Renewable Energy Targets and Australian Energy Intensity – May 2012

Australian Alternative Technology Association (ATA)

“Two Percent renewables target – fact or fabrication” – Alan Pears raises some doubts about the Australian Federal Government’s renewable commitment. It’s almost 18 months since Prime Minister Howard announced what has become widely known as the “Two per cent renewable energy target“. Community consultations were held last May. A working group was set up to sort out the details: it released an interim report last August. A series of workshops were held last November to resolve more issues. Now the rumour is that there will be an options paper released in May, before a decision is made later this year. So the renewable energy industry has to live through almost two years of uncertainty on what seemed like a straightforward commitment. Even though the government has consistently described this measure as the “Two per cent renewables target”, one option expected to be floated in the options paper is inclusion of coal seam methane (a fossil fuel released as a by-product of black coal mining). It is even rumoured that there will be a proposal to make the scheme voluntary. What’s going on here? The Prime Minister’s statement was: “Targets will be set for the inclusion of renewable energy in electricity generation by the year 2010. Electricity retailers and other large electricity buyers will be legally required to source an additional two per cent of their electricity from renewable or specified waste product energy sources by 2010…”

Kyoto Obligations

The Prime Minister clearly said the electricity industry would be legally required to comply. So any move to make the scheme voluntary is a breach of a commitment made in an international arena. A backdown invites the international community to question Australia’s commitment to its Kyoto obligations. Advocates of inclusion of coal seam methane argue that it complies under the “specified waste product” criterion. They add that collection and use of coal seam methane is a worthy greenhouse measure, which can provide useful energy and avoid leakage of the very active greenhouse gas methane into the atmosphere. Renewable energy, solar power and wind power for example, advocates certainly have no problem with a government program that encourages capture and use of coal seam methane: but it should be separate from the two per cent renewables commitment. If coal seam methane is included, it could take up a substantial share of a market niche that was intended for renewables. More importantly, the government has made a great deal of its commitment to the two per cent renewables target in many publications, such as the 1998 National Greenhouse Strategy and numerous promotional articles. The government has failed to make it clear in this publicity that it believed part of this target could be satisfied by a fossil fuel. It can also be argued that the wording of the PM’s statement clearly specifies a renewable requirement first, then specifies waste fuels: in this context, the objective reader could interpret “waste” as meaning renewable fuels such as organic wastes, as there is no reference to “wastes from fossil fuel production”.

 

Two Percent Renewable Becoming 20 Percent

It seems that the government is trying to manipulate the two per cent renewables target to benefit the coal industry. Regardless of what we in Australia think of this, the big question is how will the rest of the world react when they find out that the Australian government is trying to pull a swifty. Our government already has a serious international credibility problem after its performance at Kyoto. Do they want to make sure our name is mud, and undermine our capacity to credibly negotiate on major issues such as emissions trading, joint implementation and the clean development mechanism? Or maybe their PR advisors are so keen to please the coal industry that they haven’t realised what impact this could have on our future negotiating position.

Dust off your computer keyboard and start lobbying now: you can be sure the fossil fuel industry is working very hard on this one! And if you know anyone involved in international global warming negotiations, you might just explain what’s going on, and suggest that they inform the Australian government of their folly. Energy efficiency: the invisible industry

Most people have little difficulty identifying the renewable energy industry. They’re the people who make and install solar water heaters, wind generators and wood heaters. The energy efficiency industry is much more difficult to relate to, and that’s a real problem, it’s hard to generate lots of community support for an invisible industry. In addition most economists and government policy makers are very sceptical about the role it plays. Even participants in the energy efficiency industry itself often can’t see that they’re part of it!

How important is the solar energy  industry?

According to the Australian Bureau of Agricultural and Resource Economics (who can hardly be described as advocates for energy efficiency, if their economic modelling of greenhouse response is any indication), solar energy efficiency improvement saves Australia billions of dollars every year. An ABARE study of the solar energy efficiency trends within the Australian economy found that ”technical efficiency” improvement reduced Australia’s energy intensity by 6.7 per cent between 1974 and 1995. That means Australia uses at least $2 billion less energy each year than it would have if this improvement had not occurred. This improvement has also meant we have avoided the need to invest several billion dollars in energy supply infrastructure such as power stations and transmission lines. Just think how much we could have saved if we’d actually tried to achieve efficiency improvements, and governments had promoted energy efficiency instead of energy waste!

 

Solar Panels Efficiency Set for 40 Percent

The S.A. Government renewable energy office reports that “P.V. panels should be producing solar electricity for 25 years (they are generally warranted to supply 80% of their rated power after 20 years), so having backup in years to come is important. Long term, solar panels are becoming more efficient – currently the best solar panels, in terms of efficiency, are up to 19% efficient. In years to come this cold be up to 30 or 40%”.

But there are no signs that governments around Australia are serious about reinvesting those savings to gain even greater savings. Even New South Wales government’s SEDA has a budget of only $15 million. When SEDA gets an annual budget of $150 million we’ll know the NSW government is serious. And NSW stands out as the one government with a commitment to energy efficiency!

Too bad for the rest of us.

For example, the South Australian government, after shutting down the State Electricity Commission’s very cost-effective demand management program in 1994 and halving Energy Efficiency S.A’s budget, then set up energy markets that encouraged increased electricity sales. Their response to the gas supply crisis has carefully avoided any mention of improving the efficiency of gas use: all the “solutions” involve increased gas supply. Surely this could have nothing to do with the fact that the government was in the act of selling its gas industry – any indication that it might support action to reduce future gas sales would have reduced the sale price! So they will continue to waste natural gas and emit unnecessary greenhouse gases. Indeed, all the new gas supply capacity may well provoke competition to get Victorians to waste even more gas – after all, the owners of these new pipelines and processing plants will have to get a return on their investments.

It’s difficult to create a shared commitment within the energy efficiency industry when it is so diverse – including insulation companies, energy advisors, equipment manufacturers, and so on. Worse still, many of the manufacturers of energy efficient appliances and equipment also make clunkers: they just see themselves as satisfying the various market niches… Oh, for the simplicity of the renewable energy industry! A serious problem seems to be that most people just can’t imagine that it’s possible to do more with less. Despite the many examples all around them, and exciting visions painted by people like Amory Lovins over the past 20 years, the reality is that most people respond to an energy problem by wheeling in more “grunt”. If the house is cold, it’s much more obvious to install a bigger central heater than it is to cut the heating requirements by insulating, draughtproofing and double glazing.

References and Resources

I wish we could work out how to change this. Any suggestions? Alan Pears recently compiled an issues paper on the potential for addressing the gas crisis through energy efficiency improvement. For copies contact Environment Victoria, Ph (03) 93776 9044.

For South Australia - http://www.sa.gov.au/subject/Water,+energy+and+environment/Energy/Renewable+energy

Federal Government Renewable Energy: http://www.climatechange.gov.au/what-you-need-to-know/renewable-energy.aspx

Victorian Government Sustainability : http://www.sustainability.vic.gov.au/www/html/1620-sustainability-in-action.asp