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"...public opinion deserves to be respected as well as despised" G.W.F. Hegel, 'Philosophy of Right'

electricity problems « Previous | |Next »
December 7, 2004

This article by Keith Orchison is good. It analyzes the gap between demand and capacity of electricity in NSW that leads to power blackouts. Demand is increasing and is outstripping supply. That requires new capacity to be built. That means big money to build the new infrastructure.

How is this going to happen? Keith says:


"The likelihood of private investors risking about $1.5 billion to build a modern coal-fired plant in NSW, given the greenhouse gas politics of the state, is not high. Where, given other demands on it for infrastructure development, will the State Government find the money?"


In other words it is crunch time.

Will it be coal-fired or the more environmentally friendly gas-fired power station? The NSW 's Government Energy Options Paper is here. There is little emphasis in Australia on establishing signals to the market (eg., through emissions trading)to encourage investment in greenhouse friendly technologies.

Keith says that electricity is a now very political commodity. Nothing is more political than the lack of a reliable, acceptable-cost supply - and time is against the NSW Government in sustaining this situation to the end of the decade.

And likewise for other state governments. The future can be seen in SA, where around 1300 families have been disconnected from electricity and now live without power. Their households are powered by candles.

The other significant point is that emissions from transport (cars) are set to rise by 42% whilst those from electricity generation are projected to grow by 46% over the next decade. There is little movement in investing in clean energy and greenhouse friendly technology. Australia, as a Kyoto refusenik, continues to rely on a one-off boost to meeting its Greenhouse targets (ie., limit its 2008-12 carbon emission levels to 8-10 % above its 1990 levels) through land-clearing restrictions in Queensland.

Why the head in the sand? Well Australia is an energy producing nation with energy intensive industries and large variations in regional energy use. These industries cannot be placed at risk by regulation, caps, pollution taxes or even emissions trading. So Canberra defends these industries.

Update: Dec. 8
The state's are still trying to develop their own national emissions trading system. Here is Victoria's proposal Today's editorial in the Australian Financial Review sneers.


"It is a limp document. It mouths all the right sentiments but is devoid of any explanation of how a national emissions trading system might work. Instead, it blames all its shortcomings on the lack of federal government involvement."


No support is offered for developing market signals to enable investors invest in new electricity plants and avoid unacceptable levels of greenhouse risk.

So the AFR sacrifices market instruments s to protect the energy intensive industries.

| Posted by Gary Sauer-Thompson at 8:51 PM | | Comments (3)
Comments

Comments

I think it is time to seriously consider, without a lot of hysteria, nuclear power generation.

Ron,

why nuclear power rather than renewables?

Gary,

I guess I have to read the NSW options paper you linked to but at 65 pages time is against me at the moment.