This is a discussion paper about renewable energy and how Australia is placed to act on reforms to improve the uptake of renewable energy. The paper also comments on a series of letters sent to Federal Government Members and Ministers from 2006 to 2010.
The commentaries on the letters add additional information not given in these letters to the federal government. This additional information has been added with a contemporary nature relating to the year 2010.
This discussion paper has within its appendix list the actual letters sent to the federal government. In addition it has the two replies from two federal departments received from the final letter written in 2009. These letters are from the Minister for Resources and Energy and the Department of Infrastructure, Transport.
These replies outline some interesting plans for the direction of the then Rudd government and actions containing exciting programs underway. The commentary on the letter from the Minister for Resources and Energy analyses information presented in the letter that explain the government’s promoting of the ‘hydrogen economy’, and the continuation of research into carbon abatement programs. Some interesting results are emerging from this program that may be environmentally friendlier than the simple carbon capture and storage concept.
The commentary on the reply from the office of the Department of Infrastructure, Transport, makes two important points. Firstly the government is continuing the planning for coal extraction by providing additional rail infrastructure for the coal mining industry. Secondly, though the introduction of Infrastructure Australia a range of much-needed infrastructure within Australia can be planned, This will ensure proper investment in future infrastructure provided consideration is given to issues surrounding the impacts of climate change and peak oil. These should include best practice planning for the use of renewable fuels and renewable energy.
The commentaries on the letters are detailed, adding to the information contained in the letters. When reading these commentaries the original letters should be referenced to get a better picture of how the subject has evolved over the 2 to 3 year period between the letters and the commentary.
Some of the subjects canvassed by the letters include; ‘the future of fuel cell technologies’, ‘the hydrogen economy’, ‘using hydrogen as an energy carrier’, ‘the efficiencies of heavy freight rail’ and that a move towards higher levels of public transport use will help reduce carbon emissions and reduce government spending on high cost infrastructure such as roads.
The letters cover, as does the commentary, the issue of a carbon trading system or carbon tax. It outlines in brief the need for some market based system to line up with world’s carbon trading systems or programs that provide ways to give disincentives for producing greenhouse gases by manufacturing enterprises. These enterprises utilize the ‘public good’ resources such as a balanced gaseous air mix in our atmosphere and clean seas that still have a capacity to absorb carbon dioxide. However many industrial and transport processes are impacting on the percentage of CO2 in the atmosphere which is tending to cause changes to other economic systems reliant on stable weather patterns. These economic systems such as food production and other systems including natural systems rely on stable climate and weather patterns. When these systems are impacted the world’s population and general economy can be drastically affected. High levels of CO2 impact the very wellbeing of human life on earth and any compensation by manufacturing and industry is meaningless. However, these externalities explained above are considerable and morally they should somehow be accounted for in the manufacturing process. With these externalities accounted for by an artificial but morally sound price signal, it then may be that a cheaper and more economically sound (assuming the pure economics of a level playing field) process may be found that is better for the manufacturer. This is where a price on carbon helps to artificially price the damage these externalities are causing and attempts to give industry some impetus to find more carbon neutral forms of energy production.
One of the most important areas the commentary covers is that of a future change in energy sources from a fossil fuel driven economy to a renewable energy economy.
This move must be accompanied by a government planned response to supporting infrastructure. It is one thing to drive a renewable energy industry and connect it to an existing grid, but another to plan for and encourage infrastructure development by private industry to build plant in areas away from the grid.
Similarly, an organized plan is need for the infrastructure needed to support a move away from fossil fuels in the automotive industry. Without government initiatives and proper planning to a standardized type of automotive support infrastructure, private investment will continue to identify a move towards renewable automotive fuels too risky.
With no standards for a supply route for a renewable energy fuel, private industry will find it a mammoth task to provide both a vehicle to run on a particular renewable energy source as well as provide the infrastructure, this with the high possibility that the whole new type of renewable energy system, including the vehicle and infrastructure, will not be embraced by the public due to its initial costs or lack of convenience etc.
The paper makes no apologies for being prescriptive. Although many of the concepts in the paper have been thought through by government experts, there is always the danger that assumptions can be made about the detail of what is being explained in a paper. So the avoid this some level of detail in some of the concepts and processes are present in the document.