Thursday 5 March 2009

Home buyers hit for 51000 in environmental pitch - Cost of going green

Courier Mail
Tuesday 3/3/2009 Page: 11

Anna BlighNEW home owners will pay at least $1000 more for their houses from next year, under a Labor plan to make buildings more energy efficient and create green jobs. Queensland would become the first state to force new homes and those undergoing major renovations to meet six-star energy efficiency ratings by the end of 2010, if Labor is reelected.

All new units would have to meet five-star standards and office buildings install individual electricity meters for tenants in a bid to encourage energy savings and cut greenhouse gas emissions. Unveiling a wide-ranging green policy in Brisbane yesterday, Premier Anna Bligh said the regulations would add less than $1000 to the average cost of a new house, but the building industry described the figure as "optimistic". "On average there will be a small upfront cost in the construction of new homes, we anticipate that will be under $1000," Ms Bligh said.

"That of course is then easily paid off in reductions in electricity bills in the early part of the life of the home." In another green policy, Ms Bligh also revealed Labor would set up a "Green Door" into government giving ministers the power to fast-track ecofriendly developments with five or six-star energy ratings to boost green jobs.

Developers and body corporates would be banned from preventing owners from installing energy-efficient appliances such as solar hot water systems and new large commercial properties would have to have facilities for cyclists. Labor would also offer $500,000 to subsidise 3000 training places to boost environmentally friendly skills in the building industry.

Housing Industry Association executive director Warwick Temby said the group was concerned about the cost of some of the measures. He also called on Labor to overhaul the ratings system, saying it had been developed for Sydney and Melbourne and did not suit Brisbane's climate. It was "more expensive and in some cases just impossible" for owners to meet requirements, he said.

Under existing laws, new homes in Queensland must meet five-star energy standards and increasing it to six stars out of a maximum of 10 for the 33,000 new homes built each year could require them to have additional measures such as outdoor living areas or energy efficient appliances. Greens MP Ronan Lee yesterday accused the Government of stealing policies but indicated it may still not be enough to win preference deals.

"This Labor Government has a very poor record of delivering on policy commitments ... particularly on environmental issues," he said. LNP sustainability spokesman David Gibson said Ms Bligh was desperately chasing Greens preferences. "It's clear the only job she is concerned about saving is her own," he said.

Green power for extra $1 a week

Northern Territory News
Wednesday 4/3/2009 Page: 9

THE Territory Government yesterday launched the "green power" initiative - which gives Territorians the option of paying more on their electricity bill to subsidise the Government's use of renewable energy. Essential Services Minister Rob Knight said he expected Territorians would be interested in paying the $1 a week extra for green power. "This is a way of them being able to do their bit. Everyone needs to do their bit." he said. Mr Knight said running a household contributes to about 50% of greenhouse gas emissions across the nation each year.

Carbon capture on hold

Wednesday 4/3/2009 Page: 20

SANTOS, Australia's third biggest oil and gas producer, has suspended its Moomba carbon storage project a victim of weak government support and plunging prices for permits to release greenhouse gases. Credit prices to emit carbon dioxide into the atmosphere were too low to underpin the investment planned for central Australia's Cooper Basin, Santos spokesman Matthew Doman said yesterday.

Adelaide-based Santos estimated the project would have cost more than $700 million. Governments and energy companies worldwide are revising plans to build underground storage for carbon dioxide, the main gas blamed for global warming, because stalled economies and lower permit prices are making them less attractive. "It just doesn't make sense for them to go ahead with these prices," said Gary Cox, vice president of commodities in Australia for Newedge Australia. Mr Cox said his last trade of domestic allowances, covering 50,000 tonnes of carbon dioxide for delivery in 2011, was at $21/t, compared with prices as high as $24.75 last year.

European Union emission permits for delivery in December have dropped about two-thirds from the 30.53/t price reached on July 1 last year. Carbon capture projects became viable when industrial pollution cost about $US50 (40) a tonne, more than three times the current over-the-counter price in Australia, said London School of Economics professor Nicholas Stern.

Santos had been talking to the federal and state governments about the Moomba project "for some time, and whilst we have received strong interest, we haven't had strong or direct support for it", Mr Doman said. A low carbon price makes it more profitable for coal-fired power plants to simply buy permits to cover future emissions rather than invest in projects to pump CO2 underground.

Some energy companies, including StatoilHydro, Norway's largest oil and gas company, are continuing to pursue carbon capture projects. Santos said that in June 2007 it had proposed to the federal Government to pump CO2 into its depleted fields at the Moomba site, provided that pipelines could be built to coal-fired power plants in the east that needed to dispose of the waste gas to comply with emissions targets. Santos and General Electric cancelled a low-emissions venture in Queensland in 2007. In May, BP and Rio Tinto dropped a plan to build a carbon capture power plant in WA.

Solar credits a con, say greens - Don't install panels, homes warned

Wednesday 4/3/2009 Page: 8

CLEAN energy advocates are advising people to reconsider installing solar energy, warning it may perversely hurt the renewable energy industry. They say a proposed "solar credit scheme" will artificially inflate renewable energy figures, potentially limiting investment in large-scale projects. From mid-year, households installing solar panels will receive "phantom" credits worth five times the amount of energy generated at home.

If cashed in, the phantom certificates - those issued for energy that has not been generated - will be counted towards the Federal Government's renewable energy target of 20% of power coming from green sources by 2020. Moreland Energy Foundation energy strategy manager Brad Shone said it would be worse if people cashed in certificates issued for solar panels than if they did nothing.

"People installing solar are actually reducing the amount of renewable energy installed in Australia," he said. "We would have to recommend that people not claim the rebate available to them for solar, or just not install solar at all. And that is a horrible situation for an organisation like ours to be in." Alternative Technology Association energy advocate Damien Moyse said based on today's figures about 15% of certificates issued for renewable power generation would effectively be fake.

The policy experts also criticised the Government's decision to include solar hot water systems - which reduce energy consumption, but do not generate power - towards the renewable target. About one in five renewable energy certificates issued in 2007 were for solar water heaters. The solar credit scheme was a late addition to the renewable target proposal. It was announced in December as a cheaper replacement for the Government's $8000 solar panel rebate.

The number of certificates issued per kW-hour generated at home will be gradually reduced, ending in 2015. But a Moreland Energy Foundation analysis found the phantom certificates would remain in the system. It found that by 2020 the 20% target would in real terms equate to only 17% of the nation's energy coming from green sources.

Climate Change Minister Penny Wong's spokeswoman, Ilsa Colson, said Government modelling showed otherwise - that it would reach the 20% target by 2020. And she said the inclusion of solar water heaters was justified as they displaced gas and electrical heating that uses fossil fuels.

Garnaut dismisses calls for delay

Wednesday 4/3/2009 Page: 5

THE Federal Government's former adviser on climate change, Professor Ross Garnaut, has rejected calls from business groups to delay the start of an emissions trading scheme. That is despite Professor Garnaut still having reservations about the design of the government's carbon cap-and-trade program, including its 2020 emissions reduction target of 15% on 2000 levels if there is a global agreement. "I think there are lots of advantages of bedding our system down (by 2010) so that business is comfortable with it," Professor Garnaut said.

"Then business will know how it works ahead of a time when it starts having to carry a heavier load after 2012, when we must play our full part in what we hope will be a strong global agreement." Last week the Australian Industry Group and the Australian Chamber of Commerce and Industry called on the government to delay the scheme until 2012 to offset the effects of the global financial crisis.

Professor Garnaut was speaking at an Australian Bureau of Agricultural Resource Economics conference in Canberra yesterday discussing the issues surrounding the agriculture sector's inclusion in an emissions trading scheme, which he said should occur "as soon as possible." Currently a decision on agriculture's inclusion in the scheme has been deferred by the Federal Government until 2013, for a possible full inclusion in 2015.

But federal Agriculture Minister Tony Burke said there were still a number of issues relating to agriculture's inclusion, especially monitoring, and the Government had not yet committed to a decision either way. Mr Burke extended one conciliatory offer to the sector yesterday, pledging $32 million in research money for biochar production, a program strongly supported by the Federal Opposition.

Wednesday 4 March 2009

Soil carbon under study

Summaries - Australian Financial Review
Tuesday 3/3/2009 Page: 5

New research funded by the Federal Government will look at the role soil plays in storing and releasing greenhouses gases, as it seeks ways to involve farmers in climate change policy. Agriculture Minister Tony Burke announces today a $20 million study into how to measure and analyse soil carbon and a $12 million study on nitrous oxide emissions from soils.

The research would be revealed at the Australian Bureau of Agricultural Resource Economics annual outlook conference. Prime Minister Kevin Rudd told the same conference last year the government would investigate soil carbon. Liberal leader Malcolm Turnbull's response to climate change relies on the role soil and forest play in sequestering carbon. Agriculture accounts for about 16% of Australia's greenhouse gas emissions, while farm emissions are not included in the government's emissions trading scheme that starts in 2010.

US grapples with climate policy

Canberra Times
Saturday 28/2/2009 Page: 20

 Cooling TowersA mandatory cap on the nation's greenhouse gas emissions, which President Obama embraced this week as central to his domestic agenda, would be designed to generate badly needed revenue for the Government while addressing the world's most pressing environmental issue.

But only hours after his speech to Congress on Wednesday, the proposal triggered a heated exchange among senators on a key committee, underscoring that the effort to come up with a system that limits emissions, puts a price on carbon and allows industries to trade pollution allowances will be difficult to sell on Capitol Hill, especially in the current economic crisis.

A federal cap-and-trade program, which many scientific and policy experts see as key to curbing dangerous levels of global warming, would create a new commodity in the form of the allowances permitting industries to discharge specified amounts carbon dioxide into the atmosphere. A market for them that will be worth tens or perhaps hundreds of billions of dollars, along with a complex new regulatory system.

The political battle on Capitol Hill is largely divided along regional rather than party lines. While lawmakers from coastal states see a carbon cap as a critical goal whose public and long-term economic benefits will outweigh its costs, most Republicans and some Democrats from the middle of the country fear it will hurt their states' economies, dependent as they are on fossil fuels and manufacturing.

At a Senate Environment and Public Works Committee hearing on climate science Wednesday, Republican senator Christopher Bond, of Missouri, called any cap-and-trade system "a huge unfair tax" that "would devastate the Sinosteel-Midwest". Republican senator John Barrasso, of Wyoming, referred to it as "a trillion dollar climate bail-out". But the panel's chair, Democratic senator Barbara Boxer, of California, countered that a cap-and-trade system "isn't a bail-out. It's revenues coming into the Government".

"We think it will be a boon for our economy," she said. The extent to which states rely on coal-fired utilities, which produce roughly 40%of the nation's greenhouse gas emissions, helps influence how their elected officials view the prospect of curbs on carbon. In Indiana, 94%of electric power comes from coal-fired plants, while in Florida - which relies more on nuclear plants that don't emit greenhouse gases - only 30%of electricity comes from coal.

In California and Rhode Island, only 1%of electricity comes from coal; in Vermont, none. Most analysts predict that over time, placing a price on carbon will spur technological innovation and ease American dependence on foreign oil, while probably driving tip energy prices in the short term. Although so far the mechanics of a cap-and-trade system have been debated mostly by business executives and a small but growing group of policy experts, the implications could be far-reaching. It would create a new commodity and a market to trade it worth tens of billions of dollars. It would create property rights where none exist today.

In a speech last week at Georgetown University, a senior fellow at Resources for the Future, Dallas Burtraw said, "Emission allowances could be the greatest creation of property rights since the 19th century settlement of the West." The White House unveiled a budget yesterday that includes revenues from an emissions trading system as of 2012. In testimony to Congress in September, former director of the Congressional Budget Office and now Mr Obama's budget director, Peter Orszag, estimated that revenues from a the cap-and-trade bill that died on the Senate floor last year would have generated $112 billion by 2012 and would have kept rising afterward.

By 2020, he estimated, that a cap-and - trade program might generate $50 billion to $300 billion a year. The executive director of the advocacy group Sierra Club, Carl Pope, said he had been surprised at the extent to which Mr Obama had made green energy a priority and had based his economic plan on the assumption that this sector would drive the nation's financial recovery.

Mr Pope said, "Obama's talking about this as the economic equivalent of war." The cost of carbon emissions and hence the revenue the Federal Government would receive from auctioning carbon allowances or permits remains highly uncertain. In Europe, which has a cap-and-trade system, the price of carbon has fluctuated roughly between 10 and 30 euro ($A20 to $60) a ton. With world economies in recession, European prices have slumped.

US experts have varying estimates for what the allowances might cost, all based on unknowable factors such as whether the cost of solar and wind energy will fall or whether industry will come up with an economic way to capture and store carbon dioxide emissions. Such advances might make it cheaper to cut emissions than to buy allowances.

John Rowe, the chief executive of Exelon, the nation's biggest nuclear energy producer, said one consultant estimated that carbon allowances would cost $US50 ($A77) a ton. "Personally I believe they will be closer to $70 or $100 a ton," he said. "There is no one solution and there are no cheap solutions" to climate change, Mr Rowe said. Senate Energy and Natural Resources Committee Chairman Jeff Bingaman, of New Mexico, favoured a ceiling on the price of carbon allowances, but his ceiling is well below what most energy experts believe is needed to generate the investment and innovation that would achieve big reductions in emissions.

Republican senator Arlen Specter of Pennsylvania - who co-sponsored the Democratic Senator Bingaman's Bill - and remains a key swing vote in the Senate, said at Wednesday's climate hearing that he saw global warming as "a central issue" but could not support a bill that was based on "speculative" technological advances. A broad alliance of business and environmental groups back a cap-and - trade program, though there are deep fissures about ]low it should be tailored. Many environmental groups and economists favour auctioning 100%of the carbon allowances, but many coal-intensive industries and utilities want to delay or phase in auctions.

A spokesman for Duke Energy, Tom Williams, said, "We do not support auction allowances in the early years at all, and certainly not for using the revenues in the general fund for purposes unrelated for climate change." Some lawmakers support returning mach of the revenue generated by carbon allowances back to taxpayers as either tax cuts or dividends, the way Alaska shares its oil revenues. That plan, however, would deprive the Federal Government of much of the money it hopes to capture through a cap-and-trade system.

Emissions plan may loll GreenPower

Sydney Morning Herald
Monday 2/3/2009 Page: 4

THE future of Australia's renewable energy program, GreenPower, is in doubt, after big energy companies warned it might not be viable under the Rudd Government's planned emissions trading scheme. The GreenPower program has been heavily promoted by state and federal governments and environment groups. Householders pay extra on their power bills, which is invested by energy companies in renewable sources like wind and hydro.

The head of the Energy Retailers Association of Australia, Cameron O'Reilly, has written to state energy ministers asking for their support to save the program, which has more than 800,000 customers nationally. A household's voluntary purchase of GreenPower would not technically be recognised under the Government's scheme as reducing national greenhouse gas emissions, according to the letter.

In the letter, obtained by the Herald, Mr O'Reilly warns ministers: "[Energy] retailers are likely to face a number of consequences if GreenPower ceases to be a viable proposition, the most obvious of these involves contacting each of the 800,000 GreenPower customers, explaining to them how the premise under which they had entered into their contract has changed and offering them the ability to transition to an alternative nonrenewable product".

The predicament has arisen because the GreenPower program, considered one of the most successful efforts by households to cut their greenhouse gas emissions, is voluntary. Under the Rudd Government's carbon pollution reduction scheme, energy companies and all big greenhouse polluters must, by law, obtain permits to emit greenhouse gases.

The Government is also introducing a renewable energy target aimed at providing 20%of the electricity supply from green sources by 2020. The scheme sets a target or limit on the greenhouse pollution for Australia of between 5% and 15% below 2000 levels. Mr O'Reilly told the Herald that energy companies were still hopeful GreenPower could be brought into the new scheme and counted towards cuts to the nation's emissions.

"There are a lot of people who have fully embraced the GreenPower policy. It is about taking additional action and it might be wise to give them that option, particularly if you look at the debate on the targets," Mr O'Reilly said. The voluntary program has no obvious way of fitting into the new system because energy retailers will not have a direct incentive to promote green power.

The Federal Government is aware of the problem and is trying to work out a way to incorporate GreenPower but has so far been unable to. Environment groups have criticised the Rudd Government's national targets as too low and there is growing criticism that household efforts to cut emissions will allow big polluting companies to make less effort to reduce their emissions. A spokeswoman for the Climate Change Minister, Penny Wong, said buying GreenPower "will continue to drive investment in renewable energy technologies, such as wind and solar".

Second chance at free carbon permits

Saturday 28/2/2009 Page: 9

Penny WongHEAVY carbon-emitting industries that miss out on government compensation will get a second chance at free carbon permits through a committee established by Climate Change Minister Penny Wong. The committee will be led by former Caltex chairman Dick Warburton and has been asked to review all industries not already qualified for free permits under the Government's proposed emissions trading scheme.

In advice released last week, the Government listed 33 industries that will qualify for free permits as "trade exposed". These industries included petrol refining, aluminium refining and methanol production. But Mr Warburton told The Age that industries that missed out would have a chance to have the decision reviewed by the expert panel to determine whether they had been treated fairly by the Department of Climate Change.

"We will be looking at the types of activities that have been assessed as being valid for some assistance," he said. "Some industries have already been proclaimed as valid within that, but the Government has properly covered all of the industries." The committee review conies after one of the Government's closest industry allies, the Australian Industry Group, changed its stance on the emissions trading scheme, calling for it to be delayed by two years to

The group did, however, retain support for the design of the scheme, but its call for a delay was backed yesterday by the Australian Chamber of Commerce and Industry. Senator Wong rejected industry calls for a delay to the scheme, saying the Government had set its time line and would stick with what was outlined in its policy document last year. However, Ms Wong did announce a delay in the release of the draft legislation for the scheme from the scheduled "late February" to March 10.

Opposition Leader Malcolm Turnbull welcomed the calls by industry for a delay. "For the risk of a year or two of rushing into it, (Prime Minister Kevin Rudd) is putting our economy at very grave risk and no environmental gain," he said. The Opposition has yet to form an official position on emissions trading or the Government's scheme and is awaiting advice from economist David Pearce, whose report is expected to be handed to the Opposition within a fortnight.

Jump in GreenPower

Monday 2/3/2009 Page: 6

GREENPOWER subscriptions jumped dramatically last year, with the number of Australian households paying extra to support renewable energy approaching 880,000.

The 26% rise comes as energy companies and environmentalists warn that the Federal Government's proposed emissions trading scheme could hit household subscriptions to green electricity. Lobby group GetUp! last week launched a campaign warning that, under the scheme, voluntary cuts in emissions would limit the reductions necessary by big industry.

Figures released yesterday showed Victoria had the most GreenPower subscriptions, with 330,000 households signed on - 37% of the national total. Price comparison service Switchwise said Origin Energy was the most successful GreenPower retailer.

Green rubbish to cost

Sunday Herald Sun
Sunday 1/3/2009 Page: 26

HOUSEHOLD waste collection will be revamped in Victoria under a radical rubbish plan that could increase the cost of taking out the trash. The Brumby Government will unveil a 20-year plan today focused on turning household waste into renewable energy and reusable products. Up to seven superwaste stations are likely to be built throughout Melbourne under the strategy to reduce the state's landfill.

Remarkably, the Government will also investigate building rubbish tips that can transform garbage into electricity. The Government will set a target of recovering 65% of municipal waste by 2014 in a bid to cut greenhouse gas emissions. The plan is expected to reduce emissions by up to 400,000 tonnes a year. However, experts predicted the cost of making Victoria's waste collection greener would lead to higher costs for consumers, but beneficial long-term results for the environment. The frequency of rubbish collections could be reduced.

The Government is also expected to investigate what bins are used to collect the waste and private companies are set to profit from charging people to take their trash, similar to the way in which people pay to dump their rubbish in landfills. Environment Minister Gavin Jennings said the plan "set a new direction for waste management in Melbourne", moving away from landfill and toward new technologies that make use of what Victorians throw away.

"Melburnians have been great recyclers, but we are going to need to more than double the amount of waste we recover, recycle and reprocess," he said. A Sydney rubbish tip, which takes 8% of the city's waste, already turns organic waste into electricity and sorts recyclables. Similar tips are expected to be built in Victoria soon, under private public partnerships. Greenhouse emissions rose by 1.3% in Victoria last year, according to a report released last month.

Kallis takes on energy role

Independent Weekly
Friday 27/2/2009 Page: 14

Petratherm managing director Terry Kallis has been appointed chairman of the Australian Geothermal Energy Association, the main national body representing the interests of the Australian geothermal energy industry. Mr Kallis takes over from Gerry Grove-White, managing director of GeoDynamics, who has held the position since the association was formed in 2007.

AGEA chief executive officer Susan Jeanes said Mr Kallis's experience and leadership would provide "a major boost to the association and assist AGEA to draw closer to our ultimate vision for geothermal energy, which is to provide the lowest-cost, emissions-free, renewable-base-load energy to Australian homes and businesses for centuries to come".

The association has 25 members, including major geothermal energy project developers, direct heat equipment suppliers, and service providers to the industry. Since 2007, its has provided input on policy reforms affecting Australia's geothermal energy industry, including the $50 million Geothermal Drilling Program and the $435 million Renewable Energy Demonstration Program.

AGEA also played a key role helping shape the Federal Government's Geothermal Energy Industry Development Framework, launched in December last year, as well as its carbon pollution reduction scheme and 2020 Renewable Energy Target.

Rees to ease the way for 40 wind farm projects

Sydney Morning Herald
Saturday 28/2/2009 Page: 9

THE State Government is to pave the way for a speedy rollout of windfarms across NSW by relaxing development controls throughout much of the State. The Federal Government wants as much as one-fifth of Australia's energy to come from renewable sources by 2020, which is expected to lead to a big rise in investment in wind turbines throughout NSW.

The Premier, Nathan Rees, said yesterday the big beneficiary would likely be windfarms, which he said would generate as much as 70%of the state's renewable energy. To prepare for this, windfarms planned for the NSW-ACT border area, the Central and New England tablelands, the South Coast and the Upper Hunter would be given access to accelerated planning approvals.

At the same time, farms as small as 30 MWs would be considered critical infrastructure, down from 250 MWs at present, which also means quicker consideration for development approval. "The Rees Government is trying to address community opposition to large-scale windfarms by forcing Department of Planning project managers to act as promoters," NSW Greens MP John Kaye said. But Mr Rees said there were "regional sensitivities to be considered". ''Working more closely on these important projects is about local buy-in and ownership - getting the strong local input into the process," he said.

The State Government also outlined a plan to force electricity retailers to cut 4%of their electricity sales a year within five years by working with customers to introduce energy efficiencies. These measures might slash the need for big new coal-fired power stations by the second half of the next decade, a government official said. Initially, the energy efficiency scheme would target measures such as retrofitting downlights and the use of more energy efficient appliances, perhaps through rebates offered by the electricity retailer. Then more detailed steps would be introduced to cut the heating, cooling and lighting costs of businesses.

From July 1, power retailers such as Integral and EnergyAustralia would have to take measures to begin cutting electricity sales by an initial 0.4% by helping customers adopt energy efficiencies, or face financial penalties of $24 per MW. The efficiency target will rise to 4% in 2014. The scheme is hoped to boost investment in low-cost energy efficiency measures which will cut electricity use.

Once the scheme is up and running, improved efficiency would shave as much as $50 a year off the household electricity bill, the Government said. From 2014 to 2020 the energy improvements delivered by the scheme will save as much as 32 million MW hours of electricity a year, which would equal 3.2 million tonnes of carbon dioxide emissions annually, the Government said.

Monday 2 March 2009

Renewable Energy Target legislation won't deliver election promise

Clean Energy Council
19 February 2009

The Rudd government needs to make small but important adjustments to the design of its draft renewable energy target (RET) legislation if it wants to honour its election commitment of delivering 20%of Australia's electricity from renewable sources by 2020. In its submission on the draft RET legislation, the Clean Energy Council (CEC) has highlighted the detailed repairs needed to achieve the target and stimulate more than $20 billion of investment in Australia's emerging clean energy industry.

CEC Chief Executive Matthew Warren said the government was to be congratulated on finally delivering its RET legislation as a key complementary measure in its climate change strategy. "Now we've just got to get the details right. The legislation as currently drafted will create a boom-bust cycle for the industry, undermining long-term industry development and the capacity for Australia to be a leader in developing a world class industry and exporting exciting new technologies," Mr Warren said.

As Australia's peak representative body for clean energy, the CEC has analysed the government proposal in detail and has identified a key flaw in the design of the proposed trajectory that will effectively stall investment in clean energy generation after 2014. Economic modelling recently commissioned by the CEC found the government's proposed draft RET legislation will only reach 15 %, well short of the government's promised 20%target by 2020.

"This flaw will become an impossible hurdle to many of the exciting and emerging new generation technologies like geothermal, solar thermal and ocean energy and undermine the government's election promise before the legislation is even enacted," Mr Warren said. "It is imperative that we get RET design right to deliver immediate action on climate change in Australia and leave no stone unturned in discovering the lowest cost way of transitioning to a low carbon energy future."

The Council accepts the use of a multiplier as an interim step to developing Australia's PV industry but has concerns over the continued limits on system size and the potential for "phantom" certificates to also undermine the overall target promised by the government at the 2007 election.

The Clean Energy Council's submission will be available for download at

Climate change raises spectre of insurance market failure
London, 26 February:

Climate change increases the possibility of the failure of insurance markets, according to a Chartered Insurance Institute report, which cites the need for better measures of market robustness. Extreme weather events present the most obvious risk to insurers, says the Coping with climate change: risks and opportunities for insurers report, but global warming may already be compounding catastrophe losses by 2% a year, it warns.

"Social disorder and international tensions could deteriorate to the point where substantial markets become uninsurable. Another potential problem is 'claims contagion', when systems cannot cope with the sheer volume of work," the report says. Insurance markets can fail to operate as intended in four ways, the report notes: through lack of capital, lack of cover, inability to pay claims, or failure to contract.

"Lack of cover is the most likely of these problems to spread with climate change," it says. Insurers withdrawing from a market can lead to many problems, the report states, such as shareholder doubts about a firm's long-term strategic capabilities, exit costs, and customer and intermediary distrust.

The report's lead author, Andrew Dlugolecki, a visiting research fellow at the University of East Anglia's climate research unit, advocates the creation of an independent index of market robustness that would indicate the aggregate degree of coverage, the collective vulnerability to catastrophes, and the overall capacity to manage a disaster claims situation.

"The most important strategy to preserve insurability is to reduce greenhouse gas emissions. Insurers can play a role as underwriters and investors [in] clean technology, and by lobbying for action on policies," the report concludes. The global insurance industry manages assets worth $55 trillion, which are impacted by and have an impact on climate change. "Yet this factor is still largely ignored," the report says.

Obama goes for green light at end of tunnel

Sydney Morning Herald
Friday 27/2/2009 Page: 14

A MANDATORY cap on greenhouse gas emissions in the United States, which the President, Barack Obama, has made central to his domestic agenda, would be designed to generate revenue for the Government while addressing arguably the world's most pressing environmental issue.

As debate rages in Australia about Kevin Rudd's proposed emissions trading scheme, the White House will unveil a budget that assumes revenue from a cap-and-trade system by 2012. A source familiar with the document said it would direct $US15 billion ($23 billion) of that revenue to clean energy projects, $US60 billion to aid the working poor and additional money to help offset higher energy costs for families and small businesses. But a system that limits emissions, puts a price on carbon and allows industries to trade pollution allowances will be a difficult sell on Capitol Hill, especially in the current economic crisis.

The political battle on Capitol Hill is largely divided along regional lines. Politicians from coastal states see a carbon cap as a critical goal whose public and long-term economic benefits would outweigh its costs. Most Republicans and some Democrats from the middle of the country fear it would hurt their states' economies, dependent as they are on fossil fuels and manufacturing.

The implications of a cap-and-trade system could be far reaching. It would create a new commodity and a market to trade it worth tens of billions of dollars. It would create property rights where none exist now. "Emission allowances could be the greatest creation of property rights since the 19th-century settlement of the West," said Dallas Burtraw, a senior fellow at Resources for the Future. Carl Pope, executive director of the advocacy group Sierra Club, said he has been surprised at the extent to which Mr Obama has made green energy a priority.

"Obama's talking about this as the economic equivalent of war. His Administration sees that the green economy is the only train leaving the station and they are eager to hitch on to it to pull its out of this crisis." The cost of carbon emissions - and hence the revenue the Government would receive from auctioning carbon allowances or permits - remains uncertain.

In Europe, which has a cap-and-trade system, the price of carbon has fluctuated between about 10 and 30 ($20-$60) a tonne. But with economies in recession, prices have slumped by up to two-thirds. US estimates are based on such unknowable factors as whether industry will cone up with an affordable way to capture and store carbon dioxide emissions.

Green status of Snowy power station in doubt

Sydney Morning Herald
Friday 27/2/2009 Page: 11

A KEY power station in the Snowy Mountains hydroelectric scheme may have breached its status as a "green power" provider, because its environmental effect downstream appears to outweigh the benefits of the renewable power it creates. The Jindabyne darn plant received green power accreditation in 2006, but studies show that downstream water flows have slowed to a trickle, putting native fish, plants and animals in jeopardy.

A report by the independent Snowy Scientific Committee, completed in October but kept secret for four months by the State Government, showed a river system starved of water. Environmental flows were only a third of those promised and water was being diverted to the Murray River to boost crop irrigation. Under the rules for green power accreditation, hydro plants must allow for ''adequate" environmental flows, and the leaked Snowy report says "environmental releases to date have not been adequate".

"There's a lot at stake here if green power is going to keep its clean reputation, and the Snowy Hydro debacle is a low point in it's credibility,'' said the director of the Total Environment Centre, Jeff Angel. The group has written to the Department of Water and Energy, which oversees green power, requesting that Lake Jindabyne be removed from the list of approved renewable energy generators.

The NSW Government is standing by the power plant's green credentials. The complaints were "typical pettiness by some elements of the Green movement", said the Minister for Energy, Ian McDonald. Snowy Hydro Limited, the corporation that manages the hydro-electric scheme, including Lake Jindabyne, said it regarded the power plant as accredited green power.

''From our point of view we're releasing environmental water that is improving the river, and Lake Jindabyne is completely green, clean power," said a Snowy Hydro spokesman, Paul Johnson. ''We don't determine the amount of flow; that's up to the NSW Government." The water licence that determined how much of the Snowy River should be released downstream was being reviewed, with a decision due within weeks, the Department of Water and Energy said.

The NSW Opposition believes public confidence in green power, in which people pay extra on their power bills to support renewable energy, will be undermined if the accreditation process is not reviewed in the Jindabyne case. About 10%of households and businesses support the greenpower program. The Opposition spokeswoman on environmental sustainability, Catherine Cusack, said: ''The State Government must be scrupulous about maintaining the integrity of the green power scheme, otherwise it undermines consumers and all the businesses that are trying to do the right thing. It's appalling that the Government isn't reaching those standards."

The Jindabyne hydro plant was built in 2006, when another river was diverted to Lake Jindabyne to allow for environmental flows mandated by the Snowy water licence agreement. It harvests water flows to spin turbines and generate electricity.

The Carbon Club

Summaries - Australian Financial Review
Friday 27/2/2009 Page: 20

There is a growing legion of business executives creating the new arena of climate change and carbon trading with a distinctly capitalistic bent. Former options trader Geoff Evison founded the Arkx carbon fund with former Citigroup trader Lisa Wade with the intention of convincing investors that superior returns can be had from alternative energy plays.

After 30 years with BP, Greg Bourne became CEO of WWF Australia. A graduate of the University of Western Australia, he admires Climate Change Minister Penny Wong, is on friendly terms with Malcolm Turnbull, and says his line of communication with Prime Minister Kevin Rudd is very good. When he encouraged the Howard government to ratify the Kyoto Protocol he found himself immediately cut off.

Gerry McGowan founded Impulse Airlines but now heads a renewable energy company that is building wind turbines on the Chatham Islands. Maria Atkinson was only offered jobs in the Environmental Protection Authority and National Parks when she graduated with a degree in environmental science back in 1996. Today she is global head of sustainability with Lend Lease.

Cassandra McCarthy is the manager of energy and climate change policy at Xstrata. She was formerly with the Australian Coal Association. Petrea Bradford is group manager, carbon at Origin Energy. Sean Lucy did stints with PricewaterhouseCoopers, Maddocks, and Mallesons Stephen Jaques before joining nabCapital as head of the carbon solutions group.

Green plan delayed - Supporters turn on trading scheme

Courier Mail
Friday 27/2/2009 Page: 17

THE Rudd Government will delay the release of its draft legislation on the emissions trading scheme as two key supporters demand sweeping changes. And in a blow to Climate Change Minister Penny Wong, the chief executive of the Australian Industry Group, Heather Ridout, yesterday strongly advised the Government to postpone its ETS until 2012.

It means that the position of Ms Ridout, often referred to as the Government's 21st Cabinet minister because of her influence within Labor circles, is now more aligned to the policy of the Opposition, which also wants the scheme delayed. Ms Ridout said the ETS legislation should still be passed in 2009 so that business had certainty, but the Government's starting date of 2010 was "neither necessary nor realistic". "Australia is already on track to meet its Kyoto commitments over the period to 2012," Ms Ridout said.

"The sharp downturn in the economy and the associated reduction in emissions for example from reduced metals production and slower growth in energy demand across the economy will reduce our abatement task in the short term." Senator Wong has signalled the draft legislation, which was due at the end of February, might now be "a little bit later". Opposition Leader Malcolm Turnbull is expected to receive his commissioned research on the emissions white paper by tomorrow.

Meanwhile, a survey released yesterday by the Australian National University showed that the community wanted to address climate change but not if it cost them too much money. The results compiled after interviews with 600 Sydney residents revealed households were willing to pay an extra $135 a month to address climate change but when aggregated across the nation it represented significantly less than what Treasury had estimated.

And in print advertisements to start today, the left-leaning lobby group GetUp encourages readers to fill out a petition against the Government's "weak" targets and send them directly to Mr Rudd. "You've designed your carbon pollution reduction scheme so badly that when I save energy at home, I free up permits to pollute for energy company's to sell on to polluting companies like aluminium smelters," it says.

Queensland Senator Ron Boswell said the community needed to be told about the hidden costs of an ETS. "Every sewing machine, every production line, every mill, every conveyor belt, every piece of machinery that uses energy will suffer a new cost as a result of the ETS that our overseas competitors will not have to face," he said.