1.2 Greenhouse gas emissions
Annual New South Wales greenhouse gas emissions have remained relatively steady since 1989–90, with per capita emissions below the national average.
Using the UN accounting methodology, the state's greenhouse gas emissions (including those from land use) were equivalent to 157.4 million tonnes of carbon dioxide (CO2-e) in 2009–10. This has been relatively steady since 1989–90 and at 21.8 tonnes per person, these emissions are below the national average of 25.1 tonnes per person.
Eighty-five per cent of NSW emissions are from the use of energy, which includes the equivalent of 62 million tonnes of CO2 coming from the burning of coal for electricity generation and 18 million tonnes CO2-equivalent from methane released during the mining of coal.
Since 1989–90, emissions from fugitive emissions, agriculture, land clearing and waste disposal all declined, while those from transport and industry have increased. Emissions from electricity generation grew on average at just under 2% per year.
Indicator and status
Atmospheric concentrations of greenhouse gases
Total annual NSW greenhouse gas emissions
Annual NSW per capita greenhouse gas emissions
Notes: Terms and symbols used above are defined in About SoE 2012 at the front of the report.
The greenhouse effect is a well-understood process. Greenhouse gases in the atmosphere, along with a number of physical processes, act to reduce the loss of heat to space, allowing the Earth to maintain an average global surface temperature of about 14°C. This is about 33°C warmer than if there were no greenhouse gases in the atmosphere (IPCC 2007, p.946). The increased use of fossil fuels since 1750, land-use changes, agriculture and other activities have resulted in a growing accumulation in the atmosphere of such greenhouse gases as carbon dioxide, methane, nitrous oxide, ozone and manufactured gases like chlorofluorocarbons (IPCC 2007; CSIRO 2011). As a result, extra heat is being trapped by the atmosphere as evidenced by an increase in global surface temperatures (IPCC 2007, p.4).
Global greenhouse gas concentrations and Australasian temperatures
For most of the past 2000 years, global atmospheric concentrations of greenhouse gases have been fairly stable and only since the Industrial Revolution have they increased significantly (Figure 1.9).
Figure 1.9: Greenhouse gas concentrations from ice cores (Law Dome, Antarctica) and direct measurement (Cape Grim, Tasmania), AD 1–2012
Source: CSIRO data
Concentrations of atmospheric carbon dioxide are known to have risen from the natural range of ~170–300 parts per million (ppm) observed over the last 800,000 years (Lüthi et al. 2008) to an average in 2011 of about 390 ppm (CSIRO 2011): northern hemisphere concentrations (such as at Mauna Loa, Hawaii) have been measured at 2–3 ppm higher than those in the southern hemisphere (such as at Cape Grim, Tasmania). Mauna Loa data shows that carbon dioxide concentrations are now increasing at about 2 ppm per year.
Current atmospheric methane concentrations of 1789 parts per billion (ppb) are more than double the levels present at any other time during the past 800,000 years, while nitrous oxide concentrations are about 20% higher (Spahni et al. 2005; MacFarling Meure et al. 2006; Loulergue et al. 2008; Schilt et al. 2009; Montzka et al. 2011).
The last time that carbon dioxide concentrations were comparable to these modern levels was 10–15 million years ago, when the world climate was significantly warmer than at present (3–6°C on average) and sea levels were much higher (Tripati et al. 2009; Allison et al. 2011).
Temperatures in the Australasian region are already rising quickly to their highest levels in more than a thousand years (Figure 1.10). Over the last century, Australia has experienced an average warming of about 0.9°C, slightly above the worldwide average of 0.8°C.
Carbon dioxide is the largest single contributor, being responsible for approximately 63% of the change in the climate observed since pre-industrial times (CSIRO 2011).
Figure 1.10: Australasian September–January mean temperature reconstruction, AD 1000–2001
Source: Gergis et al. in revision
Notes: This reconstruction is based on 28 temperature proxies from the Australasian region and was generated using multivariate principal component regression. The dark brown line represents the average of an ensemble of 3000 reconstructions, which are based on varying reconstruction parameters. The reconstruction uncertainties are denoted by the lighter brown shadings; they are defined as twice the ensemble (mid-brown) and combined calibration and ensemble Standard Error (light brown; 2×SE).
The most reliable periods of the reconstruction are shown by the thick sections of the dark brown line with less reliability indicated by the thin dark brown line. The blue line represents the instrumental data.
Status and trends
Global greenhouse gas emissions
Total greenhouse gas emissions are quantified using carbon dioxide equivalent (CO2-e), a measure used to compare the global warming potential of various greenhouse gases relative to the concentration of carbon dioxide.
In 2010, global greenhouse gas emissions were estimated to be 36,700 million tonnes of carbon dioxide equivalent (Mt CO2-e), the highest level in history (Peters et al. 2012). The use of fossil fuels accounted for 90% of all emissions. This was 49% higher than the 1990 Kyoto reference year, with developed countries emitting just over half of the total (GCP 2011).
Australian greenhouse gas emissions
Using the same accounting guidelines as the Intergovernmental Panel on Climate Change (IPCC) and United Nations Framework Convention on Climate Change (UNFCCC), an estimated 561 Mt CO2-e of greenhouse gases were emitted in Australia in 2010 (DCCEE 2012). This makes Australia one of the highest per capita emitters of greenhouse gases in the world, ranked above Saudi Arabia, Canada and the United States (IEA 2011, pp.97–99). However, when emissions are tallied taking into account the production of traded goods and services within Australia and the consumption of those goods in other countries, Australia's per capita emissions (14 tonnes CO2-e per person) are only slightly higher than the average for all developed countries (12 tonnes CO2-e per person) (Figure 1.11) (Davis & Caldeira 2010; Peters et al. 2011). This is due primarily to Australia being one of the few developed countries that is a net exporter of energy (Syed et al. 2010).
Figure 1.11: Per capita greenhouse gas emissions in developed countries, based on consumption of goods and services, 2008
Source: Adapted from Peters et al. 2011 and UNFCCC population estimates
NSW greenhouse gas emissions
Using the UNFCCC accounting methodology, total NSW greenhouse gas emissions for 2009–10 were 157.4 Mt CO2-e (28% of the national total) (DCCEE 2012). Despite NSW being the largest contributor to national emissions, the state's balance of industrial, commercial and service activities mean its annual per capita emissions (21.8 tonnes) are below the national average (25.1 tonnes). However they are nearly double the average across all of the developed nations of 11.3 tonnes (DCCEE 2012).
The majority of NSW emissions are carbon dioxide (73%), followed by methane (23%), nitrous oxide (3%) and other gases (1%) (DCCEE 2012). Emissions from the combustion of fossil fuels (coal, oil and gas) increased about 275% between 1960–61 and 2009–10 and accounted for nearly 75% of NSW emissions at the end of that period. At 62 Mt CO2-e, emissions from NSW local coal consumption is about 40% of the state total. Almost 80% of local coal is used in electricity generation and most of the remainder in industry (see also People and the Environment 1.5).
The production of coal also releases methane equivalent to 18 Mt CO2-e (12 Mt from underground mines and 6 Mt from surface mines). This represents 97% of all NSW 'fugitive emissions', with small contributions from oil and gas recovery, transport and storage. Fugitive emissions depend on the production methods used in mining: a pilot plant at Vales Point Mines can capture and use methane (or convert it to a less potent greenhouse gas by flaring).
NSW emissions components
Stationary energy emissions (primarily electricity generation) have grown one-third since 1989–90 (Figure 1.12) (an annual average growth rate of just under 2%), reflecting the growing NSW population and economy. Greenhouse gas emissions from this sector stood at 64.2 Mt CO2-e in 2009–10. Growth in electricity generation and use in recent years has been tempered by energy efficiency improvements by users, a move towards lower emissions generation from gas-fired power stations and renewable sources, and reduced demand due to the impacts of the Global Financial Crisis (Figure 1.12). Electricity generation and use in NSW is expected to resume growing (see Figure 1.22 in People and the Environment 1.5).
Figure 1.12: NSW greenhouse gas emissions components, 1989–90 to 2009–10
Source: DCCEE 2012
Notes: * Includes fuel combustion for manufacturing industries and construction, etc.
Accounting of emissions from land use, land-use change and forestry is interim and will be finalised at end of the Kyoto Protocol commitment period (2008–12). This will account, for example, for reafforestation that may have occurred since 1990, but was cleared before the end of the commitment period.
Emissions from the second-largest greenhouse component, industrial processes, include a variety of mainly chemical processes in a wide range of industries: iron and steel, cement clinker, lime production, limestone and dolomite use, chemical manufacturing and aluminium production. Industrial process emissions have been relatively steady since 1989–90.
Transport emissions are currently the next fastest growing component of NSW-generated greenhouse gases, with road transport accounting for 90% of all NSW transport emissions. This reflects the importance of motor vehicles for both passenger and freight transport within the state. Between 1989–90 and 2003–04, emissions increased by 3.6 Mt and have remained relatively steady since then.
Fugitive emissions also contribute more than 10% of NSW emissions, amounting to 18.7 Mt CO2-e in 2009–10.
The primary source of agricultural emissions is methane produced as cows and sheep digest their food. At about 12 Mt CO2-e in 2009–10, these emissions account for approximately three-quarters of all NSW agricultural emissions (15.8 Mt CO2-e in 2009–10). Emissions from agriculture have fallen by 30% since 1989–90. This trend has accelerated since 1999–2000 with an average annual decline of over 3% per annum as production fell during the prolonged drought across much of the state. Sheep numbers, for example, have fallen by over 40% since 1999–2000 (DCCEE 2012).
Emissions from the waste sector (5 Mt CO2-e in 2009–10) are made up of solid waste disposal on land (landfills) and wastewater handling (sewage treatment). Since 1989–90, emissions from waste decreased by almost a quarter as increased waste associated with growing populations and industrial production were offset by higher recycling rates (see People and the Environment 1.3), methane recovery and improved use of the gases for productive purposes at landfills.
Estimates of greenhouse gas emissions from land use, land-use change and forestry are based on the emissions from deforestation, less carbon that is sequestered by reforestation projects. With land clearing rates falling considerably in NSW in the 1990s and remaining relatively stable over the past decade (see Biodiversity 5.2), emissions from land clearing have also fallen. In 1989–90, 24 Mt CO2-e of greenhouse gases were emitted because of land clearing. Since then, changes to the management of land use, land-use change and forestry have reduced related emissions by nearly 80%. In parallel, NSW forestry projects undertaking plantings for carbon sequestration have accelerated, removing over 3 Mt CO2-e of greenhouse gases from the atmosphere in 2010. Importantly, accounting of emissions from this sector is interim and will undergo finalisation at the end of the first Kyoto Protocol commitment period (2008–12).
When all sectoral emissions are added together (including the interim figures for emissions from land use, land-use change and forestry), NSW greenhouse gas emissions have remained relatively steady since 1989–90, being 0.6% higher than the base year in 2007–08 and 2.1% lower in 2009–10.
NSW emissions by economic sector
Greenhouse gas emissions produced during electricity generation can also be attributed to the final consumer of the generated electricity. Using this approach, the manufacturing sector makes the largest contribution to greenhouse gas emissions in NSW (43 Mt CO2-e), followed by the residential sector (34 Mt CO2-e) (Figure 1.13). Residential emissions include emissions from electricity use (20 Mt CO2-e), private transport (12 Mt CO2-e) and other emissions, primarily from the use of gas for cooking and heating (2 Mt CO2-e).
Figure 1.13: NSW greenhouse gas emissions by end use sector, 2009–10
Source: NSW Office of Environment and Heritage (OEH) estimates based on Australian Department of Climate Change and Energy Efficiency data
Notes: The economic sectors presented above and used for national climate change reporting do not match the four economic sectors presented in People and the Environment 1.5 and should not be directly compared.
Ongoing growth in the world economy, together with a relative increase in the level of greenhouse gas emissions, has effectively raised the planet's overall 'carbon intensity' (Canadell et al. 2007; Peters et al. 2012). This has led to rapid growth in fossil fuel (CO2) emissions and accelerating broadscale land-use changes. Natural systems provide an array of 'ecosystem services', including CO2 sinks in the land and oceans that offset about half the greenhouse emissions generated by human activities (CSIRO 2011, Ch.2). However recent scientific research suggests that natural CO2 sinks are not increasing as quickly as emissions, with particular concern about terrestrial sinks in the Arctic and northern hemisphere systems and ocean sinks in the Southern Ocean (Le Quéré et al. 2009; Jung et al. 2010; Hayes et al. 2011; Lourantou & Metzl 2011).
The Copenhagen Accord declared that deep cuts in global emissions are required 'to hold the increase in global temperature below 2°C' (UNFCCC 2009). Recent research suggests that to have any reasonable prospect of meeting this target, carbon dioxide emissions will have to stop rising within this decade, then fall below 90% of 2010 levels by 2020, and be wholly or mostly eliminated before cumulative worldwide emissions reach the equivalent of one trillion tonnes of carbon (Allen et al. 2009; Meinshausen et al. 2009; Raupach et al. 2011). The world has already emitted the equivalent of more than 500 billion tonnes of carbon since the Industrial Revolution and, at current growth rates for CO2 emissions, the remaining 400–500 billion tonnes will be emitted by about 2050 (CSIRO 2011, Ch.2).
Meeting the 2°C target will require sustained emission reductions well beyond 2020. Such reductions can be achieved through restructuring primary energy use to decouple emissions from economic growth (Le Quéré et al. 2009). However, the decades-long service life of much of the world's energy-related infrastructure means that a large part of the global emissions expected over the next few decades are already locked in (Davis et al. 2010).
The growth in emissions from energy use in NSW is linked to an increase in per capita income and a growing population (Figure 1.14).
Figure 1.14: Trends in NSW energy use, compared with key NSW statistics, 1960–2010
Source: OEH analysis based on ABS 2008; ABARES 2011a; ABS 2011a; ABS 2011d; DCCEE 2011
Notes: The Kaya identity analysis for emissions from energy use (after Raupach et al. 2011) is:
[Emissions from energy use] = [Population] × [per capita $GSP] × [Energy use per $GSP] × [Emissions intensity of energy].
Although total NSW emissions have remained relatively steady since 1990, this is expected to change with demand for electricity forecast to resume growing by about 1.6% annually to 2019–20 and beyond (AEMO 2012) (see Figure 1.22 in People and the Environment 1.5). As a result, emissions from electricity generation are forecast to keep growing to 2020 and beyond unless there is a move to lower emission sources (DCCEE 2011). In contrast, agricultural emissions are forecast to either remain stable or increase slightly up to 2019–20 and beyond as livestock numbers gradually recover from the prolonged drought conditions (DCCEE 2011).
As part of their Copenhagen Accord pledges, all industrialised countries have submitted economy-wide emission reduction targets, while major developing nations have agreed to limit the growth of their emissions (UNFCCC 2011). Emissions will be reported annually and progress in emission reductions every two years. These pledges are consistent with emissions pathways that lead to likely temperature increases of between 2.5°C and 5°C by the end of this century (UNEP 2010), well above the 2ºC target identified in the Copenhagen Accord.
NSW 2021: A plan to make NSW number one (NSW Government 2011), the Government's 10-year plan for NSW, includes initiatives aimed at using energy more efficiently and moving to sources of electricity with lower emissions. The increased use of sustainable energy sources is one priority, with the following target under NSW 2021 Goal 22 – 'Increase renewable energy: 20% renewable energy by 2020'. The federal renewable energy target of 20% by 2020 creates a broader national objective and contributing to this is a priority action under Goal 22.
Using energy more efficiently is a priority action under NSW 2021 with a target to assist business and households to realise annual energy savings of 16,000 gigawatt-hours (GWh) by 2020. Emissions reduction will also receive indirect support from Goal 7 – 'Reduce travel times' and Goal 8 – 'Grow patronage on public transport by making it a more attractive choice'. Importantly, these actions aimed at reducing greenhouse gas emissions also reduce air pollution.
Clean Energy Futures package
The reduction of greenhouse gas emissions will be primarily addressed through the Commonwealth's Clean Energy Futures package (see below), rather than through effort by individual states and territories.
The introduction of the NSW Greenhouse Gas Reduction Scheme (GGAS) in 2003 resulted in the abatement of nearly 100 Mt CO2-e of greenhouse gas emissions between January 2003 and December 2010 (IPART 2011, Table 3.3). The scheme fostered the development of new green industries and delivered valuable skills in emissions trading and green finance to the NSW economy.
The commencement of the Australian Government's Clean Energy Legislative Package introduced a fixed price for the carbon emissions produced by Australia's top 315 polluters from 1 July 2012. The NSW Government closed GGAS on the commencement of the federal carbon pricing mechanism (GGAS SA 2012; MR&E 2012).
Using energy more efficiently
Energy efficiency is about improving energy productivity and achieving more with less by using energy wisely and avoiding energy waste. Increased energy efficiency in homes, businesses and industry can provide financial benefits by lowering electricity bills as well as costs to the economy through more economically efficient energy consumption and supply patterns.
NSW 2021 commits to improving the efficiency of energy use and assisting business and households to save 16,000 GWh of energy a year by 2020 compared with business-as-usual trends. A range of strategies that support households, businesses and government agencies to reduce energy use across the state are being developed and implemented.
NSW Energy Efficiency Strategy: NSW has developed this strategy to implement energy efficiency measures that will reduce the cost of consumers' power bills and improve economic performance. These goals can be achieved because there are considerable opportunities to save money by reducing energy consumption rather than increasing its supply.
A number of energy efficiency programs, covering small businesses, lower income households and community organisations, are funded from the NSW Climate Change Fund (CCF) under the Energy Efficiency Strategy. Since July 2007, the $700-million fund has provided financial support for households, businesses, communities, schools and government to save energy and reduce greenhouse gas emissions.
In 2010–11, the CCF spent $63m to save water and power, cut greenhouse gas emissions, and reduce water and energy utility bills. On average, every $1 the CCF invests in energy and water saving initiatives delivers more than $5 in utility bill savings (OEH 2011). By 30 June 2011, the fund had supported projects cutting an estimated 0.992 Mt CO2-e of greenhouse gas emissions per annum, saving 0.924 GWh of electricity and reducing peak demand by 67 megawatts (MW) (OEH 2011). Sustainable reductions in peak demand help to partially offset the need for new generation capacity or an increase in the size of the network in some areas.
Specific CCF-financed community and business energy efficiency programs include:
- The Energy Saver program provides subsidised energy audits and technical and project advice to assist with implementing energy saving projects. At December 2011, participating organisations had achieved annual savings of 138 GWh of electricity and 717,000 gigajoules (GJ) of gas, with cost savings totalling $29.1m per year.
- The Energy Efficiency for Small Business Program helps small businesses implement energy-efficient improvements by offering subsidised energy assessments, Energy Action Plans, and matched funding and installation assistance for new plant and equipment. At December 2011, over 16,000 small businesses had achieved ongoing annual savings of 0.042 Mt CO2-e with reduced electricity costs of $9.7m per year.
- The Energy Efficiency Training Program (linked to the NSW Green Skills Strategy) has delivered vocational training to over 2600 people with 37 free courses for architects, engineers, facility managers and manufacturers developed and piloted with industry and university partners.
- The Energy Efficiency Community Awareness Program provides the NSW community with information and practical advice on how to reduce electricity use at home and work. It acts as an umbrella for other government programs targeting energy efficiency for households, business and the community (see People and the Environment 1.6).
- The Home Power Savings Program offers free home energy assessment, energy refit and tailored advice to 220,000 lower income households across NSW. By February 2011, over 80,000 assessments had been completed, providing annual savings of approximately 78 GWh of electricity and 0.082 Mt CO2-e.
The CCF has also stimulated investment in both emerging and proven clean energy technologies in NSW. In 2010–11, the CCF provided $82m to programs such as the NSW Clean Coal Fund (now known as the 'Coal Innovation Fund') (see 'Lower emissions energy' below), national energy market projects, and communication and education projects (OEH 2011). It has also provided $138m to the Solar Bonus Scheme to support the adoption by households and small businesses of renewable energy technologies.
Energy savings schemes: Investments in cost-effective energy efficiency measures are being encouraged through the Electricity Supply Act 1995 (ES Act) and Energy and Utilities Administration Act 1987.
Starting in 2005, all businesses and government agencies that used more than 10 GWh of electricity per year at a site (along with designated local councils) were required to develop Energy Savings Action Plans. Plans from all 267 entities required to prepare them were approved by 30 June 2009. These set out 2359 measures that aimed to save 0.825 Mt CO2-e of greenhouse gas emissions each year. By 30 June 2011, 48% of the measures had been implemented.
The Energy Savings Scheme started under the ES Act on 1 July 2009. Complementing the achievements of the Greenhouse Gas Reduction Scheme (which closed in July 2012), the scheme sets annual energy savings targets for electricity retailers, providing clear financial incentives for them to develop creative, cost-effective programs that reduce energy use and provide energy efficiency services to consumers. The scheme is expected to drive energy efficiency gains supplementary to those under the national carbon tax which commenced on 1 July 2012. Work is currently under way between the NSW and Victorian Governments to improve alignment between the Energy Savings Scheme and the Victorian Energy Efficiency Target scheme.
The following programs also provide opportunities for environmental savings:
Lower emissions energy
The majority of the proposed new electricity generation facilities in NSW do not involve the use of coal as an energy source. This has the dual effect of reducing the state's dependence on coal and aiding the move to lower emission energy sources. Gas is being increasingly used for electricity generation, as are renewable energy sources, especially wind, with most new renewable energy over the next decade expected to come from wind power (see People and the Environment 1.5).
NSW 2021 commits the state to achieving a 20% renewable energy target by 2020. In 2009–10, about 12% or 8557 GWh of the state's energy consumption was from renewable energy sources (see People and the Environment 1.5). This is a significant increase in renewable energy consumption since SoE 2009 (DECCW 2009a) when energy consumed in NSW from renewable energy sources was 6%. By March 2012, more than 160,000 households and small business customers had installed solar photovoltaic systems in NSW which contributed 358 GWh of energy (IPART 2012a).
To support the 20% national renewable energy target, a state Joint Industry–Government Taskforce has been established to develop a Renewable Energy Action Plan for NSW. In conjunction with the Renewable Energy Precinct Program and Renewable Energy Development Program (funded under the Climate Change Fund), the action plan will position the state to increase the use of energy from renewable sources at least cost to the energy customer and with maximum benefits for NSW (see People and the Environment 1.5).
Emissions from land management (and carbon storage opportunities)
Public lands in NSW store approximately 1.5 billion tonnes of carbon. The NSW Government administers almost 50% of land in NSW (including the Western Division, which itself comprises 42% of the state's land). Appropriate management of the carbon stored on public lands will help maintain landscape values and reduce NSW carbon emissions. The NSW Government is working to manage carbon across all types of public land (e.g. OEH in prep.[a]).
The establishment of markets such as the Carbon Farming Initiative will support the expansion of carbon farming and allow land managers to diversify their income streams. The initiative provides an opportunity for land managers to create income from activities which avoid greenhouse gas emissions or sequester (store) carbon on the land. Other programs, such as the Biodiversity Fund, support landholders to establish new native vegetation, maintain existing plantings, and manage invasive species in native vegetation. NSW will work to ensure that farmers and land managers maximise the opportunities from carbon farming while also protecting biodiverse carbon stores and securing positive environmental outcomes from carbon farming.
The NSW Office of Environment and Heritage is working with the Department of Primary Industries and Lachlan Catchment Management Authority on a soil carbon pilot project in which Lachlan catchment farmers can tender a price to change their management practices for five years to sequester more carbon in the soil. The projects aim to test a market mechanism that encourages changes in land management to increase soil carbon sequestration, while still achieving sustained production.
As a means of maintaining supply of electricity while reducing emissions, research and development is currently being conducted in NSW into suitable, cost-effective technologies that can be added to conventional energy systems. The NSW Government established the Clean Coal Fund (now 'Coal Innovation Fund') and has invested $100m in a fund to research, develop and demonstrate low-emission coal technologies.
Areas of research and development include:
- Carbon capture and storage: The possibility of retrofitting post-combustion capture and storage of carbon dioxide to existing power stations is being explored, although this is not yet commercially available for power stations emitting in the order of 15 Mt CO2-e per annum or more.
- Combustion efficiency improvement technology: Developments in Integrated Gasification Combined Cycle technology and hybrid combined cycle power stations (where the exhaust heat from a gas turbine assists combustion in a conventional coal furnace) are being monitored by NSW Trade & Investment, as part of its Coal Innovation Fund program.
- Drainage of mines to reduce emissions: With the sponsorship of the Coal Innovation Fund, the CSIRO is researching options to enhance methane drainage of 'gassy' mines or remove methane from ventilation air with the aim of potentially using the drained gas for power generation.
There are also opportunities in NSW to improve resource recovery and energy efficiency by reducing or capturing and using fugitive emissions, such as those from landfill waste decomposition or mines, and through the recovery and use of waste heat from industrial processes.