Climate Change – Global Warming Scenarios

Electricity Generation and Emissionsa 2050 Scenario

Hydro (16)

Electricity generation 2003 (TWh)

Gas (34)Brown Coal

(50)

Black Coal(128)

Greenhouse gasemissions 2003(550 Mt CO2-e)

Waste (11)

Land use (35)

Agriculture(97)

Industrial (32)

Primary energy supply

(104)

Transport(80)

Electricitygeneration

(190)

Electricity generation 2050 (TWh)

Notionalemissions

profile

Electricitydemand

Electricity demandwith improved

energy efficiency234 TWh

190 Mt CO2-e

2020

614 TWh

492 TWh

88 Mt CO2-eCoal (70)

Gas (24)Hydro (19)

Zero emissions electricity generation

(500)

2030

2003 2010 2020 2030 2040 2050

Generation Cost Comparisons

$20

$30

$40

$50

$60

$70

$80

$90

$100

$110

$120

Le

ve

lise

d C

os

t E

sti

ma

tes

( A

$ 2

00

6 /

MW

h )

Nuclear costs are for an established industry

Nuclear

Coal

Coal - Supercritical

Pulverised Coal Combustion +

CCS

Gas - Combined Cycle Gas

Turbine + CCS

Coal - Integrated

Gasification Combined Cycle

+ CCS

Renewables

High Capacity

Factor Wind /

Small Hydro

Solar PV

Solar Thermal / Biomass

Gas - Combined Cycle Gas

Turbine

CCS estimates are indicative onlyRenewables have large ranges and substantial overlaps

Main Steps in the Innovation Cycle

Global Emissions Trading Scheme

The Emissions Trajectory

The Forward Price Curve

Other (non trade-exposed emissions‑intensive) disproportionately affected industries

Permits to be auctioned

Sectors not covered (agriculture and land use in this example)

Trade-exposed, emissions- intensive industries (existing plants)

Mt CO2-e

Allocated free permits

National Emissions

Domestic emissions trading scheme cap

Stream of Permits

APP – collaborative adoption of APP – collaborative adoption of technologiestechnologies

13

Timeframe• Phase 1 – Foundations – years 0-1 (2007 to 2008)

– Finalise scheme design, establish emission reporting systems, determine long term aspirational goal, engage international partners

• Phase 2 – Establishment – year 2 (2009)– Pass relevant legislation, establish governance

structures (independent regulator and advisory panel), broaden international cooperation (focusing on countries considering emissions trading), rationalise state/territory programmes

• Phase 3 – Trading - years 3-4 (2010-2011)– Set short term targets, allocate permits, commence

trading in 2011, explore linkages with other countries

Allocation of Permits

Trade Exposed Emissions Intensive

Emissions Trading ReviewMembers

• Peter Coates Xstrata

• Tony Concannon Int Power

• Russell Higgins APT, RGL

• Margaret Jackson Qantas

• Chris Lynch BHP Billiton

• John Marlay Alumina

• John Stewart NAB

• Secretary PM & C

• Secretary Treasury

• Secretary Industry

• Secretary Environment

• Secretary Foreign Affairs & Trade

Exports

Indicative emissions intensity of electricity generation

(Figure 3 Page 135)