Saturday, 16 May 2009

Coal shoulder: all solar power to you $1.5 billion to fuel four large plants

Age
Thursday 14/5/2009 Page: 4

SOLAR companies are preparing themselves in a bid to build what is being described as the largest solar energy plants in the world under government budget spending. There was $1.5 billion set aside in Tuesday's budget to build four solar plants, preferably solar thermal or solar photovoltaic, which will produce 1000 MWs of energy, the size of a coal-fired plant.

The Australian president of solar thermal company Ausra, Bob Matthews, said his firm would almost certainly propose an application to build one of the plants. "This is a huge step, not just in Australia but worldwide. There are not any initiatives in the world this big and the Government has put the money behind it," Mr Matthews said.

James Harding, from MAN Ferrostaal AG, said that while it was still early in the process, his firm would also pitch for the project. But industry insiders say Victorian company Solar Systems, which runs a solar photovoltaic plant in Mildura, is best placed to score one of the four plants. A spokesman for Energy Minister Martin Ferguson said it was too early to say where the plants would be located. However, south-east Queensland is regarded as a certainty for at least one of the projects.

The head of the University of South Australia's Institute for Sustainable Systems and Technologies, Professor Wasim Saman, said northern South Australia, western NSW and north-west Victoria could also be in the mix, as there is reliable sunlight in those areas. Professor Saman said the space required for a solar plant generating 1000 MWs of power could be as much as 100,000 square kilometres.

But Professor Saman said the biggest issue would be ensuring a solar plant on that scale would be able to access the national electricity grid. The Institute for Sustainable Systems and Technologies operates a .5 MW solar demonstration program in northern South Australia. The $1.5 billion for solar energy in the federal budget was part of a wider $4.5 billion clean energy package, including $3.5 billion in finance. Other initiatives include $2.4 billion for clean coal projects around Australia and $500 million for a national research and development body to look at all renewable energy.

But the Government's clean energy plans are not without criticism. Green groups, including the Australian Conservation Foundation and Greenpeace, have slammed the large cost on clean coal, saying the technology is unreliable. Yesterday demonstrators draped a banner over Parliament House reading "carbon budget blowout", protesting the Government's emissions trading plans.

The Government's decision to fund $2.5 billion of the clean energy scheme from a fund dedicated to education spending has also raised eyebrows, with shadow minister for infrastructure Andrew Robb saying it represented the Government's lower priority on education.

"The Education Investment Fund was explicitly created just 12 months ago for universities and for vocational education and training - two areas absolutely critical to our nation's capacity to increase productivity so that we can rebound as quickly as possible in the future from this economic malaise and repay the massive home-grown government debt being incurred by this reckless and panicked Government," Mr Robb said.

However, Mr Robb said the Coalition would not stand in the way of the program, and legislation to draw money from the education fund passed the House of Representatives unopposed yesterday.

Panels power rush on rebate

Hobart Mercury
Wednesday 13/5/2009 Page: 13

AUSTRALIANS have gone crazy for solar panels - and the Government is picking up the tab. Unexpected demand for the $8000 rebate on household solar panels has forced the Government to find another $270 million to pay for the scheme. As expected, the scheme will change from July 1 and some households will get a smaller rebate.

The Budget has delivered on a range of promises to help households reduce greenhouse gas emissions. Free ceiling insulation and an increased $1600 rebate for solar hot water are available until 2012, at a Budget cost of $3.9 billion. This is expected to slash household power bills by up to 40%. Low-interest green loans are on offer to households to cut their emissions - but the program has been cut by $125 million and fewer people can access it.

There is $64 million over four years for schemes to mandate better energy efficiency labelling on electrical devices, and minimum efficiency standards. Environment Minister Peter Garrett said the moves would help households buy clean, green products and cut their power bills.

Scientists back climate bill despite target doubts

Age
Thursday 14/5/2009 Page: 1

AUSTRALIA'S leading climate scientists believe the Federal Government is not doing enough to cut greenhouse emissions. But they want its climate legislation quickly passed in Parliament anyway. An Age survey of scientists working with the Nobel Prizewinning Intergovernmental Panel on Climate Change found six out of nine believed the emissions trading scheme - due to be introduced in the lower house today - was flawed, but better than nothing.

The most common reasoning was that it meant emissions must stop increasing and start to decrease, albeit gradually. One scientist said: "It is important that legislation be approved now, as airy delay sends a signal to business and the community that it is OK to procrastinate." Another said: "To knock it back entirely will not achieve anything - incrementalism is a part of this game."

All but one scientist who responded said the Government's proposed 2020 emissions targets - a cut between 5 and 25% below 2000 levels - were not ambitious enough for Australia to play its part in avoiding climate change. They were pessimistic about political efforts to limit global warming, predicting a rise due to greenhouse emissions of about 4 degrees this century.

The panel said this would expose hundreds of millions of people to water stress, trigger sea level rises that would swamp coastal areas and cause the extinction of thousands of species. There is heated debate in the environmental movement whether it would be better to back the Government's proposals or reject there as too weak.

The Australian Conservation Foundation and WWF Australia have been criticised by their members for backing the Government after it raised the possibility of a 25% emissions cut. It was one of a handful of changes announced last week, including delaying the scheme until July 2011 and increasing compensation for industry. The scheme still allows an unlimited number of carbon permits to be bought overseas.

The changes seem unlikely to be enough to win passage through the Senate. The Coalition said the scheme would cost thousands of jobs without environmental benefit; the Greens will not support a 2020 target that could end up being less than 25%. The panel's lead authors and review editors responded to The Age survey on condition of anonymity. Nine answered a question on whether the legislation should pass without amendment: six said yes, one was undecided and two said it was fatally flawed.

Asked what Australia's minimum role should be in a deal to limit warning to 2 degrees - the trigger point for unpredictable climate change - the scientists nominated an average 2020 emissions cut of 30%. Other majority views included that Labor was better on climate change than the Coalition, but had gone backwards since the 2007 federal election.

Most said public investment in carbon capture and storage was justified, but it must be matched by an increase in spending on renewable energy and energy efficiency. The survey was made before the Government announced $2.4 billion for clean coal projects and $1.5 billion for solar energy plants in the budget. The coal miners' union, the CFMEU, meets climate change secretary Greg Combet today to ask for help for gassy coal mines.

Budget cashes in on Australia's clean energy surplus

Clean Energy Council
13 May 2009

NATIONAL: The Federal Government's new $1.5 billion investment in renewable energy demonstrates their commitment to clean energy as a frontline solution to mitigating dangerous climate change. The clean energy headline in last night's federal budget was a new $1.35 billion Solar Flagships program that will drive up to four large scale solar energy stations.

"Australia is blessed with world class roaring 40s wind and is the sunniest continent on earth – we should be making the most of these clean energy assets," Clean Energy Council (CEC) chief executive Matthew Warren said. The CEC welcomes the creation of a new agency, Renewables Australia, to steward the development of emerging technologies. "If effective this new agency can help fill a gap in the development of new technologies and help grow great ideas and small companies into big solutions," Mr Warren said.

The CEC also welcomed certainty for the growing PV industry in Australia, with sustained support for the $8000 solar rebate until it is replaced with a Solar Credits scheme under the renewable energy targets expected later this year. Mr Warren said the endorsement of clean energy, like solar and energy efficiency by the government is the next big step towards developing the new green jobs market and reducing national greenhouse emissions.

"The initiatives outlined will not only accelerate our ability to deliver affordable clean energy at large scale, but will help deliver new jobs – particularly in regional Australia – and stimulate investment in this important emerging industry," Mr Warren said. The CEC looks forward to working with the government towards helping remote, regional and rural communities transition from diesel reliant systems to clean energy.

The budget commitment to developing Australia's first smart grid network will allow householders to go beyond the traditional energy saving methods such as retrofitting lighting. "The smart grid initiative puts the power in everyone's hands – reducing demand and lowering greenhouse emissions," Mr Warren said.

China tries cleaner approach to coal

Summaries - Australian Financial Review
Wednesday 13/5/2009 Page: 16

China's fast-paced construction of coal-fired power plants raised concerns worldwide about the effects on climate change as it is the largest emitter of gasses warming the planet.

However, it is also the world' leading builder of 'clean coal' power plants. The United States is still in the process of debating whether it should build a more efficient coal-fired plant that uses very hot steam, China is building similar plants at the rate of one of month.

US Energy Secretary Steven Chu says the Obama administration may revive a new generation low pollution power plant that turns coal into gas. Hal Harvey, president of ClimateWorks, a San Francisco group that helps to finance projects to limit global warming, said that China's approach is probably as fast and as serious as anywhere in power-generation history.

Cao Peixi is president of China Huaneng Group, China's largest state-owned electric utility, a majority partner in a new low-pollution power plant. Mr Peixi said his company has committed to the project despite the higher cost as 'it represents the future'. The International Energy Agency's annual report last November cut its prediction on an annual increase in Chinese emissions of global warming gasses from 3% to 3.2%.

Programs promote cleaner power

Australian
Wednesday 13/5/2009 Page: 11

NEW technologies will be commercialised, jobs created and households encouraged to save money by cutting carbon emissions through new clean energy programs announced last night. The Government will invest $3.5 billion in new funding on top of $1 billion already allocated on its clean energy initiative.

The budget says the funds will support clean technologies and industries, and assist with efforts to lower the nation's carbon emissions as well as stimulating economic activity in a sector that will support thousands of new green-collar jobs. The budget builds on the Energy Efficient Homes Package announced as part of the second stimulus plank in February, investing $100 million to encourage a smarter and more efficient network and $64.6 million to streamline existing measures.

The Government says the package will improve homes' energy ratings, cut waste and help households save up to 40% on electricity bills. The National Energy Efficiency Initiative will build on this through developing a smart-grid energy network that will combine broadband with intelligent grid technology and smart meters in homes. The Government hopes this will allow for a better integration of renewable energy sources.

The vast majority of funding from the clean energy initiative will go towards carbon capture and storage programs under a CCS Flagships program. The Government will spend $1.5 billion over six years on a Solar Flagships program, hoping to develop up to four projects to demonstrate solar generation at a capacity of up to 1000MW.

The Government will also establish the independent Renewables Australia with an initial funding of $465 million over four years to support the development, commercialisation and deployment of renewable technologies.

Wednesday, 13 May 2009

Trade wind set to blow

Hobart Mercury
Tuesday 12/5/2009 Page: 19

IN 1990 an ingenious way to make air polluters pay for their sins - or to reward efforts to reduce pollution - was passed into law in the United States. The Clean Air Act set up a market for sulphur dioxide emissions, administered by the Chicago Board of Trade. The scheme's success in achieving a 40% reduction in emissions in its early years was noted by the nations of the world. In 1997, in Kyoto, Japan, they voted to adopt its principles to tackle global greenhouse gas emissions.

Kyoto opted for emissions trading ahead of taxation because a trading scheme, while it has price uncertainties, puts a physical limit on emissions. A carbon tax, which seems to appeal to some Australian commentators, has no mechanism for direct control over emission levels.

Like the US scheme, the Kyoto system follows the "cap-and-trade" principle. whereby governments set a cap on total emissions and issue permits to allow pollution up to that limit, but not beyond. The trading part of the scheme allows corporations that cannot operate within their permit limits to buy carbon credits from those who pollute less.

The Kyoto agreement encouraged regional trading schemes in advance of a global system, and in 2005 the European Union began its own emissions trading scheme. It got off to a shaky start with a collapse in the carbon price - a story often cited by opponents of emissions trading. Yet this was hardly a surprise: such a new scheme, on such a scale, must have time to settle down.

Australia started down the emissions trading path in 2007, when the Howard government, after many years of opposition, finally decided to get a scheme under way by 2011. The more ambitious program of the new Rudd Government saw the starting date cone forward to 2010.

That is by way of background to the palaver that has been so prominent in the national political debate leading up to tonight's Budget. It also begins to explain why I think a trading scheme rather than a tax is the best national-scale tool available to tackle the mighty task of reducing carbon emissions.

When the Howard government signed Kyoto in 1997, and when the Rudd Government finally ratified it in 2007, we recognised that climate change was a global issue demanding international co-operation. As Climate Change Minister Penny Wong has frequently said, an Australian emissions trading scheme is part of that agreement.

Hunan carbon emissions continue to rise, setting the prospect of a real (as opposed to a mere financial) meltdown. With the world now moving inexorably towards an international emissions trading future, it is right that we quickly adopt measures that fit with this global trend.

The scale of emissions trading means that while the Government's announcement of a delayed start until 2011 is to be regretted, it is not surprising. Equally unsurprising is the welter of criticism about the scheme's low emissions targets, its cap review process, its impact on business, the scale of its assistance to big polluters, and the failure to adequately reward personal energy saving efforts.

A few weeks ago I reported in this column a powerful critique of the Government's plan by Guy Pearse, a former Howard government staffer and a strong advocate of emissions trading. The criticism still holds. The Government has put too much reliance on offsetting Australian emissions by paying for "avoided deforestation" in foreign countries.

There is still a lot that can be done to make the proposed scheme work better. Opposition parties and independents are right to criticise it and to work to improve it though amending the legislation. But they would be very wrong to seek to block the legislation until after this year's UN climate meeting, which starts in Copenhagen on December 7.

Copenhagen is shaping up as the most important global congress in history. With European emissions trading now well under way and US President Barack Obama declaring his support for a similar cap-and-trade system, a failure in setting up an Australian scheme would put us in a weak bargaining position in this critical meeting.

To abandon or further delay emissions trading would be to throw the baby out with the bath water. We need to have legislation in place by the time we join the Copenhagen debate. We should seek to make the legislation better but there will be time in the years ahead to address shortcomings.

To paraphrase Winston Churchill's quip about democracy, there is no doubt the Rudd Government's emissions trading option has serious shortcomings. The only trouble is that all the other options - including delay - are much worse.

MORE than 8000 primary schools around the nation will pound the pavement on Friday, doing their bit for the sake of their own health and that of the planet, as part of the 10th national Walk Safely to School Day.

For more information visit www.walk.com.au
Peter Boyer is a Hobart-based science writer and a presenter for Al Gore's Climate Project.
pb@climatetasmania.com.au

$1b to `green' energy

Daily Telegraph
Tuesday 12/5/2009 Page: 4

A $1 billion-plus investment in solar and other clean energy will spearhead Budget plans to make Australia a global leader in "green" technology. Treasurer Wayne Swan will tonight commit the nation to technology to cut high-polluting coal emissions. Hundreds of millions will go to develop cutting-edge solar projects with the Government hoping Australia can become a world leader, while millions will help develop high-tech "smart grids" in which energy is delivered using digital networks.

But the economic meltdown has forced the Rudd Government to slash money expected by elite universities. Mr Swan has also been forced to dramatically scale back a promised overhaul of funding for business research and innovation. The $1 billion-plus investment in clean and renewable technology will focus on solar, clean coal solutions and "smart grid" technology.

It follows last week's backflip on the timing of an emissions trading scheme after criticism from business. But Prime Minister Kevin Rudd will use the $1 billion-plus move to say his Government wants Australia at the fore of global "green" technology. US President Barack Obama is also investing heavily in clean energy.

$67m deal gives wave energy play global rights

West Australian
Tuesday 12/5/2009 Page: 36

A London group will emerge as the biggest shareholder in wave energy company Carnegie Corporation under a $67 million deal announced yesterday. Carnegie Corporation has entered into a heads of agreement with AIM-listed Renewable Energy Holdings to buy the intellectual property and global rights to the CETO wave technology it is trying to commercialise in Australia.

Renewable owns the patent for the technology, which converts the energy of ocean waves into zero emission electricity. Carnegie Corporation signed a £4.75 million ($9.5 million) licence agreement with Renewable two years ago to develop the CETO technology in the southern hemisphere. In exchange for the global rights, Carnegie Corporation will issue 252 million shares, giving Renewable a 35% stake in the company.

Carnegie Corporation managing director Michael Ottaviano said the acquisition would open up the lucrative and more wave energy-ready European and US markets for the company once the technology was commercialised. "One of the major drivers for the deal was access to the northern hemisphere markets which conservatively and accurately would be around 10 times the southern hemisphere's market," Dr Ottaviano said.

"I am extremely confident, purely from a monetary point; this is significantly value-increasing for Carnegie Corporation." Renewable chief executive Mike Proffitt already sits on the Carnegie Corporation board and the latest deal will give Renewable the right to appoint another director. Investors welcomed the deal yesterday, sending the share price more than 10% higher in a subdued market to close at 26.5.

ACT to aim for zero gas target

Canberra Times
Tuesday 12/5/2009 Page: 1

The ACT Government will set an ambitious target of zero net greenhouse gas emissions in a bid to combat climate change. Environment Minister Simon Corbell said yesterday the target, outlined in the Government's submission to a Legislative Assembly Committee inquiry into gas emission reduction targets was realistic and necessary. "Achieving zero net emissions really mast be the ultimate goal of Government and of the Canberra community," Mr Corbell said. "It mast be an achievable goal.

We can't continue to sustain our quality of life and continue to emit the levels of carbon that we currently emit." Conceding it would be impossible to eliminate all emissions, the Government's proposal was three pronged: abatement, mitigation and offsets. That is, as well as reducing emissions, they would be "offset" through initiatives such as investing in tree planting and renewable energy.

The Government's submission said that in 2005 the ACT emitted more than four million tonnes of greenhouse gasses, or about 13.7 tonnes a person. Also, ACT emissions had grown by about 2.6% each year since 2000, and in 2006 were 15% above 2000 levels. The submission does not provide a timeline, framework or costings for achieving the zero net emissions goal, prompting concern among the ACT Greens.

Greens environment spokesman Shane Rattenbury said the Government needed to set a clear framework for achieving the target, which he believed could be achieved by 2050. "The Government's looking to be inspirational, but without a clear timeline they're only being aspirational," Mr Rattenbury said.

"We need clear timelines, a series of actual points that lead its to the zero net emission. It's not worth the paper it's written on without some clear interim targets." Mr Corbell said the Government would wait until the Standing Committee on Climate Change, Environment and Water, chaired by Greens leader Meredith Hunter, had reported to the Assembly with its recommendations and findings, which were due on July 31.

This would determine what timeline and policies were needed for the zero target, as well as what interim targets to legislate for. In 2007 the ACT Government unveiled its Weathering the Change action plan, which sought to reduce 2025 emission levels to those of 2000, and for 2050 emissions to be 60% less than 2000 levels.

Mr Corbell said the Assembly would almost certainly legislate for more aggressive targets, as all three parties were in favour of this. The Government's parliamentary agreement with the Greens, signed after last year's election, committed to legislating a greenhouse gas reduction target based on the committee's recommendations.

The Government's submission said the ambitious targets would inevitably result in higher costs to the community, noting, "The local economic impact of actions, such as increased business input prices, higher consumer prices, and ACT budgetary implications, will need to be weighed tip against the benefits of the ACT contributing to reducing climate change globally."

Mr Corbell said the ACT would not be pushing back the changes despite the tough economic climate, as changes were needed immediately. "I think the community expects its to act on this issue for the long term and to act on it quickly," Mr Corbell said.

"We will certainly do a very detailed analysis on the impact of targets on economic activity as part of formulating the Government's response to the committee inquiry, but the existing short term economic circumstances are not a reason to delay action on what is required now."

State backs coal to fill energy gap

Australian
Tuesday 12/5/2009 Page: 7

WESTERN Australia is increasing its reliance on coal by firing up a decommissioned power station to cope with a predicted 200 MW shortfall in the summer of 2011-12.

While Premier Colin Barnett yesterday pledged his Government's commitment to the Council of Australian Governments renewable energy target of 20% by 2020, he described the decision to refurbish the Muja A B Power Station south of Perth as "perhaps not the ideal solution, but it is a pragmatic one".

Mr Barnett said the four units that comprised Muja A B Power Station would provide 240MW of power for about 15 years, starting in late 2011. Two of the units were recommissioned temporarily last year by the Carpenter government in the wake of the Varanus gas explosion that cut the state's gas supply by 30 % . "(The four units) are old, they were built in the 1960s, they were decommissioned because of their poor environmental performance in 2007," Mr Barnett said.

But he said the decision to use the decommissioned Muja A B coal-fired Power Station would be balanced by an increase in the use of renewable energy for power generation in coming years. "This Government's strategic approach is about ensuring a reliable and secure electricity supply for all Western Australians," he said. "We have a long-term plan for energy security, something that was severely lacking under eight years of a Labor government."

The state Government is in negotiations with a private investor who would pay for a $100 million refurbishment of the units. Mr Barnett has been preparing the public for days for steep electricity price rises in Thursday's state budget. He said yesterday charges would rise by 25% in two installments of 10% and then 15% . West Australians could expect further price rises in the future. He blamed this on Labor's "disastrous" decision to break up the utility Western Power, which ultimately led to utility Verve Energy losing almost $1 billion.

Western Australia's projected electricity shortfall in 2011-12 has also prompted the Barnett Government to spend $263 million on two 100MW high-efficiency gas turbines at the Kwinana Power Station south of Perth. Energy Minister Peter Collier said such turbines had not been installed anywhere else in Australia and were at least one-third more efficient than the generators they would replace.

Construction would begin immediately, with the turbines expected to be operational by late 2011, ready for the 2012 summer. Mr Collier said the state currently got 5% of its energy from renewable resources, and the decision to recommission Muja A B Power Station would have a negligible effect on that percentage.

Carnegie inks CETO deal

Adelaide Advertiser
Tuesday 12/5/2009 Page: 39

OCEAN wave energy company Carnegie Corporation will buy all the intellectual property and global development rights for the CETO Wave Energy Technology, it said yesterday.

Carnegie Corporation signed a heads of agreement with CETO rights owner UK-based Renewable Energy Holdings for 252 million shares, worth $20.8 million yesterday, and giving Renewable Energy 35% of Carnegie Corporation.

The deal, which needs shareholder approval, would give Carnegie Corporation opportunities to set up its wave energy technology in the U.S., Europe and Asia. Carnegie Corporation was licensed in February to explore the seabed off the state's South-East coast for SA's first wave farm.

Tuesday, 12 May 2009

Change in the wind on green jobs front

Adelaide Advertiser
Saturday 9/5/2009 Page: 41

THOUSANDS of new jobs will be created if South Australia acts quickly enough to avert climate change, environmentalists say. More jobs are expected to be created than lost in the "green" sector from the effects of climate change on local industries. Environmentalists say that by standing firm on tackling climate change, jobs will be created which will help overturn the number of jobs lost from the global financial crisis.

The Australian Conservation Foundation says SA has a lot more to lose by acting on the GFC ahead of climate change. Climate campaigner Phil Freeman said that even energy intensive industries SA's economy relied on, such as mining and manufacturing, would experience job growth by responding to climate change, rather than doing nothing.

SA stood to lose thousands of jobs in the agriculture sector because of reduced rainfall. Tourism would be affected, particularly nature tourism, as plants and animals failed to adapt to rising temperatures. Tourism ventures which relied on water, such as Murray River houseboat operators, also would be affected. But Mr Freeman predicted SA would pick up thousands of jobs across the state in the renewable energy sector, in particular wind, geothermal and solar. He said 175,000 new jobs were estimated nationally in the sector.

"South Australia will be going for a fair chunk of that pie," he said. "We can make big cuts in greenhouse pollution by 2050 and overall employment will continue to grow. 'By making sure we are a leader in the next 'green' technology, both will kick-start the economy and create hundreds of thousands of jobs."

Several areas of the state, including the Far North and South-East, have been identified as potential sites for geothermal energy plants, one of few renewable energy sources able to produce base-load power. White collar jobs also would be created, to help businesses understand the effect of climate change on their bottom line.

Carbon Planet is one Adelaide company which has already been created to help businesses. State manager Matthew Curnow said job losses from climate change would be more than replaced by employment being created. "There will be opportunities for energy auditors, for both the commercial building sector and residential requirements, employment in retro-fitting and construction," he said. "The manufacturing sector needs to know how it can modify and change practices and equipment to become more efficient."

Coal or gas-fired electricity generators, often seen as having a limited future because of their high emissions - also would have new job opportunities. "The ability for job creation in the coal industry is for carbon capture and storage," he said. "(These facilities) will all go up right next to coal-fired power stations and are able to increase employment in that area."

Australia on the verge of a $20 billion kick start in clean green investment

Clean Energy Council
30 April 2009

NATIONAL: Today's approval of the federal government's renewable energy target (RET) brings Australia to the brink of unleashing more than $20 billion of new clean energy investment.

Clean Energy Council (CEC) chief executive Matthew Warren said the endorsement by the Council of Australian Governments (COAG) is the penultimate step towards the creation of thousands of new green jobs and delivering the first big cuts in national greenhouse emissions.

"We congratulate the federal government for delivering on its commitment to the development of a clean energy industry in Australia," Mr Warren said. "Successfully deploying the 20 per cent target of renewable energy in Australia by 2020 will unleash the ingenuity of Australia's energy industry, accelerate research and development and will reveal quickly the scale and potential of this important emerging industry," he said.

The CEC has been working closely with the government since January to fine tune the draft legislation released in December. Mr Warren said Climate Change Minister Penny Wong and the Department of Climate Change responded quickly and effectively to initial concerns raised by the industry.

"The refined RET legislation incorporates crucial changes which will ensure accelerated investment in clean energy so the industry can play an immediate role in reducing Australia's greenhouse emissions and help drive a new green economy," he said. The final step in delivering a revitalised green energy industry in Australia will be the swift approval of Federal Parliament when the RET bill is tabled in the coming weeks.

AGL stands by drought-hit hydro plants

Sydney Morning Herald
Monday 11/5/2009 Page: 19

AGL Energy is standing by the assets it bought in the controversial $1.425 billion takeover of Southern Hydro, despite the worst drought on record severely constraining output from hydroelectric plants at the centre of the 2005 deal. A key assumption in the takeover was that normal rainfall would resume by this year but the two main dams dependent on rainfall are parched.

After the worst-ever flows into the Murray system in the March quarter, the 135 MW Lake Eildon is just 12% full and its output is believed to be minimal. The 180 MW Dartmouth Dam - Australia's largest - stopped generating electricity in 2007 and is unlikely to restart before 2011. Industry sources said the $1.425 billion price tag was well ahead of rival bids from Origin Energy and Babcock and Brown, which were less than $1.1 billion.

Electricity supply from the Snowy region has fallen sharply since 2007, though AGL does not disclose individual plant production levels. A company spokesman denied the assets had been impaired and pointed to a 20% pre-tax rise in wholesale electricity earnings at the latest half-year results.

We do not run the business on an asset by asset basis. Rather, we look at all of the generation across our portfolio and that is how the auditors sign off on the business, as a single cash generating unit," he said. Several analysts, who think AGL overpaid for Southern Hydro, have lowered their valuations on the dams. AGL's hydro assets contributed just $3.4 million to earnings before interest and tax in the 2008 financial year.

Despite the drought, the company aims this year to complete a 140 MW expansion of the Bogong hydro-power plant, which will use water from snowfields in Victoria. It says the move will mean half its hydro capacity is effectively drought-proof. AGL's managing director, Michael Fraser. has said the company was also considering an expansion of the Dartmouth Dam, but a spokesman said this was now a low priority because of expected prices.

"There are other more attractive development opportunities for AGL at this time, although that option remains in our wider development portfolio," be said. Amid the prolonged drought, the company says the carbon pollution reduction scheme and a government mandate to increase renewable energy use will raise the value of hydro assets. At the time of the Southern Hydro deal, AGL's then managing director, Greg Martin, stressed the company's cautious rainfall assumptions.

"Higher dam levels at Dartmouth Dam and Lake Eildon are important, and they're currently well on their way to recovery from the lows experienced in the recent drought," he said in 2005. AGL's low dam levels are just one example of the headaches the drought is causing companies that depend on plentiful or cheap water. New Zealand's Contact Energy, half owned by Origin Energy, also suffered a similar problem when drought contributed to a 23% fall in earnings forecast for this financial year.

A consultant for sustainable water management at Energetics, Dr Peter Holt, said climate change science suggested water shortages would lead to increases in hydro dam shortages. "What we're seeing from the macro weather trends is that we'll see more and more droughts and less rainfall availability, so we're expecting that to increase." he said.

BluGlass pursues toxin-free technology

Australian
Monday 11/5/2009 Page: 29

SHARES in green technology company BluGlass rose by more than a third on Friday after it announced it had signed a licence agreement with South Korean group BLK and would look for opportunities in the solar PV market.

BluGlass was listed in September 2006 to pursue commercial opportunities from technology developed at Macquarie University to allow gallium nitrides to be deposited on glass wafers at lower temperatures than conventional means. Not only is it a cheaper process, it does not emit toxins.

Until now the company has been focusing on the LED market, which includes traffic lights, computers and mobile phones, but the agreement with BLK will look at opportunities to use the technology in the household and commercial lighting markets. BluGlass chief executive Giles Bourne says LEDs could cut energy use in lighting by 30% and the market is tipped to have annual growth of 20% to $12.5 billion by 2013.

As for solar, Bourne says indium gallium nitride is one of the most exciting materials since the silicon solar cell and could lift the efficiency potential of solar cells to more than 50% from about 20% now. The solar PV market is also expected to soar in coming years, with estimates that it will grow almost fourfold to $74 billion by 2017.

Myths of peak energy use

Adelaide Advertiser
Monday 11/5/2009 Page: 55

IT seems very common with people I am talking to on a daily basis that a shared assumption is that we use more energy in summer. I think this often comes about from the number of blackouts we have during summer due to huge quantities of air conditioners creating such a large demand at any one time.

This obviously occurs on those stinking hot days because the only way we can all cool our homes and workplaces is with electric energy and air conditioners. In actual fact almost every home will consume more energy throughout winter than summer in our climate. In winter our consumption is greater because we have less daylight, therefore we use electricity to light our homes. We spend more time indoors bringing greater demand on our appliances and many of us use my pet hate, the clothes dryer.

I believe we need to look at ways we can reduce our consumption to guard against the future costs of living. As we head into winter it is important to create living spaces that are well zoned within your home. If we are heating, we want to ensure we are heating the parts of the home where we are spending all our time and not the entire house unnecessarily.

Solar energy is the way of the future. With rebates at $8000 and additional renewable energy certificates provided with each system purchased, now is the time to get on board. A good sized solar system can actually make you money with the current feed-in tariffs, something I have found in my own home.

Adam Wright is a director of Beyond Today.

AGL defends hydro assets - $1.4bn takeover queried

Age
Monday 11/5/2009 Page: 1

AGL Energy is under pressure over its controversial $1.425 billion takeover of Southern Hydro as the worst drought on record has severely cut output from hydroelectric plants at the centre of the 2005 deal. A key assumption in the takeover was that normal rainfall would resume by this year, but instead, the two main dams dependent on rainfall are parched.

After the worst-ever flows into the Murray system in the March quarter, the 135 MW Eildon Dam is just 12% full and its output is believed to be minimal. The 180 MW Dartmouth Dam - Australia's largest - stopped generating electricity in 2007 and is unlikely to restart before 2011.

Industry sources said the $1.425 billion price tag was well ahead of rival bids from Origin Energy and Babcock and Brown, which were less than $1.1 billion. Electricity supply from the Snowy region has fallen sharply since 2007, though AGL does not disclose individual plant production levels.

A company spokesman denied the assets had been impaired, and pointed to a 20% pre-tax rise in wholesale electricity earnings at the latest half year results. "We do not run the business on an asset by - asset basis. Rather, we look at all of the generation across our portfolio and that is how the auditors sign off on the business, as a single cash-generating unit," he said.

Several analysts, who think AGL overpaid for Southern Hydro, have lowered their valuations on the dams. AGL's hydro assets contributed just $3.4 million to earnings before interest and tax in the 2008 financial year. Despite the drought, the company aims to this year complete a 140MW expansion of the Bogong hydro-power plant, which will use water from snowfields in Victoria. It says the move will mean half its hydro capacity is effectively drought-proof.

AGL managing director Michael Fraser has previously said the company was also considering expansion of the Dartmouth Dam, but a spokesman said this was now a low priority because of expected prices. "There are other more attractive development opportunities for AGL at this time, although that option remains in our wider development portfolio," he said.

Amid the prolonged drought, the company says the carbon pollution reduction scheme and a government mandate to increase renewable energy use will raise the value of hydro assets. At the time of the Southern Hydro deal, AGL's managing director, Greg Martin, stressed the company's cautious rainfall assumptions. "Higher dam levels at Dartmouth Dam and Lake Eildon are important, and they're currently well on their way to recovery from the lows experienced in the recent drought," he said in 2005 before Paul Anthony took over the top job.

AGL's low dam levels are just one example of the headaches the drought is causing companies that depend on plentiful or cheap water. New Zealand's Contact Energy, half owned by Origin Energy, also suffered a similar problem when drought contributed to a 23% fall in earnings forecast for this financial year.

The principal consultant for sustainable water management at Energetics, Peter Holt, said climate change science suggested water shortages would lead to increases in hydro dam shortages. Analysts at Citigroup said operations run by Foster's, OneSteel, Newcrest Mining and Rio Tinto were also at risk from security of water supply and the possibility of higher prices caused by drought.

Mounting expenses in store for energy

Weekend Australian
Saturday 9/5/2009 Page: 1

DESPITE the global financial crisis, the Australian domestic energy industry is well down the road to spending more than $100 billion in the next decade in pursuit of supply reliability and a smaller environmental footprint. Even allowing for inflation, it is by far the largest level of energy industry capital expenditure in the country's history.

Leading the charge, to the surprise of many focused on the greenhouse gas emissions of power stations, are not the generators but the network businesses, half government-owned, that are already outlaying about $3.5 billion a year and have plans in train to spend as much as $60 billion between now and 2020.

The biggest budget belongs go the country's largest network operator, EnergyAustralia, owned by the NSW Government and unhappily in the headlines at present because of power blackouts in central Sydney. It has spent $3 billion on capital works in the past five years and says it will need to contribute another $16 billion by 2020 to meet growing demand and to replace aged assets, some 50 years old.

Most of the expenditure will occur on the eastern seaboard, home of the national electricity market and of nearly 90% of the power load, but the stand-alone network in Western Australia requires a substantial budget, too. Operator Western Power, owned by the WA Government, spent $1 billion augmenting and upgrading the system last financial year, at the height of the minerals boom, and has projected continuing spending at the rate of $2 billion annually until 2012.

The Energy Networks Australia, a Canberra-based lobby group for the country's power and gas delivery businesses, says that, nationally, energy distribution and high-voltage electricity transmission businesses are spending more than $6.2 billion a year in operating the systems, reinforcing and expanding them, and undertaking greenfield extensions.

The need to address global warming issues also is starting to loom large in the networks' budgets. A recently released study for the association by consulting firm Parsons Brinckerhoff claims that network costs related to climate change will run to $2.5 billion during the next five years, the largest part of which will go on expanding power systems to accommodate the fast rising use of airconditioning. Parsons Brinckerhoff says the networks will need to increase capital expenditure by $1.2 billion to reduce energy lost over the 857,000km of cables linking homes, hospitals, schools and businesses to power generators.

Projections by leading transmission businesses, including TransGrid, Powerlink Queensland, ElectraNet in South Australia and Tasmania's Transend, that they need to devote $16 billion to capital works in the next decade do not include the estimated cost of connecting a large number of new windfarms and other zero-emission generation to power grids when the Rudd Government's new renewable energy target is implemented.

It is predicted that the target will require 6000 MWs of new windfarms and an outlay of about $4.5 billion in connecting their remote sites along with at least 2500MW of open-cycle gas turbines to provide back-up for the intermittent supply to the main delivery system.

Estimates of what needs to be spent on power generation between now and 2020 fluctuate widely because it is hard to come up with accurate projections of the effect of carbon prices on demand as well as on the ability of older, high-emitting coal-fired generators to continue operating under the new policies. Projections range from $25 billion to more than $40 billion.

(One of the unknown factors is whether federal and state governments will go ahead with rolling out a revolution in householder metering to enable customers to better manage their electricity use and suppliers to intervene during extreme demand to reduce consumption. The cost of the smart-meter rollout is estimated at $7.5 billion. This does not include high-cost IT investments by retailers to make full use of the system.)

Apart from the cost of windfarms the 129MW set of turbines Roaring 40s plans to erect at Musselroe Bay on Tasmania's northeast cost will cost $230 million companies such as Origin Energy, Santos and TRUEnergy, the Australian subsidiary of Hong Kong-based China Light and Power, have large gas-fired developments in train in Victoria, NSW and Queensland, involving, when fully commissioned during the decade, capital outlays totalling about $10 billion.

One of the biggest question marks in Australian electricity supply is whether new clean coal generation can be brought to the market by 2020. Environmentalists and many industry analysts consider this unlikely, given the state of technology development, although international giant General Electric has offered to build a 1000MW carbon dioxide-capture ready coal plant for $3 billion. This does not cover infrastructure for carrying the greenhouse gas to burial in deep geological sites, nor the on-site costs of sequestration.

It has been estimated that building a government-owned, common carrier CO2, pipeline to take Latrobe Valley gases from the brown coal generators to disused wells in the Bass Strait would cost at least $200 million. Finding the necessary capital for these capital projects presents developers with serious hurdles, but Origin Energy chief executive Grant King argues that the global financial crisis will be seen as a blip by 2030.

King says he is still able to invest billions of dollars. Although there is less capital available, energy companies with strong balance sheets can access it, albeit at a higher cost, he says. Firms with highly geared balance sheets will have problems pursuing development, he says, "but Origin Energy can find ways to invest for the long term. The current circumstances are largely irrelevant to major decisions we will make on capital investment."

The key issue today, he argues, is for government especially the federal Government to make carbon policy decisions to "avoid the problems of acting slowly" on global warming. Failure to make good policy decisions now, he says, will affect investment decisions. "Government needs to set the direction of change by placing a cost on carbon. But it must balance purity of policy with pragmatism. It needs to appreciate the stranding risks for power plants with very long lives."

The ENA echoes this advice in its submission to the Senate select committee on climate change. The transition to emissions trading, it says, must avoid giving rise to energy supply insecurity. A poorly designed trading scheme could create investor uncertainty with "consequent negative impacts on clean energy-enabling infrastructure investment".

Loans of $10,000 to lower home energy use

Sydney Morning Herald
Saturday 9/5/2009 Page: 5

THE Federal Government will offer people interest-free loans of up to $10,000 to help them make their homes more energy and water-efficient. Up to 75,000 loans will be offered but this is less than half the number announced when Labor first made the promise during the election campaign.

The Minister for the Environment, Peter Garrett, said this was because government rebates had since been introduced to help householders install specific devices such as solar hot water systems and insulation. "These are sensible changes to the green loans program which acknowledge that many home owners won't need a loan to make big changes to improve their energy efficiency," be said.

The loans will be available to households with a combined income of up to $250,000 and be interest-free for four years. The Government anticipates that loans will be repaid in that time but if they are not then market interest rates will apply to the remainder of the loan. Five credit unions have agreed to run the loans on behalf of the Government but none of the major banks have shown interest.

Before getting a loan, people will have to have their home audited for its energy and water usage by an approved assessor. The Government will cover the cost of 360,000 home inspections over the next five years. "The fact is that, for many households, the assessor will identify simple, low-cost actions like changing light globes, sealing draughts and repairing leaking taps," Mr Garrett said.

People would be directed to apply for separate government rebates if they were found to have energy-guzzling household items, such as an electric hot water system. The Government announced earlier this week that voluntary actions by householders to reduce their emissions would also be taken into account as part of the emissions trading system.

People will be able to donate money to a newly created Carbon Trust, which will use the money to buy carbon permits. If people choose to destroy the permits, the Government says this will mean there are fewer permits available to industry. The Government will also adjust the emissions reduction target to account for people who wish to have their power generated by environmentally friendly sources through the Greenpower scheme. But it will only count people who join the scheme after 2009.

The Alternative fast rising said yesterday existing customers should also be counted. "Once again, people willing to make a personal contribution to reducing Australia's carbon emissions get no reward for their efforts, while the big polluters get a helping hand," the association's Damien Moyse said. The association asked 750 of its members whether they would continue to buy Greenpower if their efforts were not recognised by the emissions trading scheme. A third said they would not.

Many targets for AGL

Summaries - Australian Financial Review
Saturday 9/5/2009 Page: 46

AGL Energy and Origin Energy are tipped to share in the carve-up of the NSW power sector when it is privatised. AGL chief Michael Fraser spoke about post-privatisation plans at the Macquarie conference in Sydney. There are no targets as apparent as the NSW power assets, although AGL has pushed hard to build up coal seam gas reserves in NSW through last year's deals with Molopo and AJ Lucas and the takeover of Sydney Gas. Much of the prime NSW coal seam acreage has been snapped up by Santos and Eastern Star Gas. AGL will have to invest heavily in wind energy to meet the government's renewable energy targets.

Petratherm applauds COAG decision

Independent Weekly
Friday 8/5/2009 Page: 13

Adelaide-based geothermal energy company Petratherm has applauded a Government ruling for an expanded Renewable Energy Target (RET) for Australia. Last week, the Council of Australian Governments announced a landmark decision to a new RET scheme ensuring that 20% of the country's electricity comes from renewable sources by 2020. The RET scheme will be implemented through Commonwealth legislation this year, with increased annual targets starting in 2010.

The targets increase annually to reach 45.000GWh in 2020 and will now be maintained at that level to
2030. The RET scheme also includes an increased shortfall charge (the penalty paid by electricity retailers in lieu of renewable energy certificates) from $40/MWh to $65/ MWh to encourage compliance.

Speaking at Paydirt's 2009 South Australian Resources and Energy Investment Conference this week, Petratherm managing director Terry Kallis said he was delighted with the Australian Government's latest show of support for renewable energy and the geothermal sector.

"The Government's new RET scheme, in particular its decision to increase the renewable energy certificate penalty by $25/MWh and extend the period to 2030, is likely to create greater certainty and improved NPV for geothermal project investment," said Mr Kallis "This is a significant decision by COAG and continues strong Government support for geothermal and renewable energy, which includes capital funding through the $50 million geothermal drilling program and the $435 million renewable energy demonstration program."

Mr Kallis said the new RET scheme could deliver a renewable energy target more than four times the size of the current mandatory renewable energy target. "This new RET scheme is a fantastic step forward for renewable energy and the geothermal sector in Australia," he said.

"Not only will it give confidence to investors to help advance a broad range of renewable energy technologies, but it will also result in more green jobs for Australians. "It will also help the Government achieve an estimated 30-fold increase in the renewable electricity sector by 2050 and maintain this country's reputation as one of the world's renewable energy leaders."

Renewables target an incentive to invest

Australian
Wednesday 6/5/2009 Page: 33

LAST week's decision to more than double the amount of electricity sourced from renewable energy "meant a generation of research and development had to be done in a decade", the Clean Energy Council says. The Council of Australian Governments' endorsement of the mandatory renewable energy target brought Australia to the brink of unleashing more than $20 billion of new clean energy investment, CEC chief executive Matthew Warren said.

Successfully deploying the 20% target of renewable energy by 2020 would tap the ingenuity of the energy industry, accelerate research and development and reveal the scale and potential of the industry, he said. Mr Warren said that despite the maturation of wind and other renewable energy technologies in Europe and the US, all Australian universities, not just Group of Eight research-intensive institutions, stood to play a vital role in helping meet the target.

Australia still hosted two world-class solar photovoltaic research centres at the University of New South Wales and the Australian National University, and there was a "colossal array" of scientific knowledge that renewable energy companies would need to innovate, be profitable and meet the 2020 target, he said.

"Australia and the US are the only two countries that have outstanding natural assets. We have bioenergy, world-class wind on the roaring 40s, great geology and sunshine, good hydro, very strong ocean currents; a Melbourne Cup field of renewable resources," he said. Universities would play an increasingly vital role in improving the efficiency and driving down the cost of technologies based on natural resources and training the various professionals to drive the change, he said.

In a call likely to be well received by Innovation Minister Kim Carr, who is backing greater research concentration under his hubs-and-spokes model, Mr Warren said the industry wanted a smaller number of schools with the right collection of minds. "We have to think about how we better co-ordinate those efforts so good ideas aren't lost and concentrate schools of leading thinkers so we don't waste scarce resources," he said.

lain MacGill, co-director of the UNSW Centre for Energy and Environmental Markets, told the HES that the new target would be influential in driving a renewed level of investment and in proven renewable technologies such as wind. biomass and solar.

Plantation Energy wins $70m European contract

West Australian
Thursday 7/5/2009 Page: 48

Private equity-backed biomass producer Plantation Energy Australia has tapped into the growing European market for so-called green energy by securing a $70 million, three-year deal to supply its compressed biomass fuel pellets to a Belgium-based power company. Plantation Energy trumpeted the deal with Electrabel, a subsidiary of Europe's biggest power company, as the first of its kind in Australia.

The Perth-based company uses plantation timber residues to produce its "densified biomass pellets", which are burned in coal-fired power stations. Initial exports will be shipped from Albany where Plantation Energy has a pellet factory. "This agreement is an important first step as we look to expand our business model in Victoria and South Australia and increase our capability to meet growing world demand," Plantation Energy business development manager Jarrod Waring said.

"We also believe there is great potential to supply the domestic market over time as fuel pellets become more widely understood and accepted here in Australia. " The unlisted group is backed by US private equity giant Denham Capital, which took a majority stake last year via an $US80 million ($108 million) funding injection to help pay for construction of the Albany plant. It struck an offtake deal with listed MIS provider Great Southern earlier this year for the timber group's bluegum harvest residues, and is reportedly planning to build another pellet plant at Mt Gambier in South Australia.

Origin gains more power with Wind

Summaries - Australian Financial Review
Thursday 7/5/2009 Page: 17

Origin Energy has acquired the private Victorian company Wind Power for an estimated $30 to $40 million, almost quadrupling the size of its wind development pipeline. Melbourne-based Wind Power is best known for its proposed Bald Hills development which, after being temporarily knocked back by the Howard government, was sold to Japan's Mitsui in mid-2008.

Wind Power's main project is Stockyard Hill, Victoria, a $1.4 billion turbine venture. Origin Energy chief executive Grant King told the Macquarie Securities conference yesterday that the federal government's renewable energy target would best be met by wind energy. Meanwhile, Origin Energy's joint venture with geothermal energy play GeoDynamics is facing problems, as the company struggles to stop an uncontrollable flow of steam from its Habanero-3 well in South Australia.

Origin Energy has also formally opened its $250 million coal seam gas-fed Talooma power plant, whilst the $35 billion joint venture with ConocoPhillips remains on track. Mr King said he believed only Origin Energy and British gas producer BG Group had enough reserves to underpin projects with multiple processing lines, despite Santos and Arrow Energy proposing multi-train developments in the region.

Origin acquires Wind Power

Australian
Thursday 7/5/2009 Page: 23

Origin Energy, Australia's second-biggest electricity and gas retailer, has acquired Wind Power, more than tripling its potential wind capacity to benefit from regulations supporting renewable energy. Along with existing sites and options, the purchase increases Origin Energy's prospective capacity by 1460 MWs to more than 2000MW. Developing all the projects may cost as much as $4.4 billion based on an Origin Energy estimate of typical wind ventures.

Australia wants renewable sources to account for 20% of electricity supplies by 2020 to help tackle global warming. The regulations, which the Clean Energy Council estimates will trigger more than $20 billion of new investment, deliver extra revenue for producers using wind, sun or wave energy and compel power retailers to sell more electricity from such sources.

"Origin Energy have realised they've got a liability under the renewable energy target, so with that getting firmed up, I suspect this is something they've been looking at for a while," said Jason Mabee, a utilities analyst at RBS Group Australia. The acquisition "definitely makes sense", he said.

Origin Energy would not comment on the purchase price, said Michelle Zahra, a spokeswoman in Sydney. Andrew Newbold, a director of Melbourne-based Wind Power, also wouldn't give the price. "Given they're all just development projects, I wouldn't have thought it's that substantial," RBS's Mabee said. Wind Power's ventures in Victoria state include the intended 484MW Stockyard Hill project near Ballarat, which Origin Energy said was one of the most competitive of its kind in Australia.

The most advanced project was the 38MW Lexton venture, which had won planning approval, Mr Newbold said. Origin Energy estimated last January that each MW of wind energy capacity cost between $2.5 million and $3 million to install. Mr Zahra would not say whether that range applied to the Wind Power projects. Origin Energy has windfarm sites with 60MW of capacity and options on as much as 500MW of capacity from Conergy's Epuron unit.

Wind Power, which was previously closely held, had developed more than 300MW of windfarms in Victoria that had since been sold, Mr Newbold said. Those windfarms represented about half of the operating capacity in the state, he said. Australia's renewable energy target regulations set a goal of 45,000 gigawatt-hours of renewable energy generation by 2020, more than four times existing production of about 9500 gigawatt-hours.

Monday, 11 May 2009

Victory for Greens in $19m carbon footprint information shop

Canberra Times
Wednesday 6/5/2009 Page: 21

The ACT Greens have posted their first budget win, with the announcement of a $19 million one-stop information shop to help residents reduce their carbon footprint. The program, which aims to reduce business and household waste, and cut energy and water use, gets a $4.6 million kick-start in the 2009-10 budget, with funding extended to 2013.

The public information service - called Switch Your Thinking - was a key item on a wish-list of reforms put forward by the Greens after winning the balance of power in the ACT Assembly last year. The list formed the basis of a power-sharing agreement negotiated between the Greens and Labor. Yesterday, the Greens said the budget reflected "a greener way of doing government, with a more practical focus on climate change".

This year's budget allocates $35 million in new funding for the environment. The big ticket items are $14 million over two years to create urban wetlands in Dickson and Lyneham, and $19 million over four years for the public information service. Both programs were Greens initiatives, detailed in the post election agreement negotiated with Labor.

Other budget allocations include $4.5 million this year to remove and replant street trees, $686,000 to increase uptake of greenpower electricity by 7%, $485,000 to improve waste recycling at the Mugga Lane tip, $350,000 to remove dead street trees and $200,000 for weed control of native grasslands. The Government will spend $85,000 on community consultation to reduce plastic bag use, and $483,000 over two years to consult local industry on ways to reduce electronic and organic waste.

Expenditure on parks and reserves has been cut by 10%, with no budget line allocations for control of weeds, feral pigs, deer, foxes or wild dogs in Namadgi National Park. The Government will spend $150,000 on rabbit control at Mt Majura and Mt Ainslie and $4.2 million on forest plantings, mulching and irrigation for the arboretum. Two environmental impact studies, totalling $600,000, will be conducted on the feasibility of high density housing at East Lake, neighbouring the Jerrabomberra wetlands.

ACT Environment Minister Simon Corbell said the budget reflected "a substantial and important investment" in new environmental programs. He said the $19 million one-stop shop would bring together information on the Government's rebates and energy efficiency programs. It would offer consumer advice on rebate applications, home energy audits, energy efficient appliances, water efficiency and updates on government services.

ACT Greens climate change spokesman Shane Rattenbury said it was critical this new information service "went a lot further than setting tip a website and giving out brochures and press releases". He said people were "bamboozled by all the efficiency rebates and programs on offer from the ACT and Federal governments" and needed practical advice to identity ways to snake their homes more energy and water efficient.

Mr Rattenbury criticised the Stanhope Government's continued funding for the arboretum, comparing the project to an episode of the ABC political satire, The Hollowmen in which the fictional Prime Minister "is desperate to create a public monument". He said the $4.2 million allocated for the arboretum would be better spent on helping the cash-strapped Australian National Botanic Gardens adjust to water restrictions and climate change.

BlueScope scraps plans for cleaner, greener power plant

Sydney Morning Herald
Wednesday 6/5/2009 Page: 21

BlueScope Steel's plan to build a $1 billion-plus cogeneration plant to lower greenhouse gas emissions from its blast furnaces at Port Kembla has emerged as the first major casualty of the Federal Government's decision to delay the start of the proposed emissions trading scheme by at least a year.

The steelmaker, which in November had hoped to start construction within a few months pending the finalisation of the Government's carbon pollution reduction scheme,yesterday revealed plans to place the project on indefinite hold. A 150-page prospectus for a $1 billion-plus equity raising also revealed a $463 million gap in funding of defined-benefit pension schemes for its employees in Australia, New Zealand and the US.

BlueScope's chief executive, Paul O'Malley, said the cogeneration project had been delayed due to the uncertainty of the costs associated with the emissions reduction scheme and the impacts of the financial crisis. "We will continue to invest in the steelworks to make sure that we reduce CO2, emissions and undertake key maintenance," he said yesterday.

BlueScope, one of the biggest greenhouse emitters in Australia, had planned to use the cogeneration plant to replace ageing steam-producing assets. It had announced the project in November 2006 but over time the cost had risen substantially from its initial estimate of $500 to $700 million.

The plant would have used surplus gas from iron and steel making operations to produce electricity and steam, which would reduce the need for coal-fired electricity from the national grid and save 800,000 tonnes of emissions a year, out of its annual emissions of 12.6 million tonnes.

BlueScope said its decision to delay the $1 billion project for now meant it would implement a lower-cost, short-term solution that would defer the need to replace the steam assets for several pears. It will spend $50 million next year and the following year to install a new steam main and boiler to replace older equipment but that will have little effect on its emissions.

The steelmaker, which has taken a financial hit from a collapse in steel prices in recent months, said it was likely to take a second writedown on the value of its inventory - estimated at $100 to $140 million after tax - after already impairing its stock in February.

BlueScope also disclosed it had contributed $31 million to a shortfall in its defined-benefit pension scheme in the half-year to December 31 and more contributions were likely due to a $463 million deficit in the scheme, which has projected obligations of $1.2 billion. Other big companies, such as Rio Tinto and Qantas, have also announced large shortfalls due to the rapid sharemarket decline.

Chancy winds of change

Australian
Wednesday 6/5/2009 Page: 16

Renewable energy is back on the agenda, writes Martin Nicholson

NOW that the Council of Australian Governments has agreed the design of the expanded national renewable energy target scheme to get 20% of Australia's electricity supply from renewables by 2020, perhaps it is time to look at where this renewable electricity may come from and what effect that could have on our electricity supply and greenhouse gas emissions. The scheme focuses on reaching the 20% target at least cost.

According to Department of Climate Change consultants McLennan, Magasanik Associates, the lowest cost renewable energy sources a MW hour are hydro, biomass, geothermal hot dry rocks and wind energy. Leaving aside hydro (remember water shortages?), MMA saw biomass, HDR and wind as the main contributors to the 20% target. Biomass electricity is a mature technology but constrained by resources.

We already get some electricity from biomass, mainly from bagasse, and MMA expects a 10-fold increase in biomass electricity by 2020. HDR is emerging technology with enormous potential but there are still no HDR generators in operation in Australia. MMA is not expecting a significant contribution from geothermal before 2015. Given the recent incident at GeoDynamics Habanero 3 well site, that date may be further delayed.

The largest contributor to the target is from wind. According to MMA, about a third of the 20% will be from wind, a seven-fold increase over the existing installed wind energy. In case anyone is wondering, MMA doesn't seem to have a great deal of confidence that solar energy will make a significant contribution to the 20%, probably because of its high cost.

Remember that the RET scheme focuses on the least cost solutions. It seems unlikely solar electricity will be competing with wind any time soon. The RET legislation will come with a big stick for those electricity retailers and large wholesale electricity purchasers that fail to meet their annual renewable energy targets. This will probably guarantee that much of the 20% does get built. But what will get built and what are the implications? What we do know is that it will be the solutions that appear the lowest cost.

With the HDR wobbles, the resource constraint on biomass and the high cost of solar, the odds are it will be more wind energy. Unfortunately, of the three main contenders wind is the most difficult to manage in the electricity network. It is variable and the least predictable energy source of the three. If the wind stops blowing we need to get the power from elsewhere.

Unlike countries in Europe, Australia is isolated so we can't buy power from our neighbours when we need it. If the weather turns calm in countries such as Denmark and Spain (that get a much higher proportion of their electricity from wind energy than the RET may deliver) they have ready access to nuclear and coal-generated power from France and Germany. Australia has to be self-sufficient.

If it turns out that half or most of the 20% target has to come from wind energy, that will mean greater upgrading of grids and more fossil fuel reserve generation capacity to cover for any drop in the wind. Apart from making wind energy more expensive (and perhaps no longer the lowest cost), it may affect greenhouse gas reductions because reserve fossil fuel generators will probably have to be kept running and producing greenhouse gases just in case the wind drops unexpectedly. wind energy may not actually replace very much fossil fuel generation. The danger is that, in the haste to meet our RET targets, the wind energy is built before the network is ready.

National Electricity Market Management Company, the electricity system operator, needs to maintain a high reliability standard and accurately match our demand for electricity with supply. The operator may be forced to curtail some of the available wind energy to maintain the supply-demand balance. Degrading the wind energy output could mean we have built the renewable capacity but are unable to meet the targets.

None of this concerned the NSW Government when it recently streamlined the approval process for new smaller windfarms giving them critical infrastructure status. Governments are fond of setting specific targets by specific time frames to be seen to be doing something without properly considering the technical feasibility. Geothermal isn't ready for 2020. Hydro and biomass growth is limited by available resources. Solar, tidal and wave power are considered too expensive today and probably still will be in 2020.

Which leaves us with wind and that will probably not deliver as much greenhouse gas reduction as we might have expected unless we are prepared to sacrifice network reliability. More Melbourne and Sydney blackouts anyone?

Martin Nicholson is the author of Energy in a Changing Climate.