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Monday, 4 June 2001
Page: 27233

Mr Murphy asked the Minister representing the Minister for the Environment and Heritage, upon notice, on 5 April 2001:

(1) Is the Minister aware of a report in The Sydney Morning Herald of 3 April 2001 that Cabinet is said to have decided to support the stand taken by the US against the Kyoto Protocol while the Minister is reported as saying that he is in favour of supporting the protocol; if so, will the Government support the Kyoto protocol; if not, why not.

(2) In terms of the Kyoto protocol what is the estimated cost per kilogram of carbon dioxide reduction from the electric power industry when measures such as increased energy efficiency of domestic, commercial and industrial equipment are taken into consideration.

(3) What effect would a program of supporting the installation of domestic solar hot water heaters nationwide have on carbon dioxide emissions if the level of use of such solar hot water heaters reached that (approximately 50%) found in the Northern Territory.

(4) Considering that electricity generators are responsible for nearly 50% of Australia's carbon dioxide emissions, what measures does the Government have in place to reduce the consumption of electricity.

(5) What measures does the Government have in place to increase the energy efficiency of Australia's coal fired power stations.

(6) What area of solar photo-voltaic or solar thermal collectors would be required to replace all of Australia's existing fossil fuelled electric power stations.

(7) What would be the cost of such a conversion.

(8) Is the Minister able to provide a comprehensive list of economic sectors, ranging from agriculture, transport, energy supply, housing, food production, mining and all other sectors that each contribute more than five percent of Australia's carbon dioxide emissions together with a breakdown of the costs and potential savings that would result if measures were taken to reduce Australia's carbon dioxide emissions below the levels of 1990.

(9) Have reputable economic analysts shown that significant savings are possible if measures to reduce carbon dioxide emissions are taken on a case by case basis rather than taking the worst case and claiming that case to represent the whole economy.

Mr Truss (Minister for Agriculture, Fisheries and Forestry) —The Minister for the Environment and Heritage has provided the following answer to the honourable member's question:

(1) The Prime Minister wrote to the President of the United States on this matter on 11 April 2001. He stated that Australia remains committed to dealing effectively with climate change and that the Government would continue to implement its program of domestic policies to reduce greenhouse gas emissions.

The Government indicated when signing the Protocol in April 1998 that possible future ratification of the Protocol was dependent upon satisfactory outcomes on four key outstanding issues: sinks, compliance, the flexibility mechanisms and the involvement of developing countries. Australia has consistently argued that an effective international framework to address climate change needs to be economically manageable and include the participation of developing countries. Any international framework to address climate change will, if it is to be effective, need to incorporate the participation of all major emitters, including the United States.

(2) There are a range of costs for abating greenhouse gas emissions from electricity supply and consumption, depending upon the measures adopted and the context in which they are used. Experience through programs such as the Greenhouse Challenge shows that there are a variety of cost-effective measures available.

For example, analysis carried out by the Australian Greenhouse Office on the National Appliance and Equipment Energy Efficiency Program indicates that labelling and energy efficiency standards for some appliances and equipment can deliver savings of greenhouse gas emissions at a net community benefit of up to $31 a tonne.

(3) The Australian Bureau of Statistics estimated that in 1999 there were 7.2 million hot water systems installed in dwellings in Australia. If solar hot water systems were installed in 50% of the houses across Australia, around 6.5 million additional tonnes of carbon dioxide would be abated each year.

(4) The Australian government has developed a range of measures to improve energy efficiency and hence reduce consumption of electricity. These include:

· Agreement for the development of standards for the energy efficiency of buildings,

· Joint government and industry initiatives that encourage benchmarking and best practice within the building industry,

· The National Appliance and Equipment Energy Efficiency Program,

· The Greenhouse Challenge program, and

· The Energy Efficiency Best Practice program.

(5) In order to improve the efficiency of Australia's power stations the Government introduced new standards for power generators on 1 July 2000. Generator Efficiency Standards work to increase the efficiency of energy production from fossil fuels.

(6) Australia's annual generation of electricity from fossil fuel sources in 1999 was estimated as 170,000 gigawatt hours (GWh). To generate 170,000 GWh per year from solar photovoltaic panels would require an area in the order of 850 square kilometers (not including the energy storage systems). To generate the same amount of energy from solar thermal collectors, an area in the order of 300 square kilometres of solar thermal collectors would be required (in addition to the area taken up by the generation equipment).

(7) With current solar photovoltaic technology the costs would be in the order of $1,000 billion, not including the energy storage systems required to deliver useable power to consumers. Using solar thermal systems, which are not yet fully commercial, the cost would be in the order of $200 billion excluding the generating equipment and storage systems. These estimates do not include the cost of the land that would be required for either system.

(8) According to the 1999 National Greenhouse Gas Inventory, Energy Industries (41.2%), Transport (16.1%), Livestock (13.7%) and Manufacturing Industries and Construction (11.3%) each contributed more than 5% of Australia's carbon dioxide equivalent emissions.

ABARE have published analysis of the potential economic impacts of the Kyoto Protocol, based on a greenhouse gas emissions target of 108% of 1990 levels. The ABARE analysis estimates that real GNP will grow by around 1% less than the 40% growth otherwise expected between now and 2010. Corresponding impacts have been reported for a range of industries.

However, there is no current analysis of the industry costs or benefits of taking action to reduce Australia's carbon dioxide emissions below 1990 levels.

(9) Studies based on `bottom up' style partial analyses often identify potential emissions measures with net savings, based in many instances on the adoption of new technologies. Reflecting the existence of these opportunities, a range of measures with net savings already has been implemented by the Commonwealth, such as the Greenhouse Challenge Program and Minimum Energy Performance Standards. The Commonwealth also provides funding for large-scale cost-effective emission abatement projects through the Greenhouse Gas Abatement Program.

Bottom up models can tend to understate the economy-wide impacts resulting from the diversion of investment required to implement new technologies in an accelerated timeframe. `Top down' economic models can provide additional information helping to inform the economy-wide costs of taking greenhouse action. Both modelling approaches are valuable in evaluating optimal greenhouse policy responses.