Environmental management (case studies edition!) - Australia (an MEDC case study)

Case studies - Australia - why renewables aren't achievable for a country

Basic information about Australia

• GDP growth rate = 3% annual change, World Bank (2023)

• OECD country

• Oceana = continent

• Island continent

Australia’s energy mix

68% = Fossil Fuels (2022) - bumped down to 65% in 2023

• Coal = 46%, dominant source

• Natural Gas = 17%

• Oil = 2%

35% = Renewables (according to GOV 2023)

• Solar = 16%

• Wind = 12%

• Hydro = 6%

2024 = 1/3 of energy was Renewable in first quarter

What is Australia’s main energy source? + give some info about it

Coal - Black and Brown, according to DCCEWW

• 47% of energy mix in 2022.

• 46% in 2023

• High energy content

• Low impurity content.

How much has coal usage changed over the years? - Australia

1999 = 83%

2023 = 46%

Reasons for it’s current energy mix (Australia)

1)Resource endowment → (2) Political + economic factor

1. Biggest reason = Coal is primary source (47%) - Resource endowment

   • Coal deposits occur in all states and N.territory.

   • Range: 15-225 mil yrs old

2. Energy security

   • No/less dependence on other countries to import a source of energy. + save money.

   • Coal prices ⬆5% in beginning of 2024.

   • Less impacted by external factors (e.g. war in Ukraine caused coal prices to 📈)

   • International power = One of the major coal exporters.

Socio-economic reason to why non-renewable energy are high
(Work)

Economic growth from adding 📈 jobs to the job market.

• 2021-22 = Australia exported $113.8 billion worth of coal.

• 2023 = 48,000 ppl employed in coal industry

• Liquid N.Gas, comes from brown and black coal = 📈jobs

Social factor (urban planning + buildings)

Energy infrastructure was dev around fossil fuels for years (83% 1999)

• E.g. Power plants (Kwinana Power Station) + Distribution networks (location planning)

• Due to resource endowment and lack of knowledge around the harm and how finite fossil fuels are.

• Current infrastructure = cheaper & accessible with a guarantee in running successfully.

Social factors for Oil usage

Why are they a net importer of oil, importing from South Korea, Japan, and Singapore

1. Oil is big = transportation fuel + resource endowment

   • Produced at the NW Shelf

   • Transportation needs oil + Australia has a large area with dispersed population centres.

     = Local transportation is a significant consumer of energy

   • Preference: Petrol Cars = 68% , Petrol Bus = 38% = high demand for petrol

2. Industrial oil is involved in various industrial processes

   • Mining: 14% of total GDP

   • Agriculture: around 3% total GDP

   • Manufacturing: 5.7% total GDP

   • Changing industrial processes/infrastructures to incorporate renewable energy

   • = lots of time and money

   • US example: $4.5 tril to change power grid

= Change = Economy growth decline, social growth, lots of investment and possible losses

Renewable Energy - Why is it difficult to attain in Australia?

• Goals vs pace

• Why it’s difficult: economic, political, and social factors.

• Goal: 2030, have 82% of their energy sector to be produced by Renewable sources.

• Pace: 7.5% to 30% share of renewable energy in energy sector. Within 15 years.

This pace is not fast enough

What is an economic factor to why renewable energy may be difficult to attain in Australia

Decrease in financial support (investments)

Investments in renewable energy plants slowed in 2023

• Financial approvals for new solar farms shrank more than 1/3 and no new wind farms won backing (help or support). 

By the end of that year, Australia had 56 renewable energy projects under construction, which decreased from 72 in 2023, last year.

Social factor - People use a lot of energy

• Urbanisation rate: in 2023 it has reached a rate at 86.6%

= People need electricity for modern appliances

• New wind and solar farms need new transmission lines to get their electricity to users. 

• That’s because the good sources of wind and sunshine aren’t in the same places as the existing transmission network.

• Even if they were, we’d still need to upgrade and build transmission because of the growth in demand.

Social factor:

Transmission lines vs local’s reactions

• The Australian Energy Market Operator estimates 50% of the transmission needed to deliver a clean, reliable, affordable energy supply in 2050 needs to be constructed in the next six years. 

• Most of these transmission lines are yet to be built.

• Most of these poles and transmission lines are to be built in rural communities with an open big area (room for plant)

• Many of the rural communities have reacted negatively towards it.

2024 - Wind farms were planned to be built in outback Australia with many protesting against it, as it will cause food security issues.

• 1/3 of farmlands could be destroyed by net-zero targets.

Socioeconomic - Renewable generators are a problem

Things are also being built slowly (renewable generators) due to safety concerns. 

• Renewable generators have had to connect to existing lines, which have become congested.

  → So even when new renewable installations get an approval for construction, their output can be reduced in extent and quantity because they can’t get it to consumers. 

• This has already hit developer finances hard. 

Political factors to why renewables are difficult to implement in Australia

The coal industry has considerable political influence in Australia. 

• Industry groups and companies actively lobby to protect their interests, influencing policy decisions to favour the continued use of coal. 

• Political leaders often balance environmental concerns with economic and employment considerations, leading to continued support for coal​

They need coal, it is the drive of their economy and political power.

• They export coal to many countries, the top ones being Taiwan, Japan, South Korea, China, and India. + Energy security   

• In 2021-22 they exported $113.8 billion worth of coal

Renewable backup system

• Renewable energy sources like wind and solar are intermittent and require backup systems or energy storage solutions, which are still developing. 

• For example: Tesla's Hornsdale Power Reserve: Located in South Australia, it is one of the world's largest lithium-ion batteries.

• It stores excess energy generated by wind farms and releases it when demand is high or when wind generation is low, helping to stabilise the grid​