Australia got a slap on the wrist this week.
It came from the G20 after they took a look at all their members in their latest Climate Transparency Report.
According to the report, Australia is the member with one of the highest shares of fossil fuels in their energy mix — 93%.
The report also took a swipe at our policy:
‘Australia’s so-called “technology neutral” approach continues to support the fossil fuel industry over a transition to renewable energy. The “First Low Emissions Technology Statement” reflects the government’s pro-gas and carbon capture and storage position, without excluding coal.
Australia should be positioning itself to export renewable energy carriers and zero emissions products instead.’
Australia is also together with India, one of the only two members to not have a carbon pricing scheme in place, and neither are considering introducing one in the future either.
I mean, fossil fuels play quite a role in our economy. Australia is one of the world’s largest coal producers. But pressure is increasing.
Especially as three of our largest coal markets — China, South Korea, and Japan — have pledged to go carbon neutral by either 2050 or 2060. With Biden also committing the US to net-zero emissions by 2050, this means 70% of our major trading partners are committed to net zero by around 2050.
But while Australia may have gotten a bad report card this week, it doesn’t mean that things aren’t changing.
While Australia hasn’t set a carbon neutral goal, every Australian state and territory has set a net zero by 2050 goal.
And, in fact, things are starting to move already.
Change Towards Renewables is Happening
Last week New South Wales released their Electricity Infrastructure Roadmap.
According to PV Magazine:
‘The NSW Electricity Infrastructure Roadmap charts a path to construction of 12 GW of new large-scale solar and wind generations, attracting $32 billion in private investment, creating 6,300 construction jobs and 2,800 ongoing jobs in 2030; and a reduction in the annual electricity bills to businesses of around $430, and to the average household of around $130.
‘Perhaps more important than the numbers around the NSW Electricity Infrastructure Roadmap, is the way in which it integrates known resources with proven technologies; industrial, agricultural and manufacturing opportunities; and the projected retirement of coal-fired generation.’
And in Victoria, the Australian Energy Market Operator (AEMO) recently has drawn up a strategy to work with the state to take it to their 50% renewable target by 2030.
On the other hand, last week Fortescue — one of the largest iron ore producers in the world — announced they have plans to build 235GW of renewables.
Through Fortescue Future Industries the company is looking to build their renewable capacities to supply green energy and hydrogen from projects across the globe.
Just to give you an idea, this is five times the size of Australia’s grid and more energy than Chevron’s energy production last year. FFI has already pledged to spend $1 billion by 2023.
Yep, there’s plenty happening in this space.
The case for a shift to renewables is strengthening…and it’s not just about peer pressure, it’s about economics too.
Renewables are getting cheaper…but they are also more efficient.
According to Bloomberg Green, the average efficiency for coal plants around the world is 33%. That is, only 33% of the energy in coal ends up as electricity. For internal combustion engine cars (ICE) and gasoline, that number is about 20%.
As Bloomberg Green noted:
‘Even though fossil fuels meet roughly 80% of the world’s primary energy demand [the measure of energy as it is in its natural state such as a lump of coal], they are responsible for only 60% of its useful energy [useful energy is the fraction of energy converted into things like motion or light], according to BNEF. Put another way, 20% of the world’s primary energy demand today is met by non-fossil sources—and those sources are responsible for 40% of the world’s useful energy.
‘As the world consumes more energy from renewables in the form of electricity, it manages similar economic output while consuming less primary energy. Generating electricity from solar and wind is highly efficient, and motors inside electric vehicles convert more than 80% of the energy stored in batteries into motion.
‘Understanding the enormous amounts of wasted energy produced from burning fossil fuels shows why replacing it with cleaner sources may not be as much of a lift as it seems.’
When the economics make sense, things shift.
For Money Morning
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