Like what you've read?

On Line Opinion is the only Australian site where you get all sides of the story. We don't
charge, but we need your support. Here�s how you can help.

  • Advertise

    We have a monthly audience of 70,000 and advertising packages from $200 a month.

  • Volunteer

    We always need commissioning editors and sub-editors.

  • Contribute

    Got something to say? Submit an essay.


 The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
On Line Opinion logo ON LINE OPINION - Australia's e-journal of social and political debate

Subscribe!
Subscribe





On Line Opinion is a not-for-profit publication and relies on the generosity of its sponsors, editors and contributors. If you would like to help, contact us.
___________

Syndicate
RSS/XML


RSS 2.0

Proper evaluation of greenhouse gas reduction policies

By Geoff Carmody - posted Tuesday, 24 September 2024


Arguments about how to cut Australian greenhouse emissions (incl using nuclear power) are rife. They've been all about the cost of policy options. They're partial and misleading, at best.

At least three policy questions require explicit consideration. First, how much does each option reduce emissions compared with business-as-usual (BAU)? Second, how reliable are the power supplies produced, compared with BAU? Third, how much does each cost, above BAU?

Proper evaluation of all options must answer these questions. There are big trade-offs between reducing emissions, power reliability and option cost. These must be recognised and dealt with.

Advertisement

These three questions themselves require elaboration for answers to them to be meaningful: viz

Reducing emissions. This must cover the full supply chain, from input resource extraction, to equipment production, to operation and power supply, to asset disposal at the end of asset lives. Comparing 'apples-with-apples', these must be compared over the same operating asset life.

Power reliability. Comparing 'apples-with-apples', this must include all measures, covering the same total reliable power generation for each option; all measures to store power where that's required; and all transmission investment, if needed, to ensure the same power to end-users.

Costs above BAU. An 'apples-with-apples' approach is needed here, too. Cost comparisons must be over the same operating asset life. All assets must be benchmarked against the life of the longest-lived assets. Adjusted 'levelised cost of energy' measures must explicitly allow for this. Costs must allow for varying estimated roll-out times for different options. Time costs, too.

Trade-offs. Scarcity makes these inevitable. Balancing between cutting emissions and keeping high power reliability means higher costs. Less emissions reduction, plus less reliability of power supplies, plus higher power costs, is one possible trade-off outcome. Remember the 'Trilemma'?

If highly-reliable power, and much more of it, increasingly is demanded, either emissions reduction outcomes are eroded, or costs increase. Or both. Both seem likely.

Advertisement

Suppose Australia adopts a good, if not, in some eyes, perfect, trade-off. What difference will that make to global greenhouse gas emissions and concerns about global warming? At best, very little. At worst, our less competitive economy will drive BAU offshore, making things worse.

Shifting emissions offshore, à la Europe, shuffles the national emissions deck and shifts the blame. That blame goes to countries producing emissions. Europe imports its emissions back (and more) via its emissions consumption. This, after 'virtue-signalling' by exporting its production of emissions to other countries. Bureaucratic hypocrisy, banking on others not acting.

In the USA, there's talk of a 20-year agreement between Microsoft and Constellation Energy (its owner) to restart the Harrisburg Pennsylvania Three Mile Island nuclear plant. Microsoft would contract to buy all the power it generates. It wants to secure a very reliable, low emissions, power supply for its booming data centre/AI businesses. This mooted deal reflects the trade-off between lower emissions, rising power demand, 24/7 reliability, and cost.

Looks like 24/7 reliability wins in this case, if it proceeds. Microsoft must think low emissions, plus 'always on' reliability, is good value. Using nuclear.

 

  1. Pages:
  2. Page 1
  3. All


Discuss in our Forums

See what other readers are saying about this article!

Click here to read & post comments.

4 posts so far.

Share this:
reddit this reddit thisbookmark with del.icio.us Del.icio.usdigg thisseed newsvineSeed NewsvineStumbleUpon StumbleUponsubmit to propellerkwoff it

About the Author

Geoff Carmody is Director, Geoff Carmody & Associates, a former co-founder of Access Economics, and before that was a senior officer in the Commonwealth Treasury. He favours a national consumption-based climate policy, preferably using a carbon tax to put a price on carbon. He has prepared papers entitled Effective climate change policy: the seven Cs. Paper #1: Some design principles for evaluating greenhouse gas abatement policies. Paper #2: Implementing design principles for effective climate change policy. Paper #3: ETS or carbon tax?

Other articles by this Author

All articles by Geoff Carmody

Creative Commons LicenseThis work is licensed under a Creative Commons License.

Article Tools
Comment 4 comments
Print Printable version
Subscribe Subscribe
Email Email a friend
Advertisement

About Us Search Discuss Feedback Legals Privacy