(By Keith Orchison, published in The Weekend Australian, 28-29 June 2008)
The enormous opportunities in sustainable investment have been highlighted by the International Energy Agency in a new report that estimates $47,000 billion needs to be spent on alternative energy technologies between now and 2050 to prevent global carbon emissions more than doubling.
This is the equivalent to 47 times the entire Australian economy's annual worth.
Releasing its "Energy Technologies Perspectives" report in Tokyo, the IEA --the principal energy adviser for 27 nations, including Australia --has called for an investment of 1.1 percent of projected average annual global gross domestic product over four decades in low or zero emission energy technologies.
Unless this happens, says IEA executive director Nobuo Tanaka, world CO2
emissions will be 130 percent higher in 2050.
The IEA research warns that the current record crude oil prices will paradoxically contribute to a sharp rise in carbon emissions because they will drive consumers away from oil and gas supplies for power generation to cheaper coal.
The report, which has been produced in response to a recent call by the leaders of the G8 nations for ideas on how best to develop a sustainable energy future, recommends that investment in clean technology be increased by $105 billion to $210 billion annually in the next 10 years -- and then driven up to as much as $2,100 billion a year after 2020.
A key contribution, the report urges, is a major increase in energy R&D -- it calls for a rise of between $11 billion and $110 billion annually next 15 years.
The IEA says the most important initial focus should be on energy intensity -- reducing the amount of energy needed per unit of production -- followed by a huge increase in spending on renewable energy and carbon capture and sequestration systems for fossil-fuelled power stations. Global energy efficiency needs to be doubled by the middle of the century.
In sharp contrast to the Rudd Government's new focus on manufacturing "green" cars in Australia, the Paris-based agency warns that the relatively slow rate of clean technology development in the transport sector -- coupled with soaring global use of cars -- means that governments need to give priority to "the virtual decarbonisation" of power supply if a target of cutting greenhouse gas emissions in half by 2050 is to be realised.
However, it acknowledges that a shift from petrol-fuelled to electric vehicles is an important step over time, noting that there should be a focus on rapid progress in battery technology as well as a shift to biomass-to-liquids fuel for trucks, aircraft and ships.
Pursuit of this goal, it adds, requires an average of 35 coal and 20 gas-fired power stations to be fitted with CO2 capture and storage technology every year until 2050, for 32 new nuclear plants to be built annually,for wind power to be increased by 17,500 turbines per year and for billion square metres of solar panels to be rolled out annually. (France, Europe's biggest nuclear power, currently has 58 uranium-fuelled power stations.)
A key change factor, says the agency, will be overcoming NIMBY attitudes to infrastructure development.
Tanaka says this program requires "immediate policy action" and "technology transition on an unprecedented scale." It also needs, he adds, a huge increase in the world's engineering and technology graduates.
The truth about the present situation, Tanaka says, is that "we are very far from sustainable development despite widespread recognition of a long-term problem." Carbon dioxide emissions from energy use have accelerated this decade, he points out, partly because higher oil and gas prices are driving a switch to coal and partly because of rapid economic growth in China and India.
Step one in to a "brave new world," the IEA director says, requires a carbon charge of about $US50 per tonne to drive a wide range of technology and consumption changes, starting with end-use energy efficiency.
Step two, Tanaka says, is to wean the world off oil and he warns that the IEA modelling shows that this might take carbon charges of between $US200 and $US500 a tonne.
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