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Published on May 30th, 2013 | by Silvio Marcacci


Australia Approaches 22% Renewables By 2020, 51% by 2050

May 30th, 2013 by  

Australia may be one of the most coal-dependent economies in the world, but by the end of this decade, it may have one of the greenest global grids.

A new analysis of government data compiled by Green Energy Markets finds Australia on track to not only hit 22% renewables by 2020, but reach an unprecedented 51% of all electricity by 2050.

Two major factors are empowering this paradigm shift: rapid growth of solar energy and the gradual phase-out of oil and brown coal – the two most carbon-intense energy resources.

Where’d All This Green Power Come From?

Since past is prologue, let’s examine how this green transformation began. Australia’s 20% Renewable Energy Target (RET), roughly 60,000 gigawatt-hours (GWh) of power, or equal to reducing every resident’s carbon footprint by one-third, was established in the Australian Labor Party’s 2007 election platform.

45,000GWh of new capacity was required to meet this target, considering the country’s projected 2020 electricity generation requirement of 300,000GWh and existing renewables capacity of 15,000GWh as of 1997.

Electricity retailers and other large-scale emitters are required to produce certificates demonstrating progress against a set liability level of renewable generation. In January 2011, the RET was divided into two parts: an uncapped scheme for small-scale renewable projects like rooftop solar, and a utility-scale target of 41,000GWh.

Slow Start, Fast Finish

So far, progress toward the RET has been modest, despite billions of pending clean energy investments. Government figures show that in 2012-2013, 13% (34,000GWh) of the country’s total electricity came from renewable generation, with 60% coming from coal, 24% coming from natural gas, and 2% from oil.

But renewables are poised to quickly expand, growing at an annual average rate of 4.8% from 2012-2013 to 2049-2050 while fossil fuels decrease at an annual average rate of 3.1% over the same time period. As expected, this means the fossil fuel industry has renewables in their sights.

Under this projection, total renewable generation will hit 194 terawatt hours (TWh) for a 51% market share by 2049-2050. Wind power will represent the largest percentage of total renewables at 21TWh and a 4.7% annual growth rate, while solar will be the fastest grower at 12.3% per year to reach 16TWh. This isn’t surprising, considering solar reached “socket parity” in Australia several years ago.

Solar Energy On Top Down Under

Even though transmission is boosting wind’s market access and investment is pouring into Australia, helping to build the Southern Hemisphere’s largest wind farm, solar energy could lead the country’s transition to a clean energy economy.

Electricity consumption in the National Electricity Market fell 5.5% (11,400 GWh) from 2008 to 2012, with more than half of this reduction attributable to solar and energy efficiency activities supported by Government market based schemes.

Distributed generation from rooftop solar PV and solar water heater systems are considered by the government as reductions in demand. Good thing, as one million Australian homes now have rooftop solar.

The average capacity of an Australian rooftop solar system is now between 3-5 kilowatts and they will continue to lower grid consumption past 2020, producing “up front” renewable certificates and helping lower the cost of solar PV components, showing the two-way benefits of small-scale solar.

Australian Renewables May Even Surge Past 51%

While extremely promising, this renewables outlook may not even capture the true potential of Australia’s clean energy future. Government figures include “off-grid” electricity generation in the mining industry, a sector expected to grow faster than generation on the main grids. But since this generation is difficult to determine, government estimates may be lower than eventual output.

In addition, Green Energy Market’s analysis doesn’t include community solar projections or growing investor concerns about Australia’s risk from the $6 trillion carbon bubble.

But most of all, the analysis doesn’t consider Australia’s nascent carbon market, which has already linked with New Zealand and the European Union, and is considering linkages to China and South Korea’s markets once they are fully functioning between 2015-2020. If this Pan-Asian carbon market were to take shape, carbon prices would rise and boost demand for renewables as cross-border investment pours into clean energy sources. 


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About the Author

Silvio is Principal at Marcacci Communications, a full-service clean energy and climate policy public relations company based in Oakland, CA.

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