Dont compare Australias energy and carbon pricing with Swedens

10 May 2011

Australia’s potential carbon price should not be compared with Sweden’s as almost 85 per cent of its primary energy production comes from nuclear and hydro sources, the Energy Supply Association of Australia said today.

esaa’s CEO Brad Page said he was puzzled by The Greens Leader Bob Brown’s discussion of the impact of a carbon price on Australia, during Meet the Press.
Bob Brown’s Meet the Press quote published in The Australian, 9 May 2011, Coalition calls up moguls to carbon panel: “I don’t know who’s referring to $20. We’re looking at, and other corporations are looking at, much higher levels than that, but way below the more than $100 you see in Sweden.”

Mr Page said casual readers of Dr Brown’s statement should be fully aware that the Australian and Swedish energy generation sectors are not comparable.

“The Swedish electricity supply depends mainly on nuclear energy and hydro power; carbon-based fuels play almost no part in its electricity generation,” he said.

Sweden is the third highest producer of nuclear energy in the EU with 10 nuclear power reactors at three active nuclear power plants providing around 45 per cent of the electricity generated.

A significant part of electricity is generated from renewable resources, where hydro generation plays a substantial role, providing almost 50 per cent of the electricity generated in Sweden.

“If Australia had a near zero emission electricity system courtesy of extensive nuclear and hydro generation facilities, then a high starting price for greenhouse gas emissions may be able to be accommodated. But the reality is otherwise,” Mr Page said.

“Given the Greens’ policy is strongly anti-nuclear, and also states there should be no large scale dams on Australian rivers, I’m particularly surprised the Swedish example was used.

“Efficiently pricing greenhouse gas emissions to ensure an orderly and sustainable transition to a low emission economy without arbitrarily destroying capital value in existing companies is the policy setting that Australia must pursue.

“But implying that a $100 per tonne carbon price in Sweden is somehow relevant to the Australian conversation borders on the bizarre,” Mr Page said.

Australia’s electricity generation is predominantly coal-fired (77.3 per cent comprised of 50 per cent black and 27.3 per cent brown coal) with natural gas the next largest producer at 14 per cent.

Hydro (5.6 per cent), wind (2.7 per cent), and oil and other production (0.2 per cent) make up the rest. (See diagrams below.)

Australian Primary Domestic Energy Production 2010

Sweden Primary Domestic Energy Production 2009

Source: Swedish Institute, 2009

Ends.

Media contact:    Caroline Page     0421 103 089

The Energy Supply Association of Australia seeks to positively influence government policy decisions to ensure that Australia enjoys the benefits of a safe, secure, reliable, sustainable and competitively priced electricity and natural gas supply.

esaa’s 40-plus member businesses have more than $120 billion in assets and infrastructure investment plans worth over $49 billion over the next five years. The Association is fuel and technology neutral and member businesses have investments across a wide range of fossil fuel and renewable generation technologies