The proposed Mandatory Renewable Energy Targets (MRET) scheme should include clean coal technologies such as carbon storage, Senator Simon Birmingham said today.
Senator Birmingham has written to Professor Ross Garnaut urging him to consider the role of carbon sequestration as part of his review into the effects of climate change on the Australian economy and possible policy responses.
As part of its goal of a 20 per cent share for renewable energy in Australia’s electricity supply by 2020, the Government has committed to increasing the MRET so as to generate approximately 60,000 gigawatt-hours of energy from renewable sources by 2020.
“The Australian Government is rightly establishing a carbon trading scheme that, we’re led to believe, will be market-driven in order to encourage the adoption of greenhouse-friendly technologies,” Senator Birmingham said.
“Yet the MRET scheme being proposed would basically pick winners choosing green power generation technologies while excluding measures such as carbon sequestration or carbon storage.”
One such project has been proposed by Santos a $700 million carbon storage program that could pump an estimated billion tonnes of carbon dioxide from coal-fired power stations on the east coast to underground storage at Moomba in South Australia’s north.
“While it is important to encourage the development of renewable technologies, this should not be at the expense of other technologies that might be better placed to reduce carbon emissions faster and do so with less disruption to the economy,” Senator Birmingham said.
“I am disappointed that the additional incentive that could be generated from inclusion of carbon capture or clean coal technologies into a comprehensive clean energy target, rather than the restrictive renewables-only MRET formula, is being ruled out by the Government.
“I hope Professor Garnaut will agree to look at this issue and that the Government will heed his advice if he agrees that all greenhouse friendly technologies should be on the table, not just the trendier ones the Government likes to use for photo opportunities.”
Text of Senator Birmingham’s letter to Professor Garnaut follows.
Professor Ross Garnaut
Garnaut Review Secretariat
Level 2, 1 Treasury Place
MELBOURNE VIC 3002
Dear Professor Garnaut
I write to draw to your attention discussions in a recent Additional Estimates Committee meeting in relation to carbon sequestration and ask you to consider the role of carbon sequestration in the government’s proposed Mandatory Renewable Energy Targets (MRETs) as part of your work into Australia’s policy response to climate change.
The Minister for Climate Change and Water, Senator the Hon Penny Wong, confirmed to the Senate Standing Committee on Finance and Public Administration on 22 February that the government was committed to a renewable energy target of 20 per cent by 2020, but was not open to considering the inclusion of clean coal or carbon sequestration into the framework for such a target.
Whilst recognising that clean coal technologies and carbon sequestration, such as the proposed Moomba Carbon Storage plan developed by Santos, would be encouraged by an effective Emissions Trading Scheme, I am disappointed that the additional incentive that could be generated from inclusion of these developments into a comprehensive clean energy target, rather than the proposed restrictive MRET formula, is being ruled out by the Government.
The importance of developing clean coal or carbon capture and storage proposals to Australia’s future was highlighted by Dr Martin Parkinson, Secretary of the Department of Climate Change, who told the same hearings that:
“… it is imperative for Australia that there be solutions to the clean coal issue. Coal is the most widely distributed fossil fuel in the world. Countries are going to use coal because it is so widely distributed and because the technology is well known and it is cheap, so for energy security reasons countries are going to use coal. It does not matter whether a tonne of emissions come out of Melbourne or out of Moscow: we are going to be affected. Even if Australia does not use coal, we are going to be affected if other countries do. So finding the solution to the clean coal problem is actually an important part of the global solution to climate change. It also happens to be the case that if we can find that solution it will allow us to exploit the fossil fuel reserves that we have here without any impact on the global climate.”
I note also your comments on both the potential importance of carbon capture and storage (CCS) in your interim report released recently, as well as those relating to the likely significant impact of MRETs in the period to 2020, particularly that:
“A high proportion of the incentive to introduce low-emissions energy in the early years of the ETS, and a higher proportion of the economic cost, may be carried by the MRET scheme.”
It would seem from these comments that the risk of the MRET structured in the manner proposed, excluding CCS or other clean coal initiatives from inclusion in its targets, could have a significant detrimental effect on the development of such technologies.
When asked, Minister Wong advised the committee that you had not and would not be asked by the Government to consider as part of your review the benefits of a clean energy target, inclusive of technologies like CCS, as against the presently proposed purely renewable energy target. However, she did add that:
“Professor Garnaut’s terms of reference … are wide enough for him to report on a great many matters, including the matters that you raise in relation to climate change.”
It is with this in mind that I urge you to consider, as part of or in addition to your review, the impact the Government’s 20 per cent by 2020 MRET will have on the development of CCS and other clean coal technologies as well as the possible benefits to successfully addressing climate change that a target, possibly greater than 20 per cent, could have if applied inclusive of such technologies.
I look forward to your response and hopefully to your consideration of this important issue.