Energy security is also an increasingly topical issue that now involves electricity and gas, as well as oil supply. Increasing and volatile international oil prices are certainly important when Australia is becoming more dependent on imports.
Increased use of gas for heavy road freight offers potential benefits. But the lack of rail freight infrastructure commitment is a major issue, and providing urban public transport and planning for easy access to services is critically important for many reasons beyond energy security.
A new white paper also needs to explore the nature and implications of the sustainable energy revolution and climate response. These are transforming our whole approach to energy.
The new government’s climate policy is focused on “direct action”: paying businesses via auction to reduce emissions beyond their “business as usual” baseline emissions.
The government expects farming and forestry related projects to deliver most of the abatement to meet its 2020 target (5% below 2000 emissions). But other sectors will also be able to bid for the $2.9 billion allocated.
It seems likely that energy efficiency projects will deliver a substantial proportion of the abatement under this scheme. There is a large amount of energy efficiency potential available at low and even negative cost.
The Energy Efficiency Opportunities industry program is saving around 8 million tonnes of CO2 annually and over $800 million at an average carbon cost of minus $95 per tonne of CO2 avoided.
Our appliance energy efficiency scheme is also avoiding millions of tonnes of emissions annually at negative cost. This helps explain the recent unprecedented and ongoing decline in National Electricity Market electricity sales.
At an individual level, everyday decisions that used to drive an increase in energy use and emissions now lead to reductions. Buying a new TV or fridge saves energy; switching from a laptop to a tablet slashes energy use; new office buildings and renovated ones use less energy; new industrial equipment is much more energy efficient. We are now on a savings-multiplying path, despite our ignorance, and our reluctance to pursue effective policies.
For energy efficiency to capture its cost-effective share of Direct Action funding, energy efficiency proponents will have to prove Treasury and other economic modellers have dramatically underestimated the energy savings from efficiency.
There is scope to do that. But it will require redirection of business towards action and government policy towards energy efficiency and innovation. This will apply even more pressure to the existing electricity industry and fossil fuel industries.
It will certainly be interesting to watch energy policy evolve over the coming year.
Alan Pears is a sustainable energy and climate researcher at RMIT University.
This article was originally published at The Conversation. Read the original article.
