By Tom Kelly
A breakthrough in solar energy technology at the University of New South Wales (UNSW) means that clean energy from the sun can now be cost-competitive with energy produced by the combustion of fossil fuels. This breakthrough, however, which made front-page news in Sydney in mid-May, fails to rate a mention in government and industry discussions about the strategy to minimise Australia's contribution to the greenhouse effect.
Given that power generation using fossil fuels accounts for nearly half of Australia's greenhouse gas emissions, the rapid development of a widely useable source of electrical energy that produces no greenhouse gases should be a high priority in any strategy to minimise Australia's contribution to global warming.
The government has agreed to an interim planning target of reducing emissions of the main greenhouse gas, carbon dioxide, to 20% below 1988 levels by 2005. The Business Council of Australia claims that meeting this target will cost Australia $40 billion annually, much of this through losses in energy exports (such as coal) and energy-based exports (such as aluminium).
This estimate appears to presume that no greenhouse friendly alternative can substitute for coal, either as a local energy source or as an earner of export dollars. In contrast to this potential annual cost of $40 billion, the UNSW solar research centre, which has the potential to provide the technology that will solve a significant part of this problem, has a funding base of only $1 million per year!
With this level of funding, UNSW's Centre for Photovoltaic Devices and Systems researches many aspects of solar energy. The research team estimates that it will take 10 years before solar cells using the new design strategy are commercially available.
The recent breakthrough makes possible an 80% cost saving compared to previously developed techniques of producing solar electricity. The new solar cells utilise many thin layers of low grade silicon, whereas previous technology required a single, much thicker, layer of high purity silicon. Material costs for the new technology are 5% of the old, with the major cost now being that of the glass used in the solar cell modules.
Professor Martin Green, head of the UNSW solar centre, says that the new design strategy "should eventually meet all nations' needs for cheap and environmentally sound energy supplies". The new cells, when commercially produced, will generate electricity at a price initially comparable with coal-fired power stations. Once production is established, however, economies of scale could reduce costs to one-fifth that of electricity from coal.
The solar energy research at UNSW is clearly of global significance, both for its contribution to the development of a source of cheap energy, and because this is an energy source that doesn't contribute to global warming. When one considers the huge environmental and social benefits that would flow from cheap, clean, renewable energy, the low level of government funding received by the UNSW solar research centre is shameful. The future well-being of humanity and the global environment ought to have more influence on government policy.
What, then, are the factors influencing government energy policy and greenhouse strategy?
In the June 17 Financial Review, Alan Moran, research director of the Tasman Institute (a business think-tank), argues that any agreement to carbon dioxide reduction targets would cause the nation serious economic harm. In his view, the only way to meet these targets is to impose a new tax on fossil fuels, or enforce limits on their use and production. He says this will impact on firms and workers in the coal industry, electric utilities and major power users. Consumers will face steep rises in electricity, gas and petrol prices.
Moran concludes, "For the electricity utilities ... it is a question of whether coal-based stations are to be rendered worthless. For workers and residents in the coal mining and smelting areas it is a question of whether they are to be put out to the same pastures faced by the victims of green radicalism in former logging areas."
An editorial in the Financial Review on June 20 points out that Australia's economy is energy intensive, with coal being our largest export as well as being the fuel used to generate 70% of our electricity. It goes on to refer to Australia's adoption of an interim planning target of a 20% reduction of carbon dioxide emission levels below 1988 levels by 2005, as a "mistake".
"Instead of emphasising the interim planning target, Australia must emphasise the potential cost to its economy." The editorial concludes, "Environmentalists may be bitterly disappointed, but the Australian Government's policy on greenhouse gas emissions must take account of Australia's particular economic reality."
The clear message here is that Australian business wants economic interests put ahead of environmental responsibilities. But it's important to note that it's not just economic interests in general that business is concerned about.
The rhetoric of concern for workers who may lose their jobs lacks credibility in a country where hundreds of thousands of workers have been retrenched by employers demonstrating no such concern. It is a cynical attempt to win support for the business agenda.
The real concern is for those with money tied up in the industries that will be most affected. Their money is already invested and earning them profits. They have a vested interest in avoiding controls and constraints on greenhouse gas emissions, which could eat into their profit rates and devalue their capital investments.
This is why the government is constantly being called upon by business interests to reiterate its promise that Australia's greenhouse strategy will not be allowed to impact on the economy or on export industries.
Clearly, Australia's economy does need to be reoriented in the light of the ecological dangers posed by the greenhouse effect. This reorientation must inevitably favour some sectors of the economy over others — renewable energy over fossil fuels for example. With the potential for solar energy at one-fifth the cost of coal-fired power, however, it does not follow that the Australian economy overall would be worse off.
With intelligent planning and government intervention, a switch to solar technology could make the Australian economy significantly more productive. This of course would be greatly facilitated by a dramatically increased provision of research and development resources to match the social and ecological importance of the technology. Such an approach could not only improve the general quality of life, but could also provide the resources to compensate and re-employ those workers whose jobs disappear in the transition to more ecologically sound energy generation.
In assessing the obstacles to such an approach, we need to recognise that vested interests are again likely to play a role. Just as investments in the fossil fuel sector would be devalued by the implementation of a responsible greenhouse strategy, such investments would also be devalued by the rapid emergence of a clean energy alternative that was cheaper than energy generated by the burning of fossil fuels. One might expect that the business imperatives that motivate the government to go so slowly on greenhouse abatement measures, would also motivate it to show little enthusiasm for the solar energy option.