The New Zealand
Government’s published modelling for its Carbon Zero Bill estimates a wealth
loss of $200-300 billion over 30+ years of ‘blood toil tears and sweat’ to
increase New Zealand’s 2050 net emissions reduction target from 50% to 100%.
The NZIER report is at
pains to say that its modelling “should not be seen as a cost-benefit
analysis”, nor a prediction
of what will happen in future. It is merely the calculated outcome of certain
assumptions – key ones being (a) there will be no exogenous technological
change and (b) the following things would happen as “business as usual”
(BAU)[1] without policy changes:
•
electric vehicles will reach
65% of the fleet by 2050;
•
a methane vaccine will be
available from 2030;
•
unidentified innovations will
deliver a 50% reduction in emissions by 2050;
•
the ‘rest of the world’ will
take strong action on climate
These massive predicted
losses are the result of increased energy taxes or other deliberate Government
interventions in the economy. This results from the assumption that the desired
emissions reductions will not flow naturally from advances in technology or constant
improvements/innovations in the supply or usage of energy.
The Technology
Assumption
The assumption of 30
years of stationary technology is obvious nonsense. One need only to look back
to the pre-internet era of 1990 to know that the entire world can and will
change drastically from one decade to the next.
There will be new ways
to produce and consume energy and they will become more and more efficient.
There will be a range of options for personal transport and goods distribution.
A recent article in The Australian
points to the 20th century precedent of the Green Revolution:
“Through practical
innovation — irrigation, fertiliser, pesticides and plant breeding — the Green
Revolution increased world grain production by an astonishing 250 per cent
between 1950 and 1984, raising the calorie intake of the world’s poorest people
and reducing the incidence of serious famines. Instead of tinkering around the
edges, innovation tackled the problem head-on. Instead of asking people to do
less with less, innovation offered the ability to produce more with less.”
While 99% of the
carbon-reducing innovations will be patented in ‘the rest of the world’, New
Zealand can also play a role by deliberately being an ‘early adopter’. Not by picking winners, but by ensuring that
all the myriads of roadblocks and red tape (such as the RMA) are rapidly
overcome or circumvented.
Generation IV
reactors
The first breakthrough
will likely be the full commercialisation in China of a next-generation nuclear
energy system, with electricity outputs costing approximately UD$3 per mwh –
less than the cost of any other baseload system, including new coal-fired
plants. This is widely expected to occur in less than 10 years (see Annexe
below) and thereafter to ride down the price-volume curve.
Even before the rollout
of Generation IV energy systems, China’s version of the Generation III EPR
system has reduced capital costs by about half over the past decade. Developers
now say that a $20 carbon tax would be sufficient to enable new Gen III
reactors to compete against coal.
Nuclear (Gen III) is
already the preferred new power source in those countries that account for 100%
of the global growth in baseload energy demand – China, India, S Korea, Iran
and Saudi Arabia. Once Gen III reactors are available, all countries will have
strong economic incentives to repurpose the sites of existing coal plants and
substitute nuclear reactors.
The opposition of the
Green lobby has forestalled new nuclear plants in the USA and much of the EU
since the Green Mile Island incident of 1979, and this resistance was
re-energised by the 2011 Fukushima disaster. However, many Green movement
leaders have reversed their stance and now consider
nuclear energy to be the solution rather than the problem. These converts
include such notables as James Hansen, ‘the father of global warming’, who pointed out (before the Paris
Agreement):
“A build rate of 61 new reactors [Gen
III] per year could entirely replace current fossil fuel electricity
generation by 2050. Accounting for increased global electricity demand driven
by population growth and development in poorer countries, which would add
another 54 reactors per year, this makes a total requirement of 115 reactors
per year to 2050 to entirely decarbonise the global electricity system in this
illustrative scenario. We know that this is technically achievable because
France and Sweden were able to ramp up nuclear power to high levels in just
15-20 years.”
Major Emitters
The five countries most
heavily engaged in the new nuclear race produced approximately two-thirds of the world’s
long-term gases in 2017.
% Global CO2 GtCo2
China 29.34 10.9
USA 13.77 5.1
EU 9.57 3.5
India 6.62 2.5
Russia 4.76 1.8
64.06% 23.8
By 2030, China is
expected to
have increased its 2010 emission levels by 50-100%, while the International
Energy Agency predicts that emissions in
India will treble
over the 2010-30 period. These two alone will comprise two-thirds of the global
total within a decade, so the five major nuclear competitors will likely exceed
80% of global CO2 emissions by the time Gen IV
nuclear begins to make its impact.
How will this affect
the Paris Agreement?
As soon as it becomes
apparent that the “nuclear era” is replacing the “fossil fuel era” for economic
(rather than political) reasons, the Paris Agreement objective of limiting
anthropogenic global warming to 2°C since pre-industrial times (1.2°C since
1995) will have been met.
The IPCC’s projections
of future warming are based on four mutually-incompatible scenarios, or
“representative concentration pathways”, regarding future emissions of CO2. The
UN has no opinion on the relative likelihood of any scenario, which is outside
the realm of the physical science, and leaves this pick to its member
governments.
The expectation that
the 2°C ceiling will be breached by 2050 is based on the worst case, known as
RCP8.5, which anticipates a massive increase in both global population and the
carbon-intensity (ie coal-use) of world energy production. This worst case
dominates the apocalyptic and grossly exaggerated claims most favoured by news
media and activist groups.
The best case, called
RCP2.6, assumes that the carbon-intensity of energy falls away dramatically in
the second half of the 21st century, ensuring that the 2°C ceiling is never
reached. Under this scenario, human-caused global warming never becomes
‘dangerous’.
Projected change in global mean surface air temperature
for the mid and late 21st century relative to the
reference
period of 1986-2005 [IPCC-AR5-WG1
Table SPM.2]
Scenario
|
Mean 2046-2065
|
Mean 2081-2100
|
RCP2.6
|
1.0°C
|
1.0°C
|
RCP4.5
|
1.4°C
|
1.8°C
|
RCP6.0
|
1.3°C
|
2.2°C
|
RCP8.5
|
2.0°C
|
3.7°C
|
Demand side
forecasts
The advance of nuclear
technologies will address the supply side of the energy economy, augmenting the
success of other market-driven improved-efficiency sources[2].
The pace of emissions
growth has already eased sharply from its peak in the early years of this
century. Carbon intensity (CO2 per energy unit) is already decreasing in all sectors, having fallen 20% over the 10 years from 2006 to
2016 (from 60kg to 48kg per MMBtu). If maintained, that BAU improvement rate of
2% per annum will itself see emissions drop by one-third by 2030.
On the demand side,
energy intensity (energy use per unit of GDP) has been improving globally since
1990 with its decline averaging 1.5% per annum since 2001. This constant efficiency improvement is simply driven
by the market and is not an outcome of climate policies[3].
McKinsey’s April 2019 report: “The decoupling of GDP and energy growth.”
forecasts that aggregate global energy demand will plateau in 2030 and
thereafter begin to decline. This is a far cry from the forecast exponential
demand growth which under-pinned climate anxiety at the time of the 2009
Copenhagen Conference. The McKinsey prediction is wholly incompatible with the
scenarios that would drive either RCP8.5 or RCP6.0.
It is already widely
accepted that RCP8.5, the ‘apocalypse scenario’, is extremely unlikely and may even be impossible. It cannot be long before policymakers around the world conclude
that RCP2.6 is the only likely pathway, whereupon the perceived urgency for
mitigation action will surely dissipate overnight. Schoolchildren can stop
marching. The Paris Agreement will become redundant. The climate scare will be
over.
Annexe : Status of Advanced Nuclear
Technologies
R&D
co-operation between the G20 countries in the Generation IV Forum (GIF) led to
the publication of a Technology Roadmap Update
as long ago as January 2014 which selected six diverse systems
all of which offer “significant advances in sustainability,
safety and reliability, economics, proliferation resistance and physical
protection.” They range from small modular reactors (SMRs) to
nation-scale multi-gigawatt facilities, all providing baseload power.
The
UN’s International Atomic Energy Agency (IAEA) says there are currently four
SMRs in advanced stages of construction in Argentina, China and Russia and
estimates the global market at $150 billion per year by 2040. Canada describes
SMRs as the “next wave of innovation”
and expects to have its first demonstration plant in operation by 2026.
China
already has 46 uranium-powered reactors producing 42 GWh per annum, with 11
more under construction and 51 planned. Since 2015, the Chinese Government has
deferred construction of Generation IV plants pending completion of the
long-delayed Generation III plants which were being built in partnership with
USA (Sanmen) and France (Taishan)
respectively. Both came on line late last year and four demonstration plants
for China’s own Hualong One Gen III design are on schedule.
China hopes to build 30 overseas reactors as
part of its “Belt and Road” initiative, earning about $145 billion by 2030.
China
is also moving fast on its Linglong One 100 MW SMR with its first use to generate heat for a residential
district, replacing coal-fired boilers. A thorium-powered pilot plant cooled by
molten salt may be completed next year and the technology is expected to be
fully commercialised by 2030.
India has 20 uranium-based nuclear reactors producing 45 GW of
electricity already in operation and has another six under construction, 17
planned, and 40 proposed. It claims to be “leading the pack” on the use of
thorium.
Scale in Asia
is already driving down the cost of Gen III reactors and capital costs are only
about half of what they were a decade ago. Industry groups claim Gen III would
be made viable in Australia by a carbon
price of $20 per tonne.
The
USA has been kept out of the race for decades by its set-in-cement atomic
regulatory morass. These handcuffs were finally demolished by the Nuclear
Energy Innovation and Modernisation Act which became law on 14 January
and the Nuclear Energy Leadership Act which is now before both Houses with
bi-partisan support. The US Nuclear Regulatory Commission has developed a
vision for “the next nuclear renaissance”.
US
current policy is to catch up
to China and Russia[4] and have fully commercial Gen IV plants in operation by
2030. Its ThorCon technology aims to produce CO2-free electricity at 3¢/kWh
- cheaper than coal.
There
are 126 reactors in 14 EU Member States, providing more than one-quarter
of the bloc’s overall generating capacity. The European
Sustainable Nuclear Industrial Initiative is funding three Generation IV reactor systems, one of which is a gas-cooled fast reactor, called Allegro, 100 MW(t), which will be built in an
eastern European country with construction expected to begin in 2019.
[1] ie without any change in existing 2018 policies. While
the “innovations” are expected to be very expensive, these costs are unknown
and therefore omitted. Who pays is also omitted.
[2] eg advanced
solar farms + battery storage in desert areas
Barry Brill is a lawyer and former Minister of Energy, who Chairs the New Zealand Climate Science Coalition.
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