Page 960 - Week 03 - Tuesday, 29 March 2011
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ultimately all people. There are great challenges ahead for the Canberra community as we manage the transition to a low carbon future; the one that we have committed to through our greenhouse gas reduction target legislation passed last year.
We know that we need to reduce greenhouse gas emissions. Doing so to meet the cuts that science tells us we must make on a global scale will address many of the problems caused by what is known as peak oil. The ACT will this year move to action plan 2 of its weathering the change greenhouse gas reduction strategy. We will expand further our policies such as to have local responses to take into account issues such as vehicle emissions standards, carbon pricing and renewable energy support which underpin most of the shift from fossil fuels in the world’s economies.
The reality is, even if oil reserves were limitless, we would not be able to continue to burn oil at the current rate. We know that the way we currently use fossil fuels is contributing to global warming and that the resulting changes to the world’s biosphere will have great environmental costs both here and abroad.
Today I would like to highlight some of the energy security issues that shape this debate—issues that the government is mindful of and that inform our consideration of new policies and policy reforms in relation to greenhouse gas mitigation, community services, transport and land use planning.
Firstly, turning to the concept of peak oil itself, what is it? There is a growing concern that peak oil is a significant issue that governments will need to address. Peak oil is the term for the point in time when global oil production reaches its maximum rate and is followed by a long-term decline. Predictions vary of when peak oil will occur and its consequences. More optimistic predictions on timing pinpoint that a decline in production rates will not occur until 2020 or much later. Alternatively, the more pessimistic predictions suggest we have already used up over half of global oil supplies and that production rates have either peaked or will peak in the next few years.
The problem with trying to predict the timing of peak oil is that the factors determining it are themselves extremely uncertain. For example, we do not know with certainty the extent of the recoverable resources of both conventional and unconventional oil, nor do we know how future supply and demand will respond to higher prices for oil products as extraction costs increase and major policy initiatives to respond to matters such as climate change are adopted.
Furthermore, there is uncertainty with respect to the technological innovation that will arise as a consequence of these developments. The International Energy Agency in its 2010 world energy outlook highlights climate change policy as a significant determinant of the timing of peak oil production.
There is a view that peak oil may be delayed by relying on more unconventional sources of oil and natural gas. The extraction of unconventional oil resources could potentially delay peak oil until around 2035. However, recovering oil from these sources will have adverse local environmental consequences, as well as increasing global emissions of greenhouse gases. Coal seam oil is an example of this.
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