Do we need a CPRS?
The Garnaut Report is silent on ‘the elephant in the room’: the role of nuclear power in achieving lower carbon emissions in other countries.
No doubt the silence on nuclear power is politically astute and/or avoiding controversy. As indicated above Garnaut is not concerned with the actual methods employed and assumes that whatever technology becomes profitable will be used.
Almost all power engineers acknowledge that nuclear power is currently the only practical alternative to coal. There are now several hundred new nuclear power plants in planning and under construction worldwide and China alone is projecting 300.
If carbon sequestration is impractical on a scale that would make a difference, and this paper asserts this is so, it is virtually certain that the impact of an effective CPRS would be to make nuclear power inevitable in the new energy mix. This mix would no doubt include increased use of other economic alternatives like solar and wind. Photovoltaic solar and some other alternative technologies are already competitive with nuclear power in some circumstances and may replace part of our electricity needs if technological progress allows but they do not provide this energy continuously at present and are not a realistic replacement for coal. Nuclear electricity is the ‘next best’ economic alternative to coal and as outlined above the engineering challenges involved are trivial compared to CCS.
If this is so, we have a good idea of what the world aught to look like. Why go through the difficulty of implementing economy distorting mechanisms with unknown side effects, when we can simply identify the technology changes we want and implement them?
When changing to a new phone or television standard we do not tax the old technology to make the new attractive; we simply say that from such and such a date we will no longer use the old and everyone needs to make the appropriate transition arrangements.
One gets the impression that if the authors of the Garnaut Report had been engaged to design and build the Sydney Harbour Bridge they would have proposed, instead, a tax on ferries.
To achieve the desired outcome of a transition to nuclear electricity without hidden economy distorting market mechanisms, NSW (and other states, perhaps with explicit Loan Council support or Commonwealth transition funding) could simply take action to progressively replace the present coal burning power stations with similar or possibly larger nuclear stations in the same or similar locations. Existing transmission and other generator independent infrastructure could then be used minimising cost. Local employment impacts would be minimised, employees and local residents would be healthier and safer. With appropriate advice and information this improved greenhouse, safety and employment environment would minimise any ‘not in my backyard’ objections to the changes. The new stations would provide carbon free electricity to support existing industrial and residential purposes and provide for future growth, at a price competitive with that under the CPRS.
Additional electricity capacity could be provided for electric trains, public road transport and private cars. These will inevitably become more attractive as oil prices rise and government infrastructure catches up with almost every other comparable city and country in the World.
We will know we have caught up when Sydney (and possibly Newcastle) has a proper Metro network of several intersecting lines linking up-market residential, retail and employment nodes across the city; the State has an updated 25KV electrified freight rail network; and there is a separate very fast passenger train service, at least down the east coast. These will substantially reduce the transport use of fossil fuel and encourage urban consolidation around the new stations. New industrial lands could be developed around freight hubs. Technological progress and local industry will be encouraged and stimulated by moving the State’s infrastructure into the 21st Century.
The relative cost of energy is, in any case, expected to increase under existing (undistorted) market mechanisms, encouraging increased energy efficiency. Most experts predict that oil will increase in price relative to coal and together with new battery technology will encourage the development of new electric and hybrid transport.
As nuclear power would only replace coal for electricity generation and indirectly for transport, coal would continue to be sold overseas (just as we presently sell uranium but do not consume it; conscious that NSW coal will remain a tiny fraction of the coal consumed worldwide) and used (at an undistorted price) in local metals smelting where there is no alternative.