Sustainable Energy Development – Myth or Reality ? Sustainable Energy Day 2001 Harry Schaap Assistant Director – Environment and Sustainable Energy ESAA Ltd

Overview Using electricity supply as a focus: Where are we now and where are we going ? Some sustainable energy development dimensions Policy setting Energy efficiency Renewables Taking some of the hard steps

SUSTAINABLE DEVELOPMENT Development which meets the needs and aspirations of the present generation without compromising the ability of future generations to meet their own needs Using, conserving and enhancing the community resources so that ecological processes, on which life depends, are maintained, and the total quality of life, now and in the future, can be increased

Where Are We Now and Where Are We Going ?

ENERGY GROWTH 1993 to 1998 (per annum) Overall world energy growth +2.4% Overall renewable energy growth +2.0% Nuclear +2.2% Fossil fuel +2.6% Wind +25% Photovoltaics +4.9% World electricity generation from renewables 20.2% (mostly large hydro)

Total Energy Supply, Exports and Consumption (98/99) (Pj) Total supply – Pj Total exports – 8983 Pj Conversion losses – 1945 Pj Total consumption – 3268 Pj 3.9 Pj Australia

Energy Available for Final Consumption – 3268 Pj (98/99)

Primary Energy Use in Electricity Production (98/99) Primary energy Pj (fuel conversion loss 66.3%, power station and network loss 2.3%) Electricity for final consumption Pj (173.5 TWh)

Public End-use Consumption (1998/99) GWh

The Value of Electricity, Gas and Water in Value added = $11,314m This amounted to 2.8% of national GDP The annual growth rate was 2.9% The electricity, gas and water sector employed 0.9% of Australia’s labour force. Source: Dept of Industry Science & Resources 2001

Electricity Price Comparisons – Large User - January 2000

Total Electricity Generation Growth (GWh)

Greenhouse gas emissions by sector (1999 inventory, excluding land-use change (Mt CO2 equiv.)) 108 % of 1990

Greenhouse Gas Emissions (Excluding Land-use Change) (Mt) Australia % of Excess3793 Electricity % of * estimate

Emissions (Including Renewables and Generation Efficiency)

Sustainable Energy Development Policy Setting Energy Efficiency Renewables

SUSTAINABLE ENERGY POLICY Commitment to improving the well-being of this generation of Australians and to laying a firm foundation that this will enable future generations to prosper Commitment to implement measures in the energy sector that provide continued improvements in our economic prosperity and protect our natural environment from unacceptable and irreversible damage

Towards a National Energy Policy (1) Objectives: Encourage efficient provision of reliable, competitively-priced energy services Encourage responsible development of Australia’s energy resources, technology and expertise Mitigate local and global environmental impacts, notably greenhouse impacts

Towards a National Energy Policy (2) Principles: Recognise the importance of competitive and sustainable energy markets Continuously improve Australia’s national energy markets Enhance the security and reliability of energy supply Stimulate sustained energy efficiency improvements Encourage efficiency economic development and increase application of less carbon-intensive energy sources and technologies Recognise the Australia’s energy markets operate in a wider global context Provide transparency and clarity in government decision-making Consider social and economic impacts on regional and remote areas Facilitate constructive, effective inter-jurisdictional cooperation and productive international collaboration

Ministerial Council on Energy Objectives: Provide national oversight and coordination of policy development to address the opportunities and challenges facing Australia’s energy sector Provide national leadership so that consideration of broader convergence issues and environmental impacts are effectively integrated into energy sector decision-making

UN Commission on Environment and Development Requirements of business: Integrate environmental criteria in purchasing policies Design more efficient products and services Increase life spans of durable goods Improve after sales service Reuse and recycle Promote sustainable consumption through advertising, marketing and product information In other words: improving energy and resource use efficiency and reduce consumption

What Governments Must Do? Stimulate market forces Promote more efficient use of materials and energy Establish pricing structures that internalise environmental costs Support recycling and reuse – on a life-cycle basis Provide flexibility to choose effective solutions Support a process of continuous improvement Stimulate economic growth Promote innovation Minimise trade barriers Encourage technology and systems sharing

World Business Council for Sustainable Development Companies have a responsibility to : Address entire life-cycle of goods and services Apply principles of eco-efficiency Procure and request products and services with reduced environmental impact Make available accurate, scientifically sound environmental information in order to inform purchasing, use and disposal

SUSTAINABLE ENERGY DEVELOPMENT ultimate sustainability of energy is based on renewable resources extending sustainability of fossil fuels through supply and end-use efficiency and through new technologies Using current energy resources to create economic and intellectual wealth for sustainability Improving energy efficiency and reduce the carbon intensity of energy supply making fossil fuels technologically obsolete or redundant

Electricity and Sustainable Development Prerequisite for a networked world of the future – vehicle for the most productivity gains Key role in addressing the problems of population, poverty and pollution 1000 kWh/person/year minimum needed to move from immediate survival needs to amenity needs such as education, environment, and intergenerational investment Ideal energy carrier for economic and social development

Electricity Use Per Capita (kWh)

Energy Intensity per US$1000 of GDP

Sustainable Energy Development Policy Setting Energy Efficiency Renewables

Electricity, Greenhouse and Cost Benefit Test (in 2010) %

Sustainable Energy Development Policy Setting Energy Efficiency Renewables

MRET Supply and Demand Issues

Commissioned, Committed and Proposed Capacity (GWh/year) (after Redding) Generation GWh/year

Projected Generation Costs in 2010 ($/MWh) (after Redding)

Green Power Customers -- Are Numbers Increasing and Do They Buy Energy?

Renewable Energy Action Agenda Vision – To achieve a sustainable and internationally competitive renewable energy industry, which has annual sales of $4 billion by 2010 Five key strategies: Market development Building community commitment Building industry capability Setting the policy framework Encouraging a culture of innovation Nine initiatives covering twenty-five identified actions are in the process of being implemented

Taking Some of the Hard Steps

Global Sustainability Targets Education – universal access to education and technical training Industrial ecology – reduce industrial waste streams to near zero and minimise the need for virgin resources Transportation – electrify over 50% of global transportation Water use – cut agricultural and industrial water use by half Decarbonisation – triple the global rate of decarbonisation from 0.3% to 1% per year Energy efficiency – double energy efficiency of total energy chain from 5% to 10% Energy intensity – accelerate decline from 1% to 2% per year Electrification – universal global electrification, basic service of 1000 kWh per person per year Infrastructure – universal availability of fresh water, sanitation, commercial energy and communications