How can Australia improve the use of renewable energy
Renewable energies & energy efficiency
For several generations the electricity market in Australia has been dependent on hard coal and lignite, which has only been expanded by hydropower and, more recently, by gas. In recent years, however, the proportion of energy generated from renewable energies has increased significantly. In 2019, more than 2.2 GW of new renewable generation capacity was fed into the grid as part of 34 major projects. Almost two thirds of these came from solar parks, while the wind sector also experienced its best year to date in 2019, in which 837 MW of new capacities were installed across eight wind parks. The roof-top PV sector also had a strong year with an additional 2 GW of capacity. These developments also led to a boom in energy storage with 22,000 home storage batteries installed and 15 new large-scale storage projects under construction.
Despite the industry's record year, the power grid and the lack of a long-term energy policy are still an obstacle to further growth. Grid congestion, transmission loss factors and problems with system strength caused the project developers considerable headaches in 2019, as the grid with the transition to renewable energies only hard to keep up. Addressing these problems results in great market potential, especially in the sectors listed below.
The greatest market potential:
- hydrogen: In the “National Hydrogen Strategy” published at the end of 2019, Australia set the clear goal of becoming one of the world's leading nations in the hydrogen industry in the long term. The most important element of the strategy is the development of a hydrogen export industry with the potential main customer countries China, Japan, Singapore and South Korea. In addition to a strong position in exports, hydrogen should also play an important role within Australia.
- Transmission infrastructure: Improvements in transmission infrastructure and investments in energy storage are required to maintain the stability of the power grid and support a continuous increase in renewable energy generation. The “2020 Integrated System Plan (ISP)” published by AEMO describes over 15 potential projects to strengthen the transmission network, eight of which are classified as priority projects.
- Energy storage: The generation of solar and wind energy depends on meteorological variables, which may not be sufficiently available at times when electricity is needed. As a result, storage is required to match the supply and demand for energy. Batteries and hydropower are the most common forms of storage in Australia, although new hydrogen storage technologies are also being proposed and tested.
- Major projects: Investments in renewable energy generation are expected to decrease slightly compared to previous years as some of the recent drivers weaken and the integration of renewable energy sources into the power grid poses challenges. In the longer term, however, the transition to renewable energy generation is expected to continue as obsolete coal-fired power plants are shut down and the process of decarbonization continues.
- Small projects: Household investments in solar energy generation on roofs are expected to decline slightly, but still remain at a strong level. This is due to the relatively high degree of saturation and the falling retail electricity prices. In comparison, companies' investments in rooftop solar energy are expected to remain robust and continue to increase over the next few years.
- AEMO - The Australian Energy Market Operator is an independent energy market operator that fulfills various functions on the national electricity and gas market, including maintaining a secure electricity network, managing the markets and designing the future energy market. This includes close cooperation with governments, energy market authorities and other market participants.
- AER - Australian Energy Regulator: The Australian energy regulator controls the electricity and gas networks in all states except Western Australia. The AER checks the effectiveness of competition in the energy sector, regulates the setting of prices for private and business customers and is subordinate to the ACCC.
- ARENA - The Australian Renewable Energy Agency was founded on July 1st, 2012 by the Australian government. The aim is to improve the competitiveness of technologies for renewable energies and to increase the supply of renewable energy through innovations.
- CEFC - The Clean Energy Finance Corporation's role is to increase investment in Australia's transition to lower emissions. With the support of the Australian government, the CEFC invests in agriculture, energy generation and storage, infrastructure, real estate, transportation and waste management.
- COAG - The Council of Australian Governments: The Australian Governments Energy Council is a ministerial forum for the Commonwealth, States and Territories and New Zealand to work together in pursuing national energy reforms.
- CSIRO - The Commonwealth Scientific and Industrial Research Organization was founded in 1916 as a government research institution. The organization works annually across industries with numerous Australian and international companies to promote economic, environmental and social development.
- DISER - The Department of Industry, Science, Energy and Resources Ministry, which is responsible for the energy sector and has various administrative and regulatory functions.
- Renewable Energy Target (RET): Sets the Australian government's target to reduce emissions and thus increase the proportion of electricity generated from renewable energies. The goal is to generate a total of 33,000 gigawatt hours of electricity from renewable energies from major projects by 2020. This goal was already achieved in September 2019
- National Energy Customer Framework (NECF): The NECF regulates the connection / supply of electricity producers / providers and network-integrated end customers (small businesses and households). The framework was adopted by the states of ACT, Tasmania, South Australia, Queensland and New South Wales. The state of Victoria has adapted its own Victorian Energy Retail Code to the requirements of the NECF.
- Renewable energies in states and territories:Also of importance in the field of renewable energies are the actions and initiatives of the governments of the states and territories. The governments of the states and territories have announced their own goals to support the renewable energy sector, and most of them have already been formulated.
- Technology Investment Roadmap: The Australian government is currently developing a national investment roadmap to advance low-carbon technologies to strengthen the Australian economy and support jobs and businesses. This is a key priority on the road to recovery from COVID-19.
- Australian Energy Council - The association, founded in 2016, represents the 22 largest electricity and gas companies in Australia.
- Clean Energy Council - The Clean Energy Council is the peak body for the clean energy industry in Australia. They are a not-for-profit, membership-based organization and represent and work with Australia's leading renewable energy and energy storage businesses, as well as rooftop solar installers, to further the development of clean energy in Australia.
- Hydrogen Council - The Australian Hydrogen Council is the peak body for the hydrogen industry, with members from across the hydrogen value chain and connect the emerging hydrogen industry and its stakeholders in building a secure, clean and resilient energy future based on hydrogen.
- Smart Energy Council- The Smart Energy Council is the peak body for the solar, storage and smart energy in Australia. They are a not-for-profit membership organization committed to clean, efficient, cheap and smart energy solutions for all Australians
Energy efficiency in Australia
Australia is one of the most energy-intensive nations in the world. Due to the steadily rising energy and gas prices, the demand for energy-efficient and energy-saving technologies is growing both in industry and in commerce and in private households. In the construction sector, the most widespread lightweight construction method in Australia has deficits in the insulation of walls, doors and windows as well as in energy and water-saving building technology. In addition, the rapid urban population growth will pose further major challenges for the country in the next few years.
Energy-efficient technologies will therefore also play an important role in rising sectors in the future, such as sustainable building construction, smart cities, infrastructure and Industry 4.0.
In addition to investments in renewable energies, the government and the states have launched various initiatives and subsidy programs to promote energy efficiency measures in the country. Looks like this, for example. The National Energy Productivity Plan (NEPP) agreed by the Energy Council of the COAG (Council of Australian Governments) proposes an increase in energy productivity by 40% by 2030, based on the base year 2015. The increase in energy efficiency not only makes an important contribution to reducing the Costs for companies and households, but ultimately also to reduce greenhouse gas emissions. German providers of innovative technologies in the field of energy efficiency and renewable energies enjoy an excellent reputation in Australia as well as internationally.
The greatest market potential:
- Industry / Commerce: The industrial sector in Australia consumes approximately 38% of total energy. There are many ways to increase energy efficiency in industry and commerce, ranging from investments in more modern and efficient technologies to the use of process heat and various other fields of application. Industries with particular potential for increasing efficiency are primarily the food and mining industries, the chemical industry, the pulp and paper industry and the commercial sector (especially retail and office buildings).
- Sustainable building construction: Australia reaffirms its green building ambitions. The Australian government agreed with the states in early 2019 on the "Trajectory for Low Energy Buildings" program of measures. A gradual tightening of the energy efficiency regulations in the National Construction Code is planned for the years 2022 and 2025. The certification of buildings by the Green Buildings Council Australia (GBCA) has been gaining in importance in recent years.
- Smart cities / infrastructure: The population in Australia's largest cities is growing steadily. The resulting challenges open up good market opportunities for German providers of energy-efficient and innovative solutions in the fields of infrastructure, traffic planning, smart city technologies and energy supply.
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