RET Review Recommendations Garner More Criticism
Yesterday, recommendations from a panel-led review of Australia’s renewable energy target (RET) were released and called for the target to be scaled back dramatically. To no one’s surprise, reaction was swift and critical.
Many renewable energy advocates and government officials viewed the recommendations are the work of a biased, climate skeptic in Dick Warburton and said if Prime Minister Tony Abbott were to scale back the RET, he would betray his campaign promises. A day later, more reaction as poured out from critics and it hasn’t been kind.
“Essentially, this says Australia is closed for business for renewable energy,” Kobad Bhavnagri, an analyst for Bloomberg New Energy Finance in Sydney, said. This sentiment was echoed across the industry.
“If the goal posts keep moving on business, global investors move on to more stable environments,” said Chris Judd, head of offshore turbine supplier Senvion SE’s Australia operations, told Bloomberg. “This will be at the peril of a cleaner economy and environment for Australia.”
Sustainability, Environment, and Conversation Minister Ian Hunter blasted the administration for even ordering the review and tried to paint the Abbott government as being out of touch with the realities of climate change.
“The South Australian Government opposes any move by the anti-science Abbott Government to scale back the RET,” he said. “We are concerned that this Federal Government, which appears to fly against the accepted, worldwide consensus on climate change, will make an ill-considered and ideological decision on this very important issue.”
Climate Council’s Professor Tim Flannery says the findings are motivated by an attempt to support the oil and gas industry, a charge that has been lobbed repeatedly at the Abbott administration.
"I'm not surprised, some of the people who've served in the review panel are notorious for their pro-fossil fuel interests," he told ABC News. "But I am dismayed because that RET has survived five electoral cycles and it's served the country well."
Flannery may not be far off, either, as the Australian Mines and Metals Association, which includes Chevron and Exxon Mobil, praised the review.
“There is a strong argument to scrap the RET altogether,” the group said. “It is vitally important the RET has minimal impact on the rapid development of our nation’s $200 billion LNG sector.”
Abbott has also been very vocal about his support of coal. Michelle Grattan, a professional fellow at the University of Canberra, points to a speech Abbott gave in Texas earlier this year.
“We don’t believe in ostracizing any particular fuel,” he said. “For many decades at least, coal will continue to fuel human progress as an affordable energy source for wealthy and developing countries alike.”
Grattan notes that Abbott now finds himself in a difficult position—and it doesn’t look like it will end well.
Ellen Whinnett, national politics editor for the Herald Sun, argues that a balance must be struck for Abbott to come out of this issue alive. He argued that the second option presented by the panel, to scale back the RET to 20%, is the best, as it offers a compromise in this unfortunate situation.
“There’s no perfect way to make power. Gas is still dirty, although much less so than coal. Wind farms are controversial and divide communities. Hydro requires the damming of rivers. Solar is expensive,” she writes. “Accepting that brown coal is still providing the cheapest and most reliable power supplies doesn’t mean there’s no room for renewable energy supplies. Digging up and burning coal to produce power is, ultimately, unsustainable and bad for the environment. Australia needs a variety of energy sources. That must be balanced with the urgent need to protect jobs—at aluminum smelters, in the Latrobe Valley and in the clean energy industry. Which leads to the conclusion that the compromise—a true 20 per cent—seems a sensible option.”
The next few weeks will be a tumultuous time for the Australian energy sector, as the Abbott government must decide on how it will proceed with the recommendations.
Carbon dioxide removal revenues worth £2bn a year by 2030
Carbon dioxide removal revenues could reach £2bn a year by 2030 in the UK with costs per megatonne totalling up to £400 million, according to the National Infrastructure Commission.
Engineered greenhouse gas removals will become "a major new infrastructure sector" in the coming decades - although costs are uncertain given removal technologies are in their infancy - and revenues could match that of the UK’s water sector by 2050. The Commission’s analysis suggests engineered removals technologies need to have capacity to remove five to ten megatonnes of carbon dioxide no later than 2030, and between 40 and 100 megatonnes by 2050.
The Commission states technologies fit into two categories: extracting carbon dioxide directly out of the air; and bioenergy with carbon capture technology – processing biomass to recapture carbon dioxide absorbed as the fuel grew. In both cases, the captured CO2 is then stored permanently out of the atmosphere, typically under the seabed.
The report sets out how the engineered removal and storage of carbon dioxide offers the most realistic way to mitigate the final slice of emissions expected to remain by the 2040s from sources that don’t currently have a decarbonisation solution, like aviation and agriculture.
It stresses that the potential of these technologies is “not an excuse to delay necessary action elsewhere” and cannot replace efforts to reduce emissions from sectors like road transport or power, where removals would be a more expensive alternative.
The critical role these technologies will play in meeting climate targets means government must rapidly kick start the sector so that it becomes viable by the 2030s, according to the report, which was commissioned by government in November 2020.
Early movement by the UK to develop the expertise and capacity in greenhouse gas removal technologies could create a comparative advantage, with the prospect of other countries needing to procure the knowledge and skills the UK develops.
The Commission recommends that government should support the development of this new sector in the short term with policies that drive delivery of these technologies and create demand through obligations on polluting industries, which will over time enable a competitive market to develop. Robust independent regulation must also be put in place from the start to help build public and investor confidence.
While the burden of these costs could be shared by different parts of industries required to pay for removals or in part shared with government, the report acknowledges that, over the longer term, the aim should be to have polluting sectors pay for removals they need to reach carbon targets.
Polluting industries are likely to pass a proportion of the costs onto consumers. While those with bigger household expenditures will pay more than those on lower incomes, the report underlines that government will need to identify ways of protecting vulnerable consumers and to decide where in relevant industry supply chains the costs should fall.
Chair of the National Infrastructure Commission, Sir John Armitt, said taking steps to clean our air is something we’re going to have to get used to, just as we already manage our wastewater and household refuse.
"While engineered removals will not be everyone’s favourite device in the toolkit, they are there for the hardest jobs. And in the overall project of mitigating our impact on the planet for the sake of generations to come, we need every tool we can find," he said.
“But to get close to having the sector operating where and when we need it to, the government needs to get ahead of the game now. The adaptive approach to market building we recommend will create the best environment for emerging technologies to develop quickly and show their worth, avoiding the need for government to pick winners. We know from the dramatic fall in the cost of renewables that this approach works and we must apply the lessons learned to this novel, but necessary, technology.”
The Intergovernmental Panel on Climate Change and International Energy Agency estimate a global capacity for engineered removals of 2,000 to 16,000 megatonnes of carbon dioxide each year by 2050 will be needed in order to meet global reduction targets.
Yesterday Summit Carbon Solutions received "a strategic investment" from John Deere to advance a major CCUS project (click here). The project will accelerate decarbonisation efforts across the agriculture industry by enabling the production of low carbon ethanol, resulting in the production of more sustainable food, feed, and fuel. Summit Carbon Solutions has partnered with 31 biorefineries across the Midwest United States to capture and permanently sequester their CO2 emissions.
Cory Reed, President, Agriculture & Turf Division of John Deere, said: "Carbon neutral ethanol would have a positive impact on the environment and bolster the long-term sustainability of the agriculture industry. The work Summit Carbon Solutions is doing will be critical in delivering on these goals."
McKinsey highlights a number of CCUS methods which can drive CO2 to net zero:
- Today’s leader: Enhanced oil recovery Among CO2 uses by industry, enhanced oil recovery leads the field. It accounts for around 90 percent of all CO2 usage today
- Cementing in CO2 for the ages New processes could lock up CO2 permanently in concrete, “storing” CO2 in buildings, sidewalks, or anywhere else concrete is used
- Carbon neutral fuel for jets Technically, CO2 could be used to create virtually any type of fuel. Through a chemical reaction, CO2 captured from industry can be combined with hydrogen to create synthetic gasoline, jet fuel, and diesel
- Capturing CO2 from ambient air - anywhere Direct air capture (DAC) could push CO2 emissions into negative territory in a big way
- The biomass-energy cycle: CO2 neutral or even negative Bioenergy with carbon capture and storage relies on nature to remove CO2 from the atmosphere for use elsewhere