ENERGY: balanced discussion needed
Posted : Thursday, October 27, 2011
Open and accurate conversation about fuel choices including
renewables and Coal Seam Gas (CSG) is needed, Managing Director of
Origin Energy has told a CEDA Energy series audience.
At CEDA's Energy series lunch event held in Sydney, Origin Energy
Managing Director, Grant King said: "For us to have a balanced
debate on the energy choices available to us we must demand
consistency in the arguments used for and against these
Mr King said discussion around energy sources has become a "good"
vs. "bad" argument, where renewables are the "good" and fossil
fuels are the "bad". Further, gas has moved from being represented
as a friendly transitional energy source to an "enemy of
"This misunderstands the true long term role of gas as a balancing
fuel to support a world with an increasing amount of renewable but
intermittent energy," he said.
"Australia's greatest contribution to reducing global greenhouse
gas emissions, and ...providing reliable supplies of energy to
consumers is to expand our liquified natural gas production and
Despite this, Mr King said that in the Clean Energy Future package
liquified natural gas will receive the lowest level of
The core issue is carbon, he said, and the carbon package should
put an end to the "good" and "bad" fuel debates.
Origin Energy welcomed the Clean Energy legislative package, as a
long time supporter of an Emissions Trading Scheme. Mr King
noted how important competitive energy costs are to consumers. "In
the normal course, blessed with resources as we are, the industry
will chose those technologies and fuels that produce the lowest
cost for consumers".
If fossil fuels are bad because of CO2 emissions, "we should also
consider the environmental impacts of the production of renewable
energy to ensure we have some balance in discussion on these
choices," he said.
Mr King's observations about the environmental impacts of some of
the most popularly promoted forms of renewable energy included:
- The manufacture of solar photovoltaic cells uses a range of
chemicals including hydrofluoric acid, phosphoric acid and sodium
hydroxide, highly toxic and corrosive chemicals.
- Unconventional geothermal requires hydraulic stimulation, known
as fraccing, that is the same as is required with shale gas (in
America) and sometimes with coal seam gas. Both conventional and
unconventional geothermal electricity generation produce large
amounts of water.
- Hydro electric dams produce significant amounts of carbon
dioxide and methane.
Return to the news
"The point of these examples is not to say renewables are 'bad'
rather that all forms of energy bring environmental issues which
must be considered and appropriately balanced in any fuel choice we
make," he said.
In regard to consumer energy prices, Mr King explained that since
1998 energy costs have consistently represented 2.6 per cent of
household income. In fact, the "energy share of household
expenditure has hardly changed over 25 years".
Though "there are a number of prospective issues that will give
rise to future increases in energy prices, we expect that increased
network costs that have driven increases to date have peaked and
will moderate over the next few years," he said.
Further, Mr King said that "we expect the wholesale cost of energy
to rise in coming years for a number of reasons" and that "these
costs comprise a relatively small percentage of the costs to
residential consumers and therefore are substantially muted at a
The question and answer session covered a range of topics from
fraccing in the CSG process to carbon pricing and the media's role
in seeking facts around energy sources and their environmental
On the topical, yet controversial, issue of CSG, Mr King was
questioned about the fraccing process during CSG extraction and the
risk of contamination of the water table.
"The shortest answer is, there is no toxicity in the fluids," he
"One of the mistruths and misperceptions is the chemicals used in
fraccing; they are almost without exception either drunk, eaten or
washed in by all of us today."
Mr King directed people to Origin's Senate submission around LNG,
available at www.aplng.com.au, for more
This was the final event in 2011 for CEDA's Energy series, which
examined economic policy, technologies and the energy market. The
series will continue in 2012.
For event audio
Nuclear Energy research paper
In Melbourne on 10 November, CEDA will release the first of three
Energy and Climate Policy research papers, the first of which
focuses on Nuclear Energy. For event information