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Feb 13, 2012

Oakeshott, Windsor biomass burner scheme Pythonesque

Substituting native forest biomass for another renewable generation source is particularly problematic because of the nature of the technology, writes Andrew Macintosh, associate director of the ANU Centre for Climate Law and Policy.

Imagine a climate policy plan that was incapable of lowering emissions but could increase them, that resulted in no net gain in the amount of renewable electricity generation, and that cost Australian taxpayers millions each year. While this might sound like it is from a Monty Python skit, it is the effect of a plan put forward last week by independents Rob Oakeshott and Tony Windsor, which will allow biomass burners using native forest wood waste to generate Renewable Energy Certificates (RECs) under the Large-Scale Renewable Energy Target (LRET) scheme.

The standard justification for this idea is that native forest wood waste projects lower greenhouse gas emissions by displacing more carbon-intensive forms of electricity generation. Due to this, the native forestry industry claims it should be able to access RECs as a means of subsidising the activity.

At a superficial level, the argument sounds compelling — surely burning wood is cleaner than burning coal? However, on closer inspection, it is demonstrably false.

To understand why, you have to start with Australia’s emission targets, which cap national emissions. While the cap is in place, nothing that affects emissions within the sectors that count towards the cap should have any influence on the total national or global emissions outcome. All it will achieve is to change the distribution of emissions between sectors, countries and/or time. So, if native forest biomass projects did displace fossil fuel-based electricity generation, as the industry argues it does, it would not lower emissions but simply mean that the emissions would come from another source.

An easy way to think of this is to envisage a magic tub of Neapolitan ice-cream that is always full, where you can change the proportions of chocolate, vanilla and strawberry. You can have more chocolate but it means having less vanilla or strawberry, or you can have more strawberry but less chocolate or vanilla, and so on. Whatever combination you choose, you’ll always end up with the same amount of ice-cream in the tub. The same goes for emissions under a cap; less emissions from one source means there must be more from another.

On July 1, 2015, when the carbon price becomes a cap-and-trade scheme, this will apply doubly. We will have an emission cap within an emission cap and no amount of abatement effort directed at the electricity sector, or any other “counted” sector, will be able to lower net emissions.

The second hole on the independents’ plan is that allowing forest biomass projects to access to RECs will not increase the amount of renewable electricity generation. This is because the LRET scheme sets a mandatory amount of renewable electricity that must be generated each year. Because of this, the only thing allowing native forest wood waste into the scheme will achieve is to displace other forms of renewable electricity. Rather than having wind, hydro or some other form of renewable electricity, we’ll get native forest biomass. So, contrary to what is so often claimed, burning native forest biomass won’t displace fossil fuel-based electricity generation and won’t increase renewable generation.

Substituting native forest biomass for another renewable generation source is particularly problematic because of the nature of the technology. The stated purpose of the LRET is to lower the cost of low-emissions technology and, thereby, reduce the long-term cost of cutting greenhouse emissions. Cutting emissions is primarily the job of the carbon pricing scheme and other regulatory mechanisms. Renewable energy support schemes, such as the LRET, are supposed to complement the carbon pricing scheme by driving down the cost of alternative technologies more rapidly than would otherwise occur.

In the case of biomass burning, this is already a mature technology. It has been around for eons and the cost reduction benefits society will reap from allowing native forest biomass projects it to access RECs are likely to be negligible. This is not the same for many other types of renewables, which are immature and have a considerable way to go before they reach their potential. By pushing these other technologies aside, native forest biomass projects will undermine the very purpose of the LRET.

The damage done by including native forest biomass in the LRET may not end there. By increasing the profits from native forestry operations, the independents’ scheme could increase native forest harvesting. If Australia’s greenhouse accounting rules remain as they are, and forestry management is excluded from the national target, the impact of the increase in harvesting will be to increase global greenhouse emissions. If Australia amends its rules and counts forest management towards its emissions target, the increase in harvesting won’t increase global emissions but it will lead to a reduction in Commonwealth revenues from the carbon pricing scheme. Due to this, the Australian taxpayer could end up paying twice for these projects: once through the LRET scheme and again as a result of the lost scheme revenues.

To sum up, the plan can’t lower emissions but could increase them, it will displace other forms of renewable energy and sabotage the operation of the LRET scheme, and it could cost millions. For bad policy, it is hard to beat.

*Andrew Macintosh is the associate director of the ANU Centre for Climate Law & Policy

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21 thoughts on “Oakeshott, Windsor biomass burner scheme Pythonesque

  1. beryceann@bigpond.com

    Both MPs should be made to read the novel Solar – it puts their proposal in its true perspective.

  2. Modus Ponens

    Scandalous. First step wrong Windsor has taken. Wonder if anyone is lobbying the Speaker? Might have the casting vote.

    If any energy retailer buys RECs from burnt native forests – no doubt the public campaign against them will be fierce.

    Buyer beware.

  3. Rupert Crowe

    My understanding is that these projects will be creating energy out of waste wood that would otherwise be burned in the open air anyway. If this is the case, as it is for a planned biomass plant in our part of SW WA, then there is a saving in carbon emissions; one fire instead of two. In addition, it is understood that the forest fuel will be replaced by regrowth whereas the fossil fuel will not.

  4. Modus Ponens

    Rupert – it would drive a market for native forest destruction – just when they are all running out of ways to make money from it.

    Industries can still use native forest biomass if they want, but RECs add a financial incentive that frankly shouldn’t be there (not a fledgling industry and not renewable when clear felling occurs).

    The native forest market doesn’t need correction – it needs a cold dose of market rationalism. Then governments would stop needlessly pouring money into it to keep it from dying its natural death….

  5. Jackol

    There are definitely environmental issues to do with using any material from native forests.

    However, the major points of the article are completely wrong. The fact that a capped system means that any savings in one form will offset non-savings in other forms is not, in itself, an argument that a particular form of renewable energy (in this case using forestry waste to fuel biomass power generation) is not a “saving”. The same argument applies to wind, solar, tidal, all renewable energy generation.

    If it is a renewable energy source (and it is), then why should it be treated any differently (setting aside the incredibly convoluted issue of land use accounting in carbon credit schemes, which is a separate problem entirely)?

    I’m not, personally, a great fan of a native forest biomass generator proposal due to the fact I think the management of collection of “waste” is a very sensitive environmental issue, but that doesn’t mean there shouldn’t be a discussion about it, and it doesn’t mean that biomass doesn’t deserve to be treated as a potential renewable energy resource.

    To sum up, the plan can’t lower emissions but could increase them

    To sum up, Andrew Macintosh doesn’t have a clue what he is talking about.

  6. claudedwalker

    Good article. Adding more uncertainty to an already ineffective scheme is sure to render it completely useless.

    Sucks for all the real renewable energy projects wind/solar/geothermal/wave waiting on the sidelines until the LREC certificates are valuable enough.

    So as of 2012 we will be chopping down native trees to burn them for renewable energy and growing them again for Carbon offsets… But we will have just displaced renewables with burnt biomass and replaced big trees in native forests with little trees in sparse plantations.

    Pythonesque, exactly

  7. Stephen

    Compare with the equally loony Eden wood-pellet plant for generating electricity.

    Although this one was struck down by NSW Land and Environment Court last December, you can guarantee that the shire and the proponents will keep on moving the goalposts, until they get their way.

  8. AR

    Rupert/Modus – waayyy back in ancient history, the use of “forest waste” was the original justification for wood chipping. Very quickly that tail began to wag the dog.
    I actually heard some dingbat from the Tas forest rapists recently demanding that the Feds help find new markets for the almost dead woodchip export industry.
    It might have been a nightmare but no rent seeking would be too stoopid these daze.

  9. Kincuri

    Good article Andrew.

    The proposed regulation reversal from Oakeshott only acts to incentivize the destruction of native forests, and ruins the integrity of the renewable energy target to do it. This is the distortion of democracy that money and influence can have in our nations politics.

    The argument that these projects are using waste wood, and will be burnt anyway is a moot point, the fact is that the harvesting projects will already have factored the earnings from LGCs into the viability of their projects (hence why they would have lobbied Oakeshott so strongly)

  10. Sherman Brad

    There is likely to be a real difference, in climate terms, from biomass burning compared to burning coal. Biomass is typically less than a couple of hundred years old and is sourced from above ground and in the upper layers of soil. This region has been roughly in balance with the atmosphere over the past several hundred thousand years. It took many many millions of years to convert CO2 to oil and coal. Burning fossil fuels unquestionably adds CO2 to the atmosphere and ocean (in fact, fossil fuel combustion on its own more than accounts for the measured change in atmospheric CO2, I believe). I suspect burning biomass accelerates the cycle of CO2->plant matter->combustion-> CO2 and can, if executed correctly, contribute less net CO2 per unit energy produced. Obviously, you can’t burn it faster than it grows.

    That said, burning native forests is a really bad idea in my view. There are far more appropriate forms of biomass and we owe it to our native fauna and our descendants to try to preserve what little of it is left. And we must consider all the other aspects of air pollution that come from combustion before we commit to that direction.

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