True size of solar subsidies exaggerated, researchers say

By Peter Hannam

The true cost to consumers of subsidies to solar energy has been “somewhat exaggerated” because regulators have excluded the full benefits of solar photovoltaic panels, according to energy researchers.

While feed-in tariffs and upfront rebates have been criticised by officials and fossil-fuel fired generators for increasing consumers' electricity bills, a peer-reviewed research paper by researchers including Mike Sandiford at the Melbourne Energy Institute and Matthew Wright from Beyond Zero Emissions, found those costs are partly offset by lower wholesale power prices.

“By not considering this value, the cost of both feed-in tariffs and (Small-scale Technology Certificates) is somewhat exaggerated,” the paper, to be published this week in the Energy Policy journal, said. The contribution from solar in pushing down wholesale prices is "not recognised by the wider public”, the paper concluded.

The influence on wholesale electricity prices works via the so-called merit order effect. Under the National Electricity Market pricing scheme, the cheapest source of power gets preference. As more wind and solar energy gets added to the network, their negligible cost of production helps drive down prices across the network - a result that should benefit consumers.

"The question is whether we see that (saving) in the retail prices," Professor Sandiford said. "In an efficient market, we'd expect that to flow through."

Gas – is it a natural fit for buildings?

By Richard Keech

(Note: This article has been updated to correct leakage rate that cause the net climate effect of gas to double. The leakage rate is 2.6%, not 1% as originally published)

According to the Department of Climate Change and Energy Efficiency website, old electric-element-style hot water systems (that about half of households still have) “produce up to three times the greenhouse gas emissions of low emission technologies such as gas, solar and heat pump systems.”

The website recommends, that “changing your electric water heater for a low emission gas, heat pump or solar system, you can reduce your energy consumption, cut your greenhouse gas emissions and save money on your power bills.”

As far as heat pumps go, and electric or heat pump boosted solar, it’s hard to argue. But for fossil gas appliances, that “low emissions” tag is plain wrong. Now, we could just criticise it by asking whether “low emissions”  is good enough. Many think there’s enough scary climate science reports to mean that “low emissions” halfway measures are not good enough.

It’s true that at the point of combustion, fossil gas produces about half the emissions of coal for the same amount of energy. We could debate about whether the emissions cup is half full or half empty at this point, but that would be a diversion. In truth, if you look past the point of combustion, the cup is overflowing.

Previously, Beyond Zero Emissions have pointed to the fugitive/migratory emissions from coal-seam gas as a big question for just how low the emissions of future (and some current) gas supply will be. This concern is now gaining mainstream attention, as evidenced by the ABC TV Four Corners program last week. It’s a serious worry, given that CSG is the fossil gas industry’s future.

Beyond Zero Emissions’ Buildings Plan researchers have put together a short briefing paper drawing on the available research into the various problems of using gas, and conclude that gas use should be phased out (in buildings in particular) – based primarily on its climate impact.

The key reason is that all gas networks leak, not just at the well head. The only question is how much. There is some limited data out of South Australia that suggests the gas networks’ leakage there is in the order of 7%, whereas official government figures put it at around 1.5% nationwide. In reality, in most areas, it’s probably somewhere in between.

Clean electricity makes fossil gas redundant

Climate solutions think-tank Beyond Zero Emissions have today published a briefing paper on the use of gas as a fuel in buildings. The evidence shows that fossil gas' reputation as a clean, safe and cheap fuel needs to be re-considered.

Beyond Zero Emissions have criticised the fossil gas industry for increasingly using dirty and controversial coal-seam gas (CSG) for both export and domestic gas supply.

CSG has raised questions about leaks of the gas from and around the gas wells, as documented on Four Corners last week.

However, even traditional fossil gas mains and distribution networks leak.

CSG wells

The briefing paper was prepared by Richard Keech, who is working on the Zero Carbon Australia Buildings Plan for BZE.

Mr Keech explained that “In the production and distribution of gas there's leaks all along the way.

“There was some limited data out of South Australia that suggested it was in the order of 7%, but the official figures put it at around 1.5%. In reality it's probably somewhere in between.”

Fossil gas is methane. Mr Keech said “The 20-year climate effect of methane is currently understood to be about 105 times that of CO2. It only takes about 2.6% leakage to effectively double the net climate effect of gas.

“With any technology that carries some risk, we weigh the hazard against the benefits.

“That balance has now shifted, especially as fossil gas supply is now moving to CSG. We're seeing that the hazard is much greater than it was once seen as, and the benefit much less.

“Ceasing gas use in buildings is the low-hanging fruit of a larger fossil fuel phase out that is ultimately necessary if a climate catastrophe is to be avoided.

“BZE concludes that clean electricity now makes fossil gas redundant.”

BZE will release the Zero Carbon Australia Buildings Plan in mid 2013. The plan will outline how replacing buildings' gas appliances with renewable electricity powered heat pumps and induction cooktops can make a large reduction on carbon emissions and energy use.

This statement has been changed to correct the leakage rate to double the climate effect of methane, which is 2.6% not 1% as we had erroneously stated.

Download the briefing paper here (PDF)
Richard Keech interview on Radio Beyond Zero (podcast)

VIC - BZE Film Night - 'White Water, Black Gold'

After a brief hiatus, Beyond Zero Emissions film nights are back...and we're pretty excited about it!

Join us for a screening of the multi-award winning film 'White Water, Black Gold', which follows filmmaker David Lavallee on a three-year journey across Canada to document the environmental and social impacts of the world's most energy intensive oil industry: the tar sands. The industry is expanding right at a time when the world needs to be moving away from its heavy reliance on fossil fuels.

What's any of this got to do with Australia?

Well, business is booming for the oil and gas industry here as well, with the development of unconventional fossil fuel projects increasing along the eastern seaboard. Stick around after the film for some light refreshments and to hear more about this from our guest speakers from Friends of the Earth/Quit Coal...our audience may be particularly interested to hear about the doings of a company called Lakes Oil in Gippsland, backed by none other than one Mme. Rinehart.


Location: Kindness House, 288 Brunswick Street, Fitzroy, 3065

Date and Time: April 11th, 6.00pm

Transport: Tram 112, Stop 16 (Corner of Johnston and Brunswick Street)

Price: $10


NSW should call CSG industry bluff, go to zero gas

Threats that the NSW government's restrictions on the coal-seam gas industry will cause a price rise are a bluff that NSW residents should call, according to climate solutions think-tank Beyond Zero Emissions.

“The gas industry has no real commitment to domestic gas supply, and certainly not to cheap supply,” said BZE spokesperson Ben Courtice.

“The gas companies are not desperate to frack NSW for more CSG because they care about the NSW gas supply. They need it for their LNG export trains and contracts with Asia.”

Export commitments, and the move into costly and dirty shale and coal-seam gas, are already driving gas costs up. From $3-4 per gigajoule now, prices are expected to soon rise to as much as $10/GJ.

But gas companies are desperate to secure reserves. For example, gas company Santos' total proven, probable, possible and contingent gas reserves (known in the industry as “3P + 2C”) fell 26% in the last two years, indicating they are struggling to meet their commitment to GLNG export contracts (See PDF)

Image: walking the CSG pipeline (from Friends of the Earth/flickr)

Conflicting opinions have been voiced on NSW gas supply security. Despite numerous announcements that shortages could come as soon as 2015, the head of BHP Petroleum chair Michael Yeager recently said “it's more important to let the citizens of Victoria and NSW and to some degree even Queensland (know) there's plenty of gas to supply those provinces indefinitely"

Whatever the truth of this matter, it is already clear that no new gas power stations are required, with electricity demand falling in Eastern Australia for the last three years. AGL recently put on hold their proposed 1000MW gas power plant at Dalton for the foreseeable future.

Zero gas: the way forwards

“Gas corporations want to access NSW' coal-seam gas at all costs, but is NSW really at risk of shortages? Not if we move towards zero gas use – which our analysis shows is the logical step, from an economic as well as environmental perspective,” Mr Courtice said.

“At the prices we are going to be seeing, no-one will be building new gas power stations in Australia, and households will be hurting at the hip pocket if they rely on gas appliances.”

“NSW can do better than allow itself to be bluffed and bullied by the gas companies. NSW could tomorrow begin to transition away from dirty fossil gas and implement efficient electric technologies powered by renewable energy.”

BZE's research has identified that the technology to replace fossil gas use is now cleaner, more efficient and cheaper to run:

  • Household heat pumps and induction cooktops can replace fossil gas appliances with greater efficiency and safety, and lower operating costs and greenhouse emissions;

  • An energy efficiency program as simple as changing halogen light globes across Australia for new LEDs could reduce electricity demand by as much as one large coal power station;

  • Fossil gas and coal power stations can be replaced with a combination of wind farms, solar panels, and large solar-thermal power plants with molten salt heat storage for backup to run at night.

High speed rail cheaper than Albanese thinks

Transport minister Anthony Albanese is trying to derail the promising High Speed Rail option before it even leaves the platform, according to climate solutions think-tank Beyond Zero Emissions.

“Mr Albanese appears to have decided to write off this nation building project before even releasing the report which he has been sitting on for four months,” said BZE's Zero Carbon Australia Transport researcher Gerard Drew.

“It is time to allow the public to consider the proposal. It’s unacceptable for the government to dismiss this publicly financed research before the costs and benefits have been shown.”

BZE, in partnership with the German Aerospace Centre (DLR), has analysed high-speed rail route options for Melbourne to Brisbane to arrive at a significantly lower cost figure than the Phase 1 AECOM study for the government, released in 2011.

“Based on the first study, we think that a price tag at the lower end of AECOM's costing range is what we should expect from the high speed rail network”, said Mr Drew.

“Mr Albanese has declared that the alignment 'has got to be in a straight line' which is certainly false. This assumption can inflate the project cost by a huge degree by unnecessarily forcing it through adverse terrain. For example, a kilometre of tunnel can cost more than 10 times as much as track on flat ground.

Image: Mapping the path of least resistance (dark blue) and precise route with optimised horizontal curvature (light blue), including bridges (purple) and tunnels (dark red)

Don't waste solar energy on coal

Port Augusta is the ideal location in South Australia for a solar thermal power plant, due to its very good direct annual solar radiation and its proximity to a strong piece of grid infrastructure that services the old lignite burning power plants that are located there, owned by Alinta.

There has been a campaign for some time to repower Port Augusta, after the town was named as one of 12 key power generation sites in the Zero Carbon Australia stationary energy plan.

This campaign has garnered a lot of support and gained a great deal of momentum.

But now we're at a turning point where we may get a type solar thermal plant that is of little use in promoting a shift away from fossil fuels.  A plant that will not create an inspiring vision, nor support greater understanding and learning-by-doing that will shift us from a 19th century fossil fuel economy, to a 21st century renewable-powered, cleantech economy.

The plant being proposed is a cheaper option being proposed by electricity company Alinta. But buyer beware - you get what you pay for.

Coal train bound from Leigh Creek mine to Port Augusta

Greens push 100pct renewables plan for W.A.

By Giles Parkinson

The Greens Party has unveiled an ambitious new document that outlines possible pathways to turn Western Australia – one of the most energy-intensive states in the world – into one where its stationary energy needs are powered 100 per cent by renewable energy sources in less than two decades.

The Greens offer two principal scenarios to transform the coal and gas-dependent grid known as the South West Interconnected System (SWIS), which includes the capital Perth and the most populous regions. The first involves a heavier reliance on solar thermal and storage technologies currently deployed in Spain, the US and elsewhere, while the second relies more on currently cheaper technologies such as wind energy and solar PV. Both are supported by bio-mass and pumped hydro.

According to Scott Ludlam, the WA-based Senator whose office anchored the report with the help of specialist consultants, the plan seeks to make two important points – one that it is feasible, and two, it will not cost much more than business as usual (BAU).

Indeed, even using somewhat conservative technology cost forecasts for the various forms of solar, and to allow for a safety-first  approach to capacity requirements, the study concludes that the levellised cost of electricity in the various renewable scenarios ranges from $208/MWh to $221/MWh by 2029. (We go into detail further down)

The levellised cost of electricity in the BAU case is not much cheaper – $203/MWh. While it has lower up front capital costs – $20 billion vs $60 billion, the balance of the BAU scenario bill will be paid in fuel costs, which for gas and diesel customers in WA is already proving expensive and forcing those on isolated and remote areas in particular to already consider solar alternatives.

Go LED and kill Hazelwood?

By Trent Hawkins

According to analysis conducted by Beyond Zero Emissions, lighting in homes is responsible for about seven per cent of household electricity use, and around 30 per cent of electricity for commercial and retail buildings.

That's quite a large amount of energy use, but it could be about to fall drastically, perhaps by as much as a large coal power station's worth of electricity demand. That's a hefty amount when energy utilities are already seriously challenged by falling electricity demand.  

As reported by Gerard Wynn, LEDs (light emitting diodes) are now set to dominate the global lighting market. In the general lighting market the consultants McKinsey & Company forecast a 45 per cent market share for LEDs by 2016, up from 9 per cent in 2011. 

Electronics giant Philips has completely ceased research and development into fluorescent lighting technology, recognising that the future is in LEDs. Other companies in the semiconductor business, not traditionally in lighting, are getting in on the act. In Australia, companies are springing up that come into your home or business and do a full change-out to LEDs. Even McDonald’s restaurants are making the switch.  

Beyond Zero Emissions' Buildings Plan research is proposing a full switch to replace all existing lighting with LEDs within 10 years. This would result in up to 80 per cent reduction in lighting energy use for most building categories.

These energy savings are in the order of 15 terawatt-hours of electricity per year: more than Victoria's notoriously polluting Hazelwood power station could produce if it ran flat out, non-stop, for an entire year. Avoiding the burning of all that brown coal would avoid CO2 emissions of over 20 million tonnes of CO2 per year. 

The US Department of Energy chart below shows the trajectory of improvement of LED lights as compared with other technologies. There is a lot of further improvement to be had, with the US DOE supporting a realistic goal of reaching 200 lumens/watt (compared to 60-90 lumens/watt in products on the market now).

Chart from US Department of Energy (USDOE) - “Solid-State Lighting Research and Development: Multi-Year Program Plan”, April 2012.

And this improvement in light output only begins to tell the story of why LEDs are taking the lighting market by storm.

A turn for the better

If there’s one thing Wonthaggi has plenty of it’s wind. Energy researcher BEN COURTICE looks at whether it could prove to be one of the shire’s biggest assets.

IF YOU install solar panels to offset your entire electricity use, you pay no electricity bill – you may even get a credit. There are options to achieve this on a larger, regional or town scale, if communities work together.

Wonthaggi could supply all its own energy, on an annual basis, from a small wind farm. In fact, it could easily be a net exporter of large amounts of renewable energy, via the electricity grid, as the wind resource in the region is better than most parts of the country.

Crunching the numbers based on the existing information makes this clear.

The small existing Wonthaggi wind farm has a nominal capacity of 12 megawatts (MW) from its six turbines. Its annual output in 2011 was 28.3 gigawatt-hours (GWh).

With a population of just under 6900 in 2011, Wonthaggi has about a third of the Shire’s mainland population. Assuming a similar proportion of electricity use, that makes about 25 GWh per year energy use (using state government energy use figures from 2007).

That's less than the output of the wind farm. So six two-megawatt turbines can do the job now.

If the aim is energy independence, though, much more can be done.

If households in Wonthaggi reduced their own energy use, then more clean energy would be exported to other, less windy regions such as Melbourne's suburbs.

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