Australia’s Primary Energy Supply and Climate Change: Implications and the Future

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Analysis of Australia’s emission profile evidences Australia’s historical reliance on coal for energy generation; Australia’s emissions intensity with respect to primary energy supply is the second highest of all OECD countries. The competitive bidding system underpinning Australia’s National Electricity Market (NEM) ensures that the cheapest sources of power, such as coal, are called upon to meet demand. For this reason, it is expected that emissions relating to primary energy supply will continue to grow if Australia continues as business-as-usual. This paper explores the structure of Australia’s primary energy sector in comparison to other developed countries and assesses the impacts on this industry in relation to broad-based measures targeted at curbing climate change, such as the national emissions trading scheme, entitled the Carbon Pollution Reduction Scheme, proposed by the Australian Federal Government in its Green Paper (July 2008). Placing a price on emissions under such a scheme will mean coal-fired generators will face higher risk, loss of value and increased compliance costs, therefore decreasing the competitiveness of coal generated energy on the NEM. However, the ability for alternative energy sources, such as wind, to exploit such market opportunities and compete on the NEM will depend on a number of factors, including adequate infrastructure support to carry alternative energy flows and the price of carbon.

Stream: Technical, Political and Social Responses

Paper: A paper has not yet been submitted.

Renee Garner is a Solicitor at Freehills (Melbourne) and co-author of the first legal text book of its kind in Australia entitled "Global Climate Change: Australian Law and Policy" (LexisNexis - August 2008). Renee was an Honorary Research Fellow at the University of Western Australia between October 2007 and April 2008. Renee is a member of Freehills’ National Climate Change Steering Group and has expertise in all aspects of climate change law, including emissions trading, energy and renewable energy major projects. Renee has authored a number of publications in this area, including “Regulating a National Emissions Trading Scheme within Australia: Constitutional Implications” (Macquarie Journal of International and Comparative Environmental Law) and “Strategies for Airlines on Aircraft Emission and Climate Change: Sustainable, Long-term Solutions” (The Hodgkinson Group and tabled by United Nations World Tourism Organisation).