News | 10th May, 2013

Carbon price working? Coal slumps, clean energy soars

10 May 2013
Tom Arup, Sydney Morning Herald
Electricity generated by Australia's highly polluting brown coal power plants has fallen 14 per cent since introduction of the carbon price, while renewable power has soared.
An analysis by the federal government, comparing daily national electricity market data for the first nine months of the carbon price with the same period a year earlier, also shows generation from slightly less polluting black coal power plants fell 4.7 per cent.
In the same time renewable energy – including hydro – rose by 28 per cent, while lower-emitting gas power grew by 9.5 per cent.
Labor credits the decline in coal electricity in large part to its carbon price and other policies such as a 20 per cent renewable energy target. The carbon price began on July 1, 2012 at a fixed price of $23 a tonne. Those in the industry and analysts say the carbon price is playing a role but other factors at work include changing fuels costs and falling power demand.
Climate Change Minister Greg Combet said: ''This change in fuel mix means cleaner electricity is being delivered to households and business''.
The Grattan Institute's Tony Wood said other influences could be changing costs of coal and the renewable energy target, including flooding at the Yallourn brown-coal plant last year, commissioning of the Mortlake gas plant in Victoria and companies burning spare gas.
''The carbon price is in and the system is working. However, it is probably wishful thinking to ascribe a heavy-lifting role to the carbon price in what we have seen,'' Mr Wood said.
All up, the emissions intensity of the national electricity market has fallen 5.4 per cent since the carbon price was introduced, meaning carbon emissions from power generation is down 7.7 per cent, or 10 million tonnes, from the previous nine months.
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