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The Unavoidable Green Future

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Excellent article in today’s New Matilda – The Unavoidable Green Future (will open in new tab/window). It’s an interview of Ben McNeil, author of The Clean Industrial Revolution. Here’s my favourite bit:

“Right now we’re in the same position in Australia as GM was in the 1990s. We’re protecting high-carbon assets. We’re protecting coal, we’re protecting oil and we are looking at carbon price, a carbon cost in the future. There is no doubt that the world is going to value carbon, and that means higher carbon costs. So how the hell is coal going to survive in a world moving to low carbon? It’s not going to.”Coal Plant

McNeil points to research by Chris Reidy at the University of Technology Sydney which estimated a public subsidy of $9-10 billion on 2005-06 figures for the transport and electricity industries alone.

“When people say let’s do nothing, let’s just play that scenario out,” McNeil continues, “if we do nothing in terms of emissions, it’s essentially saying let’s rely on these old relics for our future prosperity in terms of economic growth. But Japan and the EU, who buy most of our coal, are de-carbonising their economies. Why would they be buying coal? They’ll be getting gas, they’ll be getting renewables, they’ll be getting more nuclear, they’ll be doing other things. So someone who says this will be devastating to our economy — it doesn’t make sense.”

But what about the argument, often voiced by the Opposition, that Australia should wait until the rest of the world puts a price on carbon before it acts?

“It’s funny. When someone says there is no current price for carbon they’re just living in la-la land. There’s a very strong shadow price for carbon right now, irrespective of the Government. Last year, 45 coal-fired power stations went off the books in terms of planning. They didn’t go off the books because of coal technology — we’ve had coal for a long time. They [were cancelled] because of the financiers, the Wall St bankers. They said ‘Actually, in a carbon constrained world, where you’ve got a 50-year asset, the carbon price could go from $20 a ton to $200 a ton within 10 or 20 years, so we’re talking about huge carbon liabilities here.'”

“These guys in the coal industry are just delusional, completely delusional.”

To read more, click here.


Written by Gabriel Sassoon

June 16, 2009 at 9:13 pm

Economic benefits of emissions trading scheme

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This article appeared in the Sun Herald today: “Emissions scheme’s $6bn boost to the economy“.

An internal report by National Australia Bank seen by The Sun-Herald suggests the emissions trading debate in Australia has been dominated by claims about the short-term costs, and scant attention has been paid to new investment opportunities.

“The average year-on-year investment created by the [Carbon Pollution Reduction Scheme] could be up to 60 per cent greater than that committed for infrastructure in this year’s budget,” the report says.

It warns there has been “little consideration of the investment stimulus” that would be created as the economy becomes less greenhouse-intensive.

“This is unfortunate, as discussion of any costs should be balanced with an examination of the opportunities.”

Duh. The only reason the scheme has been delayed in Australia is because the only industries set to lose from its implementation – heavy polluting ones – have lobbied to have it delayed. And they’ve convinced the public with their false dilemma of environment vs jobs. Here’s how the article ends; don’t worry, I’m not spoiling anything for you. Trust me:

Treasury modelling produced for the Government concluded the emissions trading scheme would only have a small net impact on employment.

But the Minerals Council says the mining sector will lose 23,510 jobs over the next decade if a 5 per cent target is adopted.

And, as I’ve written before, punch-card computer operators lost their jobs when technology improved. My question is: um, so?

Written by Gabriel Sassoon

May 24, 2009 at 7:06 pm

Rudd’s three-card trick

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This week’s Australian federal budget was nearly as short-sighted as ever. What we saw on Tuesday was mostly greenwash. Bob Brown was right: this was not a green budget.

Federal Treasurer, Wayne Swan

Federal Treasurer, Wayne Swan

The government pandered to narrow dirty business interests and dressed its actions up with a poorly-disguised sop to the environmental movement.

It is true that we’ve committed serious money to a national broadband infrastructure. But that should have been done years ago. The info tech boom is now a fact of life. And now we’re left lagging in the next crucial tech boom: clean tech.

A welcome initiative is the government’s $1.5 billion over 4 years that will go into building serious centralised solar generation infrastructure.

But this is a mere sideshow – it’s the sop to the greens. It is a smokescreen for the government’s real agenda: protecting carbon-intensive industries.

Out of total budget expenditures of roughly $340 billion, $4.5 billion is going into “clean energy”. That’s just over 1% of the budget. The lion’s share of this money is going into that oxymoron, “clean coal”.

“Clean coal”, or carbon capture and storage (CCS), is a largely unproven technology. Certainly more unproven than established renewable alternatives like wind and solar. It’s 10 years away from industrial-scale deployment. And it’s not “clean”.

But since coal-fired power and coal exports are entrenched Australian industries, it is easy for the government to fund relatively unproven CCS technology and get away with greenwashing it by calling it “clean” technology.

This, after last week’s delay in the emissions trading scheme, casts serious doubt on the government’s commitment to the environment and to green business.

What happened? The government should be investing many billions into true, proven clean technology. Where is the serious funding for wind, solar, smart grids, electric vehicles, and other clean technology infrastructure and R&D?

Our government doesn’t get it. While our most promising future jobs engine – clean energy and clean tech – is left to fend for itself, the government’s priorities are clearly reflected in, for instance, its increases in defence expenditures, its clear commitment to subsidising the fossil fuel industries (partly by greenwashed stealth), and its refusal to include petrol-induced emissions in the ETS.

Serious money needs to be pumped into this sector. Instead, the government has doled out $20 billion in frivolous cash giveaways (a vote-buying ploy spun as “fiscal stimulus”) and delivered an unnecessarily reckless and short-sighted budget.

Will we ever learn?

Written by Gabriel Sassoon

May 15, 2009 at 7:50 am

Disaster in Tennessee, wind, solar, and the end of coal

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Two excellent clips showing the contours of the debate going on in the US. Note that even the “skeptics” are simply querying the viability of raising capital during the GFC – they are not questioning the value of switching to clean energy. Particularly, as is referenced, in the wake of December’s disaster at a Tennessee coal plant (which only goes to prove that eliminating coal is an imperative whether or not climate change science turns out to be accurate).

Written by Gabriel Sassoon

May 8, 2009 at 6:50 am

The future of solar

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We need to take another look at solar.

The thing I like most about solar is that it’s not (necessarily) a centralised technology. This is an interesting challenge and a big opportunity. And as prices are driven down, as storage technology gets more efficient, and with the right policy incentives, solar could be a significant player even in our relatively small market.

In the US, 1 Block Off The Grid is getting lower solar system prices by grouping together larger groups of consumers, which only shows that one of the biggest obstacles to uptake is the scale of residential solar. Here, some companies are offering effectively free solar installation after government rebates. But in neither country has critical mass been achieved.

My sense for some time has been that solar has been getting a bum rap in Australia. Wind is the ‘it’ technology for a bunch of reasons – for instance, it’s got the advantage of scale, it’s cheaper, and traditional players understand it because generally it’s centralised so you can build a wind farm and feed it into the grid.

But the rest of the world is taking solar very seriously. China’s Dr Zhengron Shi, a UNSW graduate and founder of the highly successful company Suntech, spoke to his alma mater late last year and speculated that solar would reach grid parity by 2012 and that it would be driven by first-gen photovoltaics. He said that this would be driven by value-chain development, scale (Suntech already has over 1000 MW online and projects double that by 2010) and increasingly efficient technology. When these elements are in place, Shi argues that solar will become a mainstream energy source. Here’s the full interview:

His comments about where Australia fits in with all this were also interesting. He doesn’t believe that we have a strong entrepreneurial culture, a sizeable market, nor the financial or policy will to encourage enrepreneurialism – so he sees us as best-placed to be a technology incubator.

While I don’t agree that that’s all we are going to be, I do agree with him that there are significant challenges to building a successful clean tech business in Australia. We need to understand that not only is the US streets ahead of us in terms of clean energy policy; so is China. I hope our Mandarin-speaking PM has some surprises for us up his sleeves because we’re already lagging behind the US Administration – and our new government has had a year’s head start.

Written by Gabriel Sassoon

April 28, 2009 at 9:04 am

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ACF urges politicians to support CPRS

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When the Australian Conservation Foundation endorses the weak ETS that is being debated at the moment, you know the situation is dire.

The ACF and other green advocacy organisations recognise that the adoption of the government’s proposed CPRS is at least a step in the right direction. They figure that they and other groups can then lobby the government to increase the emissions reduction targets.

I agree with the ACF – the proposed ETS is weak but it must be passed so it can be operational by the beginning of next calendar year. It is, at the very least, a start. Not an especially good start, but a start nonetheless.

Written by Gabriel Sassoon

April 22, 2009 at 4:34 pm

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Of ostriches and forward-thinkers: US policy evolves

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It would be hilarious if it weren’t so tragic: the Republican House Minority leader, John Boehner, told George Stephanopoulos that the idea that CO2 is harmful to the environment is “almost comical”.

George, the idea that carbon dioxide is a carcinogen that is harmful to our environment is almost comical. Every time we exhale, we exhale carbon dioxide. Every cow in the world, you know, when they do what they do, you’ve got more carbon dioxide… The question is how much does man have to do with it, and what is the proper way to deal with this?

Stephanopolous could barely believe it himself – that a top elected official could still espouse such views just has to be seen to be believed:

The good news is that there’s seriously positive action happening where it matters. As David Niebauer writes at Cleantechblog.com, congressmen Waxman and Markey introduced a cap-and-trade bill in late March that would enable reduced deforestation in tropical rainforests -anywhere in the world – to be purchased as carbon credits. The EPA reckons that the scheme will cost just “pennies a day”.

It seems that finally public policy is catching up with the necessity that I’ve blogged about before – for us to price the externality of rainforest depletion into the economy. And it proves the point that it is virtually irrelevant what the skeptics say: the paradigm shift to the clean economy has reached an inflection point. It’s only going to snowball from here.

Written by Gabriel Sassoon

April 22, 2009 at 9:17 am