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Reducing our need for Energy

According to the Australian Bureau Of Statistics the total energy consumption in Australia has increased by 9% from 1998-99 to 2003-04. Electricity use has increased by 19% in the same period. In this same interval (1998-99 to 2003-04) the population in Australia has increased by about 6% and Gross Domestic Product (GDP) almost by 18%. Therefore the electricity use has increased in line with GDP. It is also interesting to note that in the same interval as above, electricity use per person increased by 11%, however total energy use per person has only increased by approximately 3%.

The table below was constructed using the information in table 17.19 of the Australian Bureau of Statistics, Year Book Australia 2006, Energy Use (see the link above).

Period Energy Use Per Person (GJ/person) Electricity Use per Person (GJ/person)
1999-99 258.1 35.7
2003-04 265.8 39.8

The Federal Government's White Paper on Energy Reform outlines that energy efficiency improvements in Australia have occurred more slowly than in other countries (see specifically the summary on energy efficiency and the chapter on energy efficiency). In fact, Australia's energy efficiency has improved at less than half the rate of other countries. Some of the factors that have affected improvement in energy efficiency include low energy prices in Australia, the initial investment required to change to more efficient use of energy, and a lack of information about energy efficiency. For more information download the NFEE Discussion Paper.

Energy Efficiency Opportunities in Australia

Again, the Federal Government's energy reform paper indicates that there is a substantial opportunity for Australia to become more energy efficient. It is estimated that energy usage in the residential sector could be decreased by 13%, in the commercial sector by 10.4% and in the industrial sector by 6.2%. These improvements in energy efficiency could reduce total greenhouse emissions by 10 million tonnes per year.

Cost of Improving Energy Efficiency

The National Framework for Energy Efficiency (NFEE) has released a study on the cost of employing energy efficiency and the energy and economic savings that can be achieved between 2001 and 2012. The study was conducted for the residential sector, the commerical sector and the industrial sector.

The results are graphed below:

The above graphs assume that current technology is used to increase energy efficiency. The information for these graphs can be found in the background report (v4.1 ) by the National Framework for Energy Efficiency, 2003, "Preliminary Assessment of Demand-Side Energy Efficiency Improvement Potential and Costs" in tables A1 and A3 in the Appendix. The study can be downloaded here: NFEE study. It is worth noting that the objective of the study was to provide, in a short time frame, a preliminary estimate of the potential for, and costs of, energy efficiency improvement (EEI), in the residential, commercial and industrial (stationary) energy end-use sectors in Australia. Because of the short time frame, the study was not based on original research, meaning that the EEI potential and cost estimates were based on a range of existing data sources in each energy end-use sector.

The graphs above outlines that a continual investment will need to be made in order to increase energy efficiency. In the residential sector the investment is expected to be paid off due to the saving of energy within ten years and in the commercial and industry sector, it is expected to be paid off within 8 years.

The study also showed how much energy (in joules rather than dollars) can be saved given a certain investment. They used two types of investment. The first investment called, "Low", assumes that only currently available technology is used. The second investment, called "High", assumes that emerging technology is used. Again, the study was conducted for a 12 year period. The results are as follows:

Sector Low Scenario High Scenario
Capital Cost ($M) Energy Saved (PJ) Capital Cost ($M) Energy Saved (PJ)
Residential $13470 855 $58350 1,866
Commercial $6361 425 $23191 850
Industrial $12101 2,163 $44134 4,068
Total $31,932 3,443 $125,675 6,784

Note that in the above table accumulated data has been used. For example, in the commercial sector for the low scenario the investment is the total capital cost over 12 years and the energy saved is the total energy saved over 12 years. The energy saved is in petajoules (PJ): 1 petajoule = 10^15 joules.

The main result from the table is that there is potential to save 3,443 PJ of energy over 12 years using currently available technology. This is equivalent to 9 large, (1 Gigawatt) power plants operating over the full 12 years. The Capital cost of saving this energy is $AUD 3,400 dollars per KiloWatt. By comparison, the capital cost of Nuclear Power plants is projected to be $AUD 2,000 per KiloWatt.

It is worth noting that to really make an impact on the total energy efficiency of the economy will require substantial investments in new equipment and products that replace current working devices. This will require substantial capital investments on the part of a large fraction of the population - the industry, commercial and residential sectors. Australians have been urged to increase energy efficiency for over 20 years. The result of these efforts have been to decrease our rate of energy use growth from 2.6% per year in the 1970's to 2% per year in the 21st century. It appears that strong Government intervention in the form differential taxes to promote energy efficiency would be required to make Australians collectively invest in energy saving equipment and technologies.

Some things to think about

Energy efficiency has a limit. As population rises and the economy grows energy consumption has to increase (as each new person will need food, shelter, light etc). While policies to dramatically increase energy efficiency could work to decrease our energy consumption in the short term, they will also defer new investment in energy generation technology. However, eventually such investments need to be made in order to cope with the growing demand for energy due to population increase.

Of course it is also possible to combine energy efficiency with renewable technology. In this case it may be possible to keep C02 levels low enough and be able to supply society with enough energy until renewable energy technology or completely new energy sources become advanced enough such that they can be the main energy source. In fact this is what is proposed in the Federal Goverment's white paper on Energy Reform. The paper outlines a plan to set up "Solar Cities" for the purpose of studying small communities which will rely heavily on solar power for their energy use. This energy efficiency/renewable energy plan is to encourage research into storage methods for renewables such as solar and wind by providing grants, offer incentives for energy efficiency such as a star system for appliances and subsidise energy efficient devices, force new buildings and large energy users to comply with energy efficiency standards. This situation should be studied thoroughly. The study should include an analysis of the cost to the consumer and ensure that C02 levels can be kept at the required minimum.

In the longer term we will need to develop alternatives to fossil fuels used for transport, to both limit global warming and because of resource exhaustion. Presently Hydrogen appears to be the logical choice for this role. Developing the technology and infrastructure to generate and distribute Hydrogen will require billions of dollars, nevertheless these costs are comparable to those of typical fossil fuel projects.

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