What Does A Price Of $26 Per Ton On Carbon (Dioxide) Emissions Mean

Posted on Mon 10/25/2010 by


Debate rages everywhere about placing a cost on Carbon Emissions, and before I go any further, it shows the ignorance of those people who propose this that they cannot even get the title right.

It’s Carbon Dioxide (CO2) Emissions.

That debate rages even here in Australia, so let’s look at the situation here in Australia a little more closely.

What people fail so comprehensively to understand is the amount of money involved with this, and believe me, it’s easy enough to calculate. Because the numbers involved are just so huge, people will tend to pass it off as not being true, because surely, numbers that large just have that ring of disbelief about them.

You see, that’s what those people in Government who are proposing this cost have as their largest advantage. They are relying on the fact that because people might not know where to even start looking for those statistics, and then to do the math, then they can divert attention away from the total amount raised from this by saying that this is being done for the sake of the environment, and that the introduction of this price on CO2 will actually result in those emissions falling. They will also add that it will have a negligible effect on the average man in the street, because, after all it is being aimed at what they call those large polluters. See how they use language that is so emotive that it then appeals to everybody’s sense of fair play, making the big guy pay, because, after all, he can afford it.

If anybody were to actually work it out and then try to tell people, then it’s an easy thing to disregard, because those figures, being so huge, then people will tend to disbelieve them, and heaven help the person actually willing to try and say these things out loud. When I actually started looking at this and related subjects nearly three years ago now, I was reluctant at first to write them down, because people would just point at what was being written, and say, ‘look at what that idiot has written…..no idea whatsoever.’

However, the more I looked, the more those figures were proved to be correct. Still, people will not believe those figures, because they are so huge. I still to this day have people almost sneering at me when I quote some of the statistics that I do quote. Even when you tell people the truth, they will just not believe it, because it sounds so unrealistic.

That is the distinct advantage that Government has as they endeavour to introduce this cost on CO2.

So then, where do you begin, and keep in mind that this is just for Australia.

I’ll say it all once, up front, and then explain it.

To produce just the electrical power that Australia uses, an amount of 90 Million tons of coal is burned. Each ton of coal burned produces 2.86 tons of CO2. This gives us around 260 million tons of CO2 just from coal fired power. When you add onto that the emissions of CO2 from Natural Gas fired power plants, you end up with a total of 300 million tons of CO2. The emissions of CO2 from the electrical power sector alone make up one third of all CO2 emissions. Now the total CO2 emissions from all man made sources comes to 900 million tons.

Professor Ross Garnaut quoted what ‘sounds’ like a reasonable cost of  $26 per ton on that CO2, and some sources say that total should be around $35 per ton, but let’s just work on that lower figure of $26 per ton.

The amount now comes in at close to $24 Billion. That’s not a one off cost, but for each and every year.

$24 Billion.

See how the end number is so astronomically high, it’s just unable to be believed.

Let’s go back to the start and then work up slowly.

One large coal fired power plant for example would be the Eraring Plant in New South Wales, and this is the link to the statistics for that Plant. (pdf document) This plant burns 6 million tons of coal each year to produce their power, and that’s one ton of coal every five and a half seconds. The plant has four turbine/generators each weighing in at more than 1300 tons, and each rotating at 3000RPM, and read that again slowly, 1300 tons rotating at 50 times a second, and snap your finger, and then immediately snap it again. 1300 tons, 50 rotations per snap of your finger. The coal is crushed and fed into a critical furnace. The immense generated heat boils water to high pressure steam, which drives the turbine which then drives the generator.

The Plant has a Nameplate Capacity of 2640 MW, and will deliver on average 21 Billion KWH of power to consumers each year.

There are seven of these huge plants around this size in Australia, and 17 plants around half that size, medium/large coal fired power plants, and around a dozen or more smaller coal fired plants.

Incidentally, two and a half years ago, every one of those large coal fired power plants had its own website with all the information about it all there for everyone to see, and also displayed at each of those sites was the amount of coal being burned to produce the electrical power they do produce. Try finding any of that information now in this new enlightened era. No, it’s all disappeared. I wonder why.

That amount of 90 million tons of coal being burned each year for every coal fired plant in Australia is a conservative amount, and even so, at that huge figure, it is still difficult to comprehend.

These large, and medium large coal fired plants are designed to operate for 24 hours a day, and will only shut down one generator on site at a time for carefully scheduled maintenance periods. These plants provide that power that is required absolutely for the full 24 hours of every day.

The most difficult thing to try and explain is that as you burn each one ton of coal, an amount of 2.86 tons of CO2 is being emitted. That’s actual physical tons. Again, see how it has that aura of disbelief around it, because it sounds so wrong. This is not obscure Science, but the Science each and every one of us learned in the first year of Science at the start of High School, and were told of the periodic table of elements. the Oxygen atom is just that slight bit heavier than a Carbon atom, so if you combine one atom of Carbon with two atoms of Oxygen (CO2) then the weight virtually triples. As coal is basically all Carbon, but has other elements in it as well, then that multiplier is indeed 2.86. The post at this link explains that effectively, and so you don’t think this is something I have made up, I have included further links to a US Government site, the Energy Information Administration (EIA) site that explains this in much the same way I have in that post.

So then, if 90 million tons of coal is being burned, then the emissions of CO2 amount to a tad under 260 million tons. See now how the numbers are becoming so huge as to be not readily understood.

Smaller plants come on line during periods when extra power is required over and above this Base Load of power that is required absolutely for every hour of the day. These plants provide peaking power, and, in the main are plants that use Natural gas to drive the turbine that drives the generator. Their design means that they can run up to speed quickly and provide their power quickly, and when not in use, they can just as quickly be shut down. Burning Natural Gas as they do, they do not emit CO2 on the same scale as those coal fired plants, but still emit CO2 at one third the rate of coal fired power on a Watt for Watt basis.

The CO2 emissions from Natural gas can also be calculated, and that calculation comes in at 22 pounds of CO2 per mcf (thousand cubic feet) Because those Natural gas fired plants mostly operate for shorter periods of time, then the emissions from them ‘seems’ considerably less, but they are still substantial, coming in at around 40 million tons each year, just for Australia remember.

So now the total comes in at 300 million tons of CO2 being emitted each year in Australia just to give us the electrical power we all have access to as a staple of life now.

Those emissions from the electrical power generating sector are one third of the total, so the amount now snowballs to the figure of 900 million tons, and at Professor Garnaut’s amount of $26 per ton, the total amount raised from all this comes in at that amount of $24 Billion each year.

See now why the Government wants so desperately to introduce this cost on Carbon (Dioxide).

So then let’s now look at how the call is there for this cost to be imposed only on those big polluters.

Here in Australia, this call is the most strident from those two main figures from the Australian Greens Party, Senators Bob Brown and Christine Milne. You know, I seriously have my doubts that they have researched this.

For so long now, they use that emotive language of making the big polluters pay, mainly those huge coal fired power plant operators.

So then, let’s go back just to Eraring, and see how much this so called big polluter will be paying.

This one plant burns 6 million tons of coal each year, and in the process emit 17.2 million tons of CO2. At that lower, and seemingly reasonable cost of the $26 per ton, then their added cost now amounts to almost $450 million.

Seriously, think this out with some logic. There is no Company, no matter how large who can afford to have that added amount of money added as a cost to their bottom line each and every year, and stay in business.

No, they, along with every coal fired power plant will be passing that added cost down to consumers in the form of increased electricity charges. In fact, those same governments who go on to impose this cost will add to the legislation the provision for that cost to be passed down to consumers.

So, work this out. If electricity is consumed in three main sectors, the Residential sector, (38%) the Commercial sector, (37%) and the Industrial sector, (24%) then each consumer from each of those areas will be subject to that added cost.

Your personal household electricity account will rise, and here I don’t mean by a small amount, but by anything up to 30%, and again, that could be a conservative percentage.

Also, that rise in the Commercial and Industrial sectors will also be passed on as an increase in the cost of everything you buy.

That accounts for the electrical power sector. In those other areas, that added cost will also be passed directly down to consumers as well, and don’t try and kid yourself that it won’t. These amounts are just so huge that no Company could afford to stay in business with that added extra cost.

Now, as to the mantra that placing a cost on CO2 will act as a mechanism to drive down those emissions, that is also not true.

When it comes to electrical power consumption, don’t think that the Industry sector is profligately using extra power. That cost of electricity adds to their bottom line, so they will already be operating as leanly as they can. They will always use what they have to use to do what it is that they do.

The Commerce sector will be the same.

Coles and Woolies Supermarkets and all other shops won’t be turning off their large range of food cooling units overnight. They won’t be turning off all their lights, them or any shop, where that lighting is for security reasons mainly.

Do you think local and State Governments will be using less power than they already do for traffic control and lighting. Will 24 hour operations that some Companies use be cut to reduce power consumption.

Every high rise building you can see above two stories won’t be turning off the air plants on their roof, because other than supplying conditioned air inside that building, they are providing breathing air for everyone inside that building, and you just cannot turn them off. Will they be turning off the lights in those buildings, the elevators.

At the personal residential level, who amongst you will be making savings, and here I mean significant savings on your electrical consumption. You will keep using what you use now. Any savings that you do intentionally make will be so minor as to be inconsequential. On that front, lighting in your house amounts to 8% of the total of your electrical account. Converting your whole house to these new CFL’s will result in a saving on your household electrical account of around 1.65%, or on average, around 40 cents a week, or $20 a year. The post at this link explains that any savings made by converting to those new Compact Fluorescent globes is so minimal that it also does not amount to the savings of very much at all.

So, when Greens Senators Bob Brown and Christine Milne place their hands on their green hearts and say that this is for the good of the environment, that the big polluters only will be paying, and that a cost on Carbon (Dioxide, Bob and Christine, Carbon Dioxide) will drive down emissions, be fully aware that they have not the slightest clue in all of this.

Prior to the recent election, Prime Minister Julia Gillard made the promise that there would be no introduction of a cost on Carbon (Dioxide, Julia, Carbon Dioxide) during her first term, if she was re-elected, and in fact not even any discussion on the matter. I’ll bet that someone mentioned the magic words into her shell like ear, those magic words being $24 Billion, and all of a sudden, now the election result is in, this cost on CO2 is suddenly back on the table.

Senator Barnaby Joyce called it a huge new tax, and as is always the fashion, people sneered at him, and laughed, some openly to his face. Leader of the Conservative side of politics Tony Abbott also called it a huge new tax, and this was somehow extrapolated to be a political stance, just saying the opposite of the left side of the political fence, because they somehow must oppose everything, hence the argument then became a political one.

However, that’s all it really is. A great big huge new tax imposed on all of us in every walk of life and on everything we do.

Think of it in this way. The total comes to $24 Billion, Australia’s population is around 22 million. Extrapolating this down to the average common denominator, that comes in at around $1100 for every man woman and child in Australia.

For the sake of comparison, this same amount of $26 per ton in the U.S. they would raise around $275 Billion each year. With a population of 305 Million, this comes in at around $900 for every man woman and child there. Now, why there is a difference of this magnitude is that their percentage of coal fired power is smaller than for here in Australia, because 22% of all their power comes from Nuclear power plants, something not even on the horizon (the very far horizon) in Australia.

Now, why I even mentioned the U.S. here when this post is oriented mainly towards Australia, and then went to pains to mention that 22% of their power is generated using the Nuclear process, is this. If that 22% of their power was not generated by Nuclear power plants and was indeed, as it is here in Australia, generated from coal fired sources, then that amount that is averaged out in the US at $200 cheaper per man woman and child, would indeed be exactly the same as for here in Australia, around $1100 per capita head.

Do not read into this that I’m postulating that Australia should construct Nuclear power plants, because in virtually any political environment, that is never likely to happen. What it does quite graphically show is that when those nuclear power plants were being constructed in the U.S. these CO2 emissions were not an issue. Now that they have become such a major issue in this supposedly enlightened age, it would seem that those Nuclear power plants have actually saved the U.S. from considerably higher emissions over the decades that they have been in operation. This gives further rise within the U.S. for more Nuclear power plants to be placed on the table if indeed this stupidity of reducing CO2 emissions leads to the closure of coal fired power plants on a large scale.

All this for a minor trace gas that makes up only 390 parts per million, or 0.039% of the total Atmosphere. The raising of $24 Billion in Australia will have absolutely zero effect in reducing that amount of CO2, because Co2 levels are the same across the World. It will be 390PPM in new York, 390PPM in London, 390PPM in Sydney. The only result from all this is that the Australian Government will have raised $24 Billion each and every year, money not from those big polluters Bob and Christine and Julia, but from every Australian.

Having explained it all like this, you must surely be aware by now that, as has been the case all along, this has nothing whatsoever to do with the environment.

It’s just about the money.