The big picture

Some of International Energy Agency CEO Fatih Birol’s comments in Brisbane at the University of Queensland Energy Initiative “Energy Breakfast” provided the grist for my last post (“Not football,” 25 February) but this was only a small part of his presentation.

The bigger picture Birol presented is worth close local scrutiny across the spectrum of Australian interested parties, not least I think because it paints a different perspective to the one green activists, politicians on the make and their local media fellow travellers try continuously to foist on the community.

Perhaps the most important aspect of this is the picture Birol offers of worldwide electricity supply out to 2040.

We are all familiar with the propaganda: coal is toast, fossil fuels are on their way out, invest in them at your peril, nuclear is non-viable and the globe’s electrons in the near future will flow mostly from wind, solar, waves and other green goodies.

Birol’s presentation told the 300 attendees at the UQ breakfast that the IEA foresees wind and solar strongly supporting the renewables sector to make up 37 per cent of the world’s power production in 2040 under the plans governments took to the 2015 Paris summit – the agreement there always presented now by activists with a capital “A,” like religious folk speak of the Christian bible with a capital “B” – and to achieve 60 per cent under a proposal the agency put to world leaders (but which has no official standing) to pursue limiting global warming to two degrees Celsius.

One needs to know the arithmetic a bit better to appreciate this picture, a bit like finding the right place to stand in an art gallery to appreciate what the artist saw.

The IEA believes global electricity generation under the policies presented by governments in Paris will reach more than 27,240 terawatt hours in 2020 and more than 42,500 TWh in 2040.

It offers an aspirational scenario in which electricity demand is curbed to contribute to the global warming target through significant energy efficiency, total production falling back 2,000 TWh by 2020 and a huge 8,400 TWh by 2040.

To put this in context, power production from coal alone under the official policies is expected to be 10,275 TWh in 2020.

As Birol told the Brisbane breakfast, the IEA sees solar PV generation at 2,000 TWh in 2040 under policies taken to Paris and exceeding 3,000 TWh under the agency’s “450 scenario.” It sees wind power exceeding 3,000 TWh under the Paris policies and at more than 6,000 TWh under the “450 scenario.”

This is a very big change in the power production mix, no question, but it needs to be seen against the other IEA projections.

Under the policies taken to Paris by governments, the agency expects coal generation to deliver some 15,300 TWh in 2040 and gas about 10,300 TWh with nuclear contributing almost 4,000 TWh and hydro power almost 6,000 TWh.

Under the “450 scenario” the agency advocates, the much-reduced 2040 power mix would still include about 2,500 TWh of coal generation, almost 5,400 TWh from gas turbines, nearly 6,900 TWh from hydro systems and just over 6,100 TWh from nuclear reactors.

In other words, conventional generation (coal, gas, hydro and nuclear) may be expected to deliver more than 83 per cent of global electricity production in 2040 under what governments say they will do and could provide 61 per cent under what the IEA says they should do. Wind power and all forms of solar would contribute just over 30 per cent in the latter case.

Translated to the Australian scene, can I suggest one might foresee (under the IEA “dream scheme”) a 2040 mix that could be roughly a quarter each of coal, gas, variable renewables (backed by energy storage) and nuclear (assuming our politicians and the community come to their senses about the value of this energy source and that the promise of small modular reactors is realized) with an ongoing role via Snowy Hydro and the Tasmanian system for hydro power?

This isn’t a “target,” just an idea of what might be workable for Australia in a sane approach to the much-touted “transition.” Technology change could vary this in any number of ways.

I appreciate it is a scenario likely to have the green activists jumping up and down on their hats or headscarves, but the name of the game really should be delivering what consumers need and can afford (and what will sustain our manufacturing, mining, agricultural and commercial sectors) rather than this mad-cap notion of “showing an example to the world.”

To pick up Birol’s sporting metaphor (see my last post – “energy policy is not a football match”), our sensible ambition surely is not to win the Gaian Bledisloe Cup but to deliver secure, affordable power to a substantially larger Australian population in 2040 while contributing our portion of the electricity share of the global “450 scenario”? Bearing in mind that our generation portion then might be 400 TWh out of the world’s 34,000 TWh.

And, of course, as Birol said in winding up his UQ “energy breakfast” talk, “the Paris agreement is a framework; its impact on energy depends on how its goals are translated in to real government policy actions,” adding that energy security “remains a major concern” for the world’s governments with both vulnerabilities and the tools able to address them subject to significant change.

PS: And just another reminder: 2040 is as far from us today as is 1994. We didn’t anticipate today’s energy environment in 1994 even after publishing our first energy white paper in April 1988. (The chief commitment of that “Energy 2000” paper, by the way, was to “maintaining Australia’s energy security, maximising the export performance of Australia’s energy industries and achieving an efficient domestic energy sector.” The more things change………)

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