State and Territory initiatives beat NEG target by 5 years
The Australia Institute’s new Climate and Energy Program has released the Electricity Update of the National Energy Emissions Audit (The Audit*) for March 2018, authored by renowned energy expert Dr Hugh Saddler.
Electricity demand and emissions in the National Energy Market continue to decline to levels not seen since 2004, meaning current policy setting are set to achieve the very low emissions ambition of the governments’ proposed National Energy Guarantee (NEG), only 5 years earlier.
“While the decline in emissions from the NEM is good news for the climate, it raises questions about the ambition Federal Government’s National Energy Guarantee,” said Hugh Saddler, author of The Australia Institute’s National Energy Emissions Audit.
“The NEM is on a slow, but steady trend to lower emissions as old coal-fired generators close and are replaced by renewables. This trend combined with renewable policies in Victoria, Queensland and the ACT could see the NEG’s emissions reduction target of 26% achieved as early as 2025, five years ahead of schedule.
“Critics of state-based policies need to realise that such a low NEG target would inhibit, rather than boost investment in new renewable electricity generation. Doing nothing else but achieving the LRET, VRET, QRET and ACT targets will see NEM emissions 34% below 2005 levels in 2030.
“This is a conservative estimate as we ignore the development of direct power purchase agreements between renewable generators and large consumers such as banks, universities and large commercial property owners. Agreements of this kind are booming in the USA and beginning to take off in Australia.
Previously released research shows that the most economically efficient way for Australia to meet its Paris commitment would be with a 40%-55% emissions reduction in the electricity sector by 2030.
“While federal policy has been absent, state and territory policies have driven emissions reduction and investment in renewables.
“It is hard to see what point is served by the emissions reduction target in the NEG, unless it is intended to actively prevent the states from pursuing their own targets.
“The quickest and lowest cost way for Australia to achieve its Paris Agreement emissions reduction target will be to focus on achieving most of those emissions from electricity generation, by supporting, rather than obstructing, the transition towards renewable generation,” Dr Saddler said
*About The Audit and Electricity Update
The Australia Institute’s Climate & Energy Program publishes the National Energy Emissions Audit (The Audit), written by respected energy analyst and ANU Honorary Associate Professor, Dr Hugh Saddler, which tracks Australia’s emissions of greenhouse gases from the combustion of fossil fuels. The Audit is published on a quarterly basis, in September, December, March and June each year. In each intermediate month the NEEA Electricity Update will report on changes to emissions from electricity generation in the National Electricity Market (NEM).