The Net Zero Australia Report & The $7-9 Trillion Panic

The Net Zero Australia Report came out on Friday, and I gotta tell ya, it’s a doozy!  It’s so enormous the report’s summary report is 95 pages.  It would take me a month of Sundays to get through the whole thing, but I have exactly one Sunday, so I’ll quickly say what it’s about and describe how you’re likely to see its results abused online and in the media.

But don’t worry, I’ll make sure Ronald, our bearded blogger, gets around to writing an in-depth article later on what it says about the future of Australian solar.

Wait a minute… I am Ronald, the bearded blogger!  Goddammit!  I just made work for myself! 

The Net Zero Australia report is the result of collaboration between the University of Melbourne, Princeton University, The University of Queensland, Nous Group Consulting, and other strange people.  It describes in great detail what Australia needs to do to reach net zero greenhouse gas emissions by 2050.  It’s an extremely interesting report that took an immense amount of work from a wide range of experts and is mostly wrong.  

It’s just unavoidable that most of these predictions are gonna be off. We’re looking at a whole bunch of scenarios, and there’s no way they can all pan out. If one of them happens to be mostly right, well, that’s just blind luck. I mean, come on! Predicting stuff over 27+ years? That’s like someone back in 1990 saying, “Hey, Trump’s gonna be president ’cause he’s got this knack for writing 140 characters that really tick off Americans!”.

Trump tweet

Trump’s leadership qualities were shining through as early as 2013. I can’t believe it took so long for America to make him President.

Or, on a more technical level, it’s like predicting back in 1996 that today 30% of Australian homes would have rooftop solar

Even though it’s unlikely that any of these scenarios will be 100% spot-on, that doesn’t mean it’s a waste of time to dig into what Australia needs to do to achieve net-zero emissions in the coming decades—or, fingers crossed, even sooner. This report’s got it all, covering a whole spectrum of topics, like:

  • Expansion of solar and wind generation.
  • Energy storage, including batteries and pumped hydro.
  • Electricity transmission upgrades and expansion.
  • Hydrogen production — both likely and imaginary.  (It’s a little optimistic on this topic.)
  • Electrification of road transport.
  • Energy efficiency.
  • Reducing industrial emissions.
  • Carbon Capture and sequestration — including planting forests.
  • Energy exports, eg. hydrogen.
  • Capital costs and employment.

The report also mentions nuclear energy but says it will only be built in Australia if two conditions are met:

  1. Its cost falls well below their most optimistic estimate.
  2. We cut back on building solar and wind-generating capacity.

I can’t see either of those things happening, let alone both, so I’m certain it’s safe to forget about nuclear playing a role in Australia’s energy future.  But if you think I’m wrong, please feel free to disagree with me — just not in the comments.  Please disagree with me in somebody else’s comments.  Maybe at that really popular site, ReactorQuotes.

If you want to see for yourself what the report says, here’s a link to the 95 page Modelling Summary Report.

If you want to read the full report — don’t.  We may never see you again.

Big Number Abuse

I’m not going into the report’s details here, but I will tell you how you’ll see it abused online and in the media over the next few days — especially if it’s a slow news week.  One thing already being misrepresented is the capital cost of all the changes necessary for Australia to reach zero net emissions.  The estimate from now until the year 2060 is $7 to $9 trillion. 

That’s a massive amount of money and there are already people whinging about it on the internet. They’re doing things such as dividing $9 trillion by 26 million Australians to get $350,000 dollars each and saying there’s no way Australia can afford this. They’re definitely right that it’s a huge amount of money, but what these apparently panicking people either don’t know or are choosing not to tell you, is that we’re likely to spend more money if we don’t dramatically reduce greenhouse gas emissions.

This is because, even if we don’t cut emissions, we’ll still have to spend a similar amount on capital such as new generating capacity, cars, and industrial equipment.  Because we’ll be spending the money anyway, we may as well use it to get low emissions versions.  In many cases, it will be cheaper.  The cost of solar and wind generation plus energy storage for firming is now cheaper than building new fossil fuel capacity.  So we’d have to be fools to choose the more expensive and polluting option. 

Now let’s talk about road transport. Yeah, electric cars might not be as budget-friendly as we’d want them to be right now, but their prices are dropping, and they’re way cheaper to operate than their gas-guzzling cousins. Here’s the deal: if we don’t shift gears and go electric on the roads, we’re just going to keep shelling out more cash in the long run. 

Reducing emissions from industrial processes, or replacing them altogether, may not result in lower costs, but often does.  While there will be costs to reducing emissions from industry, there will also be savings. 

I mean, think about it. We will be dropping trillions on new capital over the next 37 years, so why not put that cash towards the stuff that won’t wreck our planet? And hey, it could even save us some cash in the long run. That’s before we even factor in the bonus of dodging all that nasty environmental damage.

So when people whinge about the apparent cost of zero net emissions, please remember the following points:

  • We would spend as much or more if we don’t reduce emissions.
  • The estimated $7 to $9 trillion amount will be spent over around 37 years.
  • It includes expenditure by and for perhaps 10 million Australians who don’t exist at this time.  This is because they are either living overseas or haven’t yet been born.
  • By 2060 — unless things go terribly wrong — Australians will be much richer and far more able to afford capital expenditure.

So most of the capital cost will be paid by Australians who are richer than they are now, and a large portion will be paid by Australians who don’t yet exist.  Whether or not we cut emissions, we will still have to spend trillions, but cutting emissions is likely to be cheaper. 

DON’T PANIC!!!

Massive reports can be daunting. Hundreds of pages of charts, graphs, and dense text can make cutting emissions appear an impossibly complex task. But it’s a lot simpler than it appears. We know what we need to do now to dramatically cut emissions over the next few years. Eliminating coal consumption and increasing EV use are two major steps we have clear solutions for.

At this moment, we may not know the best way to eliminate emissions from all forms of transport or all industrial processes, but we will find out on the way. We’ve already started down this path, and there’s no reason why we can’t pick up speed. If you panic over all the details, you risk missing the forest for the trees.

In fact, we should plant a few goddamn forests to make sure no one misses them.

About Ronald Brakels

Joining SolarQuotes in 2015, Ronald has a knack for reading those tediously long documents put out by solar manufacturers and translating their contents into something consumers might find interesting. Master of heavily researched deep-dive blog posts, his relentless consumer advocacy has ruffled more than a few manufacturer's feathers over the years. Read Ronald's full bio.

Comments

  1. norman mcgeoch says

    These reports cover the current status quo of centralised generation and power distribution via the grid.
    What the generating people should be worrying about is the economics of complete disconnection from the grid are already in my favour as an individual. If a group of 4 houses were to do so, they’d be even better and have more backup. Currently, based on todays prices for electricity, complete disconnection is the better, cheaper option for us all.

    • Randy Wester says

      I know that solar is more dependable in Australia, than in the frozen cities of Canada, but how is a group of four houses using the same energy source more resilient?

      I get that you could be sharing four batteries, but why not share 20?

      Or how about sharing one large backup battery at each final stepdown transformer?

  2. John Mitchell says

    I think the other thing to keep in mind about the $7-9 Trillion dollar figure is a lot of that money is going to go into big capital intensive projects that may have a 50-70 year lifespan. If we had the attitude to cost out everything based on the price per capita of the people who paid for it we’d have never built the Snowy Hydro scheme.

  3. Hey! I am the first comment again! I doubt I will see the change in 37 years: That would make me 110! But I hope my Grandchildren do.
    I will be attending a talk by Prof Leslie Hughes tonight in Brunswick Heads. I guess this report will get a mention.

    • Ronald Brakels says

      Actually, the first comment was by someone exhorting us to follow the wisdom of Donald Trump. I didn’t want anyone to take it seriously, so I placed it in the ones & zeros recycling bin. But you are definitely the first poster to not mention an ex US President.

      • Ronald Brakels says

        There’s also been a comment from someone who clearly didn’t read the article. Leaving a comment saying I’m wrong is fine, but I do ask people to check I actually am wrong first.

  4. Erik Christiansen says

    Ronald, getting things wrong is what humans are best at. It’s the smart ones who back up and have another go – on a different tack. Mind you, the notion that it’s practical to hoist a million tonnes of solar panels and microwave transmitters into orbit, then beam the power down to inefficient antennae for monopolisation of power distribution. is as nutty as nuclear reactors. Neither can compete with all that energy already being sent down for free (and that’s the whole problem) from the long-life fusion reactor we orbit. Heck, if we had the batteries, we could skip the grid monopoly as well.

    As for “Carbon Sequestration”, it’s a lie. Burning carbon, then pumping the CO2 down a hole in the ground is in reality only Oxygen Sequestration – twice as much as the megatonnes of carbon misused. The carbon had been sequestered millions of years ago, and only leaving it there is genuine Carbon Sequestration. And it’ll inevitably leak back up – surprisingly rapidly as inferior strata are cheaper to access. Now “Carbon to Product”, making e.g. plastics from captured CO2, that’s a gold plated winner, so long as it’s renewable energy which powers the process.

    With 45.4 degC in India, already in spring, and Europe heading toward summer with water shortages already, I’ll be checking my fire fighting pump early this year. I hear that Tesla is ramping capex up to US$25B in the next couple of years, to boost annual production to 20 million EVs by 2030. We’re in the bottom swing in the disruption S-curve, as they and BYD drive costs down for the steep bulk take-up convulsion. If others don’t then Tesla’ll doubtless proliferate EV chargers here too. That’s another one of his mega money making businesses, leveraging his batteries. Elon’s playing chess while the rest fumble at checkers. (Toyota’s asking: “Do we have to play?”
    Sadly for them, the answer is no.)

    We need cheaper better batteries. Zenaji busts the budget, Gelion are too slow to market. How soon Na-Ion?

  5. Did the paper also cost out the carry on as usual scenario of burning dinosaurs including fuel consumption for life of plant. A bad plan I am sure, just be interesting to see the do nothing, do something comparison.

  6. Max Scholefield says

    Well done again Ronald ( He’s from Queensland y know?)

  7. “Trump’s leadership qualities were shining through as early as 2013. I can’t believe it took another 7 years for America to make him President.”

    Trump was elected in 2016.

    • Ronald Brakels says

      Oops! Yes, that’s right! I’m afraid I have such a limited understanding of the United States that, to me, it’s like a completely different country. I have fixed that sentence so it won’t confuse anyone else. Thank you for pointing that out.

  8. Geoff Miell says

    Ronald,
    Whether or not we cut emissions, we will still have to spend trillions, but cutting emissions is likely to be cheaper.

    The rate of global sea level rise (SLR) has tripled in thirty years, from an average rate of 1.5 to about 5 mm/year.
    https://sealevel.nasa.gov/internal_resources/471

    The US National Oceanic and Atmospheric Administration (NOAA) published in Feb 2022 a technical report titled Global and Regional Sea Level Rise Scenarios for the United States: Updated Mean Projections and Extreme Water Level Probabilities Along U.S. Coastlines. Table 2.3 in the report includes global mean SLR scenarios, in metres, relative to a year-2000 baseline:

    Scenario _ _ _ _ _ _ 2050_ _ 2100 _ _ 2150
    Low _ _ _ _ _ _ _ _ +0.15 _ _ +0.3 _ _ +0.4
    Intermediate-Low _ +0.20 _ _ +0.5 _ _ +0.8
    Intermediate _ _ _ _+0.28 _ _ +1.0 _ _ +1.9
    Intermediate-High _ +0.37 _ _ +1.5 _ _ +2.7
    High _ _ _ _ _ _ _ _ +0.43 _ _ +2.0 _ _ +3.7
    https://oceanservice.noaa.gov/hazards/sealevelrise/sealevelrise-tech-report.html

    Meanwhile, per NOAA data, the daily average sea surface temperature (SST) between 60°N to 60°S latitude is still holding around +21 °C (up to 25 Apr 2023). From Apr 1 to 5 the daily average SST reached an all-time peak on the instrumental record (so far) of +21.1 °C.
    https://climatereanalyzer.org/clim/sst_daily/

    The heat that’s already in the ocean will continue to melt the Greenland & Antarctic ice sheets for centuries, & that’s unavoidable now, due to the tremendous energy now stored in the ocean.
    https://essd.copernicus.org/articles/15/1675/2023/essd-15-1675-2023-f08-web.png

    SLR is going to change harbours & every coastline. Adaptation will be very costly.

    Even if we/humanity stop burning fossil fuels, SLR will be unstoppable for centuries/millennia, unless we rapidly remove some of the GHGs already in the atmosphere to start to cool the planet.

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