Sustainable Energy Development – Myth or Reality ?

Sustainable Energy Day 2001Harry Schaap

Assistant Director – Environment and Sustainable

EnergyESAA Ltd

Schaap@esaa.com.au

Overview

Using electricity supply as a focus: Where are we now and where are we

going ? Some sustainable energy development

dimensions Policy setting Energy efficiency Renewables

Taking some of the hard steps

SUSTAINABLE DEVELOPMENT Development which meets the needs and

aspirations of the present generation without compromising the ability of future generations to meet their own needs

Using, conserving and enhancing the community resources so that ecological processes, on which life depends, are maintained, and the total quality of life, now and in the future, can be increased

Where Are We Now and Where Are We Going ?

ENERGY GROWTH 1993 to 1998 (per annum) Overall world energy growth +2.4% Overall renewable energy growth +2.0% Nuclear +2.2% Fossil fuel +2.6% Wind +25% Photovoltaics +4.9% World electricity generation from

renewables 20.2% (mostly large hydro)

Total Energy Supply, Exports and Consumption (98/99) (Pj)

010002000300040005000600070008000 Total supply

Total exports

Total supply – 14196 Pj

Total exports – 8983 Pj

Conversion losses – 1945 Pj

Total consumption – 3268 Pj

3.9 Pj

Australia

Energy Available for Final Consumption – 3268 Pj (98/99)

37%

42%

7%

2% 12%transportindustrycommercialagricultureresidential

Primary Energy Use in Electricity Production (98/99)

86.1%

9.9%

2.9%

1.1%

coalgashydrooil

Primary energy 1990.4 Pj (fuel conversion loss 66.3%, power station and network loss 2.3%)

Electricity for final consumption 624.8 Pj (173.5 TWh)

Public End-use Consumption (1998/99)

46.6%

23.3%

1.4%1.6%

27.1%

industrial

commercial

residential

agriculture

transport161 762 GWh

The Value of Electricity, Gas and Water in 1999-2000 Value added = $11,314m This amounted to 2.8% of national

GDP The annual growth rate was 2.9% The electricity, gas and water sector

employed 0.9% of Australia’s labour force.

Source: Dept of Industry Science & Resources 2001

Electricity Price Comparisons – Large User - January 2000

$0

$50

$100

$150

$200

$250

JapanItalyBritainSpainFranceGermanyAustralia

per MW/hr

Total Electricity Generation Growth (GWh)

0

50000

100000

150000

200000

250000

300000

350000

98 99 0 5 10 15 20

MRET renewables

ExistingrenewablesFossil fuel

Greenhouse gas emissions by sector (1999 inventory, excluding land-use change (Mt CO2 equiv.))

-100

0

100

200

300

400

500

600

90 91 92 93 94 95 96 97 98 99 10

forestry & other

waste

agriculture

industrial processes

fugitive energyemissionstransport energy

other stationaryenergyelectricity

108 % of 1990

Greenhouse Gas Emissions(Excluding Land-use Change) (Mt)

1990 1999 2010

Australia 390 458 514

108% of 1990

421 421 421

Excess 37 93

Electricity 129

172

206

108% of 1990

139

* estimate

Emissions (Including Renewables and Generation Efficiency)

0

500

1000

1500

2000

2500

3000

1990 1995 2000 2005 2010 2015 2020

business as usual,high efficiency coalbase (Mt x 10)

15% gas by 2010, allnew gas after 2010(Mt x 10)

carbon intensisty 15%gas by 2010 (g/kWh)

Sustainable Energy Development

Policy SettingEnergy EfficiencyRenewables

SUSTAINABLE ENERGY POLICY Commitment to improving the well-being

of this generation of Australians and to laying a firm foundation that this will enable future generations to prosper

Commitment to implement measures in the energy sector that provide continued improvements in our economic prosperity and protect our natural environment from unacceptable and irreversible damage

Towards a National Energy Policy (1)

Objectives: Encourage efficient provision of reliable,

competitively-priced energy services Encourage responsible development of

Australia’s energy resources, technology and expertise

Mitigate local and global environmental impacts, notably greenhouse impacts

Towards a National Energy Policy (2)

Principles: Recognise the importance of competitive and sustainable energy

markets Continuously improve Australia’s national energy markets Enhance the security and reliability of energy supply Stimulate sustained energy efficiency improvements Encourage efficiency economic development and increase

application of less carbon-intensive energy sources and technologies

Recognise the Australia’s energy markets operate in a wider global context

Provide transparency and clarity in government decision-making Consider social and economic impacts on regional and remote areas Facilitate constructive, effective inter-jurisdictional cooperation and

productive international collaboration

Ministerial Council on Energy

Objectives: Provide national oversight and coordination of

policy development to address the opportunities and challenges facing Australia’s energy sector

Provide national leadership so that consideration of broader convergence issues and environmental impacts are effectively integrated into energy sector decision-making

UN Commission on Environment and Development

Requirements of business: Integrate environmental criteria in purchasing

policies Design more efficient products and services Increase life spans of durable goods Improve after sales service Reuse and recycle Promote sustainable consumption through

advertising, marketing and product information In other words: improving energy and

resource use efficiency and reduce consumption

What Governments Must Do?

Stimulate market forces Promote more efficient use of materials and energy Establish pricing structures that internalise

environmental costs Support recycling and reuse – on a life-cycle basis Provide flexibility to choose effective solutions Support a process of continuous improvement Stimulate economic growth Promote innovation Minimise trade barriers Encourage technology and systems sharing

World Business Council for Sustainable Development Companies have a responsibility to :

Address entire life-cycle of goods and services

Apply principles of eco-efficiency Procure and request products and

services with reduced environmental impact

Make available accurate, scientifically sound environmental information in order to inform purchasing, use and disposal

SUSTAINABLE ENERGY DEVELOPMENT

ultimate sustainability of energy is based on renewable resources

extending sustainability of fossil fuels through supply and end-use efficiency and through new technologies

Using current energy resources to create economic and intellectual wealth for sustainability

Improving energy efficiency and reduce the carbon intensity of energy supply

making fossil fuels technologically obsolete or redundant

Electricity and Sustainable Development

Prerequisite for a networked world of the future – vehicle for the most productivity gains

Key role in addressing the problems of population, poverty and pollution

1000 kWh/person/year minimum needed to move from immediate survival needs to amenity needs such as education, environment, and intergenerational investment

Ideal energy carrier for economic and social development

Electricity Use Per Capita (kWh)

0

4000

8000

12000

16000

1950 1970 1990 2010 2030 2050

Australia

World

Developingcountries

Energy Intensity per US$1000 of GDP

Sustainable Energy Development

Policy SettingEnergy EfficiencyRenewables

Electricity, Greenhouse and Cost Benefit Test (in 2010)

-250

-200

-150

-100

-50

0

50

100

150

200

250

300

generation benefit

greenhouse benefit

cost benefit

%

Sustainable Energy Development

Policy SettingEnergy EfficiencyRenewables

MRET Supply and Demand Issues

0100020003000400050006000700080009000

10000

DemandSupply - certain

Commissioned, Committed and Proposed Capacity (GWh/year) (after Redding)

0

500

1000

1500

2000

2500

generation GWh/ yr

sugar mill cogenwindMSW/ landfillhydroSHWbiomass co-firingrural biomassmuni waste watersolartidalwavegeothermal

Generation 10800 GWh/year

Projected Generation Costs in 2010 ($/MWh) (after Redding)

050

100150200

250300

350400

larg

e hy

dro

small h

ydro

wind

PV-g

rid

solar t

herm

al

bega

sse

blac

k liq

uour

woo

d was

te

ener

gy cr

ops

crop

was

te

wet

was

te

land

fill g

asMSW

sewag

e ga

s

wav

etid

al

geot

herm

al

PV R

APS

wind RAPS

SHW

pool

Green Power Customers -- Are Numbers Increasing and Do They Buy Energy?

Trends in Green Power Customers (as of May 2001)

58,69160,407 61,288

67,80971,245

68,641 69,74071,710

61,110 62,024 63,003 62,980 62,143 61,669 62,307 62,38659,300

64,005

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Nov-99 Dec-99 Jan-00 Feb-00 Mar-00 Apr-00 May-00 Jun-00 Jul-00 Aug-00 Sep-00 Oct-00 Nov-00 Dec-00 Jan-01 Feb-01 Mar-01 Apr-01

NSW Vic SA Qld ACT WA Total GP Customers

error in billing data

contribution products no longer accreditedin National Pgm

error in billing data

Renewable Energy Action Agenda

Vision – To achieve a sustainable and internationally competitive renewable energy industry, which has annual sales of $4 billion by 2010

Five key strategies: Market development Building community commitment Building industry capability Setting the policy framework Encouraging a culture of innovation

Nine initiatives covering twenty-five identified actions are in the process of being implemented

Taking Some of the Hard Steps

Global Sustainability Targets

Education – universal access to education and technical training Industrial ecology – reduce industrial waste streams to near zero

and minimise the need for virgin resources Transportation – electrify over 50% of global transportation Water use – cut agricultural and industrial water use by half Decarbonisation – triple the global rate of decarbonisation from

0.3% to 1% per year Energy efficiency – double energy efficiency of total energy chain

from 5% to 10% Energy intensity – accelerate decline from 1% to 2% per year Electrification – universal global electrification, basic service of

1000 kWh per person per year Infrastructure – universal availability of fresh water, sanitation,

commercial energy and communications