The Carbon Tax's Hazelwood Hitch


"The carbon price level needed to achieve the GHG cut is hotly debated."

Business Spectator, Keith Orchison

The Victorian government's announced it's walking away from plans to help phase out the Hazelwood Coal Power Station is actually a big issue for Gillard's commitment to cut greenhouse gas emissions (GHGs) by 5% from 2000 levels by decade's end.

Hazelwood coal plant

Buried below the mainstream media's radar is a report by Greg Combet's Department of Climate Change (DCC) that gives a sharp edge to the government's decision.

The DCC's review of stationary energy emissions—GHGs from power stations, direct fuel combustion by industry and fugitive emissions from coal mines—and its forecast that generators will emit 213 Mt. annually by 2020 hasn't raised a media eyebrow, though it's well above the power sector's notional share of the abatement target.

What's even more interesting—buried in the departmental report, is a forecast for 2030 electricity emissions, which are forecast to rise to 259 Mt./year. The 2000 industry figure was 175 Mt.

For sure, without the proposed carbon price, the renewable energy target and other measures considered in this projection, power-related emissions would rise a great deal further over two decades. But the Gillard government is selling its carbon policy on the basis that only it can achieve the 2020 target, which on present trends requires a 160 Mt. overall cut in national emissions.

Power generators' pro-rata share would be a decrease to about 166 Mt. emissions by 2020.

This simply isn't possible without cutting electricity emissions below their present levels (207 Mt./year) and without units at a number of coal-fired power stations, including Hazelwood and Yallourn in Victoria and two other old coal plants in South Australia, being shut down.

The carbon price level needed to achieve this is hotly debated.

"By 2030, electricity generation from coal is projected to recover to comprise 71% of the total."

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