Posts Tagged ‘politics’
Well, long time no post. I hope all my readers are well.
So, apparently today is something called “Blog Action Day“, and this year the topic of interest is anthropogenic forcing of the climate system, and mitigating the potential thereof.
So, OK, I thought I’ll write a blog post about it. The day is supposed to be about action, as the name suggests, so let’s talk about specific actions, with a view towards making a significant mitigation, in a realistic way, of Australia’s anthropogenic carbon dioxide emissions.
Australia’s brown coal (lignite) fired electricity generators have by far the highest specific carbon dioxide emissions intensity per unit of electrical energy generated, since they’re burning relatively high moisture brown coal. They are the most concentrated point contributors to the anthropogenic GHG output. Therefore, these are the “low-hanging fruit” – a very valuable target to look at first and foremost if we want to make the greatest realistic mitigation of the country’s carbon dioxide emissions in a practical way, followed by black coal-fired generators.
Australia’s total net greenhouse gas emissions in 2006 were 549.9 million tonnes of CO2 equivalent.
If we look at the three main sets of lignite-fired generators in the Latrobe valley in Victoria, they represent a very concentrated point source of CO2 output, so they’re a very good case to focus on specifically.
In 2006, Hazelwood generated 11.6 TWh of electrical energy, and 16,149,398 tonnes of carbon dioxide to atmosphere.
In 2006, Loy Yang A generated 15.994 TWh of electrical energy sent out to the grid and 19,326,812 tonnes of carbon dioxide to atmosphere.
I’ll exclude Loy Yang B from this list for the moment, since its numbers are eluding me.
In 2006, the Yallourn power station generated 10.392 TWh of electrical energy sent out to the grid and 14,680,000 tonnes of carbon dioxide to atmosphere.
If you look at the the total contribution of just those three brown-coal-fired plants combined, you’re looking at 9.12 percent of Australia’s total anthropogenic carbon dioxide emissions. If you replace those with clean technology that can deliver an equivalent electricity output, you get a 9.12 percent reduction in Australia’s CO2 emissions. (When you include Loy Yang B, I think it’s approximately 11-12%.)
That’s not a bad target for Australia to implement for the relatively short term for a real reduction in CO2 emissions. It can actually be done, if the real political will exists to do it.
Now, I’m not interested in this “100% renewable energy by 2020″ business from the extremist any-excuse-for-a-protest Socialist Alternative set, because it is nonsense.
Replacing all the coal-fired and gas-fired generators in this country inside 10 years (and presumably only using wind turbines and solar cells, not nuclear energy of course since it doesn’t fit their para-religious ideology)? That’s complete bullshit, of course, because in the real world it cannot be done.
There’s a difference between setting a challenging target and setting a nonsense target. Unless you’re only trying to implement a political bullshit stunt instead of actually trying to hit your targets.
Of course, you don’t just close down the coal-fired generators. You’ve actually got to build their clean replacements first. So what do you use that can realistically replace a coal-fired power station? Nuclear power, of course.
Now, again, to be realistic, we probably can’t build LFTR/MSR, PBMR/HTGR, IFR/PRISM or any kind of nuclear fusion based generation capacity on a large scale to generate grid-connected energy right now. That’s not to say that pilot-scale research and development on those very cool technologies shouldn’t continue, but right now, getting more nuclear energy on the grid means advanced light water reactors – or maybe heavy water CANDU-type things, or conventional sodium-cooled fast reactors maybe. The most practical thing for serious deployment in the relatively short term is advanced LWR technology. In the slightly longer term, there is certainly a place to be encouraging both Gen. IV and fusion.
To get the same amount of energy as the total output from those coal plants, as above, which we’re talking about replacing, we need 4.56 GW of installed nuclear capacity, assuming a 95% capacity factor.
With 4 x 1154 MWe Westinghouse AP1000s, with a 95% capacity factor, you’ve got 4.62 GW, which is a little more than what’s needed.
You can easily have four nuclear power reactors integrated into one nuclear power plant.
Now, how much does it cost?
On March 27, 2008, South Carolina Electric & Gas applied to the Nuclear Regulatory Commission for a COL to build two AP1000s at the Virgil nuclear power plant in South Carolina. On May 27, 2008, SCE&G and Santee Cooper announced an engineering, procurement, and construction contract had been reached with Westinghouse. Costs are estimated to be approximately $9.8 billion for both AP1000 units, plus transmission facility and financing costs.
That gives you an idea of how much a nuclear power plant costs today, in the current financial environment, in the current regulatory environment.
If we double that figure of USD$9.8 billion, it’s AUD $21.4 billion. There will be some saving since we’re considering building four reactors at one plant, not two independent two-reactor plants.
How much that saving will be, quantitatively, I don’t really know. If the cost is reduced by 30%, we’re looking at 15 billion Australian dollars.
How long would it take? If the real political will exists to do it, 10 years is heaps of time. We could probably do even more in that timeframe if we really, really wanted to. AP1000 construction takes 36 months from first concrete poured to fuel load, if you ignore any political protest rubbish.
This is really just a base-line relatively achievable “base case”. After this decade, of course, the rate of nuclear power deployment – and related GHG emissions mitigation – could foreseeably accelerate.
What about the uranium input? About 600 tonnes of natural uranium per year total, for all four reactors. Australia’s present production, off the top of my head, is something like 10,000-11,000 tonnes. Australia’s present uranium production can very, very easily provide for Australia’s total electricity production even without expansion of uranium production – again, considering the inefficient once-through use of low-enriched uranium in conventional LWRs.
What about the so-called “waste”?
Roughly 80-85 tonnes of used uranium fuel per year. 96% of that is unchanged uranium, so that 76.8 tonnes of uranium can be seperated and re-used. It’s just uranium, so it’s not going to hurt you.
The remaining 3200 kg is made up of the valuable, interesting and unique byproduct materials from a nuclear reactor – unique resources with all kinds of different technological applications, which aren’t all radioactive, which you cannot get anywhere else.
Anyway, that’s one scenario which I happen to think has a lot of merit.
Maybe you don’t agree – but if you don’t agree, I’d love to see you elucidate an alternative scenario which can deliver the equivalent greenhouse gas emissions mitigation – shown to be accurate in a quantitative way – within a comparable timeframe and within a comparable cost.
It will not be inexpensive, and it will not happen overnight – but I have yet to see any scenario which can honestly do the same job faster and cheaper, when some real quantitative analysis is applied.
It has been announced this week that the Victorian Government will promote renewable energy by spending $100 million to establish a new regional solar power station, subject to the Federal Government matching its commitment.
Premier John Brumby will announce both initiatives today, focusing on the plan for a 330-gigawatt hours per year solar plant with the capacity to power the equivalent of 50,000 homes.
All right. More kumbaya and rainbows and sunshine courtesy of Brumby.
This proposed new solar power station will supposedly generate 330 gigawatt-hours of electrical energy per year. (The Age article originally mentioned a “330 gigawatt” plant, but they later caught the egregious mistake and edited it.)
How much energy is that?
In 2006, Loy Yang unit A in Victoria generated 15,995 GWh of electrical energy, sent to the grid.
(In doing so, it emitted 19,314,994 tonnes of CO2 equivalent, and a whole lot of other environmentally and aetiologically nasty, dangerous, toxic waste, such as fly ash, SO2 and NO2, as well.) That’s just one example of one of the coal-fired generators, of course.
Therefore, this proposed solar power station is generating about 1.88 percent of that one single coal-fired generating station.
How much will this plant cost? We don’t know. The article doesn’t say, nor does Brumby’s original press release. We don’t know how much it costs, and I doubt Brumby knows, either.
…promote renewable energy by spending $100 million to establish a new regional solar power station, subject to the Federal Government matching its commitment.
OK… we know that it costs at least $200 million. There is actually a convenient benchmark which we can use to make an estimate of how much the whole project will actually cost, and that is the $420 million solar energy installation planned by Solar Systems for northwestern Victoria. This is another expensive solar energy project that the Victorian government just loves to talk about as a poster child for their clean, green ways.
The Solar Systems project, with 154 MW of nameplate capacity, will generate 270 GWh per annum, and will cost 420 million dollars. If we assume that the newly proposed 330 GWh/annum installation might cost about the same, for a given amount of capacity, then we can expect that it will cost 513 million dollars.
To replace Loy Yang A, to have the equivalent amount of energy generation, you’d need 49 such installations of this size, at a cost of approximately 25 billion dollars to construct.
If you build a modern* nuclear power plant, with two 1100 MWe reactors operating with a 90% capacity factor, the plant will generate about 17,356 GWh per annum. That is, such a plant will replace Loy Yang A’s output about 1.09 times over; it’s more than sufficient.
How much does it cost, to build such a nuclear power plant?
Go on, consider an exaggerated, extra-conservative cost estimate from your local greenies. 9 billion dollars? 12 billion? 14 billion? 15 billion?
In every case, even with the most pessimistic cost estimates for nuclear power, it’s far, far cheaper than solar, assuming that you’re actually capable of counting kilowatt-hours.
(* Modern, but not bleeding edge. We’ll consider the presently available modern Generation III LWRs such as Westinghouse AP1000 that are available immediately, not Generation IV fast spectrum reactors, liquid fluoride reactors, or things like that, just to be a little conservative about it.)
Brumby’s press release says that they aim to have the plant operating by 2015. So, they aim to have the plant operating within six years.
Six years? To think that opponents of nuclear energy say that it takes too long to deploy.
If it takes six years to build, and you need 49 of them to replace one coal-fired station, well, would it take 294 years for them to accomplish that goal? Well, perhaps I’m being a tiny bit mendacious. You never know, perhaps they could achieve faster deployment constructing them in parallel, and maybe it would only take 200 years, or 150 years. Maybe.
Six years is in fact sufficient time to construct a nuclear power plant, if you’re serious about doing it and don’t allow it to be delayed. All the nuclear units at the Kashiwazaki-Kariwa nuclear generating station in Japan were each constructed in timescales of between three and five years; Kashiwazaki-Kariwa Unit 2 and Unit 5 both commenced construction in 1985, and both were completed by the end of 1990, within 5 years. Obviously the Japanese operators failed to see any relevance what so ever of a certain ill-fated Soviet graphite pile to their operations.
Even if you want to talk about conservative, drawn out timescales for the construction of new nuclear power in Australia, say, 10 years maybe, it’s still a far, far faster option, for a given amount of energy delivered, than solar or wind.
Is the plutonium that is potentially formed within certain types of fuels in nuclear fission power reactors really suitable for the construction of nuclear weapons? How accessible and usable is such plutonium for such a purpose? How hard would it be to construct a nuclear weapon employing such material? Could terrorists steal nuclear fuel from a nuclear power reactor and construct a working nuclear explosive device, practice?
What characteristics would such a device have? Given the terrible power of nuclear weapons, and the very real threat of terrorists who would love nothing more than to wield such power, these are perhaps important questions to consider.
I assert that, no, there is no real threat here that is anywhere near as plausible in the real world as it is sometimes beaten up to be. Can terrorists steal nuclear fuel, and build a nuclear weapon? No. I don’t think so.
I mainly just wrote this because (i) I just wanted to get this off my chest, and it’s good to have a go at the unrealistic nonsense that gets bandied about without any real factual evidence to back it up, and (ii) because I found the Kessler paper interesting.
This little piece of writing of mine owes a lot to the always entertaining and scientifically interesting posts of NNadir, especially this one, and this one, where I was pointed to the interesting publications of Kessler and colleagues. Love your work, NNadir
My little essay is here (PDF format).
Pointing out of typos, peer review, comments, grammatical suggestions and other interesting discussion and feedback is appreciated.
(I know the sentence is too long in the last paragraph on page 5, and there’s a typo on the first line of page 13. Those are fixed in the CVS. )
I hope you find it enjoyable, interesting and/or useful.
The federal government has recently announced it will scrap the unpopular means test for the federal subsidy for domestic solar PV arrays, which restricted the rebate to households earning less than $100,000.
The size of the rebate was, formerly, $8 per watt of installed nameplate capacity, up to a maximum of $8000. The rebate will now be smaller; $5/W, up to a maximum of $7500.
Sounds good, right? But it’s horrendously expensive – the government is in effect paying $5/W for the cheapest, nastiest polycrystalline silicon PVs on the market.
There are scores of companies jumping on the bandwagon to sell these little 1-1.5 kW rooftop PV systems, advertising and promoting and installing them – because they’re making a fortune from the increase in business resulting from the subsidy.
The government rebate does not cover the full cost of such a system – therefore, in order to get as much interest as possible, the vendors are trying to keep the costs of such systems as low as absolutely possible, so that the cost that the customer pays is as small as possible. Therefore, all such systems are exclusively cheap, inefficient, basic polysilicon devices. After all, an advanced solar-concentrating collector with a high-efficiency CdTe cell or stacked heterojunction cell or sliver cell or whatever does not attract any higher subsidy than the basic polycrystalline Si device.
Advocates such as the Australian Greens say that such a scheme “supports the solar industry” – but all it does is supports the environmentally-damaging low-cost manufacturing of polycrystalline silicon in China, and doesn’t support innovation in advanced PV technology or anything like that.
What if the same amount of subsidy might be better spent elsewhere? Here’s a hypothetical idea to think about.
1. Go and find a suburb or a city or a community which has about 31,000 households. I’m certain there are 31,000 households in this country who support what I’m about to elucidate.
2. Get each household to put up AUD $1200 or so, temporarily.
3. Take that 25 million US dollars and purchase a 25 MWe Hyperion Power Module, or something similar.
4. At 25 MWe divided between 31,000 households, that’s a little over 25 GJ per year, which is a little more than Australia’s present average household electricity consumption. This doesn’t just generate a fraction of your household electricity needs – it generates 100% of it, and there will be no more electricity bills.
5. That corresponds to a nameplate capacity of 807 watts per household. Since the government hands out a subsidy of $5/W for solar photovoltaics with a 20% capacity factor, they should hand out $22.50/W for nuclear energy with a 90% capacity factor, right?
6. Collect your $18,157.50 rebate from the government. Less the $1200 investment, that’s $16,957.50 immediate profit in your pocket. This is exactly the same rate of payment per energy produced that presently exists in the form of the PV subsidy.
7. Go to the pub. Got to stimulate that economy, you know.
I wonder how many ordinary Australian households would support nuclear energy if you paid them $17,000 for doing so?
To replace one Loy Yang type coal-fired power station* with solar cells, we would need 6,082,342 homes equipped with 1.5 kW solar photovoltaic arrays.
With an $7500 rebate for each one, that would cost the government 45.6 billion dollars per each large coal-fired power station.
* (Loy Yang generated 15,995 GWh in 2006.)
Solar photovoltaics typically have a capacity factor of about 20%, and we’ll suppose the panels have a lifetime of, say, 30 years.
Therefore, this scheme costs the government 9.5 cents per kWh generated.
If the government purchases nuclear power plants, they will cost, say, 10 billion dollars (let’s be conservative) for a nuclear power plant with two 1100 MW nuclear power reactors which will operate with a 90% capacity factor and a lifetime of 50 years. The capital cost of plant dominates the overall cost of nuclear energy.
Therefore, the nuclear power plants would cost the government 1.15 cents per kWh – 12% percent of the cost of the solar rebate scheme. That’s the government’s rebate alone – without the rest of the price of these systems.
All this solar rebate is is another mendacious political enterprise involving renewable energy which can’t be scaled up, which hands out free money to the public, makes a bunch of money for the solar panel vendors (including many dangerous fossil fuel vendors such as British Petroleum), and mendaciously makes the government look like they’re actively getting the country running on clean energy.
ASIDE: I’m going to start cross-posting some blog content on the Daily Kos. I think it’s a nice site to engage with many, many readers – many of whom perhaps aren’t already so convinced of the virtue of nuclear energy – so, there’s plenty of engaging, active discussion, and the opportunity to maybe convince some people – even if that’s just a few people it’s still a very positive thing.
Of all the G20 nations, there are only a few without nuclear power. There is only one nation among the G20 which has no nuclear power reactors, and has no active interest in implementing them.
Putting aside, for now, rhetoric like “OMG Obama will kill nuclear energy”, one of the only “anti-nuclear” positions that president-elect Obama has actually made overtly clear on the issue of nuclear energy is that he is opposed to the opening / licensing of the geological repository for radioactive waste disposal at Yucca Mountain.
However, it should be realized that “No Yucca Mountain facility” is not saying “No to nuclear energy”.
I really don’t think a Yucca Mountain style geological disposal facility is a prerequisite for the continuation or the expansion of nuclear energy in the United States for the foreseeable future.
Nuclear energy works just fine at present with no Yucca Mountain, and it will continue to work in future, even without Yucca Mountain going ahead.
If Obama’s position on Yucca Mountain causes the government, the nuclear energy industry, and the public to pause for a moment, step back, and ask if branding all that used fuel containing uranium, plutonium and other useful, valuable material as “waste” and sending it to geological disposal at Yucca Mountain is really a sensible proposal, then I really don’t think that’s a bad thing.
In fact, if Obama was to back efficient utilisation of these nuclear materials as the alternative to disposal at Yucca Mountain, then I wouldn’t expect to see a great deal of opposition to such a plan, from nuclear-literate parties, at all.
The used nuclear fuel removed from a conventional LEU-fueled light-water reactor is about 25 tonnes per gigawatt per year – the equivalent of less than two 15-tonne dry storage casks per reactor per year – something that is clearly not difficult to deal with.
If the uranium and plutonium comprising 97% of the nuclear fuel is recovered and re-used, and the remaining 3%* is put into dry storage casks, then just one storage cask provides enough capacity to store the material for one reactor for twenty years. Of course, of that 3% of fission product material, half the fission products aren’t even radioactive at all, or they have extremely short half-lives. Many fission products, both radioactive and not radioactive, are valuable, exotic and useful materials, with specialised, useful and interesting applications. The assumption that all such fission products would be treated as “waste” is, therefore, especially pessimistic.
* (You can account for the minor actinides (Np, Am, Cm, Cf) in either category. They constitute a very small amount of mass either way. Such actinides, like Pu and U, can be fissioned in a nuclear reactor as sources of energy, and like many fission products, they can also be used for specialised technological and scientific applications, such as the production of 238Pu from 237Np, and the use of Cf and Am:Be as neutron sources.)
Still, it seems a real shame to waste all that money that we’ve already spent on YM if it’s not going to be used. I’m not sure off the top of my head how far underground the tunnels at Yucca Mountain are, but perhaps it could be used as a deep underground laboratory, or something, just as the Waste Isolation Pilot Plant is?
Still, there are approximately 50,000 tonnes of used nuclear fuel already in the United States, the result of the last 50 years of nuclear energy. Opponents of nuclear energy are quick to point that out, but under a scenario similar to that elucidated above, with the separation of easily usable plutonium and uranium, the significantly radioactive fission product materials only constitute 1500 tonnes, or 100 DSCs worth. Until a geological repository is built, or those fission products are put to productive uses, that’s only one additional storage cask that need be stored at every power reactor in the country.
In the foreseeable future, with no Yucca Mountain, dealing with nuclear byproduct materials, storing them safely and securely on site, is not impractical, and it’s not intractable, and it’s not unsafe. There is nothing here which impedes or prevents a revival of nuclear energy generation.
Of course, under the Nuclear Waste Policy Act, the government will have to compensate nuclear utilities for the costs of this storage. No, this does not mean handing out government money to nuclear utilities – it means giving the Nuclear Waste Fund money that is supposed to go to Yucca Mountain back to the nuclear utilities in order to pay for the management of the existing 50,000 tonnes (approx.) of used fuel (and/or processing thereof), and more importantly, it ought to mean not requiring nuclear utilities to pay any more money – more correctly, not requiring nuclear electricity customers to pay any more money – for the Nuclear Waste Fund, until we know that a geological repository for radioactive waste is going ahead. Otherwise, what exactly are they paying for?
The presidential candidates provide their responses to the most important science questions facing the United States.
Unfortunately, they have not yet posted Senator McCain’s responses yet, hopefully they do so at some point in the near future. So, at the moment, all they’re really presenting are Obama’s responses to the questions. It still makes for interesting reading, though.
Interestingly, although not specifically asked about nuclear energy at all, Obama specifically mentions “A new generation of nuclear electric technologies” as one of his policy goals. Such bipartisan support, even to a slight degree, is a promising sign.
As a bit of a change today, we’ll have something that is not energy related.
I have a shocking cold/flu at the moment. It’s really not fun. So, today, I went out to grab some of ye olde decongestant tablets, and take them… only to realise that, eight hours and six tablets later, my nose is still running as much as ever. Checking the packet in detail, I realised that I have, for the first time, fallen victim to pharmacology’s answer to the dodgy used-car lemon that doesn’t work as advertised.
That dodgy lemon is called phenylephrine.
Phenylephrine has been making its way into oral cold and allergy medications in response to the perceived “epidemic” of methylamphetamine abuse in Australia (as well as in other Western countries) – but it is typically met with skepticism by pharmacists – because phenylephrine doesn’t bloody work, at least not when given orally at these sorts of doses. This is the first time I’ve actually been given something by a pharmacist which is not psuedoephedrine.
The loser in this war against methylamphetamine abuse will be the general public, if pseudoephedrine is pushed out of the over the counter market, as it is doubtful if the legal restrictions on the sale of pseudoephedrine to the public will reduce the availability of methylamphetamine. There is little evidence that medicines containing pseudoephedrine are used by large scale producers of methylamphetamine.
The general public – the Australian public, the U.S. public, and everyone else – will be deprived of access to an effective nasal decongestant as pharmaceutical companies and pharmacists are pressured into switching to manufacturing and stocking an ineffectual medicine in phenylephrine.
There is little if any clinical support for the efficacy of phenylephrine as a nasal decongestant, and its oral bioavailability is quite limited. In contrast the efficacy of pseudoephedrine as a nasal decongestant is much stronger and its absorption from the gut is uncomplicated.
Oral phenylephrine is used as a decongestant, yet there is no published systematic review supporting its efficacy and safety.
No support has been found in the literature in the public domain for the efficacy of phenylephrine as a nasal decongestant when administered orally.
The only study involving an oral dose of phenylephrine reported that 10 mg phenylephrine (PE) was no more effective than placebo as a nasal decongestant, and a comprehensive recent Cochrane review provides no support for the efficacy of PE. In view of the extensive metabolism of PE in the gut wall, it seems unlikely that PE is an effective oral nasal decongestant. 
There is woefully insufficient evidence that oral phenylephrine is effective for nonprescription use as a decongestant, , and that’s not good enough. When people are paying for medicine, by rights, by law, they should be getting a product that actually works.
The PSA Code of Professional Conduct for Australian pharmacists states that a pharmacist must not sell any medicinal product where there is reason to doubt its efficacy. It could easily be argued that pharmacists have an obligation to advise patients that oral phenylephrine is not likely to be an effective nasal decongestant – or, to just not dispense it. Certainly, pharmacists are also obliged to avoid inadvertently contributing to the illicit manufacture of methylamphetamine. Does the replacement of psuedoephedrine products with phenylephrine containing products in pharmacies compromise the professional ethics of pharmacists, given that phenylephrine is ineffectual as an orally administered nasal decongestant? Pharmacists need to decide how they will approach this issue in their pharmacies and attempt to find a balance between the professional and legal obligations that surround the supply of psuedoephedrine and the professional and moral obligations of evidence based medicine.
In fact, studies in the USA indicate that restricting the sale of psuedoephedrine to the public as a medicine has had little impact on the morbidity and number of arrests associated with methylamphetamine abuse. 
So, you’re depriving people of legitimate, effective medicine, for legitimate use, and accomplishing nothing as a result.
Of course, if you really wanted to, in one fell swoop, completely do away with the whole issue of illicit use of psuedoephedrine as a precursor for methylamphetamine, then all you have to do is market enantiopure (1R,2R)-ephedrine in these medicines – which does have the full therapeutic effectiveness, with zero potential for illicit diversion.
The only question is how expensive the enantiopure drug would be.
It begs the question – will people with a flu pay more for the enantiopure drug if it means they can actually get the drug that is therapeutically effective, with no bullshit, without being treated like criminals?
To end up with the problematic D-methylamphetamine, from ephedrine, you need to start from (1R,2S)-ephedrine, or (1S,2S)-(psuedo)-ephedrine – if you started with (1R,2R)-psuedoephedrine or (1S,2R)-ephedrine, then you only end up with L-methylamphetamine, if you reduce the stuff. (In case you’re getting confused, they call it psuedoephedrine where both the chiral carbons have the same stereochemistry, and call it ephedrine when they’re different.)
L-methylamphetamine is not nearly as addictive or active on the central nervous system as D-methylamphetamine, and only exerts effects on the sympathetic nervous system – it is a useful vasodilator and decongestant, but it is completely useless as a recreational drug.
There are a few more references out there, mainly papers in the scholarly literature, but I won’t link to those as most won’t be able to access them without subscriptions, and they can be found linked via the above-cited pages.
Many reader’s will be familiar with Australia’s Construction, Forestry, Mining and Energy Union (CFMEU) and their now-slightly-infamous “nuclear energy threatens coal jobs!” position.
But could nuclear power really “kill the coal industry” in Australia? I don’t think so.
Total production of raw black coal in Australia in 2006 was 405 Mt (million tonnes). This production represented a small increase of 1.6% over the 2005 figure of 399 Mt. After processing, a total of 317 Mt of metallurgical and thermal black coal were available for both domestic use and export in 2006.
(I’ve taken these statistics from the Australian Coal Association website.)
In 2006, Australia’s domestic consumption of black coal for electricity generation amounted to 62.4 million tonnes of black coal. Hence, domestic electricity generators consume only about 20% of Australia’s output of processed black coal. Other domestic industrial uses of coal, such as steel production, account for about three percent, with the entire remaining 77% being exported.
(The ACA’s statistics refer exclusively to black coal – however, brown coal is a much smaller resource, relatively, and since we have the statistics for black coal, I’ll limit the discussion to black coal.)
Hence, under the worst case scenario (or best case scenario), we may envisage a future in which every coal-fired generator in Australia is closed down and replaced by nuclear power plants. This would result in cutting Australia’s greenhouse gas emissions in half – at the cost of a 20% reduction in coal demand. If we were to see half of Australia’s coal fired plants closed down and replaced by nuclear energy, we will see a 10% reduction in coal revenue.
I don’t think a 10% to 20% downturn in revenue constitutes “killing the coal industry” – and I really don’t think that the coal industry has anything to worry about for the foreseeable future.
An extract from the green paper:
The key supply-side factor to consider is the relative emissions intensity of different production processes. If all entities in an industry use similar technology, they will all face a similar increase in costs under the scheme and entities will be able to pass these costs through to consumers to the extent allowed by their price elasticity of demand.
However, if an entity is significantly more emissions-intensive than others that sell the same product, it will not be able to increase its prices without fear that its lower emissions competitors will undercut them.
Competitors for such emissions-intensive entities are not limited to existing producers, but include potential new entrants that can use less emissions-intensive technologies.
Demand for electricity is relatively inelastic. This is important, because it indicates that, absent particular supply side issues, the industry as a whole may be able to pass a large share of its carbon costs to consumers.
Some generators may be constrained in their ability to pass on carbon costs to consumers. Different technologies are used to generate electricity in Australia, and they vary significantly in emissions intensity. Highly emissions-intensive coal-fired generators compete with lower emissions (but still emissions-intensive) gas-fired generators, and with zero emissions electricity sources such as wind or hydro generation.
In the context of the competitive structure of Australia’s major electricity markets, this variability might prevent coal-fired electricity generators, in particular, from passing on a significant portion of their carbon costs, reducing their profitability.
The profitability of emissions-intensive generators could be reduced in two ways.
First, generators could lose market share to generators with lower emissions intensity.
A reduction in volume is particularly significant for coal-fired generators, because they need to sell significant quantities of electricity to cover their high fixed capital and maintenance costs.
Second, competition with less emissions-intensive generators could reduce the margins earned on electricity sold by more emissions-intensive generators.
I can’t help but think they’ve overlooked something here. Here’s a bit of a tip for the federal government: emissions-intensive generators losing market share to generators with lower emissions intensity results in a reduction of the GHG emissions intensity of the market.
We can’t have that now, can we?