Australia, particularly if taking into account the reality that new dams aren’t likely to be built. There aren’t a lot of high-capacity, high-altitude reservoirs in Australia; most of them are in the Snowy Mountains scheme. Peter Lang’s conceptual proposal at BraveNewCimate is one of the few that strikes me as even vaguely plausible.

    As to the price of gas, Australian east coast domestic gas, at least, is sold significantly below the world price. If gas generation expands on the east coast, much of the extra gas will likely come from Queensland coal seam methane, and is exportable. As such, it is likely that the price of gas will rise significantly.

    Still likely to be cheaper and just as clean than wind+open cycle gas turbines, which is the favoured green option.

  16. Robert Merkel

    Fran, I’m not sure how much additional pumped storage capacity could be added in Australia, particularly if taking into account the reality that new dams aren’t likely to be built. There aren’t a lot of high-capacity, high-altitude reservoirs in Australia; most of them are in the Snowy Mountains scheme. Peter Lang’s conceptual proposal at BraveNewCimate is one of the few that strikes me as even vaguely plausible.

    As to the price of gas, Australian east coast domestic gas, at least, is sold significantly below the world price. If gas generation expands on the east coast, much of the extra gas will likely come from Queensland coal seam methane, and is exportable. As such, it is likely that the price of gas will rise significantly.

    Still likely to be cheaper and just as clean than wind+open cycle gas turbines, which is the favoured green option.

  17. Rosemary Nankivell

    Using Coal Seam Gas as an interim enery source is short-sighted. CSG uses an huge amount of water – to release the pressure to extract the gas, the CSG aquifer has to be dewatered. Queensland projections include 350,000 megalitres of water per annum and does not account for the 4.5 megs used in processes per well for exploration energy own. Projections for Queensland include 40,000 wells with exploration happening in NSW and Victoria. Figures such as CSG conversion to electricity are only 1/3 the use of water are correct but does not account for the water extracted from the coal seam – the disposal of which, being very salty and full of heavy metals, has no real soltution. Fugitive emissions of CSG are common with drilling techniques unable to to account for escaping methane. (Methane is 22.5 times more damaging to the atmosphere as a greenhouse gas.) On top of all of that it has been shown that gas extraction, by lowering water pressures can deplate aquifers – recent Environmental Impact Statements show water levels of shallow aquifers decreased by 80 metres or more. Water is a finite resource so there is every likelihood that the Murray Darling Basin would be severely impacted upon. Contamination issues in the US are huge causing sickness in both animals and humans. This is an industry which should be avoided at all costs – and much of it occurring on our major foodbowls – in the Liverpool Plains in NSW and the Darling Downs in Queensland.

  18. Rosemary Nankivell

    Using Coal Seam Gas as an interim enery source is short-sighted. CSG uses an huge amount of water – to release the pressure to extract the gas, the CSG aquifer has to be dewatered. Queensland projections include 350,000 megalitres of water per annum and does not account for the 4.5 megs used in processes per well for exploration energy own. Projections for Queensland include 40,000 wells with exploration happening in NSW and Victoria. Figures such as CSG conversion to electricity are only 1/3 the use of water are correct but does not account for the water extracted from the coal seam – the disposal of which, being very salty and full of heavy metals, has no real soltution. Fugitive emissions of CSG are common with drilling techniques unable to to account for escaping methane. (Methane is 22.5 times more damaging to the atmosphere as a greenhouse gas.) On top of all of that it has been shown that gas extraction, by lowering water pressures can deplate aquifers – recent Environmental Impact Statements show water levels of shallow aquifers decreased by 80 metres or more. Water is a finite resource so there is every likelihood that the Murray Darling Basin would be severely impacted upon. Contamination issues in the US are huge causing sickness in both animals and humans. This is an industry which should be avoided at all costs – and much of it occurring on our major foodbowls – in the Liverpool Plains in NSW and the Darling Downs in Queensland.

  19. Fran Barlow

    Wilful re: nuclear

    …. that’s why I stated my position pro forma but didn’t argue it

    Robert:

    I agree the opportunities are limited for significant augmentation of pumped storage. Ideally, you would build them at the coast so that seawater could be used, as per that plant in Okinawa, Japan. Admittedly, these would be fairly small scale, but if you could have them for no more than about $150 per kWh stored, it would be feasible.

  20. Fran Barlow

    Wilful re: nuclear

    …. that’s why I stated my position pro forma but didn’t argue it

    Robert:

    I agree the opportunities are limited for significant augmentation of pumped storage. Ideally, you would build them at the coast so that seawater could be used, as per that plant in Okinawa, Japan. Admittedly, these would be fairly small scale, but if you could have them for no more than about $150 per kWh stored, it would be feasible.

  21. Brian

    According to this article in the New Scientist there is plenty of gas in the world. And as I mentioned in this post there are plans to exploit methane clathrates. What this means for the future price of gas I wouldn’t know.

    The last Background Briefing program, entitled Gas Rush was mostly about gas in Qld. Of interest was the dramatic increase in power usage in SEQ, Swanbank converting from coal to gas, the inability to get a 15-year contract on the supply of gas, the refusal of the Queensland Govt to quarantine some of the gas for the local market, and issues with farmers on coal seam gas production.

    On quarantining, it seems that the capitalists are holding out for the big bucks from export contracts. If the Federal Govt was awake, they could have a strategy of supplying the local market which they could negotiate in relation to resource rentals. As I understand it prioritising the local market is common practice for oil producing countries.

    We looked at production issues in relation to farmers in this post. I understand that the Qld Govt has now admitted that fracturing of rock so that there is potntial interconnectivity between artesian water and salty coal seam water is a problem. Updates from James Nason and Gary Sansom.

  22. Brian

    According to this article in the New Scientist there is plenty of gas in the world. And as I mentioned in this post there are plans to exploit methane clathrates. What this means for the future price of gas I wouldn’t know.

    The last Background Briefing program, entitled Gas Rush was mostly about gas in Qld. Of interest was the dramatic increase in power usage in SEQ, Swanbank converting from coal to gas, the inability to get a 15-year contract on the supply of gas, the refusal of the Queensland Govt to quarantine some of the gas for the local market, and issues with farmers on coal seam gas production.

    On quarantining, it seems that the capitalists are holding out for the big bucks from export contracts. If the Federal Govt was awake, they could have a strategy of supplying the local market which they could negotiate in relation to resource rentals. As I understand it prioritising the local market is common practice for oil producing countries.

    We looked at production issues in relation to farmers in this post. I understand that the Qld Govt has now admitted that fracturing of rock so that there is potntial interconnectivity between artesian water and salty coal seam water is a problem. Updates from James Nason and Gary Sansom.

  23. josh

    pablo @3, those 2 power stations in NSW will be 2000MW each, not 1000. Strictly speaking the Govt has proceeded to the development consent stage and will now attempt to sell the sites by the end of the year. Also according to the Tele, Frank Sartor (Enviro Minister) has a Cabinet Minute under consideration to place a moratorium on coal power, presumably unless/until CCS is viable. No idea if he’ll win that battle but the fact it’s even made it to Cabinet is interesting and cause for some cheer.

    I agree with the general thread in the comments that the biggest obstacle for significantly more gas is the price spike of doing so – ie. the Tallawarra price is not indicative. Perhaps John Davidson could clarify his thoughts on this point.

  24. josh

    pablo @3, those 2 power stations in NSW will be 2000MW each, not 1000. Strictly speaking the Govt has proceeded to the development consent stage and will now attempt to sell the sites by the end of the year. Also according to the Tele, Frank Sartor (Enviro Minister) has a Cabinet Minute under consideration to place a moratorium on coal power, presumably unless/until CCS is viable. No idea if he’ll win that battle but the fact it’s even made it to Cabinet is interesting and cause for some cheer.

    I agree with the general thread in the comments that the biggest obstacle for significantly more gas is the price spike of doing so – ie. the Tallawarra price is not indicative. Perhaps John Davidson could clarify his thoughts on this point.

  25. Robert Merkel

    Rosemary, Brian Bahnisch has noted the environmental costs of CSG in other posts on LP; be that as it may, it seems that our governments are determined to go down that road anyway.

    The question then arises – if not CSG, what? Pipelines from the North West Shelf? LNG imports?

    Salient Green, I’ve just been reading Beyond Zero’s plan. I think their schedule is infeasible, their cost estimates dubious given the immaturity of the technology, and even if we accept the cost estimates, politically unsaleable. Let me translate “price of a cup of coffee per person, per day” into wingnut: it will go something like “100 dollars per week burden on working families”, or “the equivalent of putting interest rates up two and a half percent“. And BZE’s plan whacks us with the full cost right from the start.

    Yes, we will need to pay eventually. But, for heaven’s sake, let it phase in over a few years, please!

  26. Robert Merkel

    Rosemary, Brian Bahnisch has noted the environmental costs of CSG in other posts on LP; be that as it may, it seems that our governments are determined to go down that road anyway.

    The question then arises – if not CSG, what? Pipelines from the North West Shelf? LNG imports?

    Salient Green, I’ve just been reading Beyond Zero’s plan. I think their schedule is infeasible, their cost estimates dubious given the immaturity of the technology, and even if we accept the cost estimates, politically unsaleable. Let me translate “price of a cup of coffee per person, per day” into wingnut: it will go something like “100 dollars per week burden on working families”, or “the equivalent of putting interest rates up two and a half percent“. And BZE’s plan whacks us with the full cost right from the start.

    Yes, we will need to pay eventually. But, for heaven’s sake, let it phase in over a few years, please!

  27. Fran Barlow

    Brian

    These “plenty of gas in the world” claims are misleading. The key questions remain:

    At what price can the gas be harvested?
    At what rate of extraction?
    At what cost in externalities? Local pollution? EROEI? carbon cost?

    Do we really want to be tapping clathrates just as we are reflecting on the problems associated with deep sea mining operations?

    Would it not in any event be better to keep gas for things that can only be done economically with gas? (eg liquid fuels for heavy vehicles)

  28. Fran Barlow

    Brian

    These “plenty of gas in the world” claims are misleading. The key questions remain:

    At what price can the gas be harvested?
    At what rate of extraction?
    At what cost in externalities? Local pollution? EROEI? carbon cost?

    Do we really want to be tapping clathrates just as we are reflecting on the problems associated with deep sea mining operations?

    Would it not in any event be better to keep gas for things that can only be done economically with gas? (eg liquid fuels for heavy vehicles)

  29. Russell

    Colin Barnett says that we (W.A.) are the Saudi Arabia of gas and have enough to supply the world for years. So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it? Does China charge its domestic users world prices for its hydro power?

    This is one of the best short-term solutions for reducing emissions since we can do it easily, soon and without any dramatic change to lifestyle.

  30. Russell

    Colin Barnett says that we (W.A.) are the Saudi Arabia of gas and have enough to supply the world for years. So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it? Does China charge its domestic users world prices for its hydro power?

    This is one of the best short-term solutions for reducing emissions since we can do it easily, soon and without any dramatic change to lifestyle.

  31. p.a.travers

    I think the pumped Snowy Mountains idea is a good idea except that,that, I cannot get anyone to go near my idea of a eco- impact study to see if putting cement rendered hay bales in the snow melt zones and other areas could enhance flow rates through the present Snowy Mountains Scheme.Thus bales of straw strategic placed to increase water flow would then mean more water availability,having growers and irrigators towns etc. ready to cope more readily with the dry times.I also proffered the idea that ,maybe the present turbine blade system was inefficient.Not that anyone at this site cares,after all,it seems you are in love with the well presented.Straw bales could also be used to provide shelter for safety reasons in expanded snow usage, fauna habitat and weed barriers, fuel efficient outside building insulation,and a general work creating process.Simply accessing a much greater area of snow melt and thus directing water into the present engineering, would then ,perhaps mean a longer season of head pressure for the turbines.An environmental impact checking this out,surely can be done with other work in the field information gathering.The present leasure skiing areas could have safer contouring for learner ski etc. enthusiasts.The plan of Lang’s also includes pipes .Why not use the above space of pipes as a legitimate tourist or other pursuit!?That is bicycle or non season skiing,where water can be turned into snow,using an Israeli inventor’s technology that wasn’t allowed to compete against a government enforced monopoly.The pipes might become frozen themselves under extreme conditions and a environmental impact on the pipes need assessing.In fact wherever there are these similar large pipes some development should occur on them,as a matter of economic sense and oppurtunity.There is also the potential unresearched at the moment,of the gaseous expressions of imploding in Silos as a result of a combination of various gases.If a silo can handle these implosions then the exploitation of prolonged implosion for electric generation or other use,eg. furnace,as in use for pig nickel or even ceramic development hasn’t occurred to the research dingbats.Who always look overseas first.Th only option the non qualified have over the trained is embarassing people.It seems Australian isn’t good enough.There are also coal mines below the oceans in a part of N.S.W. and a recent theory of what has been happening in the Gulf of Mexico suggests they hit a tar volcano and pumped oil from other rigs.These tar deposits eventually allow highly productive ecologies to grow on them as the volcanic stuff spreads across the sea bottom.Could it be a engineering feat of drilling up or down into this particular mine may allow the same pumped reality as in the Snowy Mountain scheme,mentioned above!?

  32. p.a.travers

    I think the pumped Snowy Mountains idea is a good idea except that,that, I cannot get anyone to go near my idea of a eco- impact study to see if putting cement rendered hay bales in the snow melt zones and other areas could enhance flow rates through the present Snowy Mountains Scheme.Thus bales of straw strategic placed to increase water flow would then mean more water availability,having growers and irrigators towns etc. ready to cope more readily with the dry times.I also proffered the idea that ,maybe the present turbine blade system was inefficient.Not that anyone at this site cares,after all,it seems you are in love with the well presented.Straw bales could also be used to provide shelter for safety reasons in expanded snow usage, fauna habitat and weed barriers, fuel efficient outside building insulation,and a general work creating process.Simply accessing a much greater area of snow melt and thus directing water into the present engineering, would then ,perhaps mean a longer season of head pressure for the turbines.An environmental impact checking this out,surely can be done with other work in the field information gathering.The present leasure skiing areas could have safer contouring for learner ski etc. enthusiasts.The plan of Lang’s also includes pipes .Why not use the above space of pipes as a legitimate tourist or other pursuit!?That is bicycle or non season skiing,where water can be turned into snow,using an Israeli inventor’s technology that wasn’t allowed to compete against a government enforced monopoly.The pipes might become frozen themselves under extreme conditions and a environmental impact on the pipes need assessing.In fact wherever there are these similar large pipes some development should occur on them,as a matter of economic sense and oppurtunity.There is also the potential unresearched at the moment,of the gaseous expressions of imploding in Silos as a result of a combination of various gases.If a silo can handle these implosions then the exploitation of prolonged implosion for electric generation or other use,eg. furnace,as in use for pig nickel or even ceramic development hasn’t occurred to the research dingbats.Who always look overseas first.Th only option the non qualified have over the trained is embarassing people.It seems Australian isn’t good enough.There are also coal mines below the oceans in a part of N.S.W. and a recent theory of what has been happening in the Gulf of Mexico suggests they hit a tar volcano and pumped oil from other rigs.These tar deposits eventually allow highly productive ecologies to grow on them as the volcanic stuff spreads across the sea bottom.Could it be a engineering feat of drilling up or down into this particular mine may allow the same pumped reality as in the Snowy Mountain scheme,mentioned above!?

  33. pablo

    Josh @12 thanks for the Mega correction. I may not have said it but CSG sourced from within the Hunter is not considered sufficient to run a couple of big new 2000Mw stations for any economic length of time.

  34. pablo

    Josh @12 thanks for the Mega correction. I may not have said it but CSG sourced from within the Hunter is not considered sufficient to run a couple of big new 2000Mw stations for any economic length of time.

  35. Brian

    Fran @ 14, I was talking quantities rather than feasibility or desirability. On mining clathrates I would simply note from my earlier post:

    The countries actively pursuing the stuff include the US, Canada, Germany, India, Japan, China and South Korea. First cab off the rank may well be South Korea who plan production by 2015. The Japanese hope to be in business by 2016.

    John D, I’ve just found an indent tag which I’d never used before and have reformatted the post to get it as near as possible to the Word original. Looks a bit better now, but hope I haven’t stuffed anything fiddling with it.

  36. Brian

    Fran @ 14, I was talking quantities rather than feasibility or desirability. On mining clathrates I would simply note from my earlier post:

    The countries actively pursuing the stuff include the US, Canada, Germany, India, Japan, China and South Korea. First cab off the rank may well be South Korea who plan production by 2015. The Japanese hope to be in business by 2016.

    John D, I’ve just found an indent tag which I’d never used before and have reformatted the post to get it as near as possible to the Word original. Looks a bit better now, but hope I haven’t stuffed anything fiddling with it.

  37. Tim Macknay

    As to the price of gas, Australian east coast domestic gas, at least, is sold significantly below the world price.

    The same applies in WA, Robert.

    So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it?

    Russell, 55% of WA’s electricity generation is gas, a much higher level than the rest of the country. Most of the rest is coal (which is cheaper again) and a small amount of wind and solar. We don’t pay ‘world prices’ for gas – gas in WA is incredibly cheap. The main reason the oil and gas industry was upset by the former Carpenter government’s plan to make them set a aside a portion of their reserves for domestic use was that the domestic price is vastly lower than the international one.

  38. Tim Macknay

    As to the price of gas, Australian east coast domestic gas, at least, is sold significantly below the world price.

    The same applies in WA, Robert.

    So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it?

    Russell, 55% of WA’s electricity generation is gas, a much higher level than the rest of the country. Most of the rest is coal (which is cheaper again) and a small amount of wind and solar. We don’t pay ‘world prices’ for gas – gas in WA is incredibly cheap. The main reason the oil and gas industry was upset by the former Carpenter government’s plan to make them set a aside a portion of their reserves for domestic use was that the domestic price is vastly lower than the international one.

  39. Fran Barlow

    Russell asked

    Colin Barnett says that we (W.A.) are the Saudi Arabia of gas and have enough to supply the world for years. So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it?

    Because if you don’t pay the world price for a commodity that is traded on world markets, the incentive to invest in harvesting the commodity here declines, so the gas you could recover doesn’t get recovered. In effect, you are penalising people for investing in prospecting here, all else being about equal. Not only that, unless you prevent the gas being ported offshore without a world price parity tariff, you simply hand this margin to traders. This is essentially why we also have world parity pricing on oil from Bass Strait. We don’t want to give it away cheap.

    It also becomes an incentive to use the resource wastefully, which, evidently, is something we don’t want to do with fossil fuels. That is essentially what Iran does with its oil, with the result that there’s an oil and fuel smuggling business between Iran and its neighbours. The governmen is subsidising the cost of local oil usage to the detriment of its cash balance, when it could, if it wanted to, charge the full price and use that money to subsidise its citizens’ lifestyle choices at the expense of smugglers and sharp traders.

    Does China charge its domestic users world prices for its hydro power?

    No, but Chinese hydro power is not tradeable on world markets. You can’t stick it in a box and ship it offshore. OTOH, Norway does charge the grid price for its hydro power both locally and in the trade with Denmark, Sweden and Germany.

  40. Fran Barlow

    Russell asked

    Colin Barnett says that we (W.A.) are the Saudi Arabia of gas and have enough to supply the world for years. So why don’t we use it for our own electricity generation, and why do we have to pay world prices for it?

    Because if you don’t pay the world price for a commodity that is traded on world markets, the incentive to invest in harvesting the commodity here declines, so the gas you could recover doesn’t get recovered. In effect, you are penalising people for investing in prospecting here, all else being about equal. Not only that, unless you prevent the gas being ported offshore without a world price parity tariff, you simply hand this margin to traders. This is essentially why we also have world parity pricing on oil from Bass Strait. We don’t want to give it away cheap.

    It also becomes an incentive to use the resource wastefully, which, evidently, is something we don’t want to do with fossil fuels. That is essentially what Iran does with its oil, with the result that there’s an oil and fuel smuggling business between Iran and its neighbours. The governmen is subsidising the cost of local oil usage to the detriment of its cash balance, when it could, if it wanted to, charge the full price and use that money to subsidise its citizens’ lifestyle choices at the expense of smugglers and sharp traders.

    Does China charge its domestic users world prices for its hydro power?

    No, but Chinese hydro power is not tradeable on world markets. You can’t stick it in a box and ship it offshore. OTOH, Norway does charge the grid price for its hydro power both locally and in the trade with Denmark, Sweden and Germany.

  41. Fran Barlow

    Brian

    I’d love the OL and UL + li tags to be included in the available tags

  42. Fran Barlow

    Brian

    I’d love the OL and UL + li tags to be included in the available tags

  43. Rosemary Nankivell

    This topic started off about meeting our emission targets. Let me state again, the Murray Darling Basin and Great Artesian Basin would not withstand the extracton of CSG – short-term, unregulated industry capable of doing serious harm in our best and most reliable food bowls. The destruction of the agricultural industries in these areas will result in food having to be imported – surely this will only increase our emissions. Water is the most critical issue in Australia today – with vast amounts of money being spent on irrigation buybacks and layers of bureauocracy such as the relatively new Murray-Darling Basin Authority and the new Groundwater Centre in Adelaide and yet the CSG industry is being encouraged. Perhaps we are just a selfish generation more concerned with not changing our lifestyles at the expense of future generations.

  44. Rosemary Nankivell

    This topic started off about meeting our emission targets. Let me state again, the Murray Darling Basin and Great Artesian Basin would not withstand the extracton of CSG – short-term, unregulated industry capable of doing serious harm in our best and most reliable food bowls. The destruction of the agricultural industries in these areas will result in food having to be imported – surely this will only increase our emissions. Water is the most critical issue in Australia today – with vast amounts of money being spent on irrigation buybacks and layers of bureauocracy such as the relatively new Murray-Darling Basin Authority and the new Groundwater Centre in Adelaide and yet the CSG industry is being encouraged. Perhaps we are just a selfish generation more concerned with not changing our lifestyles at the expense of future generations.

  45. adrian

    No perhaps about it!

  46. adrian

    No perhaps about it!

  47. "...Chop Chop"

    Am I right to conclude that this thread says that Gas will not be here forever?!!?

  48. "...Chop Chop"

    Am I right to conclude that this thread says that Gas will not be here forever?!!?

  49. Russell

    Tim, thanks for that information, I didn’t think our use of gas for electricity generation was that high. I just Googled and found an answer to a question in parliament in 2008 which says 59%, so that’s good. Maybe 85% would be better?

    The system of having producers set aside some gas for domestic use at a cheaper price seems a good solution to Fran’s point that if the price wasn’t high enough nobody would look for it. Should we be piping or shipping more of W.A.’s LNG to Sydney and Melbourne?

  50. Russell

    Tim, thanks for that information, I didn’t think our use of gas for electricity generation was that high. I just Googled and found an answer to a question in parliament in 2008 which says 59%, so that’s good. Maybe 85% would be better?

    The system of having producers set aside some gas for domestic use at a cheaper price seems a good solution to Fran’s point that if the price wasn’t high enough nobody would look for it. Should we be piping or shipping more of W.A.’s LNG to Sydney and Melbourne?

  51. john

    Seriously, transition electricity generators are not really needed. Because in most states, power plants are owned and run by the State Government, all that needs to happen is the State Govt. building fully renewable power stations with the money the federal hospital deal will save them. It’s not complicated; just expensive.

  52. john

    Seriously, transition electricity generators are not really needed. Because in most states, power plants are owned and run by the State Government, all that needs to happen is the State Govt. building fully renewable power stations with the money the federal hospital deal will save them. It’s not complicated; just expensive.

  53. Ron

    This seems a ‘theory’ :based not on Yallourn station and no ROI basis at all , is short term , and ignores oz most precous commodity (water) and massive methane risks (its co2 toxic compared to brown Coal)

    further there seems (by some) non accepting world Gas prices will apply , Globilzation did happen

    Worst of all it seems this “thoeory” does not say by what mechanism Private Sector all of a sudden will invest billions on unknown rates of Return …..unless people all of a sudden hav twigged that a CRPS was needed afterall to drive investment

    but then one then has to look at comparative cost of carbon elsewhere in World as well…which is why a Worldd agrement and CPRS ar needed

  54. Ron

    This seems a ‘theory’ :based not on Yallourn station and no ROI basis at all , is short term , and ignores oz most precous commodity (water) and massive methane risks (its co2 toxic compared to brown Coal)

    further there seems (by some) non accepting world Gas prices will apply , Globilzation did happen

    Worst of all it seems this “thoeory” does not say by what mechanism Private Sector all of a sudden will invest billions on unknown rates of Return …..unless people all of a sudden hav twigged that a CRPS was needed afterall to drive investment

    but then one then has to look at comparative cost of carbon elsewhere in World as well…which is why a Worldd agrement and CPRS ar needed

  55. Elise

    Instead of retrofitting coal-fired power stations, or constructing new CCGT stations, what about a widespread use of BlueGen power generation units?

    A CSIRO study indicates a significant emissions reduction from use of high efficiency BlueGen systems. They show up as better than solar PV, mainly because they run 24/7. This would satisfy the complaints of those who want a continuous power source, and those who do not have any north-facing roof area for solar panels (due to house orientation or flat-dwelling).

    Provided the government has a good FIT (feed-in tariff), BlueGen take-up could be quite quick – easy installation and feelgood factor matched to financial incentives.

    Here is the CFCL summary announcement (check out the graph): http://www.cfcl.com.au/Assets/Files/20100621_CFCL_CSIRO_Report_ASX.pdf

    Here is the full CSIRO report: http://www.cfcl.com.au/Assets/Files/20100621_CFCL_CSIRO_Report_BlueGen_Emissions_Savings.pdf

    If we are going to do a side-by-side comparison with nuclear, for goodness sake do the same with BlueGen.

  56. Elise

    Instead of retrofitting coal-fired power stations, or constructing new CCGT stations, what about a widespread use of BlueGen power generation units?

    A CSIRO study indicates a significant emissions reduction from use of high efficiency BlueGen systems. They show up as better than solar PV, mainly because they run 24/7. This would satisfy the complaints of those who want a continuous power source, and those who do not have any north-facing roof area for solar panels (due to house orientation or flat-dwelling).

    Provided the government has a good FIT (feed-in tariff), BlueGen take-up could be quite quick – easy installation and feelgood factor matched to financial incentives.

    Here is the CFCL summary announcement (check out the graph): http://www.cfcl.com.au/Assets/Files/20100621_CFCL_CSIRO_Report_ASX.pdf

    Here is the full CSIRO report: http://www.cfcl.com.au/Assets/Files/20100621_CFCL_CSIRO_Report_BlueGen_Emissions_Savings.pdf

    If we are going to do a side-by-side comparison with nuclear, for goodness sake do the same with BlueGen.

  57. Salient Green

    John @ 26 I agree, why fuck around with converting everything to gas when you can go straight to renewables? Obviously a lot of very smart people think it is feasible Robert @ 13.

  58. Salient Green

    John @ 26 I agree, why fuck around with converting everything to gas when you can go straight to renewables? Obviously a lot of very smart people think it is feasible Robert @ 13.

  59. john

    @29

    And electricity prices don’t actually have to go up that much, because government can run the plants at a loss, or at cost. Services don’t have to make money.

  60. john

    @29

    And electricity prices don’t actually have to go up that much, because government can run the plants at a loss, or at cost. Services don’t have to make money.

  61. Sam

    “So why don’t we use it for our own electricity generation”?

    Because building pipelines to transport gas from west to east is very expensive.

  62. Sam

    “So why don’t we use it for our own electricity generation”?

    Because building pipelines to transport gas from west to east is very expensive.

  63. Fran Barlow

    John sauid:

    And electricity prices don’t actually have to go up that much, because government can run the plants at a loss, or at cost. Services don’t have to make money.

    That is true. Clearly, one doesn’t expect to make money on public libraries or in welfare services or even standard public hospital functions. It is worth noting though that money foregone is the same as money spent. The state running power plants at less than the market price entails a political decision to transfer benefits from the commons to the users of the subsidised power. That may well be OK if all of these beneficiaries of cheap power are getting benefits that are more important than any other public benefit charging the market rate could offer them, but is this the case?

    Probably not. Some of the beneficiaries will be wealthy people, who don’t need a subsidy and would not qualify for one, so the subsidy is regressive, to the extent it denies funds being applied to something more worthy than having a person on $150K each year getting the power to run their 11-bedroom mansion on the cheap. Could we think of anything more useful than that?

    I’d say so.

    Even if we just stay with power costs, would it not make more sense to supply power cheaply to those who are incomes too low to have 11-bedroom houses and fund this by having the people who can afford it pay full market price?

    Again, I’d say so. We should charge very close to what the traffic will bear and then, if necessary, allow low income people a rebate on power costs, or perhaps even better in some cases simply give them more income or other benefits so that they can pay for what they need.

  64. Fran Barlow

    John sauid:

    And electricity prices don’t actually have to go up that much, because government can run the plants at a loss, or at cost. Services don’t have to make money.

    That is true. Clearly, one doesn’t expect to make money on public libraries or in welfare services or even standard public hospital functions. It is worth noting though that money foregone is the same as money spent. The state running power plants at less than the market price entails a political decision to transfer benefits from the commons to the users of the subsidised power. That may well be OK if all of these beneficiaries of cheap power are getting benefits that are more important than any other public benefit charging the market rate could offer them, but is this the case?

    Probably not. Some of the beneficiaries will be wealthy people, who don’t need a subsidy and would not qualify for one, so the subsidy is regressive, to the extent it denies funds being applied to something more worthy than having a person on $150K each year getting the power to run their 11-bedroom mansion on the cheap. Could we think of anything more useful than that?

    I’d say so.

    Even if we just stay with power costs, would it not make more sense to supply power cheaply to those who are incomes too low to have 11-bedroom houses and fund this by having the people who can afford it pay full market price?

    Again, I’d say so. We should charge very close to what the traffic will bear and then, if necessary, allow low income people a rebate on power costs, or perhaps even better in some cases simply give them more income or other benefits so that they can pay for what they need.

  65. Fran Barlow

    Of course Elise, however good these systems are, they don’t address industrial demand.

    We are still going to have plants like Hazelwood spewing out their toxic effluent and CO2. That,surely, was the target for John’s proposal.

    I note that in the course of mentioning “Blue Gen” nowhere do you mention the key input: natural gas. In essence, you are proposing the setting up hundreds of thousands of SOFC-based NG-fuelled power plants that have about a five-year life-span.

    The numbers might add up to being worthwhile, especially for those who have gas hot water, don’t have solar panels and aren’t renting, but it’s at best a marginal solution.

  66. Fran Barlow

    Of course Elise, however good these systems are, they don’t address industrial demand.

    We are still going to have plants like Hazelwood spewing out their toxic effluent and CO2. That,surely, was the target for John’s proposal.

    I note that in the course of mentioning “Blue Gen” nowhere do you mention the key input: natural gas. In essence, you are proposing the setting up hundreds of thousands of SOFC-based NG-fuelled power plants that have about a five-year life-span.

    The numbers might add up to being worthwhile, especially for those who have gas hot water, don’t have solar panels and aren’t renting, but it’s at best a marginal solution.

  67. Razor

    Of course all this is based on the assumption that we want to reduce our use of carbon based energy.

    I don’t, because nothing is cheaper at the moment.

  68. Razor

    Of course all this is based on the assumption that we want to reduce our use of carbon based energy.

    I don’t, because nothing is cheaper at the moment.

  69. sg

    Fran, are you advocating a personal carbon budget?

    Razor, you don’t want to reduce your use of carbon because you’re ignorant and incapable of understanding basic science.

  70. sg

    Fran, are you advocating a personal carbon budget?

    Razor, you don’t want to reduce your use of carbon because you’re ignorant and incapable of understanding basic science.

  71. Fran Barlow

    SG asked:

    Fran, are you advocating a personal carbon budget?

    I’m actually quite attracted to the idea, but I wasn’t doing that here. It might be quite hard to set up and politically, I suppose a lot of people would hate it –and if that were a majority, that would give me pause. There would be some serious problems trying to give everything a carbon intensity that was accurate in real time and that challenge alone might be insuperable.

    Razor: Your implicit proposal that carbon-based fuels should be used until there is something cheaper is flawed, because the externalities associated with carbon fuels are not included in the price. Moreover by the time that such fuels become more expensive than the alternatives notwithstanding these externalities, it will be too late to transition without serious disruption to normal life and major expense. Everything weill need to be fast-tracked and work like a charm first time — which is unrealistic. There will be much waste and much profiteering. The costs in climate change terms would be catastrophic.

    It’s regrettable that you feel no obligation to underpin the life chances of people reaching adulthood in 2030 and later, but this is why your attitude is not shared by most educated people.

  72. Fran Barlow

    SG asked:

    Fran, are you advocating a personal carbon budget?

    I’m actually quite attracted to the idea, but I wasn’t doing that here. It might be quite hard to set up and politically, I suppose a lot of people would hate it –and if that were a majority, that would give me pause. There would be some serious problems trying to give everything a carbon intensity that was accurate in real time and that challenge alone might be insuperable.

    Razor: Your implicit proposal that carbon-based fuels should be used until there is something cheaper is flawed, because the externalities associated with carbon fuels are not included in the price. Moreover by the time that such fuels become more expensive than the alternatives notwithstanding these externalities, it will be too late to transition without serious disruption to normal life and major expense. Everything weill need to be fast-tracked and work like a charm first time — which is unrealistic. There will be much waste and much profiteering. The costs in climate change terms would be catastrophic.

    It’s regrettable that you feel no obligation to underpin the life chances of people reaching adulthood in 2030 and later, but this is why your attitude is not shared by most educated people.

  73. sg

    Fran, I wonder if there are ways to implicitly price a carbon budget into the cost of electricity, the way they are (were?) costed into household water. So you have a free allocation and then a low-cost pay-per-unit allocation and then a high-cost pay-per-unit allocation. That enables you to subsidize basic use from green power without subsidizing the rich. Maybe.

    I think I’ve read about this for air travel too, so your first trip for the year is cheap, your second trip is moderately expensive, and then it scales up from there. Possibly impractical to implement, but with ID cards and modern computer systems…

    (I’m a fan of ID cards).

  74. sg

    Fran, I wonder if there are ways to implicitly price a carbon budget into the cost of electricity, the way they are (were?) costed into household water. So you have a free allocation and then a low-cost pay-per-unit allocation and then a high-cost pay-per-unit allocation. That enables you to subsidize basic use from green power without subsidizing the rich. Maybe.

    I think I’ve read about this for air travel too, so your first trip for the year is cheap, your second trip is moderately expensive, and then it scales up from there. Possibly impractical to implement, but with ID cards and modern computer systems…

    (I’m a fan of ID cards).

  75. Fran Barlow

    Well actually I’m also a fan of ID cards … but that’s another thing.

    I would keep it simple. Give every household head a certain minimum number of free carbon credits — it could start quite high — up around the 25Kg CO2e per person per day — which would make us slightly more economical than the average European but which ought to be plenty for most people. Everyone gets a biometrically secure smart card which they swipe everytime goods and services are bought or bills paid for.

    If people want to buy more credits they can do so at the checkout which will offer them at the prevailing auctioned rate, or they can purchase at other EFTPOS points or over the web. They can also sell their credits into the same market. Providing the goods and services are fairly accurately specified and this information is available at the effective decision-making point, this should be fine.

    Each year, the cap gets a little lower until we reach the desired cap we want by 2020, 2025, 2030 and so forth.

    We also provide means-tested access to community services like local food banks, laundry services and build quality low-carbon public housing and transport. We also use the funds raised to establish low carbon energy production. We abandon fossil fuel subsidies and make dirty energy pro-rata non-deductible in business costs, based on how dirty it is compared to coal or petro-diesel.

    We impose border tariff adjustments on goods that don’t meet our standards of Co2 compliance.

    We lift the ban on nuclear energy and begin rolling out third and fourth gen plants.

    By 2030, we would be well on the way to a 90% cut on 1990 by 2050.

  76. Fran Barlow

    Well actually I’m also a fan of ID cards … but that’s another thing.

    I would keep it simple. Give every household head a certain minimum number of free carbon credits — it could start quite high — up around the 25Kg CO2e per person per day — which would make us slightly more economical than the average European but which ought to be plenty for most people. Everyone gets a biometrically secure smart card which they swipe everytime goods and services are bought or bills paid for.

    If people want to buy more credits they can do so at the checkout which will offer them at the prevailing auctioned rate, or they can purchase at other EFTPOS points or over the web. They can also sell their credits into the same market. Providing the goods and services are fairly accurately specified and this information is available at the effective decision-making point, this should be fine.

    Each year, the cap gets a little lower until we reach the desired cap we want by 2020, 2025, 2030 and so forth.

    We also provide means-tested access to community services like local food banks, laundry services and build quality low-carbon public housing and transport. We also use the funds raised to establish low carbon energy production. We abandon fossil fuel subsidies and make dirty energy pro-rata non-deductible in business costs, based on how dirty it is compared to coal or petro-diesel.

    We impose border tariff adjustments on goods that don’t meet our standards of Co2 compliance.

    We lift the ban on nuclear energy and begin rolling out third and fourth gen plants.

    By 2030, we would be well on the way to a 90% cut on 1990 by 2050.

  77. Ron

    John Davidson

    my #27 post indicated numerous reasons against your specific proposal , but i do applaud you on most of th ‘model’ fundamentals you’ve used & passed on , and your 2050 emphasis , unlike hair brain alternitives that followed

    SG
    “Razor, you don’t want to reduce your use of carbon because you’re ignorant and incapable of understanding basic science.”

    none of your ideas stack up to reality , whereas Razor does highlite a correct cost point , no price on carbon and no market place mechanism , a la a CPRS…. and until that occurs WITH Private Sector involvment there will be no co2 mitigaton which is why Greens ar in fantasyland in practicalities of how to reduce

  78. Ron

    John Davidson

    my #27 post indicated numerous reasons against your specific proposal , but i do applaud you on most of th ‘model’ fundamentals you’ve used & passed on , and your 2050 emphasis , unlike hair brain alternitives that followed

    SG
    “Razor, you don’t want to reduce your use of carbon because you’re ignorant and incapable of understanding basic science.”

    none of your ideas stack up to reality , whereas Razor does highlite a correct cost point , no price on carbon and no market place mechanism , a la a CPRS…. and until that occurs WITH Private Sector involvment there will be no co2 mitigaton which is why Greens ar in fantasyland in practicalities of how to reduce

  79. David Irving (no relation)

    Don’t own up to liking ID cards, Fran. Next thing you know, some glibertarian will accuse you of being a green nazi, and drag in eugenics.

  80. David Irving (no relation)

    Don’t own up to liking ID cards, Fran. Next thing you know, some glibertarian will accuse you of being a green nazi, and drag in eugenics.

  81. John D

    Salient Green @2: Our per capita power consumption is about 10,000 kWh/yr. (Includes power going into exports as well as home consumption.) At this rate a one cent per kWh price increase costs an average of $100/yr/person or $0.27/day per person. By contrast, the cost of one $3.50 cup of coffee per day mentioned in your “better” plan costs $1278/yr thus increasing the cost of power by a massive 13 cents/kWh.

    It would be nice if we could clean up electricity by the end of 2020. However, there is no community support for a price increase implied by the cup of coffee analogy – hence the desirability of considering a transition policy that achieves very useful reductions at a daily price that could be sold politically.

    Ron @27: If the government were to start the process of setting up contracts for the supply of cleaner electricity and signaled that transition proposals would be considered I would expect companies such as Leighton would be very keen to be awarded some of these contracts even if they were awarded on a BOO basis (Contractor builds, owns and operates) In addition, existing coal fired generators would see the writing on the wall and be keen to stay in the business by converting to gas. This is why companies such as TRUenergy are building CCGT plants and are looking for a deal that will make converting their old coal fired plants worthwhile.
    Further expressions of interest may come from companies that hold gas leases. For them it is an opportunity to increase their profits by producing electricity as well as selling gas. It is worth noting that many of the new peak power gas turbine plants in Qld are located around gas pipelines in the Dalby region.

    Keep in mind that existing power stations in the right position may decide increase their capacity as part of the conversion so there is no need for all coal fired stations to convert.

    Palbo @3: I would emphasize that the costs I quoted in the post should be treated with caution since they are based on a very limited amount of information. I claim no expertise in the location of the Australia’s gas reserves or the economics of producing gas fired power in various locations.

  82. John D

    Salient Green @2: Our per capita power consumption is about 10,000 kWh/yr. (Includes power going into exports as well as home consumption.) At this rate a one cent per kWh price increase costs an average of $100/yr/person or $0.27/day per person. By contrast, the cost of one $3.50 cup of coffee per day mentioned in your “better” plan costs $1278/yr thus increasing the cost of power by a massive 13 cents/kWh.

    It would be nice if we could clean up electricity by the end of 2020. However, there is no community support for a price increase implied by the cup of coffee analogy – hence the desirability of considering a transition policy that achieves very useful reductions at a daily price that could be sold politically.

    Ron @27: If the government were to start the process of setting up contracts for the supply of cleaner electricity and signaled that transition proposals would be considered I would expect companies such as Leighton would be very keen to be awarded some of these contracts even if they were awarded on a BOO basis (Contractor builds, owns and operates) In addition, existing coal fired generators would see the writing on the wall and be keen to stay in the business by converting to gas. This is why companies such as TRUenergy are building CCGT plants and are looking for a deal that will make converting their old coal fired plants worthwhile.
    Further expressions of interest may come from companies that hold gas leases. For them it is an opportunity to increase their profits by producing electricity as well as selling gas. It is worth noting that many of the new peak power gas turbine plants in Qld are located around gas pipelines in the Dalby region.

    Keep in mind that existing power stations in the right position may decide increase their capacity as part of the conversion so there is no need for all coal fired stations to convert.

    Palbo @3: I would emphasize that the costs I quoted in the post should be treated with caution since they are based on a very limited amount of information. I claim no expertise in the location of the Australia’s gas reserves or the economics of producing gas fired power in various locations.

  83. Salient Green

    John D @ 41, you wouldn’t be one of those who think you’re being clever by misrepresenting the facts would you?

    The Cup of Coffee analogy is the total investment cost, not a kw/hr cost and will not be reflected in a rise in electicity prices such as you have erroneously suggested. See the graph on page 7 and read page 8 for a kw/hr price of 5-6cents in 2020.

    This is not MY report and I don’t appreciate you foisting ownership onto me. However, I am happy to support it in this discussion. We need to get to 100% renewable power sometime anyway. Not that this plan has a snowballs chance in hell of being implemented by either of the major parties who pretty much lack the vision and courage needed.

  84. Salient Green

    John D @ 41, you wouldn’t be one of those who think you’re being clever by misrepresenting the facts would you?

    The Cup of Coffee analogy is the total investment cost, not a kw/hr cost and will not be reflected in a rise in electicity prices such as you have erroneously suggested. See the graph on page 7 and read page 8 for a kw/hr price of 5-6cents in 2020.

    This is not MY report and I don’t appreciate you foisting ownership onto me. However, I am happy to support it in this discussion. We need to get to 100% renewable power sometime anyway. Not that this plan has a snowballs chance in hell of being implemented by either of the major parties who pretty much lack the vision and courage needed.

  85. Salient Green

    There’s more info on the Zero Carbon Australia report here http://beyondzeroemissions.org/zero-carbon-australia-2020

  86. Salient Green

    There’s more info on the Zero Carbon Australia report here http://beyondzeroemissions.org/zero-carbon-australia-2020

  87. Elise

    At a slight tangent, did anyone else watch the 7:30 Report segment on BlueGen? A genuine Aussie development with a HUGE potential international market, but is going begging for support in Australia. Typical. Just typical.

    They interviewed Penny Wong and Christine Milne for their thoughts. Both were really, really disappointing, for different reasons.

    Wong has absolutely no idea about technology. She claimed that HW Heat Pumps were similar to solar energy, and thus should be part of the REC’s scheme, because they “took heat out of the air to put into water”. However, the BlueGen unit uses natural gas and thus has a carbon footprint, so should not be included in the REC’s scheme.

    My God. The technical ignorance in Wong’s statement beggars belief. I recommend that the reverse cycle airconditioner manufacturers should get after Wong for their REC’s now, since they too take energy from the outside air to provide household heat energy. The only difference is they heat air, rather than water. It is absolutely similar technology. And both use electrical energy to drive them…from coal fired power stations, which indeed means heat pumps also have a carbon footprint.

    The heat pump manufacturers have done a terrific sales job on Wong, as better half remarked wryly. That’s what you get when the government is full of lawyers, trying to make decisions on technology. NO.BLOODY.CLUE.

    Milne then topped the nonsense off with the typical Greens position that anything less than 100% was not a useful solution. Indeed. So we have the hypocracy of supporting one low emissions technology with a small carbon footprint (heat pumps), and not supporting another low emissions technology with a small carbon footprint (fuel cells). Brilliant. Just Brilliant.

    Serve Australia bloody well right, if BlueGen goes offshore, and we miss out once again on a home-grown technology which could provide a new alternative export industry.

  88. Elise

    At a slight tangent, did anyone else watch the 7:30 Report segment on BlueGen? A genuine Aussie development with a HUGE potential international market, but is going begging for support in Australia. Typical. Just typical.

    They interviewed Penny Wong and Christine Milne for their thoughts. Both were really, really disappointing, for different reasons.

    Wong has absolutely no idea about technology. She claimed that HW Heat Pumps were similar to solar energy, and thus should be part of the REC’s scheme, because they “took heat out of the air to put into water”. However, the BlueGen unit uses natural gas and thus has a carbon footprint, so should not be included in the REC’s scheme.

    My God. The technical ignorance in Wong’s statement beggars belief. I recommend that the reverse cycle airconditioner manufacturers should get after Wong for their REC’s now, since they too take energy from the outside air to provide household heat energy. The only difference is they heat air, rather than water. It is absolutely similar technology. And both use electrical energy to drive them…from coal fired power stations, which indeed means heat pumps also have a carbon footprint.

    The heat pump manufacturers have done a terrific sales job on Wong, as better half remarked wryly. That’s what you get when the government is full of lawyers, trying to make decisions on technology. NO.BLOODY.CLUE.

    Milne then topped the nonsense off with the typical Greens position that anything less than 100% was not a useful solution. Indeed. So we have the hypocracy of supporting one low emissions technology with a small carbon footprint (heat pumps), and not supporting another low emissions technology with a small carbon footprint (fuel cells). Brilliant. Just Brilliant.

    Serve Australia bloody well right, if BlueGen goes offshore, and we miss out once again on a home-grown technology which could provide a new alternative export industry.

  89. John D

    [email protected]: Sorry about giving you ownership of the report but you are the only one supporting it.
    Couldn’t find the coffee cup analogy but table 1 (page 5) shows a total capital of $370b or $16,819 pp based on a population of 22 million. This works out at the cost of one cup of coffee per person per day for 13 yrs – so I am not sure what the coffee cup actually referred to.
    Had a look at the graph on page 7 and associated comments. Not sure what assumptions were made re plant life or the cost of borrowing. Keep in mind that the prices you quote are for 2020, not average for job. Note that one of my arguments for a transient approach is that pure green alternatives and costs should be much better by yr 2020. In this context it is worth detailing the plan for complete replacement of coal with CCGT with a 66.5% reduction on 40 yr emissions:
    CCGT all comes on line 2015
    No new capacity comes on line from 2016 to 2030 (25 yrs with no reduction CCGT demand.)
    CCGT replaced with pure green from 2031 to 2040.
    (The 66.5% reduction is the equivalent of what would be achieved by ramping up to pure green from the start of yr 5 till the end of yr 20.)
    Fig 9 (page 10) is a very interesting graph it shows wind contributing between 50 to 800 gWh/day out of a total demand of about 900 gWh/day. So the installed solar steam generator capacity would have to be about 850 gWh/day. Makes you wonder about the real justification of wind power in this context.

  90. John D

    [email protected]: Sorry about giving you ownership of the report but you are the only one supporting it.
    Couldn’t find the coffee cup analogy but table 1 (page 5) shows a total capital of $370b or $16,819 pp based on a population of 22 million. This works out at the cost of one cup of coffee per person per day for 13 yrs – so I am not sure what the coffee cup actually referred to.
    Had a look at the graph on page 7 and associated comments. Not sure what assumptions were made re plant life or the cost of borrowing. Keep in mind that the prices you quote are for 2020, not average for job. Note that one of my arguments for a transient approach is that pure green alternatives and costs should be much better by yr 2020. In this context it is worth detailing the plan for complete replacement of coal with CCGT with a 66.5% reduction on 40 yr emissions:
    CCGT all comes on line 2015
    No new capacity comes on line from 2016 to 2030 (25 yrs with no reduction CCGT demand.)
    CCGT replaced with pure green from 2031 to 2040.
    (The 66.5% reduction is the equivalent of what would be achieved by ramping up to pure green from the start of yr 5 till the end of yr 20.)
    Fig 9 (page 10) is a very interesting graph it shows wind contributing between 50 to 800 gWh/day out of a total demand of about 900 gWh/day. So the installed solar steam generator capacity would have to be about 850 gWh/day. Makes you wonder about the real justification of wind power in this context.

  91. John D

    Elise: Saw the 7.30 report on Bluegen and cringed when I listened to the Wong statement. Also cringed listening to Christine’s comments. We desperately need some serious climate action at a price that is going to be politically acceptable – not climate purity.

    My take on Bluegen is that it has to compete on price with other power sources after taking account of grid related and other special savings that arise from being in someones backyard and using waste heat to heat water etc. Maybe people like Bluegen and solar panel should start negotiating tariffs?

  92. John D

    Elise: Saw the 7.30 report on Bluegen and cringed when I listened to the Wong statement. Also cringed listening to Christine’s comments. We desperately need some serious climate action at a price that is going to be politically acceptable – not climate purity.

    My take on Bluegen is that it has to compete on price with other power sources after taking account of grid related and other special savings that arise from being in someones backyard and using waste heat to heat water etc. Maybe people like Bluegen and solar panel should start negotiating tariffs?

  93. Ken Fabos

    We shouldn’t fool ourselves by thinking gas provides any kind of solution; entrenching another fossil fuel in the place of coal would leave us unable to reduce emissions enough to avoid serious climate change – even if every coal plant was replaced by gas. Having invested in new plants, motivation to replace them would have to be minimal. Marginally better than more coal plants I suppose. Meanwhile wherever privatisation has happened the new owners will surely insist they were sold the ongoing right to keep emitting.
    I think it’s back to imposing a carbon cost but until we have support from across mainstream politics – bipartisan recognition of the scale of the problem and genuine committment to come up with solutions – even a minimal one looks unlikely. And should global and local economics inconveniently intervene, even the minimal efforts made to date would be dropped in an instant in favour of perpetuating and maximising fossil fuel revenue. For all the genuine efforts made by some, without efforts by most it’s more delay.

  94. Ken Fabos

    We shouldn’t fool ourselves by thinking gas provides any kind of solution; entrenching another fossil fuel in the place of coal would leave us unable to reduce emissions enough to avoid serious climate change – even if every coal plant was replaced by gas. Having invested in new plants, motivation to replace them would have to be minimal. Marginally better than more coal plants I suppose. Meanwhile wherever privatisation has happened the new owners will surely insist they were sold the ongoing right to keep emitting.
    I think it’s back to imposing a carbon cost but until we have support from across mainstream politics – bipartisan recognition of the scale of the problem and genuine committment to come up with solutions – even a minimal one looks unlikely. And should global and local economics inconveniently intervene, even the minimal efforts made to date would be dropped in an instant in favour of perpetuating and maximising fossil fuel revenue. For all the genuine efforts made by some, without efforts by most it’s more delay.

  95. Paul Norton

    This link arrived in my In box this morning

  96. Paul Norton

    This link arrived in my In box this morning

  97. Elise

    Ken Fabos @47: “We shouldn’t fool ourselves by thinking gas provides any kind of solution”

    Agree that coal and gas are both hydrocarbons – finite fossil fuel resources. However, I think we should be thinking beyond “coal versus gas”.

    Totally agree with you that gas is not the final solution. Agree that there is a risk that people will simply become dependent on gas until it runs out, unless there is ongoing pressure to move to a lower carbon solution. As such, this position argues for some form of carbon price, to maintain the pressure for transition.

    However, I disagree with the concept that just because gas is not a final solution, we cannot consider it as part of the transition process. Two reasons to start with:

    a) Lower carbon emissions would BUY TIME, by reducing the RATE of climate change.

    We need time, both for the public pursuasion process (which Gillard referred to in her maiden speech) and for the technology development and implementation process.

    b) We can use natural gas to roll-out fuel cell technology (including BlueGen), as a BRIDGING STEP.

    Ideally we would run fuel cells on hydrogen, but there is no current infrastructure for producing or transporting hydrogen on a large scale. It is currently only produced and transported on a small scale for specialised applications. We have a chicken and egg problem – no supply of hydrogen -> no fuel cells -> no demand to produce hydrogen.

    To break this loop, we need to start with something which is widely available and can be used by fuel cells, to get the scale-effect on production of fuel cells. That something is natural gas. So what if natural gas is going to run out? We can have the hydrogen supply problem sorted by then.

  98. Elise

    Ken Fabos @47: “We shouldn’t fool ourselves by thinking gas provides any kind of solution”

    Agree that coal and gas are both hydrocarbons – finite fossil fuel resources. However, I think we should be thinking beyond “coal versus gas”.

    Totally agree with you that gas is not the final solution. Agree that there is a risk that people will simply become dependent on gas until it runs out, unless there is ongoing pressure to move to a lower carbon solution. As such, this position argues for some form of carbon price, to maintain the pressure for transition.

    However, I disagree with the concept that just because gas is not a final solution, we cannot consider it as part of the transition process. Two reasons to start with:

    a) Lower carbon emissions would BUY TIME, by reducing the RATE of climate change.

    We need time, both for the public pursuasion process (which Gillard referred to in her maiden speech) and for the technology development and implementation process.

    b) We can use natural gas to roll-out fuel cell technology (including BlueGen), as a BRIDGING STEP.

    Ideally we would run fuel cells on hydrogen, but there is no current infrastructure for producing or transporting hydrogen on a large scale. It is currently only produced and transported on a small scale for specialised applications. We have a chicken and egg problem – no supply of hydrogen -> no fuel cells -> no demand to produce hydrogen.

    To break this loop, we need to start with something which is widely available and can be used by fuel cells, to get the scale-effect on production of fuel cells. That something is natural gas. So what if natural gas is going to run out? We can have the hydrogen supply problem sorted by then.

  99. John D

    Ken F: I thought I had made it very clear that I was only advocating gas as part of a transition to a pure green option. I also thought that I had made it clear that what counts is the tonnes of CO2 emitted over the next forty years. It doesn’t matter whether this comes from gas, coal or building windmills.
    I think there is a limit to the economic pain voters will tolerate in the pursuit of emissions reduction. Assuming gas costs less, this means that a greater reduction in 40 yr emissions can be achieved by using a gas transition compared with the “we must go direct to pure green” ideology. On my figures a comparison of pure green vs all coal fired is converted to gas in yr 5 with the costs at $40/tonne CO2 reduced, pure green will reduce 40 yr emissions by 66.5% vs 76.8% for the transition approach. Starting with gas also reduces many of the practical problems associated with early moves to wind and solar generation.

  100. John D

    Ken F: I thought I had made it very clear that I was only advocating gas as part of a transition to a pure green option. I also thought that I had made it clear that what counts is the tonnes of CO2 emitted over the next forty years. It doesn’t matter whether this comes from gas, coal or building windmills.
    I think there is a limit to the economic pain voters will tolerate in the pursuit of emissions reduction. Assuming gas costs less, this means that a greater reduction in 40 yr emissions can be achieved by using a gas transition compared with the “we must go direct to pure green” ideology. On my figures a comparison of pure green vs all coal fired is converted to gas in yr 5 with the costs at $40/tonne CO2 reduced, pure green will reduce 40 yr emissions by 66.5% vs 76.8% for the transition approach. Starting with gas also reduces many of the practical problems associated with early moves to wind and solar generation.

  101. John D

    WHOOPS! The figures in 50 above are misleading because my model assumes a flat cost for pure green of $40/tonne CO2 no matter what the investment schedule or 40 year emission reduction.
    It is more meaningful comparison is the 10 yr figures for a 40 yr emission reduction of 66.5% and a price above coal fired of 1.53 cents/kWh. At this price pure green would result in a 34% reduction in electricity emissions by the end of yr 10 vs 60% for the transition case. (All coal fired replaced by CCGT during yr 5)

    Thanks for the link Paul

    Elise: The economics of the transition option are are strongly affected by the time at which this power comes on line. So we are really talking about options that are ready to go now and are compatible with existing power systems.

  102. John D

    WHOOPS! The figures in 50 above are misleading because my model assumes a flat cost for pure green of $40/tonne CO2 no matter what the investment schedule or 40 year emission reduction.
    It is more meaningful comparison is the 10 yr figures for a 40 yr emission reduction of 66.5% and a price above coal fired of 1.53 cents/kWh. At this price pure green would result in a 34% reduction in electricity emissions by the end of yr 10 vs 60% for the transition case. (All coal fired replaced by CCGT during yr 5)

    Thanks for the link Paul

    Elise: The economics of the transition option are are strongly affected by the time at which this power comes on line. So we are really talking about options that are ready to go now and are compatible with existing power systems.

  103. John D

    This link provides data for various alternatives for cleaning up the Hazelwood brown coal power station. Conclusion favored CCGT as a better alternative to renewables.

  104. John D

    This link provides data for various alternatives for cleaning up the Hazelwood brown coal power station. Conclusion favored CCGT as a better alternative to renewables.

  105. Ken Fabos

    John, if I could actually believe that development of more gas extraction was for the purpose of replacing coal as an interim measure, maybe, but I think the reality is the greatest push for more use of gas is a case of ‘as well as’ rather than ‘instead of’ coal. As backup to major renewables projects I would be fully supportive but it currently looks like a case of gas instead of renewables and waiting until our economic circumstances favours major spending on low emissions looks more like code for waiting forever. As a measure of Australia’s committment on global emissions – take the spin away and bipartisan policy is to maximise the extraction and export of fossil fuels and stuff global emissions. That’s gas and coal and oil, not gas or coal or oil.

  106. Ken Fabos

    John, if I could actually believe that development of more gas extraction was for the purpose of replacing coal as an interim measure, maybe, but I think the reality is the greatest push for more use of gas is a case of ‘as well as’ rather than ‘instead of’ coal. As backup to major renewables projects I would be fully supportive but it currently looks like a case of gas instead of renewables and waiting until our economic circumstances favours major spending on low emissions looks more like code for waiting forever. As a measure of Australia’s committment on global emissions – take the spin away and bipartisan policy is to maximise the extraction and export of fossil fuels and stuff global emissions. That’s gas and coal and oil, not gas or coal or oil.

  107. John D

    Ken: Unfortunately you may be right. However, investment in gas is taking place driven by things like the Queensland gas scheme, the need for low cost peak power and the concerns of coal fired power producers such as TRUenergy and Origin that they will be cut out of the future unless they convert to CCGT and renewables.

    Moving to CCGT now will at least reduce electricity related emissions by about 60% (30% of total) and put us in a better position to move to renewables when the political will is there.

  108. John D

    Ken: Unfortunately you may be right. However, investment in gas is taking place driven by things like the Queensland gas scheme, the need for low cost peak power and the concerns of coal fired power producers such as TRUenergy and Origin that they will be cut out of the future unless they convert to CCGT and renewables.

    Moving to CCGT now will at least reduce electricity related emissions by about 60% (30% of total) and put us in a better position to move to renewables when the political will is there.

  109. OldSkeptic

    Burning gas for electricity … INSANE … except for minor peak demand stations.

    First gas, like oil or coal is finite.
    Secondly, you can use gas as a primary fuel and in chemical (eg fertilisers) and industrial processes.
    Thirdly, you can use it as a transport fuel.
    Fourthly, use it as a primary fuel and you can get 70-90% efficiency (depending on distance, use and pumping energy losses,etc)
    Fifthly, burning it for electricy and you are scratching to get 40% (usually a lot lot less point to point) efficiency.

    Might as well take 50% of the gas and just pump it into the atmosphere.

    This is the same dumb mistake Britain did, ran down its nuclear industry, set up gas powered stations and looked like a GG hero … until the gas started running out.

  110. OldSkeptic

    Burning gas for electricity … INSANE … except for minor peak demand stations.

    First gas, like oil or coal is finite.
    Secondly, you can use gas as a primary fuel and in chemical (eg fertilisers) and industrial processes.
    Thirdly, you can use it as a transport fuel.
    Fourthly, use it as a primary fuel and you can get 70-90% efficiency (depending on distance, use and pumping energy losses,etc)
    Fifthly, burning it for electricy and you are scratching to get 40% (usually a lot lot less point to point) efficiency.

    Might as well take 50% of the gas and just pump it into the atmosphere.

    This is the same dumb mistake Britain did, ran down its nuclear industry, set up gas powered stations and looked like a GG hero … until the gas started running out.

  111. John D

    Old S: We can sit around prattling on about perfect solutions and saving gas while we continue to spew CO2 into the atmosphere from cola fired power. Or we can use gas as part of the transition and bring emissions down significantly while we talk about what should be done to bring emissions down further.
    The most extreme case I quoted in the post would involve complete replacement of coal with gas with the CCGT plants running at the equivalent of about 20 yrs full-time. There are less extreme versions where some of the coal is directly replaced by pure green thus reducing total gas consumption over 40 yrs at the cost of higher 40 yr emission reduction costs.

    What I really want to see is some serious action starting now. So far the lower price CCGT transition looks like a good way of making this happen.

  112. John D

    Old S: We can sit around prattling on about perfect solutions and saving gas while we continue to spew CO2 into the atmosphere from cola fired power. Or we can use gas as part of the transition and bring emissions down significantly while we talk about what should be done to bring emissions down further.
    The most extreme case I quoted in the post would involve complete replacement of coal with gas with the CCGT plants running at the equivalent of about 20 yrs full-time. There are less extreme versions where some of the coal is directly replaced by pure green thus reducing total gas consumption over 40 yrs at the cost of higher 40 yr emission reduction costs.

    What I really want to see is some serious action starting now. So far the lower price CCGT transition looks like a good way of making this happen.