Malcolm Turnbull, Australia’s Prime Minister, wants to fix the country’s high energy prices and vulnerable energy security by going back to the roots: just build more coal plants. This approach would have been welcomed in 1967, not in 2017, though. It’s well established that coal is the dirtiest energy source out there and there’s no such thing as ‘clean’ coal. Furthermore, renewable energy has gotten so cheap that it doesn’t make business sense to build anything new that’s not solar or wind-based, especially on such a sunny continent. Even so, despite promises of subsidies and other gov breaks, no energy company seems interested in erecting any new plant.
Blaming renewables for Australia’s blackouts
Addressing the National Press Club in Canberra earlier this month, Turnbull accused the Labor governments of an “ideological” obsession with renewable energy at the expense of “energy security”. He essentially blamed “huge” renewable energy targets set by Labor governments for pushing power prices to the highest of any OECD country, all while another blackout occurred in South Australia.
“States are setting huge renewable targets, far beyond that of the national RET, with no consideration given to the baseload power and storage needed for stability,” Mr Turnbull said. “We will need more synchronous baseload power and, as the world’s largest coal exporter, we have a vested interest in showing that we can provide both lower emissions and reliable baseload power with state-of-the-art clean-coal-fired technology.”
“This has got to be all about Australian families and Australian businesses, making sure that they can keep the lights on and, when they’re on, they can afford to pay the bill.
“And, yes, of course, we meet our emissions reduction targets.” (Editor’s note: Australia pledged to reduce emissions to 26-28 per cent on 2005 levels by 2030 per the Paris Agreement. Climate Action Tracker estimates that Australia is instead on track to increase emissions above 27 per cent on 2005 levels by 2030)
“Nothing will more rapidly de-industrialise Australia and deter investment more than more and more expensive, let alone less reliable, energy.”
If you don’t follow Australia politics, you might be surprised this is the same man who in 2010 said we to move to “a situation where all or almost all of our energy comes from zero or very near zero-emission sources” to avoid the risk.
The Australian reports Turnbull’s cabinet might plan to use the $10 billion Clean Energy Finance Corporation to fund technology-neutral power sources. They also confirmed new coal would be part of the government’s energy policy mix.
The coal utopia
The Australian government seems keen on going forward with such measures despite studies and experts advise against it. Frank Jotzo, director of the Centre for Climate Economics and Policy at the Australian National University, wrote it “may seem absurd to spend large amounts of taxpayers’ money on last century’s technology that will be more costly than renewable power and would lock Australia into a high-carbon trajectory.”
Jotzo says the government’s plan to build the latest generation of conventional coal-burning plants is anything by ‘clean.’
“A new high-efficiency coal plant run on black coal would produce about 80% of the emissions of an equivalent old plant. An ultra-supercritical coal plant running on black coal emits about 0.7 tonnes of CO₂ per megawatt hour of electricity, or about 0.85 tonnes using brown coal. That is anything but clean,” Jotzo wrote for The Conversation.
It’s anything but clean and anything but economically feasible, even with billions worth of government subsidies — and energy companies know this well.
In an interview with ABC, Martin Moore, who is the CEO of CS Energy, one of the biggest energy company Australia, said new generation coal plants use less coal for the same amount of energy and “can have about 25 per cent less emissions”. But even him wasn’t impressed by ultra-super-critical plants.
“It’s not game-changing. You’ve still gmmot to think that ultra-super-critical produces twice the emissions of gas-fired technology,” he said.
When asked whether CS Energy would be interested in building new coal-fired plants, Moore said:
“Well, I think CS Energy certainly has no intention of building any coal-fired power plants, ultra-centre super-critical or not. And it would surprise me greatly if there was any more coal-fired technology was built in Australia.”
“I think when you look at the risk of the investment, you’re talking about $2 billion-plus investment up-front. These assets have a plant life of roughly 40 years, and so it’s a very, very big long-term bet.”
“So given the current uncertainty, I think it would be a very courageous board that would invest in coal-fired technology in Australia.”
In other words, not even coal-fired utilities are buying into Turnbull’s utopia. Big energy companies know fully well that coal is the technology of the last century, not of the 21st century. They also know the Australian government made some climate target commitments and once Turnbull’s out, it’s likely the new government will tax any coal company until they go out the back door.
CS Energy isn’t alone. Origin Energy, which owns the 2,880 MW Eraring black coal power station in New South Walles says it has no plans to open a new coal-fired power plant. It did say instead that it would close the Eraring power in the early 2030s.
AGL Energy, which owns large coal fired power stations in Victoria, said it “will not build, finance or acquire new conventional coal-fired power stations in Australia (i.e. without carbon capture and storage). AGL will not extend the operating life of any of its existing coal-fired power stations,” per its Greenhouse Gas Policy.
Like in the United States, where Trump has made bringing ‘coal back’ a central theme for his campaign, the Australian Prime Minister seems to have missed all the memos. Coal is tanking and dying. It simply doesn’t make sense. Politically speaking, why don’t we see candidates promote how renewable energy generates jobs? In the U.S. already solar employs twice as many people in electrical power generation than all of coal, gas, and oil combined. Now that would make sense to everyone.
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