Reducing greenhouse gas emissions is affordable and achievable
03 May 2006
Australians could pay as little as $250 each to achieve a 40% reduction in greenhouse gas emissions from the country's electricity generation industry by 2030, a new study has found.
The WWF-Australia, AGL and Frontier Economics study has modelled the cost to Australian society of using low and zero greenhouse gas emission electricity generating technology to achieve a realistic target by 2030 consistent with the greenhouse gas reductions advocated by climate scientists.
The study, Options for Moving to a Lower Emission Future, found the electricity generating sector's greenhouse gas emissions could be reduced from current levels of nearly 200 million tonnes to 120 million tonnes by 2030 while still meeting growing electricity demand from industries and households.
"We have found that solutions to help mitigate dangerous climate change are affordable and achievable in Australia - so what is stopping us from starting immediately to reduce CO2 pollution in this country?" WWF-Australia CEO Greg Bourne said.
"The myth of mitigating climate change as being 'too expensive' is discredited - we must move swiftly towards a clean energy future. We already know the consequences if we do nothing are frequent and expensive extreme weather events like droughts and cyclones and the loss of up to a million species," Mr Bourne said.
The study utilises the sophisticated Frontier Economics model of the National Electricity Market, WHIRLYGIG. By simulating investment decisions by electricity market participants, the WHIRLYGIG models act to minimise the cost to society of meeting electricity demand while reducing greenhouse gas emissions. Publicly available information on forecast demand growth and the assumed costs of different generation technologies has been used during the modelling process.
"The WHIRLYGIG model has been used internationally to assist industry and governments with energy market reform. We are pleased to have been able to participate in this unique collaboration which provides a pragmatic contribution to the greenhouse debate," Danny Price, Managing Director of Frontier Economics said.
The study shows that reducing greenhouse gas emissions from the electricity sector could be limited to between $5.19 billion net present value (NPV) and $24.16 billion NPV, depending upon the reduction pathway chosen. This represents a one-off cost of between $250 NPV and $1,172 NPV per Australian today, or 43 cents - $2.00 per person per week to 2030.
"It is important that policy makers establish long term emission reduction targets and the course for meeting those targets. This will allow businesses to invest in new technological solutions to minimise the cost of reducing emissions," AGL's General Manager Merchant Power Jeff Dimery added.
"AGL has already begun to factor the cost of greenhouse emissions into business decision making. In 2005, AGL explicitly accounted for this cost in the acquisition of renewable generating business Southern Hydro. As a result, AGL has developed a well-balanced portfolio of energy assets that is suited to a gradual transition to a low emission future."
Find out more
Download the executive summary or the full report, or contact:
Angela Heck, Press Officer, WWF-Australia
Phone: 02 8202 1268
Mobile: 0421 053 023
Email: aheck@wwf.org.au
Jane Counsel, Media Relations Manager, AGL
Phone: 02 9921 2352
Mobile: 0416 275 273
