Agenda
Challenges
Australia is one of the world’s largest carbon dioxide polluters per capita, in 2009 producing 20.5 tones per head of population according to Analyst Maplecroft. Australia's high car ownership rates and heavy exports of fossil fuels, such as coal, had contributed to the country's low ranking. Australia’s carbon dioxide emissions are coming under increasing global and national scrutiny, forcing the government to produce policy and act on controlling carbon dioxide emissions.
Currently, there are roughly as many drivers to renewable energy development in Australia as there are barriers. Australia's renewable energy market offers great opportunities due to its tremendous natural resource availability. For now, however, Australia will continue to be largely reliant upon governmental incentives and regulatory frameworks to increase its renewable energy development.
The introduction of the Australian Government’s proposed climate change plan promises significant change in the way many Australian enterprises go about their business. The plan seeks to transition Australia to a ‘clean energy’ economy through a combination of putting a price on carbon, increased renewable energy, improved energy efficiency and land management. Over time it promises to transform Australia’s economic landscape. The plan’s centrepiece is the pricing of carbon dioxide and other ‘greenhouse gas’ emissions.
Status
Current
Australia is the world’s ninth largest energy producer, accounting for around 2.4 per cent of world energy production. In 2008–09, Australia’s energy production was 17 769 petajoules. Net energy exports accounted for 68 per cent of domestic energy production in 2008–09, while domestic consumption accounted for the remaining 32 per cent.
The current structure of Australia’s eastern electricity market was shaped by industry reforms that began in the early 1990s. A key element of these reforms was the National Electricity Market (NEM), which began operation in 1998. The NEM allows market determined power flows across the Australian Capital Territory, New South Wales, Queensland, South Australia, Victoria and Tasmania. Western Australia and the Northern Territory are not connected to the NEM, primarily because of their geographic distance from the east coast.
The NEM operates as a wholesale spot market in which generators and retailers trade electricity through a gross pool managed by the Australian Energy Market Operator (AEMO), which aggregates and dispatches supply to meet demand. In addition to the physical wholesale market, retailers may also contract with generators through financial markets to better manage any price risk associated with trade on the spot market.
Institutional Structure
Department of Resources, Energy & Tourism
The Department of Resources, Energy and Tourism provides advice and policy support to the Australian Government regarding Australia's resources, energy and tourism sectors. The Department develops and delivers policies to increase Australia's international competitiveness, consistent with the principles of environmental responsibility and sustainable development.
Office of the Renewable Energy Regulator
The Office of the Renewable Energy Regulator is a statutory authority established to oversee the implementation of the Australian Government's mandatory renewable energy target.
Australian Renewable Energy Agency
The Australian Renewable Energy Agency (ARENA) was established by the Australian Government to make renewable energy solutions more affordable and increase the amount of renewable energy used in Australia.
Renewable Energy Target (RET)
In August 2009, the Government implemented the RET scheme, which is designed to deliver on the Government’s commitment to ensure that 20 per cent of Australia’s electricity supply will come from renewable sources by 2020.
In June 2010, the Parliament passed legislation to separate the RET into two parts, which commenced on 1 January 2011 — the Large scale Renewable Energy Target (LRET) and the Small-scale Renewable Energy Scheme (SRES). Combined, the new LRET and SRES are expected to deliver more renewable energy than the previous 45,000 Gigawatt-hour target in 2020.
Low Carbon Australia
The Australian Government is providing over $100 million to establish Low Carbon Australia (formerly Australian Carbon Trust) to further support energy efficiency action by businesses. This involves two key programs an energy efficiency program and a carbon neutral program.
The Energy Efficiency Program provides finance and advice to eligible businesses and the public sector for the retrofit of commercial properties while the Carbon Neutral Program provides certification for organisations that have products or operations that are carbon neutral under the National Carbon Offset Standard (NCOS).
Budget
Current
The Government will provide $3.9 million over four years from 2010 11 to expand the Energy Efficiency Opportunities Program to include the electricity generation sector and to allow the Department of Resources, Energy and Tourism to develop new emissions and Carbon Capture and Storage ready standards for all new coal fired power stations.
The Government will reduce funding for the Carbon Capture and Storage Flagships program by $420.9 million over five years from 2010. Funding of $260.0 million will be restored to the program beyond the forward estimates. The program will now provide funding of $1.6 billion, including $100.0 million under the Education Investment Fund.
The Government will provide $104.2 million over five years to support the development of emerging Australian renewable energy technology, especially in the areas of geothermal energy and ocean energy technology. The program will be administered by the Australian Centre for Renewable Energy.
The Government will provide $108.7 million over 14 years to support the development and commercialisation of renewable energy technologies by making early stage equity investments that leverage private funds.
Key Policies
Clean Energy Bill 2011
Part of a package of 18 bills to implement a carbon pricing mechanism, the bill outlines the structure of, and process for the introduction of, the mechanism by providing for: entities and emissions covered by the mechanism; entities’ obligations to surrender eligible emissions units; limits on the number of eligible emissions units that will be issued; the nature of carbon units; allocation of carbon units; mechanisms to contain costs; linking to other emissions trading schemes; assistance for emissions-intensive, trade-exposed activities and coal-fired electricity generators; monitoring, investigation, enforcement and penalties; administrative review of decisions; and reviews of aspects of the mechanism.
Implementation of a Carbon Price
Putting a price on carbon pollution is the first element of the Government’s plan for Australia’s clean energy future. The carbon pricing mechanism will apply directly to around 500 of the biggest polluters in Australia. They will be required to pay an initial $23 a tonne from July 1 2012. They will pay for each tonne of pollution they release into the atmosphere. If a business can lower its pollution then it will lower the carbon costs that it pays. This will create economic incentives for businesses to reduce their pollution, and to do so in the cheapest possible ways.
It will also make lower-polluting technologies, especially clean energy, more competitive by boosting investment in, and take-up of, these technologies. In this way, introducing a price on carbon will trigger the transformation of the economy towards a clean energy future.
Transition to Globalisation
Australian "Hot Rocks" Offer 26,000 Years of Power
Barely one percent of Australia's untapped geothermal energy could produce 26,000 years worth of clean electricity, scientists said, as the government announced a A$50 million (US$43 million) project to help develop the technology.
Globalisation » Economy » Energy » Sources » Renewable » Geothermal
Transition to Political Tools
China, World's Largest Consumer of Coal
China is world’s largest consumer of coal, its consumption accounts for 78% of net increase in world coal consumption according to International Energy Outlook by U.S Energy Information Administration.
Political Tools > National > China > Domestic Policies > Economy > Energy > Non-Renewable
Transition to Political Actors
Clean Energy Roadmap
We are in a global warming emergency. If we are a society
that cares about leaving a safe climate for our children, and if Australia is
to contribute fairly to the global challenge of limiting global warming to less
than 2 degrees, our long- term carbon budget is going to be tight and emissions
from the electricity sector must ultimately fall to zero.
The cheapest way to decarbonise the electricity sector is to
plan the transition early and build the right energy infrastructure in the right
place at the right time. The objective is to avoid wasting time and money on
investments that don’t adequately address climate change.
Actors » Sector » Political Parties » National » Australia
The Greens
