Future of energy

Australia has one of the most cost-effective energy conversion and delivery systems in the world. We are blessed with abundant, high-quality fossil fuels consisting mainly of coal, gas and (diminishing) oil resources. However, this past blessing is also a future curse as this fuel mix, coupled with limits to hydroelectric growth and no nuclear generation capacity, has endowed Australia with one of the highest greenhouse gas (GHG) emissions per unit of GDP in the developed world (currently 43 per cent above the International Energy Agency average). This prompted Claude Mandil, head of the IEA, to observe: 'Environmental sustainability represent Australia's greatest energy challenge, with high and growing carbon dioxide emissions.' The challenge for Australia is how to make the massive cuts in GHG emissions required to minimise our world trade risks (which will come at a cost, and put pressure on our energy cost-effectiveness) while maintaining an internationally competitive energy sector. This challenge is exacerbated by a healthy national growth rate which will be accompanied by at least a 50 per cent growth in energy demand by 2020, with a doubling by 2050. Electricity industry projections predict an investment in new generation capacity well in excess of $30 billion to keep up with demand over the next two decades. The stark reality is that if we con tinue to supply and use energy the way we do now, we may as well forget about stabilising our GHG emissions from the energy sector, let alone reducing them in the future. This urgent situation presents a huge opportunity for the introduction of new and improved low-emission energy conversion technologies and demand management systems that vastly reduce GHG emissions per unit of productivity - in fact, an opportunity to transform Australia's energy sector to levels of innovation, social acceptance and environmental performance that has no precedent in this country. We have little choice other than to make a start. Are the Australian governments, industry and people ready to accept the energy/greenhouse challenge? In a presentation to an Australian Institute of Energy forum in August 2005, Brad Page, CEO of the Energy Supply Association of Australia, called for a long-term focus on GHG emissions with a 'single, national greenhouse gas emission target for 2050 that applies to the whole economy.... that enables the economic impact and tate of change to be manageable'. Industry is now concentrating on the threat that unabated GHG emissions pose to the Australian economy and looking for ways to reduce that risk by application of cost-effective low-emission approaches. The Government has responded by setting up competitive low-emission technology fund sources in the order of $1 billion through the White Paper Securing Australia's Energy Future. While we still do not have a price on carbon, the push for technology solutions is a way forward. For average Australians, prompted by reports of severe weather events, there is growing awareness of climate change and its potential detrimental effects. There will be increasing public calls for action at all levels of the economy. There are certain essential routes in the energy roadmap. Restricting the view to 2050, we see continuing strong growth in energy demand, the vast majority of which will be supplied by fossil fuels, and a strong growth in wind, photovoltaic and biomass energy off a relatively small base, resulting in continuing strong growth in GHG emissions from the stationary energy and transport sectors, under business as usual. Our oil self-sufficiency will decline from 78 per cent now to 49 per cent in 2030. The response to this set of circumstances is that Australia will actively seek technological solutions to GHG mitigation from fossil fuels by carbon dioxide capture and geological storage as a primary response. The nuclear option will also be re-examined as a large-scale mitigation response. Processes to boost the rate of growth of renewables, the development of alternative transport fuels and much more attention to energy efficiency and demand management will also be needed to complete this medium-term portfolio of energy responses. Policy drivers will be needed to accelerate sorely needed actions. We will need to follow multiple routes on the energy roadmap to 2050 and beyond. There will be no one solution that will deliver the optimum economic, social and environmental outcome for Australia. As Andrew Stock, executive general manager generation, Origin Energy, said recently: ''We need all the tools in the toolbox.'' This is echoed by Ian Campbell, the Federal Environment Minister: 'If we are to avoid getting (to) 550 parts per million (of CO in the atmosphere), you need a massive injection of new technology, you need basically everything the worlds got at its doorstep at the moment. You need wind, solar, nuclear, gasification of coal, you need every single thing and you need more.' Enough said