The Real State Of Australia's Energy Resources Highlights Need For Significant Renewable Energy Investments

Australia's energy resources contribute significantly to the country's economic prosperity. The nation's abundant sources of energy place Australia in a better position to maintain its role as a vital energy supplier for domestic and international demand.

The Australian government has recently released the Australian Energy Resource Assessment report to provide a snapshot of the country's current state of energy resources and factors that would affect future use. The energy assessment has aided the federal government in creating Australia's Energy White Paper 2015.

In a media release by the Office of the Minister for Industry and Science, Ian Macfarlane said the Abbott government was delivering on an election commitment to give industry and consumers certainty in its energy policy. "The measures in the Energy White Paper will deliver stable energy policy and efficient transparent markets that give consumers information to make choices about their energy use and industry the confidence to invest," said Macfarlane.

"The productivity target will be developed as part of Australia's post 2020 emissions reduction target, which we will take to the United Nations Framework Convention on Climate Change this year," added the minister. Geoscience Australia and the Bureau of Resources and Energy Economics were commissioned by the Australian government to make the Australian Energy Assessment report to provide a comprehensive and integrated economic and scientific assessment of the country's energy resources.

Australia As Top Energy Producer

Australia's non-renewable energy resources, with the exception of oil, had increased since 2010, according to the energy assessment report. The country continues to be one of the world's largest sources of economic uranium and the fourth largest in coal resources. However, the government report has found Australia has become increasingly reliant on imported transport fuels.

The country's energy demand is expected to increase in the next few decades, but the rate of growth is predicted to slow down. The slow growth rate is due to the expected improvements in energy efficiency and higher energy prices. The report expects coal to remain the most dominant source for the country's energy needs but remains optimistic Australia would shift to lower emissions fuels. This would increase use of renewable energy, particularly solar and wind energy.

Abundant energy resources are key contributors to Australia's economic growth. In 2011 to 2012, the Australian energy sector accounted for 5 percent of industry gross value added and contributed about 24 percent of the country's total export value. The energy sector continues to provide significant employment and infrastructure and support various manufacturing industries.

Shift To A Lower Emissions Economy

Australia's economy, particularly the energy sector, is undergoing transformational change to a lower-emissions economy. The energy industry currently accounts for three-quarters of the country's greenhouse gas emissions since energy needs rely on fossil fuels. In 2011-2012, coal resources made up two-thirds of Australia's electricity generation. Renewable energy sources accounted for only 10 percent from 7 percent in 2007-2008, according to the energy assessment report.

Global energy needs are expected to grow, but rising prices and government policies on carbon emissions reduction will result in a moderate growth rate. The report suggests the global energy system will transform in the coming decades as lower emissions energy sources will eventually gain market share and create a more diverse global energy supply. The global energy demand from 2010 to 2035 is expected to increase based on the modelling scenarios of the International Energy Agency.

Australia is currently one of the world's biggest energy producers, contributing 2.4 percent of global energy production. The country is one of the largest exporters of coal and uranium, and the fourth in terms of liquefied natural gas exports. The government report has that found in 2011-2012, Australia's energy resources generated $77 billion worth of energy exports. Unlike other Organisation for Economic Cooperation and Development countries and world energy markets, coal continues to play a bigger role in Australia's fuel mix.

Outlook For Australia's Renewable Energy

The need for significant change to the Australian energy market is highlighted by the international effort to shift to renewable energy sources to reduce greenhouse gas emissions. The journey to a lower emissions economy has already begun for Australia with the introduction of the renewable energy target and other government policies.

In 2012, the Australian government had established the Australian Renewable Energy Agency, or ARENA, to provide funding for research, development and demonstration of renewable energy technologies. ARENA initiatives include helping renewable energy technologies move closer to commercialisation and providing system-wide solutions to renewable energy output variability. According to a press release on April 13, ARENA has announced a $20 million research and development round dedicated to industry-partnered projects that seek to commercialise renewable energy.

Opposition Leader Bill Shorten released his own statement in response to the government's white paper. The Australian Labor Party has fully expressed its support for efforts to boost renewable energy investments and retain jobs in the sector.

"Solar power not only provides clean energy, it reduces power bills and creates jobs," said Shorten. "Creating jobs in manufacturing and servicing, while protecting the environment, is obviously a smart way to go."

He slammed the Australian government for risking renewable energy investments with its actions. "More and more members of our community are looking to solar power for their homes and to feed power into the grid. Unfortunately, the Abbott government's dishonesty and incompetence has almost destroyed Australia's renewable energy industry, putting new jobs and investment at risk," remarked the opposition leader.

Although Australia has abundant energy resources, significant investments in energy supply is needed to promote better integration of renewable energy sources and technologies. The energy assessment report states the future of energy in Australia will be influenced by the need to deliver secure, reliable and competitively priced energy source to support a growing economy and population. The growing demand to be energy efficient and move towards a clean energy economy will also affect Australia's future energy needs.

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