Wind farm proves a windfall

Herald Sun
Saturday 28/10/2006, Page: 23

FOR three generations, Tom Robertson's family have run cattle and sheep on their Macarthur farm. But the pristine piece of farmland in the state's southwest will soon be dotted with more than 180 wind turbines producing enough green energy for 190,000 houses.

The Bracks Government yesterday announced the largest wind farm in the southern hemisphere - a $600 million project that will produce 329 megawatts of electricity. The project, run by electricity company AGL, will create up to 900 jobs in the area.

Approval was given despite some concerns about the risk the project could pose to the local brolga population. But Mr Robertson said he was pleased his land, and that of two adjoining farms, would be home to the multi-milliondollar project.

"The towns will just get so much business out of it," he said. "We are losing activity to other areas, so this lets us have our cake and eat it, in a way. "We can still farm and yet do something else." He said most locals supported the plan to install turbines across the 55sq km property.

Mr Robertson's son, James, said the area was known for high wind and rainfall. "We used to think of the wind as a curse. Now it's a blessing," he said.

Planning Minister Rob Hulls said 1148 of the 1295 submissions made to an independent planning panel had supported the wind farm. "It is a substantial project that will go a long way to address global warming," he said.

Tom Robertson said he had been working on securing the project for more than five years. He said the turbines would ensure his farm's future. The average price a farmer is paid for a turbine is $5000 a year.

"We are not really having a drought here but because there is drought across Australia animal prices are very low," he said. "We can't sell our animals at the normal price. We have had to get rid of animals."

Opposition Leader Ted Baillieu said people were in the dark about wind farms. "We don't have legislation about wind farms," he said. But he said the Liberals supported the Macarthur wind farm if the local community wanted it.

Huge wind farm gets green light

Bendigo Advertiser
Saturday 28/10/2006, Page: 16

MELBOURNE - Victoria is set to become home to the largest wind farm in the southern hemisphere, with the State Government giving the $600 million project the green light yesterday.

But environment groups said the government had to do more to improve its green credentials, with global warming pollution increasing by six million tonnes a year - the equivalent of one million extra cars on the road - since the Bracks' government came to power seven years ago.

AGL Energy yesterday received approval to build the wind farm at Macarthur, 32 km north of Port Fairy, in the state's west.

AGL managing director Paul Anthony welcomed the government backing and said a final investment decision was expected within a year. The 183-turbine farm, spread over 55 square kilometres, will have the capacity to generate up to 329 megawatts of electricity.

That could power almost 190,000 homes a year.

Planning Minister Rob Hulls seized on the opportunity to trumpet the government's Victorian Renewable Energy Target scheme, which the opposition has vowed to abolish if elected. Under the scheme, electricity retailers must buy a minimum of 10 per cent of their energy from renewable power sources by 2016.

Victorian Landscape Guardians president Randall Bell said the government was sitting on four reports unfavourable to wind farms. Property values would plummet, he warned.

Bank to invest $4bn in emissions credits

Australian Financial Review
Saturday 28/10/2006, Page: 10

Morgan Stanley, the biggest US securities firm, plans to invest within five years in about $US3 billion ($4 billion) of emissions credits and projects to curb greenhouse gas output. Investments would include credits from the Clean Development Mechanism of the 1997 Kyoto Protocol, Morgan Stanley said.

That mechanism encourages rich nations to spend on projects such as wind farms and chemicalgas- combustion plants in poor nations. Credits can be traded for profit.

"We strongly support the use of market-based solutions to meet environmental policies and objectives," said Simon Greenshields, the bank's global head of power and emissions trading and structuring: Industrialised nations might spend as much as $US100 billion a year in developing nations by 2050, helping ensure that fastgrowing economies switch to lowfossil- fuel use, the United Nations said last month. A UN board runs the CDM.

Fords, Belgium's biggest financial services group, and Deutsche Bank of Germany also trade credits.

That spending by industrialised nations might occur if they agreed to emission reductions of as much as 80 per cent by mid-century, buying credits in poorer nations where those cuts were not possible, the UN said.

Most of Morgan Stanley's investment "will focus on increasing our emissions trading volumes", the bank said. "The remainder will be used to invest in projects and for capital costs." In the first nine months of 2006, global emissions trading was about $US21.5 billion - almost double the $US11 billion in the whole of last year, the World Bank says in a report published on Friday at Carbon Expo Asia in Beijing.

The price of certified emission reductions, a type of greenhouse gas credit created under the protocol, had surged 48 per cent so far this year, the World Bank report says.

Prices for CER credits under the protocol's Clean Development Mechanism bought directly from project owners rose to an average $US10.50 a tonne of carbon dioxide equivalent through September 30 this year, from $US7.10 last year.

In the EU since last year, about 12,000 factories and power stations have needed a government permit for each tonne of carbon dioxide they produce. They can sell surplus permits if they cut their output, providing a financial incentive. If their output exceeds the level of their grant, they need to buy extra permits.

Victoria revs up wind power initiative

Australian Financial Review
Saturday 28/10/2006, Page: 6

The Victorian government gave the go-ahead on Friday for a proposed $600 million wind farm to be built by power giant AGL Energy, warning it would not be commercially viable under the state opposition's energy policies.

For the second time in a week, the government has launched a major renewable energy project it claims will depend on the Victorian renewable energy target (VRET), a $2 billion program that will require retailers to buy 10 per cent of their power from renewable sources within a decade.

But the state opposition, which wants to scrap the target and replace it with a fund paid for by coal royalties if it wins the election, has dismissed the targets as an expensive taxpayers' subsidy immaterial to providers' willingness to supply renewable energy.

The opposition, which welcomed the AGL announcement, has previously also criticised wind farms as heavily subsidised and divisive for many communities when inappropriately sited, such as in popular coastal regions.

The 183-turbine Macarthur Wind Farm in western Victoria near Port Fairy will be the southern hemisphere's largest, with a total capacity of about 329 megawatts, enough to power almost 190,000 homes a year, equivalent to the number of houses in a big regional city like Geelong, according to the government.

Planning Minister Rob Hulls, who earlier this year threatened to sue the federal government over its refusal to approve another wind farm in the state because of the danger posed to rare orangebellied parrots, warned the latest project would be jeopardised by opposition plans to scrap VRET.

Mr Hulls, who believes voter concerns about greenhouse gas and climate change will be a major issue in the November 25 poll, said nine out of 10 residents living in the vicinity of the wind farm were in favour, a turnaround from other recent proposals that sparked bitter opposition from communities that claimed the farms were an eyesore that reduced property values.

"The Liberal Party is opposed to renewable energy. Instead it wants to encourage clean coal with a policy that would not start until after 2011," he said.

Earlier this past week, Victoria and the federal government pledged $125 million to a huge experimental solar power plant in north-western Victoria. But Solar Systems, owner of the technology, warned that the project might have to be scrapped if there was a change of government at the November 25 election.

AGL managing director Paul Anthony said he was "delighted with the government's positive disposition towards renewable generation".

Liberal spokesman Denis Napthine said it was a "nonsense argument" that AGL was building the wind farm because of the VRET, which the government announced in July.

"Talks for this wind farm started four or five years ago.

VRET was not on the agenda. All parties were confident about size, efficiencies and viability on its own merits. In the meantime, there has been a lot of community meetings and discussions. This is a project that meets our requirements of having broad community support and is in an area that is suitable for wind farms," Mr Napthine said.

Last month, Pacific Hydro warned it would scrap hundreds of millions of dollars of wind power projects in Victoria because of the opposition's pledge to drop plans for the renewable energy scheme.

Garry Weaven, executive director of Industry Funds Services, owner of PacHydro, said its Portland development faced scrapping and the policy made contracts for wind farms difficult to find. He said getting purchase contracts from energy retailers was difficult for the Portland project because of the reduction of the federal government's scheme.

Key Points: The new wind farm will have a total capacity of about 329 megawatts. This is enough electricity to power 190.000 homes.

VCAT option still open

Yarram Standard News
Wednesday 25/10/2006, Page: 3

THE company proposing to build a wind farm at Devon North now has the right to appeal Wellington Shire Council's decision to not approve the nine-turbine development. The German backed company could take the issue to the state's peak planning body, the Victorian Civil and Administrative Tribunal (VCAT) in a bid to gain a planning permit.

That would then allow the turbines to be erected on a hill at Ingles Road, Devon North.

Cr Jeff Amos, of Yarram, who moved the motion at last week's council meeting to reject a planning permit on the grounds of visual and noise issues, said the next move now rested with the company.

"I have no idea whether it will go to VCAT. That is up to the company if they want to do that," he said.

They have a certain period of time to appeal and until that appeal is in writing to VCAT, we will be none the wiser." Cr Amos described the issue as one of the "major decisions" to come before councillors in recent years.

He spent four months researching planning guidelines, and reading and responding to emails for and against the wind farm before arriving at his decision.

"I'm not against renewable energy but I'm against this site. I really think that we should be looking at other alternative forms of energy, given that we have a lot of tidal movement around our coast, and we have a lot of sun too." Cr Amos said.

Gas-power future in the pipeline

The Australian
October 30, 2006

NATURAL gas, not nuclear or solar energy, will power Australia's transition to a lower greenhouse-emissions future, with a trebling of gas power plants planned or under construction over the next eight years.

A report released yesterday by the gas industry says renewable energy sources such as solar and wind cannot meet expanding energy demand on their own and that it will be "some time" before they are cost competitive on a large scale.

The report, by the Australian Pipeline Industry Association, says Australia is unlikely to switch to nuclear energy because of negative public perceptions, while gas had 60 per cent lower emissions than coal-fired power and was proven and available.

Association chief executive Cheryl Cartwright said the recent debate on the use of nuclear and solar energy ignored gas as a cheaper and ready-to-install technology that could start to immediately cut Australia's greenhouse gas emissions. "Gas is more expensive than coal but it's cheaper than renewables and it's available now," she said.

Warming could throw cold water on returns

The Age
October 29, 2006

GLOBAL warming is no longer a fringe environmental issue but one that could soon have serious implications for investment returns. This is according to a group of mainstream institutional investors who are pushing companies to deal with the risks and opportunities a warmer climate holds.

They say climate change has the potential to affect the future earnings, liabilities and general risk profiles of thousands of companies.

"What this means is that anyone with money (to invest) needs to know if a company has a plan to tackle the risks involved in climate change," said Corin Millais, chief executive of the Climate Institute.

The Investor Group on Climate Change, which represents 16 mainstream institutional investors with more than $195 billion funds under management, recently surveyed most of Australia's and New Zealand's largest companies.

While 94 per cent of companies recognise the potential for climate-related issues to affect earnings and liabilities, only 9 per cent have a fully disclosed emissions trading profile. Three per cent are actively trading emissions, 19 per cent are engaged in limited trading and 17 per cent are considering a strategy.

Andrew Gray is head of quantitative research at Goldman Sachs JBWere, which co-sponsored the report. He said it was intended to encourage companies to reveal how they were dealing with climate change to allow potential investors to make informed decisions.

"Clearly there are impacts in terms of profitability and risk profile," Mr Gray said. "Investors use price to earnings, or various other measures, to assess whether to invest in a company. This study allows them to measure any potential impact from climate change.

"How companies manage risk or take opportunities could have a direct impact on their profit and loss, revenue and costs going forward. Future earnings is a key factor that investors need to consider, so the extent climate change will impact that is a potentially relevant consideration."

Although the Federal Government has so far refused to introduce a system of carbon trading similar to the $30 billion European scheme, AMP Capital's head of investment strategy Shane Oliver reckons it's only a matter of time, with some states already adopting their own system.

"To get a reduction in carbon emissions, you need to put a price on emissions and that's what carbon trading is attempting to do," Mr Oliver said. "The bottom line is, the cost of dirty energy will go up in time, which in turn would make cleaner technologies more competitive in the marketplace."

Mr Oliver said investors should look towards low carbon producing companies, such as wind farms and solar energy businesses, particularly now that the Victorian Government has set a target of alternative energy supplying 10 per cent of household needs by 2016.

"It is important for investors to be aware of the risk companies are facing and those companies that are taking action or are aware of the problem will probably do quite well," he said.

"For retail investors it's just a matter of being aware of what companies are doing and … staying away from the companies which are carrying on regardless of the problem."

The companies that are taking action on climate change*

• Banks: ANZ, NAB, Westpac
• Construction materials: Boral
• Energy: Origin Energy
• Food: Goldman Fielder, Lion Nathan
• Health care: DCA Group, Symbion Health
• Leisure: Tabcorp Holdings
• Industrials: Transurban
• Information technology: Computershare
• Insurance: IAG
• Metals and Mining: BHP Billiton, Rio Tinto
• Property trusts: GPT Group, Investa, Mirvac
• Retail: Warehouse Group
• Telecommunications: Telstra
• Utilities: AGL

Source: Carbon Disclosure Project, based on self-disclosure

* Only top three included

Climate's last chance

The Age
October 28, 2006

By Tim Flannery

THE Howard Government seems recently to have accepted that climate change is caused by humans and needs to be dealt with. But has it really accepted this? And will its policies make a difference? The key to answering these questions lies in understanding how urgent the climate threat is.

The main indicator of how long we have to address climate change is the state of the Arctic icecap, which covers Earth's northern ocean. The entire weather system of the northern hemisphere depends on the temperature gradient between it and the equator, so if the North Pole warms up, the winds, monsoons, rains, temperatures and seasons will shift in dramatic ways. And of course, the southern hemisphere's weather system will be affected as well.

By the mid-1970s, the Arctic icecap began melting away at the rate of 8 per cent a decade. This rate of melting persisted almost unchanged until 2004, by which time about one-quarter of the icecap had melted, revealing the dark ocean underneath.

During the summer, the sun falls for 24 hours a day on the Arctic icecap, delivering a huge amount of energy. But ice is bright, and before its melting the Arctic icecap reflected 90 per cent of the sun's energy back into space, keeping the planet cool. But as the ice has melted, more of the sun has fallen on the ocean, and it absorbs 90 per cent of the sun's energy, turning it into heat.

By last year, so much of the sunlight was being captured by the ocean and turned into heat energy that a dramatic change occurred: the ocean stayed so warm that the winter ice did not form properly, and the following summer about 300,000 square kilometres of ice melted. The same thing happened this year, so now huge areas of ocean are exposed where just a few short years ago there was ice.

Before 2004, the rate of melt was such that scientists believed the icecap would melt entirely by about 2100. At the trajectory set by the new rate of melt, however, there will be no Arctic icecap in the next five to 15 years. And with no ice, the Arctic region will rapidly begin heating, perhaps by as much as 12 degrees.

This change will put further pressure on the Greenland icecap, which is already melting at the stupendous rate of 235 cubic kilometres a year. If it succumbs to the heat, the ocean will rise by six metres, and icecaps in the Antarctic may destabilise.

James Hanson, director of NASA's Goddard Institute, is arguably the world authority on climate change. He predicts that we have just a decade to avert a 25-metre rise of the sea. Picture an eight-storey building by a beach, then imagine waves lapping its roof. That's what a 25-metre rise in sea level looks like.

Whatever you think of such predictions, the rate of melt of the Arctic icecap is indisputable and deeply troubling. It should convince everyone that climate change is by far the most urgent threat facing humanity. It also tells us that the long recalcitrance of the Howard Government in respect to climate change has already cost us dearly, and that we must now make great changes in just a few short years. Had we begun a decade earlier, our actions would have been far more effective and less disruptive.

As we judge the Howard Government's climate change policies, we must keep several things in mind. One is the potentially great cost of not ratifying Kyoto. Phase 2 of the treaty begins in 2012, and already the parties are debating who shall accept what restrictions on carbon dioxide emissions. Both China and India must take on meaningful restrictions if our civilisation is to survive this crisis, but with Australia and the United States outside the treaty, they have the perfect excuse to decline: why should they accept such binding restrictions when the richest nations of Earth refuse to do so?

A second thing to watch is Australia's total emissions. Before we rejected Kyoto, Australia was given a target that allowed for a substantial increase in emissions. When the Howard Government talks of meeting its Kyoto target, this is what it's referring to. Sticking with such a lax target is disastrous, and government-funded projects such as the recently announced solar farm and more efficient burning of brown coal cannot achieve a significant reduction in carbon dioxide pollution.

So far the Howard Government's approach has been to hand out hard-earned taxpayers' money — some of it to big corporations — and proclaim that it's doing something. With a world facing as grave a threat as it faced in 1938, John Howard is quickly becoming the Chamberlain of the chequebook, while a climate-change Churchill is nowhere to be seen in Australian politics.

What must the Howard Government do if it is to effectively protect Australians from the looming climate disaster?

First it must inform Australians of the gravity of the situation, then lay out an ambitious plan for emissions reduction that includes public participation. Immediate reductions are required, and these can be had through efficiency gains. In addition, a long-term target of an 80 per cent emissions reduction by 2050 should be set. If we are to achieve that we must use the power of the market. A carbon tax and carbon trading scheme are absolutely indispensable tools to achieve such targets. And of course we must ratify Kyoto immediately.

My sense of the matter is that none of this will happen.

Instead, the Howard Government will do the bare minimum required to appease public opinion, for it appears to have no one able and willing to absorb the scientific evidence, and to champion a more resolute response through the cabinet.

I sincerely hope I'm wrong, because this Government and the one that follows it may well be the last in Australian history to have the chance to avert a climate disaster.

Tim Flannery is an environmental scientist.

Wind's up for energy industry

A hard wind is blowing - and it's kicking up a lot of energy.

In fact, the U.S. wind energy industry is on track to install a record 2,750 megawatts of generating capacity this year.

That will produce about as much electricity as is used by the entire state of Rhode Island and help strengthen energy security, according to the American Wind Energy Association, which released its third-quarter market report this week.

"To strengthen our energy independence we need safe, domestic, and inexhaustible energy, and wind power provides just that," said Randall Swisher, the association's executive director.

In Southern California, no company is more committed to wind energy - and alternative energy sources in general - than Southern California Edison. SCE is the nation's leader at meeting customer needs with renewable power. Last year, 17 percent of SCE's overall energy was produced by renewable power. That number is expected to be between 16 percent and 17 percent this year.

"We have more than 1,000 megawatts of wind contracted," Stuart Hemphill, SCE's director of renewable and alternative power, said. "We're doing all we can to get more, including building a transmission line to Tehachapi." That area is important because it has about 4,500 megawatts of untapped wind potential, according to Edison spokesman Gil Alexander.

"Our projection for our 2006 power mix includes about 3 percent of all the energy we send to customers coming from wind-generated sources," he said. That includes wind, solar, biomass, geothermal and small hydro sources, Alexander said.

The nation's wind farms currently save over a half-billion cubic feet of natural gas per day and help reduce the supply pressure that's driving up natural gas imports, according to the American Wind Energy Association.

"Every megawatt-hour of domestic, inexhaustible wind energy from our heartland is a megawatt-hour that doesn't burn fuel, and that strengthens our energy security, protects our environment, and creates good jobs," Swisher said.

To produce wind power, a large tower with a propeller is installed in an area where there are strong, steady winds. As the wind blows the propeller around, it turns a generator, which produces electricity. The more towers, the more power. The larger the propellers, the more electricity can be generated.

"We do have quite a bit of wind power from Tehachapi already," Hemphill said. "We also get it from San Gorgonio near Palm Springs. Those wind turbines you see while driving to Palm Springs are under contract to Edison."

Swisher said Edison's use of wind energy is important. "They have been one of the leading purchasers of wind power for many years," he said. "The role of the electric utility is absolutely essential because they are the ones who provide market demand."

Analysis: Deserts may yield Europe's power

BERLIN, Oct. 27 (UPI)

Deserts in the Middle East and North Africa can help meet Europe's and the region's growing electricity demand, according to two German research reports. Some may say the deserts are areas that don't yield any benefits to humanity -- but that's not quite true; the solar rays that burn all day onto the Sahara and the likes can be converted into energy -- a lot of energy.

Every year, the sun beams as much solar energy onto the area as the amount of oil needed to cover the desert with a sea 10 inches deep.

"That's a huge energy potential," Franz Trieb, of the Institute of Technical Thermodynamics at the German Aerospace Center, and author of the two studies, Friday told United Press International in a telephone interview. "And against what some say, you wouldn't have to pave the entire desert -- one thousandth of the entire desert area in the region would be enough."

Across southern Europe and deserts in North Africa and the Middle East, a series of solar thermal power plants, which use mirrors to collect sunrays during the day and generate electricity at night, could supply as much as 15 percent of Europe's electricity needs by 2050, Trieb said.

The studies strongly support switching to renewable energy sources for Europe's electricity generation of the future, and they advise governments to take similar measures to Spain and Germany; both countries have a solar energy feed-in tariff.

The renewable plan for the region includes -- aside from the solar plants in southern Europe, North Africa and the Middle East -- hydropower plants in Scandinavia, wind energy plants off the North European coast and biomass and hydropower plants in mainland Europe.

"Our studies have found that it is absolutely untrue that renewables can't meet the basic electricity demand," Trieb said. "No single renewable energy source can, but they are able to provide our basic demands of electricity in a wide mix." The existing network of fossil fuel power plants would then simply support the renewable energy mix of the future.

Electricity generated from renewable energy sources is still more expensive than power from fossil fuels, and that prevents investors from putting their dollars into the technologies -- the wrong approach, Trieb said.

Making the cost of renewable energy equivalent to fossil fuels before the year 2020 would take an investment of $75 billion, but that investment will be returned quickly, as the region would save $250 billion by 2050 when compared with a "business as usual policy scenario."

So who should pay?

"If the initial investment would be equally distributed among all electricity consumers in the region, each of them would have to afford additionally $10 per year for electricity payments for a period of 15 years in order to finance the total market introduction of renewables," the study found. "After those 15 years, all consumers will benefit from stable and low electricity costs."

The required amount is comparable to money spent developing and building the first commercial nuclear fusion reactor, which is expected in 2050, the study says. By that time, that plant will not have reduced CO2 emission, while the renewable energy mix will have avoided 28 billion tons of CO2 emissions.

Trieb said renewables, in the long run, will be far cheaper than fossil fuels. "The more you use the renewable technology, the cheaper it gets because of mass production and learning effects, while its is exactly the other way round with fossil fuels," he said.

In the case of the solar plants in Africa and the Middle East, the excess heat produced could be used for other projects important to the region, such as water desalination, the studies say.

First of all, Trieb said, the solar plants in North Africa and the Middle East should be used to satisfy that region's own electricity hunger, which by 2050 will be as big as Europe's.

"The electricity first and foremost is for the North African and Middle Eastern states," Trieb said. But after a decade or so, the sheer mass of energy could enable those states to sell cheap electricity to Europe, Trieb said, which -- in the best of all cases -- provides the poorer African states with additional income.

"It would be great if the whole project had a stabilizing effect, socially and economically, for the African states."

Trieb said North African and Middle Eastern states have already warmed up to the idea, and in Spain, a solar thermal power plant with a capacity of 50 megawatts is currently under construction.

Climate comes in from the cold

Sydney Morning Herald
October 28, 2006

After playing down the effects of climate change for years, the Federal Government has suddenly changed its tune, writes Wendy Frew.

For Matthew Nott, it all started on New Year's Day. Across the state, near-record temperatures drove many people indoors, demand for electricity soared as air-conditioning units were switched on and railway tracks buckled in the heat.

At Tathra Beach, 20 minutes east of Bega on the South Coast, where Nott had gone to cool off, the temperature had soared to 42 degrees by 10am.

"I was reading Tim Flannery's The Weather Makers and I thought 'What a juxtaposition, this book about climate change and record temperatures'," says Nott, an orthopedic surgeon who moved to the Bega Valley six years ago with his family.

It was a juxtaposition he says changed his life. With no political or environmental experience before then, Nott has since spent his spare time researching climate change. He was disturbed by what he discovered: predictions from the world's leading scientists that man-made greenhouse gases being pumped into the atmosphere would dramatically alter the earth's climate, and evidence some of the changes were taking place.

Frustrated by a lack of government action on the problem, in May Nott rallied 3000 residents in the Bega Shire to form a human sign on Tathra Beach that read "Clean Energy for Eternity". From that event, a small group of activists was formed to encourage the local council to cut energy consumption in the shire and source some of its electricity from renewable energy. The group has started to talk to residents in the neighbouring shires of Eurobodalla and Snowy River about similar programs.

While grassroots groups like this one were springing up all over Australia, little was changing in the top political echelons.

The Howard Government remained a steadfast critic of the Kyoto Protocol, an international agreement to tackle climate change, and argued any attempt to penalise greenhouse gas polluters would damage the economy. Government ministers continued to play down the link between climate change, urban water shortages and the widespread drought.

But suddenly, two weeks ago, the Government's tune appeared to change. The Prime Minister, who had long scoffed at the "gloomy predictions" about climate change, finally made the link between drought and global warming. "I don't think it alters my outlook on Kyoto, but it certainly emphasises that the world does have a problem with climate change," he said.

A few days later, he said climate change was a reason Australia should adopt nuclear power. Next up, the Foreign Affairs Minister, Alexander Downer, confessed that "a bloody hot day" in early October at the Port Elliot Show in his electorate near Adelaide crystallised his thinking on the issue.

This week, there was a flurry of Government announcements about clean energy: a $75 million grant for a solar power plant in regional Victoria and a backdown on a plan to abolish consumer rebates for solar energy were among them.

Was this a sudden change of heart from a Government derided by many for its "go slow" attitude on climate change? And if so, what prompted it?

An increasing sense of urgency about the devastation wrecked by the drought appears to be part of it. But political commentators, the Opposition and green groups say the Government's conversion is more rhetoric than real and is purely driven by public opinion.

"I think [the recent change] is utterly poll driven," says Greens senator Christine Milne. "In the federal budget, Costello did not once mention climate change and did not say the cost of the drought would blow out the budget.

"Two weeks ago Industry Minister Ian Macfarlane said [the climate change documentary] An Inconvenient Truth was "just entertainment" and Howard said we shouldn't exaggerate the link between climate change and the drought. Then, Friday week ago they suddenly changed their position," Milne says.

"The polling shows the Australian community have put two and two together and see that drought, more and hotter bushfires, the water shortage and climate change are all connected and they blame the Government for 10 years of inaction."

A Lowy Institute poll released in early October found 68 per cent of Australians believed climate change was a "critical threat" that should be immediately addressed, even if this involved significant costs. As the institute's executive director, Allan Gyngell, observed, "this has become mainstream; it's no longer just an issue for Greens and people dressed up in koala suits".

The Climate Institute of Australia's chief executive, Corin Millais, agrees public opinion, particularly in rural areas, was a key factor in what he sees as a change in Government rhetoric.

"It is the polling that has focused the Government's mind, more than any intellectual position on climate change," Millais says. "Climate change is on the [political] agenda. I think what the Government is now trying to decide is what [action] is palatable."

The Environment Minister, Ian Campbell, says claims the Government is only driven by the polls are unfair. He says the Government has been concerned about climate change for some time and remains open to new ideas about how to tackle it. However, he concedes things have changed a little recently and he attributes that to the Prime Minister being tuned in to public concerns.

"That is his great skill," says Campbell. "I don't think the Prime Minister has crossed the road to Damascus but he has picked up that climate change has become a mainstream issue … people are seeing a pattern here."

He defended the recent clean energy announcements, made under the Government's $500 million Low Emissions Technology Demonstration Fund, pointing out that the money had been allocated some time ago.

But energy experts and opposition parties described this week's announcement by the Treasurer, Peter Costello, of a $75 million grant for a solar power plant in regional Victoria as "short-term thinking" and a one-off. Greenpeace's energy campaigner, Mark Wakeham, welcomed the funding but said the company behind the plant had admitted it might not have gone ahead if it was not for a Victorian Government renewable energy support scheme and this highlighted the Federal Government's inadequate policies.

"If you are going to tackle climate change you need systemic change," says Wakeham. "You need a price on carbon … you need incentives for all renewable energy, not just funding for one project. "If that is the Government's response to climate change then we should be worried."

Labor's spokesman on the environment, Anthony Albanese, also welcomed the funding but questioned the timing of the announcement. "The Government is good at allocating money to funds and then making political decisions at politically convenient times," he says.

"But on the issue of climate change, we require a systematic response. We need to ratify the Kyoto Protocol. We need to have a significant increase in our Mandatory Renewable Energy Target . We need a national target to reduce greenhouse gas emissions and we need to have a price on carbon by having a national emissions trading system."

Without a price on carbon pollution, coal will remain Australia's cheapest energy source, way ahead of solar, wind and even less-polluting gas-fired power. It will make it uneconomic for coal-fired power generators to adopt technology that eliminates greenhouse gases, if and when that proves feasible.

It will also mean that nuclear energy - being touted by Howard as a major way of reducing greenhouse gas emissions - will be too expensive. That point was recently conceded by the former Telstra boss Ziggy Switkowski, appointed by the Government to examine the future of Australia's nuclear sector.

Switkowski, who expects to report to the Government in a month, told the Herald: "Australia is blessed with a couple of things - very low-cost electricity because of access to coal and gas, and many centuries of coal supply available. Any comparison will be unfavourable for every alternative source in the absence of an explicit cost for carbon."

Business groups, particularly banks, investment and insurance companies, have been quietly lobbying the Government for just that kind of policy.

Westpac's group general manager for stakeholder communications, Noel Purcell, says it should be acknowledged that the Government has been working on projects addressing climate change for some time. However, he says recent advice it would have received on the worsening outlook for the drought, plus the shift in public sentiment about climate change, would have influenced its position.

Now, "the big issue is putting a price on carbon and that has to be confronted", says Purcell.

Just how seriously Australians view climate change could be demonstrated next Saturday at the Walk Against Warming marches to be held in capital cities.

The Nature Conservation Council director, Cate Faehrmann, who is helping organise the event, says the response so far has been "absolutely amazing" and far stronger than for last year's walk, which attracted 5000 people in Sydney. "We have handed out 100,000 flyers, we are getting lots of phone calls from people who want to help out, businesses have contacted us to help advertise the event. The people who are coming to the walk are desperate that it be successful and are willing to do their bit to make sure it is."

The heat is on

• Over the past decade, Australia's greenhouse pollution has increased 10 per cent. It is expected to increase by 17 per cent more by 2020.
• In 2003, energy production accounted for 68 per cent of that pollution, and by 2020. It is expected to have increased by 70 per cent from 1990 levels.
• 166 nations have ratified the Kyoto Protocol on climate change. Australia is not one of them.
• The Federal Government has allocated $500 million over 15 years to develop low greenhouse gas emission technology.
• Every year, it spends $790 million on aviation fuel concessions, and $1 billion on fringe benefit tax concessions for company cars. Transport is a major contributor to Australia's greenhouse pollution.

Clean Technologies Create New Energy Tycoons in China

China Watch Home
October 26, 2006

The Hurun Report, a luxury business magazine known for its annual surveys of China’s wealthiest citizens, recently released its 2006 China Energy Rich List, which ranks the wealth generated from the nation’s booming energy sector. Shi Zhengrong, a solar energy tycoon, tops the list with a personal wealth of US$1.95 billion, followed by Jia Tingliang and Wang Suolan with the coal company Shanxi Datuhe Coke & Chemicals, with US$525 million.

While entrepreneurs from traditional energy industries such as coal mining, oil and gas distribution, and power generation still dominate the energy “rich list” (occupying more than half of the fifty spots), the share of wealthy Chinese representing the “clean energy” sector—which includes solar and wind power, batteries, bioenergy, incineration power generation, and thermal energy—has increased to 14, up from only 4 last year. Rupert Hoogewerf, CEO of the Hurun Report, concedes that “valuing the wealth of China’s Rich is as much an art as it is a science,” but believes the list offers a useful glimpse into the dynamics of China’s energy market and illustrates how private companies struggle to share the energy pie with their state-owned counterparts.

According to Shanghai Security Daily, the 2006 list reflects two main trends: the ongoing restructuring of China’s traditional coal mining industry, and the rapid entry of private companies into the clean energy field. The coal industry restructuring, which is being overseen by the National Development and Reform Commission (NDRC), is intended to accelerate technological modernization and improve the industry’s ability to meet projected growth in demand—as well as protect the environment and improve industrial safety, according to Xinhua News. Under new policies, several large private coal companies have been able to merge, renovate, and regroup smaller mines, enter the overseas market with their competitive costs, and switch to deep coal refining. These activities have contributed to the emergence of several new tycoons.

Unlike those in traditional energy industries (also known as “black gold” industries), investors in the clean energy field have been able to strike it rich by adopting cutting-edge clean technologies. In addition to rich-list leader Shi Zhengrong, who has built Suntech Power into one of the world’s leading solar cell manufacturers, five other Chinese entrepreneurs have generated large amounts of wealth for themselves by investing in solar technologies. Another clean-energy giant is Yu Jianqui, the head of Gushan Group, a leading biodiesel producer in China, who ranks fifth overall with a personal wealth of US$400 million.

Dr. Wu Daohong, who heads Beijing Shenwu Thermal Energy Co., Ltd. (BSTET), a company dedicated to the research and development of energy-efficiency technologies, ranks 21st on the list. His firm recently became the first Chinese member of the Chicago Climate Exchange, a U.S.-based greenhouse gas emissions registry, reduction, and trading system. Clean technology has also fostered the emergence of “green” heroes in the power generation industry. Dou Zhenggang, president of Jinjiang Group and No. 11 on the list, owns China’s largest private company that generates power from waste incineration, with more than 10 facilities across the country.

State-owned companies continue to dominate China’s fossil fuel industry, making it difficult for private enterprises to make their mark in petroleum exploration and refining (though they are involved to some degree in distribution). However, the Chinese government has encouraged broad participation from all sectors in developing the nation’s renewable energy market. On February 28, 2005, the State Council (China’s parliament) passed the Law on Renewable Energy Resources, which came into effect on January 1 of this year. The goal of the law is to “improve China’s energy structure, diversify energy supplies, safeguard energy security, protect the environment, and realize the sustainable development of the economy and society.”

Australians fight fear of power crisis with giant solar site

The Guardian
Thursday October 26, 2006

Australia yesterday announced it would build one of the world's biggest solar power plants amid warnings of blackouts unless it can increase generation to meet the growing demand for air conditioners.

With climate change being increasingly blamed for the severe drought that has been affecting parts of the continent for six years, and with cities imposing punishing water restrictions, the government has begun to support alternative forms of energy.

The new plant, expected to be built in Victoria by Solar Systems Generation, is expected to be a solar concentrator, an emerging technology that collects sun rays in hundreds of square metres of curved mirrors, then beams the concentrated heat on to photovoltaic panels.

The 154-megawatt project, which will be heavily subsidised by federal and state grants, will be able to provide power for 45,000 homes and could produce temperatures as high as 1,000C (1,832F).

Similar solar power stations are now being built in the US and many Mediterranean countries, and it is likely that Australia's proposed plant will be nowhere near the largest in the world by the time it is officially completed in 2013. A Spanish solar power station using similar technology is expected to produce 354MW of solar power within a year.

The federal government has been been widely criticised for not accepting Kyoto climate change targets and for setting very low national targets for renewable energies, but yesterday it also announced a A$360m (£146m) project to produce cleaner energy through brown coal drying and carbon capture and storage.

Australia, one of the world's biggest per-capita producers of greenhouse gases, is, with the US, the only major developed country that has not embraced the need for emission cuts. With a powerful fossil fuel lobby, it is the world's largest coal exporter and relies on coal-fired power stations for most of its energy supplies

Severe early season bushfires and record early spring temperatures have been recorded recently as a mild El Niño develops in the Pacific Ocean, bringing hotter, drier conditions throughout the continent. Eastern Australia has already experienced five consecutive years of below normal rainfall.

Prime minister John Howard this week released US$263m (£140m) in drought relief for farms but it is being proposed that farmers move north from the grain belt regions to open a "new agricultural frontier" in the tropical north of the country where rainfall has been above average.

"It's a no-brainer that we need a new agricultural frontier in northern Australia, where the Timor gulf and Burdekin catchments have 60% of the nation's run-off - 10 times more than the Murray-Darling basin - but are virtually untapped," said Liberal party senator Bill Heffernan yesterday. "It's time we just faced up to reality that much of the land currently farmed shouldn't be farmed," said Clive Hamilton, an analyst at the Australia Institute economic thinktank.

The latest predictions suggest extremes of drought and heat will increase because of global warming in many areas. This week, the country's leading science body, the Commonwealth Scientific and Industrial Research Organisation, said wine growers needed to re-think plans to cope with climate change or face possible ruin.

"In some regions it will become too warm to produce balanced wines from some - or maybe all - the grape varieties growing there now," said researcher Leanne Webb.

She said that temperatures in most Australian wine regions were anticipated to rise by as much as 1.7C (3F) by 2030, which would would reduce grape quality by up to 57%. It may be impossible to grow Pinot Noir and Sauvignon Blanc grapes, as well as some Chardonnay varieties.

But Mr Howard said yesterday that solar was not a mainstream option. "The problem is that, like wind power, it is not going to make a big contribution. Base-load power is only going to be generated using fossil fuel or nuclear. I see solar as being part of the solution, but at the periphery rather than at the centre."

Panel technology

• Solar power has started to take off as photovoltaic (PV) cells, which convert sunlight directly to electricity, become cheaper.
  
• Production of cells doubles every two years and more than 2500MW of electricity is now generated by PV cells worldwide.
  
• Japan, where 160,000 homes get some electricity from the sun, is the world's PV leader, but Germany, Israel, Spain, Portugal and the US are investing heavily in the technology.
  
• Costs have dropped from $30 per watt in 1970 to less than $3 a watt today.

Harness the power of wind

Farm Weekly
Thursday 26/10/2006, Page: 26

THE world has never been short of wind; for thousands of years it has turned windmills, flown kites, cooled houses and filled sails. Now, technological advances are breathing new life into the use of wind power as a clean, renewable, cost-effective means of generating electricity.

The first electricity-generating wind turbines were invented in the US and Europe in the late 1800s. In the early 1900s, as electricity became more widely available in towns and cities, many rural communities and homesteads turned to small-scale wind turbines for their electricity supply.

Many were built on-site, using old car generators and hand-carved rotor blades or old biplane propellers. Despite continued popularity in remote areas, wind power has not really had much puff as a means of generating electricity for the masses.

But the industry is growing; much of the growth is in European countries such as Holland, Denmark, the UK red Germany. Denmark, for example, currently obtains about 5pc of its electricity from wind turbines and aims to increase this to 40pc by 2030.

Interest in wind power is also growing in countries such as India and China, and Australia is paying increasing attention to the concept. There are probably two main reasons for the increasing interest in wind power. First, most electricity generated today uses non-renewable fuels such as coal, oil and gas. These contribute vast quantities of carbon dioxide to the atmosphere, which many scientists think cause an enhanced greenhouse effect, leading to a warming of the earth's atmosphere.

The second reason is that advances in wind power science and technology are reducing the cost of wind power to a point at which it is becoming competitive with many other energy sources (at about 8-10c/kw). The world has long been searching for a non-polluting, renewable source of energy that is as cheap as coal and oil.

In a coal-fired power station, chemical energy stored in coal is converted first to heat energy by burning and then into kinetic energy (energy of motion) by heating water to produce steam. A high-pressure jet of steam is used to turn a turbine (mechanical energy), which is then used to turn a generator to produce electrical energy.

In generating electricity from wind, the chemical and heat energy steps are not needed: the kinetic energy of-the wind turns the turbine (or blades), which then turns a generator to produce electricity. The power available from a wind turbine increases rapidly with wind speed: a doubling of wind speed results in as much as an eight-fold increase in power.

Therefore it is important to site wind generators in a place where the wind speed is high, as well as reasonably constant. The length of the rotor blades is also important: doubling the diameter of the circle made by the blades produces a four-fold increase in power.

A drawback to wind power is that the wind can be erratic, changing direction by the hour. There may be no wind at all one day and a howling gale the next. It may blow hard at times when electricity demand is low, and be a mere gentle breeze when demand is high. But many of the problems of wind power are now being solved. It could supply a significant proportion of the nation's electricity needs - just as long as the wind keeps blowing.

Forward planning should keep future water problems at bay

Australian Financial Review
Thursday 26/10/2006, Page: 16

Western Australia has a right to feel smug about its groundbreaking water-supply efforts.

Damned for decades as one of the driest capital cities in Australia, Perth is today basking in its status of being near drought-proof thanks to a $1 billion "water safety net".

While other mainland cities scramble to bolster shrinking water supplies, there is a smugness in the west which will reach new heights early next month when one of the world's biggest desalination plants is switched on.

Built at a cost of $400 million, the 45 billion-litre-a-year seawater processing facility located at Kwinana, about 50 kilometres south of Perth, will account for an estimated 17 per cent of the city's annual water needs. It is part of a threepronged strategy aimed at ensuring that water restrictions, which are constraining residents in other parts of the country, are eliminated from life in Perth.

"It means that we'll get nothing worse than the current restrictions, which is two sprinkling days a week," The Water Corporation chief executive Jim Gill says.

"That's managed to keep Perth and the south of the state green and we'll get nothing worse than that." As well as investing in the biggest desalination plant in the southern hemisphere, Gill's department is planning a $617 million water boring and piping exercise to extract another 45 billion litres of water a year from one of the world's great underground aquifers. In addition, it will launch a water-trading operation with south-west irrigation operator Harvey Water.

Combined, the three new water sources will add an estimated 107 billion litres a year to Perth's water supply, which was once based on a series of dams in the hills to the east and south but which is increasingly reliant on alternative sources. That change is a direct result of drier winters, and the fact that the dam system is only 32 per cent full, close to a record low.

The underground-water tapping plan is based on a deep geological rock trap known as the Yarragadee Formation. It is being designed as a major expansion of an existing borewater supply, but is yet to be approved by the West Australian government's environmental agency.

If it is rejected, plans are already being drawn up for a second desalination plant. "The [second desalination] project is considered a contingency plan for our preferred south-west Yarragadee aquifer option," Gill said in last month's annual report of The Water Corporation.

There is no doubt Perth's first desalination plant will garner significant interest, largely because of the way it has chosen to address the thorny issue of using energy to extract salt from sea water.

Rather than simply book the Kwinana plant up to the state power grid, the giant reverse-osmosis plant (which involves pushing seawater through a series of fine filters) has a dedicated alternative power supply in the form of a new wind farm being built at Emu Downs, north of Perth.

The wind farm is a nifty retort to environmentalists who question the green qualities of desalination and its big energy requirement. But while the uniquely efficient combination of wind and water will have the West Australian Premier, Alan Carpenter, crowing loudly, his next job is to decide whether to double-up by building a second desalination plant or to approve the Yarragadee project.

For Perth residents worried mainly about a regular supply of drinking water, plus having enough left over to keep their gardens green, the choice of desalination or aquifer is not a political hot potato.

Carpenter is yet to reveal his hand, but close observers of the government believe the preference will be for the Yarragadee project, simply because it adds another layer of drought-proofing protection. A second desalination plant will only follow after the first has proved itself to be reliable and cost-efficient.

Moving early on a variety of water sources is a direct result of Perth's traditional water shortage, and a heated political debate which claimed the career of former opposition leader Colin Barnett at last year's state election.

It was Barnett who championed a 3000 kilometre canal from Western Australia's water-rich Kimberley region to the drier, and more heavily populated, south-west. A lack of detailed costing, and questions over the engineering and design requirements, turned the canal proposal into a liability. However, it did serve to make water a high priority on the political agenda - and there it remains.

Last month, Gill returned water to the political centre stage when he suggested that the Kwinana desalination plant could be sold as part of a process of drawing private operators into Perth's water supply system.

"We would take a very open attitude to admitting the private sector to ownership and operation of water sources in the future," Gill said.

Within hours that proposal had been stomped on by Gill's government masters who dismissed the privatisation proposal. Water Resources Minister John Kobelke said Gill's comments were wrong and The Water Corporation's assets were not for sale.

But Gill's failing is widely seen as one of timing. The West Australian government has just completed the dismemberment of its electricity agency, Western Power, and is not yet ready to address the question of private participation in the water industry. When it is, there will be a surprising number of possibilities in a part of the country once criticised for its poor system of water supply.

Early adoption of the desalination option means that a second seawater treatment plant will face fewer political hurdles. Tapping the Yarragadee, which contains a massive 1,200,000 gigalitres of water and recharges at a rate of 374 gigalitres a year (compared with the first stage plan to take just 45 million gigalitres a year), will make expanded extraction easier in the future.

If all that fails, there might even be a return to "Colin's Canal", as the Kimberley proposal was dubbed in the heat of an election campaign. It remains a potential future water supply in the long-term drought proofing of Perth.

Emissions fund `just hot air'

Australian
Thursday 26/10/2006, Page: 23

THERE were fresh calls yesterday for the federal Government to develop a national carbon trading system as the longawaited rollout of its $500 million low-emission fund drew criticism from the renewable energy industry for not doing enough to encourage the take-up of clean technologies.

At the launch of the first project awards under the fund in Melbourne, federal Resources Minister Ian Macfarlane warned that a carbon tax or carbon trading would "cripple" industry.

But Victorian Premier Steve Bracks sought to upstage his federal colleague, claiming that Victoria's Mandatory Renewable Energy Target had been key to a $420 million large-scale solar power plant project in Victoria.

"It has gone to Victoria because the market-based signals we have here allow for competitive prices to be taken through the VRET (Victorian Renewable Energy Target) system," Mr Bracks said.

The system requires power companies by 2010 to source 10 per cent of their power from renewable sources or face fines, and is contrary to the federal Government's decision not to extend a similar federal system it has had in place since 2001, but was deemed too costly to extend.

While Treasurer Peter Costello rejected suggestions that the solar power plant would have been unviable without VRET, the company behind the project said it had been an important factor.

"We would have had to have rethought it (without VRET)," said Dave Holland, managing director of Melbourne-based private company Solar Systems which is building the plant.

Solar Systems has won a $75 million grant under the federal Government's Low Emission Technology Demonstration Fund, which has been matched by the state Government.

Mr Holland said he believed a global carbon trading system was inevitable. but he backed the federal Government's strategy to foster new technology through the fund ahead of participating in any global system rather than adopting carbon trading unilaterally, as Europe has.

Mr Macfarlane said: "The aim of the exercise is to get the technology first otherwise all we will do is cripple industry." Once the technology was in place, he said there were various mechanisms for ensuring its uptake, including carbon trading, although he stressed Carbon trading wasn't on the Government's agenda.

But alternative energy advocates, the Business Council for Sustainable Energy, said proven low emission technologies were already in place, such as wind power, biomass and solar, but needed a carbon price signal to make them viable against cheap coal and encourage their further development.

It isn't sufficient to be putting funds into commercialising technology; you need a market mechanism to encourage their deployment," BCSE executive director Ric Brazzale told The Australian.

The way to develop renewable energy is to get people into production and then you learn from day to day and you build local industry and skills." He said power-intensive Australian industries that were vulnerable to overseas competition could be protected from the full cost of carbon trading by issuing them with extra emission permits or through tax breaks.

Welcome to the second green revolution.

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