The Australian Capital Territory has accomplished an Australian first. Is it now covered in wind farms and solar panels? And are other states following?
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| ACT Minister for Climate Change and Sustainability Shane Rattenbury at Crookwell 2 wind farm. Credit: Sitthixay Ditthavong |
Spring has been busy in the Australian Capital Territory.
What
about that 100 per cent renewables gong? It's an impressive statement
at a time when there is still widespread debate about how Australia
should tackle climate change and federal energy policy has produced an
impasse that helped see off Malcolm Turnbull twice as Liberal leader.
But
if it conjures an image of the national capital overrun with solar
panels and a windmill in every back yard, the reality is very different
and much more complex.So what does "100 per cent net renewables" mean? Will it help fight climate change? And will be all soon be following suit?
What does "100 per cent net renewable energy" mean?
Let's break it down. The renewable energy part is fairly simple: it refers to energy that is naturally replenished and does not run out. The 100 per cent means that there is enough of it to meet Canberra's energy needs. It's the net where things get complicated.
If it was a gross target that Canberra had met, it would indeed be running entirely on energy from wind and solar farms. That would require better transmission lines to the ACT, more local generation and huge batteries to make up for varying power output from renewable sources.
By contrast, a net target means the ACT has bought
an amount of renewable energy equal to what it needs from suppliers
around the country but, because the ACT is connected to the national
grid, the energy it actually uses comes from power stations all over the country.
Federal
Energy Minister Angus Taylor, a critic of the ACT's scheme, says "93.6
per cent of the ACT’s electricity comes from the NSW grid, which
continues to be dependent on coal and gas". According to the Department
of the Environment and Energy, "coal and gas account for about 85 per
cent of electricity generation" nationally.But while the ACT is still powered mostly by coal and gas, the renewable energy it has bought is being used in place of coal and gas by consumers in other parts of the country. In short, the ACT and its suppliers are putting the same amount of renewable energy into the national grid as the total amount of energy used in the ACT by homes and businesses.
Shane Rattenbury, the ACT's minister for climate change, likens what the ACT is doing to depositing money in a bank and withdrawing it from an ATM. "You don't receive the same note you deposited but you still have $100," Mr Rattenbury says.
Where does all that renewable power come from?
The ACT is known for its national cultural institutions, a man-made lake and good odds of sighting a prominent politician at the local IGA but not for generating power. While there are some small solar farms on the outskirts of Canberra, most of the ACT's renewable power is generated outside the territory.
There are three ways the ACT has secured renewable power:
- About 77 per cent comes from large-scale contracts the ACT has signed directly with renewable, primarily wind, producers in Victoria, NSW and South Australia.
- Another 21 per cent is what the ACT has bought from renewable energy producers operating within the National Energy Target, a Commonwealth scheme to encourage the production of more renewable energy.
- Households in the ACT with rooftop solar contribute the remaining 2 per cent.
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| Source: ACT Government |
Does it matter?
Electricity
accounts for more of Australia's emissions than any other source, at
about a third of the country's total, figures from the federal
Department of the Environment and Energy show. However, only about 0.2 per cent of national emissions from all sources come from the ACT.That suggests the ACT's accomplishment will have a minimal impact on national greenhouse gas emissions alone.
But
it is part of a broader story. Hugh Saddler, an honorary associate
professor at the ANU who also works in the renewable sector, says having
guaranteed government demand lets renewable developers access cheap
financing to build more wind and solar farms.
And he says that, with the federal large-scale renewable energy target for 2020 nearing fulfilment, government investment is becoming more important for the sector.How big a step is this?
The ACT is not the first state or country to go 100 per cent net renewable. A report by the Australia Institute, a progressive think tank, notes that regions in Spain, Austria and Germany have done the same. The rural German district of Rhein-Hunsrück was the first of the current wave, in 2012.
Several other countries are also already reliant on renewable power, including Ethiopia, which uses hydro power, as does Iceland in conjunction with geothermal power generation. But Dan Cass, who wrote the Australia Institute report, says those countries' transitions "predate climate challenges and recent renewable development".
The ACT's transition to renewable energy, Mr Rattenbury says, shows how cities, regions and countries "can roll out renewables in a cost-effective way … getting the best deal for consumers".
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| Iceland has been running on renewables for years – its water comes out of the ground piping hot. Credit: Alamy |
The ACT government initially estimated that achieving its renewable energy target would cost households at most $5.50 per week next year before later declining.
But the actual cost might be different because the ACT buys most of its renewable power at fixed prices. When the actual power it uses from the grid is cheaper than the fixed price, it pays the renewable provider the difference. When the grid power is more expensive – on a hot summer day, for example – the renewable provider compensates the ACT.
Associate Professor Bruce Mountain, director of the Victoria Energy Policy Centre, says he would be unsurprised if customers in the ACT were currently paying substantially less than $5.50 because market power prices are so high.
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| Hornsdale wind farm in South Australia. |
The
ACT legislated a 100 per cent renewable target in 2016, with the goal
of hitting it by 2020. It then conducted a series of reverse auctions
for renewable power. In a reverse auction, the cheapest bid (in addition
to other criteria) rather than the most expensive, wins.
The last
of the renewable energy supplies contracted under that process, at the
Hornsdale wind farm in South Australia, commences in October, meaning
the ACT will achieve its goal as planned.Are other states following the ACT's lead?
There was wide variation in how much renewable energy each state generated last year, according to a report by the Clean Energy Council, a renewable energy industry body.
Tasmania produced the most renewable energy as a share of production and raw amount but NSW generated the second-highest raw amount, despite being lower in percentage terms. Associate Professor Mountain says, "Of the new wind and solar clean energy sources, in absolute amounts, Queensland, NSW and Victoria will be neck and neck by 2022."
But generation is different to consumption, which is where the ACT claims its 100 per cent net renewable crown. On consumption, the states all have different targets.
- A Tasmanian government spokeswoman says the state, which has plentiful wind and hydro power, was "on target to deliver full self-sufficiency in renewables by 2022".
- Queensland has a 50 per cent renewable energy by 2030.
- Victoria has a 40 per cent target by 2025 but is exploring how to match Queensland's. It has used reverse auctions similar to those pioneered in Australia by the ACT.
- A South Australian government spokeswoman says the state intends to be 100 per cent net renewable by "early in the 2030s".
- New South Wales does not have a renewable energy target but supports the Commonwealth's target and a net zero emissions target across its economy by 2050.
- Western Australia also has no renewable energy target but Energy Minister Bill Johnston says the state's "aspiration is net zero emissions by 2050".
Net zero emissions take into account all emissions, rather than only those caused by generating power, but states with general zero emissions targets will still need to increase their use of renewable power to meet their targets.
Where is the ACT going from here?
Going renewable isn't an end in itself. The goal is to reduce emissions overall and the ACT also has a zero emissions target, set for 2045.
As the ACT has little agriculture, natural resource refinement or manufacturing, it is trying to reduce emissions from another source: natural gas.
The government's plan to phase out natural gas use has proved controversial, as it will require switching everything from buses to household heaters and stove tops to electricity.
At the same time, the ACT's population, and therefore power usage, is growing, so the government has announced another round of reverse auctions to buy more renewable power.
How will this affect the grid?
With blackouts in South Australia and some renewable providers struggling to find space on transmission lines to get their power to consumers, it is no secret the Australian electricity grid is struggling.
Associate Professor Mountain says the grid was built for a period in which "each state has historically had its fossil-fuel coal basins and most transmission capacity has been from there."
With renewable energy spread out around the country, "we need to build infrastructure for generation that is not where it has historically been," he says.
If all states were to follow the ACT without improving power infrastructure, the grid would be unable to cope. The ACT's Shane Rattenbury says he is aware of the risk.
"We need to build a grid that can cope with the energy of the future not the energy of the past."
Links
- Wind And Solar Set New Generation Records Across Australia Grid In July
- Clean Energy Set To Provide 35% Of Australia's Electricity Within Two Years
- Call To Arms: How Can Australia Avoid A Slow And Painful Decline?
- CSIRO, NAB Chair Say Shift To 100% Renewables Inevitable, And Likely By 2050
- Australia To Achieve 50% Renewables By 2030 Without Government Intervention, Analysis Finds
- War On Wind And Renewable Energy Must End
- Australia Can Be Powered 100% By Renewables By Early 2030s, Says Garnaut
- Jump In Renewable Energy Jobs As Solar Farms Overtake Hydro Power
- 2018 Was Boom Year For Renewables Despite Political Chaos, Report Finds
- Australia Has Enough Solar, Wind Storage In Pipeline To Go 100% Renewables
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