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COMMENTARY Robert Gottliebsen 15 Jul 2009

Engineers Australia Northern Rivers Group Ballina “Australian power - where to by 2050?” Martin Thomas AM FTSE HonFIEAust HonFAIE 8 September 2012.

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COMMENTARY Robert Gottliebsen 15 Jul 2009

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  1. Engineers Australia Northern Rivers GroupBallina “Australian power - where to by 2050?”Martin Thomas AM FTSE HonFIEAust HonFAIE8 September 2012 Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  2. Infrastructure on the cliff edgeAustralia is facing a potential monumental infrastructure disaster as the politicians dither with long-term carbon questions and undertake speculative research on coal technologies.Unless someone starts actually making hard decisions now, fasten your safety belts for a very large rise in power prices in the eastern states, which will flow into inflation and interest rates. COMMENTARY Robert Gottliebsen15 Jul 2009 Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  3. G8 leaders tighten carbon targets Leaders of the G8 have agreed to a goal of achieving at least a 50% reduction in global greenhouse gas emissions by 2050, with developed countries achieving an 80% reduction by then.   Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  4. Coal Oil and gas Nuclear Geothermal Hydro Solar Wind Other renewables Distributed energy and energy storage Australian candidate generation technologies to 2050 Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  5. Coal the bad news • Mines can sterilise huge arable land areas • Substantial carbon and other emissions (viz particulates, NOx and SOx) • CCS technically promising but costly, huge efficiency penalty, and yet to be proven at scale • Heavy carbon footprint without CCS • Significant ash disposal & retention problems • Significant water demand for cooling (but can use dry cooling – ie fan cooled radiators) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  6. Coal the good news • Black and brown resources vast and easily won • LCOE (Black coal, no CCS) ~ 100-110$/MWh • Technologies (mining, materials handling, preparation, combustion, gas cleanup, ash disposal) proven strong Australian skills • Good for base load generation - capacity factors typically >90% • Generation technology conventional well proven • Huge RD&D program promises further gains (IGCC, oxy-firing, CCS, etc) • Strong Australian engineering capability Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  7. Coal power station Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  8. Coal mines for power Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  9. Oil, natural gas, shale gas and coal seam gas - the bad news • High and rising fuel costs (both oil and gas) – as Oz LNG rises to world parity • Noisy • High maintenance costs Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  10. Oil, natural gas, shale gas and coal seam gas - the good news • Diesel and gas turbine plant - well proven, reliable, numerous suppliers, good service back up • Diesel specific capex ~ 250-750$/kW • OC gas turbine capex ~ 900-1200$/kW • LCOE (CCGT, no CCS) ~ 80-110$/MWh • Short construction times • Carbon footprint < coal • Fast load following Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  11. Nuclear the bad news • Technology still very costly ~ 5,000-6,000$/kW • Australian regulatory environment inadequate • Shortage of suitably qualified Australian engineers and scientists • Significant water demand for cooling (but can use dry cooling – ie fan cooled radiators) • Risks with older reactors (eg TMI 1979, Chernobyl 1986, and Fukushima 2011) • Australian public has valid concerns on: • Safety of spent fuel disposal, • Weapons proliferation, and • NIMBY siting issues Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  12. Nuclear the good news (1) • Vast Australian uranium resources (~40% world’s low cost supplies and growing) • ANSTO Lucas Heights research reactor and nuclear medicine experience • Technologies (mining, enrichment, reactors, spent fuel management and permanent disposal) internationally proven • Australia strong in hard rock mining and minerals processing • Australia geologically stable with vast regions of minimal population for safe waste disposal Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  13. Nuclear the good news (2) • Nuclear well suited to base load generation - capacity factors typically >90% - used for ~14% of world’s electricity generation • LCOE ~ 95-105$/MWh - includes waste disposal and decommissioning costs • Generation III and III+ reactors improved, safer • Generation IV reactors inherently safe - 60 times energy recovery from uranium fuel • Worldwide RD&D program promises further gains • Strong Australian engineering capability • Small specific power footprint • Strong safety record cf alternatives • Emerging potential for thorium fuel Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  14. CruasMeysse Nuclear Power Station, Montelimar, France – 4 X 900MW Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  15. Nuclear power – Generation III+ Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  16. Nuclear fuel pellet energy equivalent to:1t coal = 3bbls oil = 481m3 natural gas Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  17. Nuclear – spent fuel repository Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  18. Nuclear – is fusion the future?ITER - Cadarache, France Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  19. Geothermal the bad news • Hot fractured rock (HFR) technology not yet fully proven • Technology still very costly ~ 6,000-8,000$/kW - and yet to be commercialised • Geothermal resources generally remote from grid and load centres, requiring substantial new transmission lines and hence transmission losses Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  20. Geothermal the good news • Huge resource at 200-270°C (>1,000 years for Australia) at 3-5km depth in Central Australia • Drilling technology well proven in oil industry • Generation technology (conversion of heat to electricity) well proven • LCOE ~ 100-120$/MWh at plant site • Negligible carbon or other emissions • Very low water demand • Good use of real estate Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  21. Geothermal technologies Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  22. Hydrothe bad news • High to very high capex depending on scheme ~ 3,000-10,000$/kW • Can pose significant environmental issues • Dependent on reliable rainfall • Limited remaining Australian resource • Safety can be questionable (Siberia 2009 – 76 dead - huge losses) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  23. Hydrothe good news • Primary energy free • Easy load following and meeting system peaks • Can provide pumped storage for load levelling • Can combine with irrigation and flood control • Environmental and recreational benefits good • Micro-hydro well suited to developing countries Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  24. Hydro power Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  25. Solar photovoltaics (PV)the bad news • Technology still costly ~ 5,000-6,500$/kWp • LCOE high but falling ~ 210-135$/MWh • Capacity factor limited ~ 15-20% so unsuited to base load demand (ie industry) • Power conditioning expensive and complex • Energy storage expensive, alternatively needs standby (diesel, hydro or mains) • Materials (silicon, lead, etc) difficult to dispose of sustainably • Poor use of real estate (unless rooftop) – although under some ‘sheep may safely graze’ Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  26. Solar photovoltaics (PV)the good news • Free primary energy – the sun • Technology cost falling with advancing RD&D – target ~ 1,000-2,000$/kWp • “Feed-in” tariffs helpful, but declining • Emerging technologies include thin film, SLIVER, concentrating PV, tracking PV • Power conditioning and storage costs falling, lives extending, efficiencies improving (world record 43%!), materials increasingly benign • Negligible carbon or other emissions • Zero water demand Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  27. Photovoltaics (PV)technology options • Flat plate crystalline Si modules (local and imported cells) • Conventional – efficiency 12-18%, reliable, expensive • Thin film Si modules (UNSW Green cells) • State of the art – very expensive, efficiencies to 25% • SLIVER cells (ANU Blakers cells) • State of the art – expensive, efficiencies >19% quoted • Concentrating PV (Solar Systems cells) • 400+ suns concentration – well suited to tracking, hence higher capacity factors (~25%) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  28. PV application Wilpena Pound Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  29. PV ANU SLIVER technology Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  30. Solar thermal (STG)the bad news • Technology still costly ~ 4,500-6,000$kWp) • Capacity factor limited ~ 20-25% so unsuited to base load demand (ie industry) without heat or gas storage • Energy storage expensive, alternatively needs standby (diesel, hydro or mains) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  31. Solar thermal (STG)the good news • Free primary energy – the sun • Technology costs falling with advancing RD&D target ~ 1,500-2,500$kWp • SolarGas technology (CSIRO) promises storage and improved capacity factors • Compact Linear Fresnel Reflectors show promise for power station supplement • Materials well understood – disposal easy • Negligible carbon or other emissions • Zero water demand Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  32. Solar thermal (STG)CSIRO Newcastle ~ 1MWe module Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  33. Windthe bad news • Technology still costly ~ 2,000- 4,000$/kWp • Capacity factor limited ~ 15-40% • Generation unrelated to system demand • Wind farms often remote from grid • Power conditioning expensive and complex • Energy storage expensive, alternatively needs standby (pumped hydro, thermal spinning reserve or mains) • Not suited to base loads (ie industry) • Regarded by many as noisy and intrusive • Poor use of real estate – prime agricultural sites - cows and sheep may safely graze, but not all birds! Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  34. Windthe good news • Free primary energy – wind > 6m/s • Technology cost falling with advanced RD&D • Manufacturers established – target ($k2-4/kWp) • Feed-in tariffs increasingly accepted • Emerging technologies include larger units, improved blades and composite materials give lower economic wind harvesting speeds • Power conditioning and energy storage costs falling, lives extending, unit sizes growing • Negligible carbon or other emissions • Zero water demand Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  35. Wind farms Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  36. Distributed generationthe good news • Can be installed close to load (eg rooftop or basement) • Uses locally available energy resources (sun, wind, biogas, biomass, micro hydro) • Offers local natural gas cogeneration/trigeneration (ie power, heating and cooling) at high efficiency • Minimises or avoids use of T&D assets and associated losses • Least cost option for remote area power supplies • Very strong Australian capability! Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  37. Distributed generationthe bad news • Specific energy costs ($/MWh) can be high • Complex (but not impossible) to connect to main grid system • Raises ownership issues, although may attract new ownership structures • Can create local distribution system congestion, especially rooftop PV Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  38. Distributed generationcommon technologies • Solar PV rooftop systems • Small wind turbines • Gas fired cogeneration/trigeneration • Micro hydro (developing countries) • Biogas (developing countries) • Etc, etc Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  39. Distributed generationcommon technologies • Pictures add Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  40. Distributed generationcommon technologies Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  41. Energy storage • Pumped storage already widely deployed • Future will be flow batteries and PHEVs • Provides for economic matching of supply and demand through peak shaving and valley filling • Critical for support of low capacity factor technologies (eg solar and wind) • Adds to system energy security • Costs falling through focussed RD&D Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  42. 500MWh energy storage system in USA Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  43. Let me conclude with some comparisons Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  44. Relative levelised costs ($/MWh) (Source: EPRI for UMPNER 2006) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  45. Nuclear Coal Gas Solar PV Wind <1 (+ mine + repository) <1 (+ mine + ash dam + CCS) <1 (+ gas field + pipeline + CCS) 400 (15-20% capacity factor) 600 (20-40% capacity factor) Real estate km²/GWa(excluding transmission) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  46. Fatality rates(Source UMPNER report - 2006) Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  47. By 2020 (60GW) Coal 65% Gas 23% Nuclear 0% Geothermal 2% Hydro 4% Wind 4% Solar <2% By 2050 (100GW) Coal 30% Gas 25% Nuclear 20% Geothermal 10% Hydro 3% Wind 7% Solar 5% My generation portfolio guesses for Australia? • At 2010 (54GW) • Coal 76% • Gas 16% • Nuclear0% • Geothermal 0% • Hydro 5% • Wind 2% • Solar <1% Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

  48. What’s yours? Thank-you for your kind attention! Engineers Australia - Northern Rivers Group - Ballina - 8 Sep 12 "Australian power - where to by 2050?"

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