Solar-Reports:


Renewable Energy in Australia

By ..... Norman Becker

16.12.2002

Australia, along with the US and Canada, received plenty of public criticism during the negotiation of the Kyoto Protocol. They were portrayed as being hostile to the goal of reducing greenhouse gas emissions and of energy conservation in general. Is Australia interested in renewable energy? Is there a market for companies in the renewable enersgy sector? In this article, we explore the Australia' energy resources including renewable energy and Australia's interest in alternative energy forms.

Australia is one of the world's major energy producers. It is a net energy exporter and coal is one of its largest export commodities.

In fact, Australia is the world's fourth largest coal producer and coal accounts for around 44% of total domestic energy needs. Australia is also a net exporter of natural gas and until relatively recently was about 70% self sufficient in its own oil.

Ayers Rock. Picture source: Australian Tourist
Commission

Australia is also a heavy energy consumer. Like most western countries, Australia's energy consumption is closely related to economic development. As economic growth has continued unabated in Australia over the last ten years, so energy consumption has risen.

Fossil fuel products dominate Australian energy consumption and this will remain the situation for the foreseeable future. Australia's dependence on fossil fuels is heightened by the fact that electricity is largely produced in coal-fired power stations; approximately 84% of electricity for Australian homes and industry comes from coal and 12% from renewables, mainly hydroelectricity.

The Australian Bureau for Agriculture and Resource Economics (ABARE) estimates that total final energy consumption in Australia will rise at an average annual growth rate of 2.3% in the period 1998-9 to 2019-20. The increase in energy consumption that will occur will come from oil (48%), gas (24%), electricity (20%), renewable energy (4.4%) and coal (2.9%). If ABARE is correct, there will be a further shift in the nature of Australia's total energy consumption with the major growth area being natural gas and some growth in renewable energy. This situation reflects the abundant natural gas reserves in Australia.

In Australia, transport is a major energy user accounting for around 40% of the total. Within the transport sector, road transport is the dominant form of transport. Road freight accounts for about 35% of road transport and is forecast to grow by 2.8% per year while passenger car transport, which accounts for 65%, is estimated to grow at only 1.1% per year. This reveals a basic fact about Australian geography and economy - the vast distances separating centres of population.

Final energy consumption in the residential sector represents about 13% of total final energy consumption and is forecast to rise about 2.1% per year. Solar energy use, mainly for hot water systems, is forecast to increase around 2.3% per year.

Primary energy consumption, the measure of total energy used in the economy, shows that coal is the main energy fuel in Australia accounting for around 41% of primary consumption while oil accounts for around 35%. Both coal and oil will maintain their positions as major energy fuels. Nevertheless, there are significant increases forecast for both biogas and wind energy.

Gaspipeline. Picture source: Australian Greenhouse Office

Primary Energy Consumption, by fuel, in petajoules

1998-9
PJ

2019-20
PJ

1998-9
%

2019-2
%0

Annual growth
%

Black coal

1366,2
1841,2
28,2
24,8
1,4

Brown coal

6368,6
701,0
13,2
9,4
0,4

Oil

1687,7
2644,5
34,8
35,6
2,2

Natural gas

871,3
1773,7
18,0
23,9
3,4

Renewables

288,6
469,2
5,9
6,3
2,3

- Biomass

217,1
357,6
4,5
4,8
2,4

- Biogas

8,9
25,5
0,2
0,3
5,1

- Hydroelectricity

58,7
68,8
1,2
0,9
0,8

- Solar

3,8
6,1
0,1
0,1
2,3

- Wind

0,1
11,1
0,0
0,1
25,2

Total

4852,4
7429,6
100,0
100,0
2,0

Primary Energy Consumption by sector

The following table shows the significance of electricity generation in energy consumption in Australia. It accounted for almost 43% of total energy consumption in
1998-9 and gross generation of electricity is forecast to increase by an average 2.3% per year. Black coal will provide the bulk of its energy source indicating that black coal is an extremely competitive energy source and is in plentiful supply in Australia.

However, there are other forms of electricity generation gradually increasing in significance. For example, generation from natural gas is forecast to grow 4.9% per year.

Primary Energy Consumption, by sector, in petajoules

1998-9
PJ

2019-20
PJ

1998-9
%

2019-20
%

Jährl Zuwachs
%

Agriculture

59,9
90,6
1,2
1,2
2,0

Mining

214,7
470,0
4,4
6,3
3,8

Petroleum refining

100,0
156,6
2,1
2,1
2,2

Manufacturing

845,0
1374,1
17,4
18,5
2,3

Electricity generation

2065,4
2851,4
42,6
38,4
1,5

Transport

1231,6
1986,2
25,4
26,7
2,3

Commercial services

62,5
100,0
1,3
1,3
2,3
Residential
215,1
315,7
4,4
4,2
1,8
Other
58,2
84,8
1,2
1,1
1,8

Total

4852,4
7429,6
100,0
100,0
2,0

Changes in Fuel Consumption

Significant changes have been occurring in fuel consumption in Australia since the 1970s - some were due to external shocks like the oil price shocks of the 1970s and others were due to the discovery of huge energy resources such as natural gas. The increase in natural gas consumption has been the major trend in the last 25 years.

Coal and oil will continue to dominate energy use in Australia over the next twenty years but there are further changes on the way driven by global warming, international treaties including the Kyoto Protocol and finally by mandated government policy.

Renewable Energy

Australia's renewable energy industries are diverse covering numerous energy sources and scales of operation. They currently only contribute a small proportion of Australia's total energy supply and represent about 5.9% of the total. The major area where renewable energy is set to grow is in electricity generation following the introduction of the Government's Mandatory Renewable Energy Target.

While the increase in electricity generation may be significant in terms of past performance, the relative scale of renewable energy generation will be quite small growing to only around 6.3% of the total in 2019-20. Still, this relative lack of scale in the overall figures hides significant projects that are being undertaken and often are important for local communities.

Solar Energy

In 2001, the total installed capacity was estimated at 33.6 MWp with 90% dedicated to remote applications. Of this about 1/3 was for domestic applications. Photovoltaic production capacity is made up of conventional silicon production by BP Solar which has a plant in Sydney with a capacity of 10 MW; Pacific Solar will soon join BP as a solar energy producer and has a plant under development with a planned capacity of 20 MW.

In 1953 the australian company Solahart Industries Ltd. introduced its first solar water heater. Today Solahart is the world's leading manufacturer of solar hot water systems for residential and commercial applications The trans-national organisation now is operating in all continents, with installations in over 70 countries.

A number of federal government programs support the installation and use of solar energy, for example the Photovoltaic Rebate Program, the Renewable Energy Commercialisation Program, and the Renewable Remote Power Generation Program.

While total installed capacity is quite low relative to other energy forms, the government has set a target of 2% for renewable energy, including solar energy, as part of its new renewable energy policies.

Solar phone box. Picture source: Australian Greenhouse Office

The Kyoto Protocol

Without doubt, Australia's participation in the Kyoto Protocol negotiations created not only a degree of anger in the international arena over Australia's position, it also attracted much domestic attention to the issues. The government also had an additional reason to take action.

With Australia's signature of the Kyoto Protocol in 1998, Australia committed itself to containing greenhouse emissions at 108% above 1990 levels, the benchmark used in setting national targets. Australia took a difficult position at these negotiations because it felt it had special circumstances; that is, a vast landscape, reliance on transport and especially road transport systems, its status as an energy producer and exporter, and high economic and population growth.

New Policies on Renewable Energy

The key commitment, and the target to which government energy policies were now to be directed, was the creation of a Mandatory Renewable Energy Target commencing on 1 April 2001. This required the generation of an additional 9,500 megawatt hours of extra renewable electricity per year by 2010. This is equivalent to the power needed to meet the residential needs of four million people.

In addition to this, the government initiated a plan to reduce greenhouse gas emissions which comprised:

  • the creation of a dedicated agency, the Australian Greenhouse Office;
  • a National Greenhouse Strategy;
  • the introduction of a carbon accounting system for estimating greenhouse gases;
  • funding for a variety of programs eg programs to boost renewable energy projects, research and development, a greenhouse gas abatement program; and others.

The Australian Greenhouse Office was set up to manage programs designed to reduce greenhouse gas emissions. It is implementing the Mandatory Target and is administering specific programs - the Renewable Remote Power Generation Program, the Photovoltaic Rebate Program, the Renewable Energy Industry Development Program, the Renewable Energy Equity Fund, and the Alternative Fuels Program.

State and Territory governments are also implementing renewable energy programs. State Governments organisations include the Sustainable Energy Authority of New South Wales, the Sustainable Energy Authority of Victoria, and the Environmental Protection Authority of Queensland.

The "SunRace", a Solar Mobile Race takes place in Australia every year, here: "SunRace2002". Picture source: Australian Greenhouse Office

What Does This Mean for Business?

The current interest in renewable energy by both Commonwealth and State and Territory governments means that there are financial and other incentives for the installation and use of renewable energy in the domestic and commercial sectors. That means there are opportunities for businesses that supply renewable energy products and services:

  • Local government organisations are developing alternative energy projects;
  • Business and industry are looking art ways to increase energy efficiency and reduce greenhouse gas emissions, for example in buildings, industrial equipment;
  • The transport sector is looking at alternative energy fuels;
  • Energy efficient appliances are being promoted;
  • New forms of energy efficiency are being explored in home and building construction including heating, airconditioning, refrigeration, lighting and water heating.
Does Australia build the bridge into the solar age? Photo: Sydney. Source: Australian Tourism Queensland

Australia has a relatively long acquaintance with solar energy, so it is not a new concept. However, as with so many things, financial considerations have often had more influence than environmental. Now that governments have added extra impetus to the renewable energy industry, and that, plus heightened community concern about the environment, may make all the difference.

Norman Becker , r & k - team, Sternbergstr. 3, 72116 Mössingen.

Additional Solar-Reports:

2010 © Heindl Server GmbH