Renewable Energy Policy of Australia-Free-Samples for Students

Question: Discuss about the topic "Australias stand on renewable energy". Answer: Introduction The growing demand for energy resource possesses a great threat on traditional or exhaustible resources. Countries thus consider a shift from traditional resources to a renewable form of energy. The main advantage of renewable energy is it come with unlimited stick and associated with a low emission generation (Twidell and Weir 2015). The energy demand in Australia has increased rapidly in recent years. The demand for electricity not only comes from private household but also bulk demand has been generated from energy intensive manufacturing sector. The energy ministry thus focuses on implementing an efficient renewable energy policy to ensure a steady supply in future. Article summary A recent article published on a daily new paper of Australia namely The Sydney Morning Herald analyses the efficient of renewable energy policy of Australia. The article mentioned that by giving more attention of demand management in order to achieve energy efficiency Australia is likely to avoid the shortcomings of energy policy, that Germany has employed. The top member of energy efficiency department of Germany, Christoph von Spesshardt said that Australia has learned good lesson from the mistakes encountered by the Germany few years back (smh.com.au 2018). He opined that the present situation of Australia is similar to that in Germany ten years back. A few years back Germany led the world in terms of its stand on renewable energy. Germany however has restricted its focus on supply side of renewables for power generation. The energy ministry in Germany has committed to supply a guaranteed kilowatt per unit of price. The policy has made power generation extremely costly leading to an overpriced electricity supply. Germanys attention was only to substitute exhaustible energy source with no care was given on aspects like reliability or affordability. The system of power generation using renewable energy thus become quite expensive. The energy policy of Germany overlooks the responses from demand side and hence, does nothing to provide household a smarter way of power consumption. The aim of Australia on the other hand is to ensure supply of energy along with a price stability. In order to meet the clean energy target of Paris Agreement Australia need 50 percent power generation with electricity. This if not done with demand efficiency then the nation will require 20 percent more that is 70 percent generation to meet the same target (smh.com.au 2018). The Greenhouse and Energy Minimum Standard Act has implemented to achieve an efficient standard of energy for the household appliances and daily used equipment. The new standard has resulted in a cost saving of power bill between $140 and $220. The use of energy efficient appliance reduces carbon emission between a range of 4.5 and 6.5 mega tones. Along with this the efficiency standard of commercial buildings is also subject to revision National Construction Code in 2019. Article Analysis The main economic concepts that are relevant for the article analysis are the concept of demand and supply and their implication on price. In Germany, the renewable energy policy has designed depending only on the supply side. The power grids of Germany thus ensure the needed energy supply given the unit price. The ignorance of demand side response has reduced the effectiveness of energy policy in Germany. The initiatives to substitute exhaustible energy sources with a renewable one combining with unrestricted demand has resulted in a very high price of electricity (Havas et al. 2015). This can be understood from the figure given below. Figure 1: Effect of increased energy demand (Source: as created by Author) Figure 1 shows the impact of ignoring demand side responses while designing energy policy. Given the supply, an increase in demand led to a rightward shift in the demand curve (Friedman 2017). Under the new circumstance, the higher demand increases power price and needed equilibrium quantity in the energy market. Learning from Germanys mistake Australia however has focused on attaining a demand-supply balance in the energy market. Australia realizes only supply side consideration cannot resolve the issues in the energy market (abc.net.au 2018). The efficiency needs to be achieved on demand side as well. Use of energy efficient compliances by household not only lead to a saving of power bills but also reduces pressure on power grids. The Greenhouse an Energy Minimum Standard Act allows government to set a national energy standard for household appliances (climatecontrolnews.com.au 2018). The new efficient system is expected to reduce an overall cost of nation by $1.58 billion. In addition to energy consumption related to home appliances government has also focused on increasing the energy efficiency of commercial buildings. The commercial buildings accounts for half of the power use in Australia. Efficient use of energy in building construction thus help to release demand side burden significa ntly (legislation.gov.au 2018). Figure 2: Effect of demand side efficiency (Source: as created by Author) Recommendation The Australian government has initiated an efficient policy to strengthen it stand on renewable energy. However, there a long way that yet to be covered. The initiatives that have been started needs to be tackled with proper care (Mey, Diesendorf and MacGill 2016). It has been observed that many of the building codes associated with efficient energy planning have not been update since the last few years. Delayed in update of these energy codes by 2019 can impose an unnecessary additional cost of $1.1 billion on household energy bills within next three or four years. Government therefore should do the needful to update the building codes. To expand the use of renewable energy government should take necessary legislation or provide other forms of incentives. Conclusion Australia has strengthened its position on renewable energy frontier with an effective policy catering to both demand and supply side management. Australia can thus avoid Germanys mistake and escape from a high price of electricity. Focus has been given on introducing energy efficient home appliances and building codes for commercial constructions. The demand management policies have contributed to a reduction in power bill for individual household and for the nation as a whole. The policies should be continued to ensure a secure energy supply at a reasonable price in future. Reference list Climatecontrolnews.com.au. (2018).GEMS Act under review - Climate Control News. [online] Available at: https://www.climatecontrolnews.com.au/news/latest/gems-act-under-review [Accessed 25 Apr. 2018]. Friedman, L.S., 2017.The microeconomics of public policy analysis. Princeton University Press. Havas, L., Ballweg, J., Penna, C. and Race, D., 2015. Power to change: Analysis of household participation in a renewable energy and energy efficiency programme in Central Australia.Energy Policy,87, pp.325-333. Kilvert, N. (2018).New renewable energy capacity double fossil fuel growth in record-breaking 2017. [online] ABC News. Available at: https://www.abc.net.au/news/science/2018-04-06/solar-power-most-backed-fuel-technology/9612976 [Accessed 25 Apr. 2018]. Latimer, C. (2018).Australia can avoid Germany's renewable energy mistakes. [online] The Sydney Morning Herald. Available at: https://www.smh.com.au/business/the-economy/australia-can-avoid-germany-s-renewable-energy-mistakes-20180312-p4z3zh.html [Accessed 25 Apr. 2018]. Legislation.gov.au. (2018).Greenhouse and Energy Minimum Standards Act 2012. [online] Available at: https://www.legislation.gov.au/Details/C2012A00132 [Accessed 25 Apr. 2018]. Mey, F., Diesendorf, M. and MacGill, I., 2016. Can local government play a greater role for community renewable energy? A case study from Australia.Energy Research Social Science,21, pp.33-43. Twidell, J. and Weir, T., 2015.Renewable energy resources. Routledge.