Perspective from Australia (Nick Cater, Menzies Research Center) – Are you interested in that?

From MasterSource

By Robert Bradley Jr.

Previous energy transitions have used energy sources with greater density and efficiency than those they replaced. Those advantages have become a natural motivation for them to apply. In the current ‘transition,’ this process will be reversed unless we are prepared to support the mass use of nuclear technology.” – Nick Cater, below

The political “energy transition” is expected to violate the physics of energy comparison and thus violate consumer preferences – as well as industry best practices. A look back at the failed and unachievable “energy transition” was written by Nick servedSenior member at Menzies Research Center at the University of Exeter, Australia. [1] It deserves widespread attention, as does his other work at the Energy Institute. Realistic effects.

As the ships of the First Fleet, propelled by wind and muscle, steam towards Australia, the final energy transition is underway in Europe and the United States. The first commercial steamship completed successful trials on the Delaware River in New Jersey on August 20, 1787, heralding the arrival of a more powerful and efficient source of power.

The ability to turn energy-rich fossil fuels into usable energy will be key to driving economic growth in Australia, starting with European settlement. By the time the colony of New South Wales marked a century of settlement in 1878, steam-powered ocean liners had begun to be built from steel. Frederick Wolseley is demonstrating a prototype set of steam-powered mechanical cutters. This Australian invention ensured Australia’s dominance in supplying wool to steam-powered woolen mills on the other side of the world.

Preparations are underway for the first export shipment of frozen lamb, a technological breakthrough that could dramatically improve the diet and life expectancy of Britons. Australia was linked to Europe by telegraph, the first stage in the development of electronic communications that broke the dominance of distance. A large-scale infrastructure investment project to provide electricity to households, factories and residential areas on demand has begun to be contemplated. Tamworth in 1888 would become the first town in Australia to be supplied with mains electricity.

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This brief history of Australia’s economic and industrial progress tells us much about the nature of the energy transition. They do not happen overnight, nor do they respond to government orders. They happen gradually in fits and starts. Innovation is just the beginning. Technical and economic viability takes decades to achieve, not days.

The most profound consequences of the energy transition may be unpredictable. Technological applications of steel, reinforced concrete and electricity appeared in the late 19th century. However, it was difficult for anyone at that time in low-rise Sydney to imagine the future streetscape. century and a half later.

The importance of the transition to net zero is rarely acknowledged in political and public debate. There is little appreciation of the technical difficulties of decarbonizing our energy supply and limited discussion of the costs.

The final transition – from wind, water, biomass and muscle from both humans and animals to fossil fuels – took more than a century to complete. It requires constant innovation and an incalculable amount of investment. The current path of not using fossil fuels requires us to completely abandon fossil fuels to use renewable energy sources, specifically wind, solar, biomass and water, just for 26 years.

Previous energy transitions have used energy sources with greater density and efficiency than those they replaced. Those advantages have become a natural motivation for them to apply. In the new “transition,” this process will be reversed unless we are willing to support the widespread use of nuclear technology.

The recent transition has given us more reliable sources of energy, independent of weather patterns. The transition to a net-zero renewable energy economy poses the seemingly insurmountable problem of overcoming variability in dependence on weather and the sun.

The recent transition has significantly reduced land demand and eased pressure on biodiversity. Huge hectares of forest are no longer cleared just to produce energy. The transition to renewable energy will once again place huge demands on land. A recent study estimates that a transition to net zero by 2050 in Australia using only land-based renewables would require 129,179 square kilometers of land, an area roughly the size of Victoria.

The most recent energy transition aims to achieve greater efficiency by concentrating energy production on industrial-scale fossil fuel conversion plants located near most energy consumers in major cities. city. The proposed transition to renewable energy would decentralize energy production from a few dozen power plants to small-scale rooftop generators and hundreds of small part-time generators often located far from centers. population center.

Technical needs are met in scale by economic challenges. Following the transition from an economy based on muscle, water and wind to fossil fuels, the average human has nearly 700 times more useful energy resources than their ancestors did at the turn of the century. Vaclav smiled, a Czech-Canadian scientist and energy policy analyst, who writes: “Abundant sources of useful energy underpin and explain all the benefits, from better eating to mass tourism. large tissue; from mechanization of production and transportation to instantaneous electronic communication.”

Based on physicist and economist Robert Ayres, economic growth and energy flows are intrinsically linked. “Nothing happens without the flow of energy. Not in the natural world and not in the human world. So it is absolutely true that energy – not money – makes the world go round.”

Yet the economic consequences of pursuing ambitious renewable energy targets are rarely debated. Brian Fisher, Australia’s leading energy economist, is one of the few who has attempted to model the economic costs of a forced energy transition. In a 2019 study, he estimated that the cumulative loss to GNP in pursuit of Labor’s 45% by 2030 target would be between $264 billion and $542 billion, depending on the parameters used. select. Rising energy prices will lead to a minimum 3% decline in real wages and the loss of 167,000 jobs by 2030.

The economic consequences of current government policies are likely to be similar. Little attention has been paid to the consequences of allocating huge amounts of capital to a net-zero energy transition. Australian Energy Minister Chris Bowen announced the capital cost of Australia’s energy transition would be $120 billion. However, a new report commissioned by the Menzies Research Center shows that Australian Energy Market Operator data puts capital costs at $320 billion in net present value (NPV) terms. The MRC report concludes that prices will be significantly higher, leading to higher energy costs for consumers and businesses.

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Australia has taken a leap into the unknown. The scale of investment required to achieve the 82% renewable energy target is unprecedented. The technical challenge of incorporating such large amounts of variable renewable energy (VRE) is enormous. No country has come close to achieving this without significant contributions from nuclear, geothermal or hydropower generation.

The unfortunate history of central planning leaves few confident that the top-down, roadmap-driven approach of AEMO (Integrated Systems Planning) will work. The risk of failure is very high. Construction time cannot be tight. The roadmap to withdraw coal and gas is basically not synchronized with the roadmap to expand renewable energy capacity. The target would increase the risk of blackouts because the National Energy Market (NEM) would only be able to meet reliability targets with significant investments in storage and other forms of capacity building .

Experience has taught us that the risk of cost escalation and overruns in renewable energy infrastructure projects is extremely high. Lack of expertise, use of non-standard technology and design, predatory practices, community resistance, supply and labor shortages mean that projects of this scale and complexity potentially significant risks. Bent FlyvbjergThe Iron Law of megaprojects applies: ‘Over time, the estimated costs of megaprojects tend to increase, while the benefits tend to decrease.’

The presence of these and other obstacles leads to worrying conclusions. The cost of transitioning to a net-zero emissions economy by 2050 will be significantly higher than the $320 billion estimated by the Australian Energy Market Operator (AEMO).

Capital formation at this scale will be a significant challenge. The opportunity cost of allocating capital to conversion costs will be high. Retail energy prices will continue to increase in the short to medium term as capital costs are absorbed. Without rapid technological development, costs in other emission-intensive sectors such as heavy manufacturing, agriculture and transportation will increase. In a dynamic, complex, interconnected economy, the impacts on employment, taxes and growth will be significant.

There is no quick solution. Nuclear energy will be a better alternative to coal than wind, water and solar power. It is denser, cleaner, more efficient and more reliable than renewable energy or fossil fuels. It is widely used as a reliable and affordable source of electricity worldwide. It can be used for industrial heating and some forms of transportation. However, it is difficult to foresee technological breakthroughs that can help the country meet all the energy needs of a modern economy.

The final energy transition happens organically and takes hundreds of years. It is driven by the natural attraction of abandoning old ways of doing things for new, markedly better ways. The energy transition we are now being asked to make is different. It is being promoted by central planners who expect it to be completed by mid-century, which is just 26 years away.

We are being asked to abandon tried and tested practices for unproven technology or technology that does not yet exist. EQUAL Alex Epstein wrote, it requires a radical departure from the way any energy economy works. A calm assessment of our progress to date must conclude, as did Epstein, that weaning off fossil fuels in the time needed is virtually impossible. The proposal to simply replace them with renewable energy is completely eccentric.

[1] The Menzies Research Center is a Liberal Party research organization promoting a free, fair and prosperous society in Australia. More information can be found This.

This post was published at Quadrant Online as “Entering the Darkness: The Illusion of Energy Transformation” (April 6, 2024). It also appeared at Nick Cater’s website Realistic effects. Full documentation (footnotes) can be found there.