Governments not making the most of renewable energy

Published 23 July 2008

A Southern Cross University academic has questioned whether Australian governments are making the most of the renewable energy opportunities that are currently available.

Adjunct Professor Michael Christie, from the Graduate Research College, said the world was currently in a period of human history where there were a great number of mitigating circumstances moving the human population away from its high dependence on fossil fuels.

“Nations like Australia are going to be judged by how timely they put in place efficient and effective public policy,” Professor Christie said.

Professor Christie is critical of the Federal Government’s recent imposition of a means test on the solar rebate - excluding people with a household income over $100,000 from claiming the rebate.

“It is not clear why this has happened,” he said. “Given the rapid change that is occurring with fossil fuels and the escalating depletion of our reserves of this resource, renewable energy provides a sustainable alternative that should be actively supported by government. Means testing a renewable energy program is a major setback for the Australian community.

“The decision to impose the means test has proven to be an inefficient way of addressing the roll-out of renewable energy infrastructure. The fairness and equity of means testing a renewable energy program for households is not clear and demonstrates a lack of an integrated and all-of-government approach to renewable energy.”

Professor Christie said there were major gaps existing in an integrated approach to renewable energy, including programs for renewable energy practices and infrastructure.

“For example, even though small business accounts for over 95 percent of Australian businesses, there is little awareness or activity with this sector of the community about renewable energy programs,” he said.

“There is also a lack of a national renewable energy plan utilising the different renewable energy technologies such as wind power, small hydro, tidal power, wave energy, solar thermal electric, photovoltaic, landfill gas, biomass, geothermal electric, municipal solid waste, and ocean thermal.

“Governments should be setting annual and 10-year targets for these technologies to be harnessed. Such a policy approach by governments would be a major generator of intellectual property, jobs and exports.”

Professor Christie said that recent overseas policy initiatives had seen the setting of targets for renewable energy use. For example the United States House of Representatives has passed an Energy Bill requiring utility companies to produce 15 percent of their electricity from renewable sources such as wind and solar power by 2020. Another example was in the City of Aspen, also in the United States, which has set a goal to purchase 75 percent of the city’s energy from renewable sources by 2010.

“The current development in Australia of Renewable Energy Credits has a number of policy inefficiencies that include competition from conventional energy technologies, lack of customer and investor confidence, regulatory and institutional barriers,” Professor Christie said.

“Much greater efficiency and effectiveness of renewable energy policy can be achieved by feed-in tariffs that are used in most European countries such as in Germany and Spain, for example. Feed-in tariffs are based on a mandated price for electricity sold into the electric grid from a renewable energy source.

“As a policy initiative, a feed-in tariff scheme has a high efficiency that allows for price differentiation and reduction in costs, planning certainty, low administration expense and no effect on government budgets.

“Feed-in tariffs allow for rapid deployment of resources, rapid development of local manufacturing, and increased local acceptance and participation. They encourage geographic distribution, transparent and lower administrative costs, more jobs, more investment, more competition in manufacturing and equipment suppliers and projected costs are minimal.”

Professor Christie said that currently much of the renewable energy debate had shifted away from households and small business owners to carbon trading.

“But carbon trading is only going to involve about 1000 Australian firms that have carbon as a commodity to trade. The increased costs of carbon trading being externalised to households and small business will create the interesting issue of how government will manage the voter backlash without renewable energy use targets and feed-in tariffs.”

Photo: Professor Michael Christie believes Australian governments are not making the most of renewable energy opportunities.

Media contact: Zoe Satherley Southern Cross University media officer, 6620 3144, 0439 132 095.