Transcript The Australian Government’s Energy Efficiency Agenda

The Australian Government’s Energy
Efficiency Agenda
Presentation to SBA Forum
13 April 2011
Martin Bowles
Deputy Secretary
Department of Climate Change and Energy Efficiency
Where does Energy Efficiency sit within the bigger picture?
Government
response to
climate change
Energy
Efficiency
Commonwealth
measures
National Strategy
on Energy
Efficiency (COAG)
Carbon Price
Renewable
Energy
Australia’s emissions are projected to grow by 1.8 per
cent per year out to 2020 without new policy measures
750
700
+24%
650
Mt CO2 -e
600
550
108% of 1990 level
2000 level
500
106% of
1990 level
450
Kyoto
period
400
% change on
2000 level
350
1990
1995
2000
2005
2010
2015
2020
Existing measures are built into this baseline:
• Without the Renewable Energy Target, emissions would be 29.9 million tonnes higher than the baseline
in 2020
•
Without the National Strategy on Energy Efficiency, emissions would by 42.6 million tonnes higher than
the baseline in 2020
Source: Australia’s Emissions 2010, Department of Climate
Change and Energy Efficiency
To reach a 5 per cent target, we need to ‘find’ an extra
160 million tonnes of abatement in 2020
750
Abatement challenge
in 2020 (Mt CO2 -e)
700
+24%
650
Mt CO2 -e
600
550
108% of 1990 level
2000 level
-5%
106% of
1990 level
500
-160
-15%
450
400
-25%
Kyoto
period
% change on
2000 level
350
1990
1995
2000
2005
Source: Australia’s Emissions 2010, Department of Climate
Change and Energy Efficiency
2010
2015
2020
-216
-272
Australia’s emissions in the global context
8,000
19.1%
18.3%
7,000
6,000
13.4%
Mt CO2-e
5,000
4,000
3,000
5.2%
2,000
4.9%
3.6%
2.0%
1,000
1.7%
1.5%
1.5%
1.1%
0.5%
0.4%
0.3%
0.1%
0.0%
0
China
USA
EU (27) Russia
India
Japan Canada Mexico South Australia South Vietnam United Sudan Norway Burundi
Korea
Africa
Arab
Emirates
Source: Climate Analysis Indicators Tool (CAIT) Version 7.0.
(Washington, DC: World Resources Institute, 2010). Total GHG
emissions in 2005 (excludes LULUCF)
Australia’s per capita emissions
45
40
38.2
2 tonnes per capita: average
2050 emissions required
under 450 ppm scenario.
tonnes CO2-e per person
35
30
27.4
25
23.5
22.9
20
13.6
15
11.8
11.2
10.6
10.3
10
9
6.2
5.9
5.5
5
3.2
2.1
1.7
0.3
0
United Australia
Arab
Emirates
USA
Canada
Russia
South
Korea
Norway
Japan
Source: Climate Analysis Indicators Tool (CAIT) Version 7.0.
(Washington, DC: World Resources Institute, 2010). Total GHG
emissions in 2005 (excludes LULUCF)
EU (27)
South
Africa
Mexico
World
average
China
Sudan
Vietnam
India
Burundi
Where will the 160 million tonnes of abatement in 2020 come
from?
Government response to
climate change
Energy Efficiency
Commonwealth
measures
National Strategy on
Energy Efficiency (COAG)
(already accounted for in
the emissions baseline)
Carbon Price
Renewable Energy Target
(already accounted for in
the emissions baseline)
Alongside the carbon price,
energy efficiency has a key role
to place in future abatement
Energy efficiency addresses other issues beyond emission
reductions
 Energy is the greatest single source of greenhouse gas emissions in
Australia
 Beyond reducing emissions, improving energy efficiency can:
─ Help households save money
─ Vastly improve comfort levels in homes and workplaces
─ Help businesses adjust to competitive pressures through
reduced costs
 Energy efficiency complements a carbon price but it cannot deliver
the emissions reductions required in the Australian economy on its
own
Where can we ‘do’ energy efficiency?
 Households
─ Building standards
─ Appliances
─ Education and behaviour change
 Energy infrastructure
 Commercial buildings
 Industrial processes
 Transport
Energy Efficiency in the Australian Context
 Australia has historically enjoyed relatively cheap energy, meaning
energy efficiency has not been a high priority in the past
 Australians produce more greenhouse gases per capita than any
other developed country
 Household electricity costs have increased in recent years and are
projected to increase further into the future
 There are great opportunities to embrace energy efficiency
improvements
Australia’s energy intensity improved at a rate of 1.5
per cent per year between 1990 – 2006...
...But, this was driven
predominantly by
structural changes to
the economy rather
than improvements in
energy efficiency
Source: IEA, unpublished 2010 update of Figure 45 in Implementing
energy efficiency policies: Are IEA member countries on track?, 2009
Note: The following sectors are not included in this analysis: quarrying, fuel
processing, electricity, and gas and water supply
Although we don’t compare well in the international
context, energy efficiency gains are being made
National Strategy on Energy Efficiency
measure
Expected emissions reductions in 2020
(million tonnes)
Equipment Energy Efficiency Program (E3)
20.3
Energy efficiency requirements: Building codes
11.8
Mandatory disclosure requirements: Buildings
<0.1
Framework Cool Efficiency Program
0.4
Phase-out of incandescent lighting
1.9
Phase-out of inefficient water heaters
4.1
Energy Efficiency Opportunities Program
4.2
Total
Source: Australia’s Emissions 2010, Department of Climate
Change and Energy Efficiency
42.6
An example: standards and labelling – 20 years of
bipartisan action
1986
2009
LABELLING
Refrigerators and freezers
Clothes washers and dryers
Dishwashers
Air conditioners – non ducted single phase
MEPS
Incandescent GLS lamps
Compact fluorescent lamps
External power supplies
Chillers (commercial air conditioning)
Televisions
1999
MEPS
Electric storage water heaters
Refrigerators and freezers
2001
MEPS
Three-phase electric motors
Three-phase air conditioners
2003-2005
MEPS
Fluorescent lamp ballasts
Distribution transformers
Single phase air conditioners
Commercial refrigeration
Linear fluorescent lamps
Electric storage water heaters
-Refrigerators and freezers
LABELLING
Televisions
2010
MEPS
Incandescent GLS lamps
Refrigerators and freezers
Air conditioners
VOLUNTARY LABELLING
Swimming pool pumps
Refrigerators and Freezers – a case study in
energy
efficiency labelling: 1986 - 2006
Energy Consumption of New Frost Free Refrigerator-Freezers, 1980 to 2006
1400
Initial MEPS introduced in 1999
Sales weighted energy of new units (kWh/year)
1200
MEPS 2005 full
impact
1000
Labelling introduced in 1986
800
Label effect waning,
impact of CFC phase-out
600
400
200
Labelling and MEPS together have resulted in a 67% reduction
in energy consumption for new family sized frost free refrigeratorfreezers over the period 1986 to 2005.
19
80
19
81
19
82
19
83
19
84
19
85
19
86
19
87
19
88
19
89
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
0
Year
Source: Department of Climate Change and Energy Efficiency
Future energy efficiency improvements
 An opportunity exists in Australia to capture social,
economic and environmental gains through energy
efficiency improvements
 Climateworks identifies significant energy efficiency
opportunities that are profitable from an investor
perspective today
 The challenge lies in unlocking these opportunities
Climateworks abatement analysis – numerous energy
efficiency measures are profitable from an investor
point of view today
Source: ClimateWorks Australia, Low carbon growth plan for
Australia, 2010, p. 24.
What currently stops the market from taking up energy
efficiency opportunities?
 Externalities/pricing
 Split incentives between tenants and landlords
 Information
 Culture and practice
 Public vs private time frames
 Utility incentives
Addressing the barriers to greater energy efficiency
uptake into the future
 A carbon price will drive the economy to make energy efficiency
improvements into the future...
 ...but we know from the Climateworks analysis that price alone isn’t the only
driver in decisions to invest in energy efficiency
Prime Minister’s Task Group on Energy Efficiency
 Established in 2009/10 to investigate energy efficiency options to complement
a carbon price and deliver step-change improvement in Australia’s energy
efficiency
 Task Group Report released in September 2010
 Government response to be finalised
Prime Minister’s Task Group on Energy Efficiency outcomes
Key Findings:
 Australia’s performance on energy
efficiency is mediocre
 Energy efficiency policy has
significant gaps
 Governance arrangements are
confused
 There is a lack of overarching
mechanisms to deliver significant
change
 Multiple benefits and considerable
potential in the area of energy
efficiency
 A step change in energy efficiency
performance requires a carbon
price
Foundation recommendations:
 An aspirational national energy
efficiency target of 30 per cent by 2020
 A transitional national energy savings
initiative to replace existing and
planned state schemes
 Improved governance arrangements
 Better data and measurement
 A new culture of energy efficiency
In addition, the Report recommends
consideration be given to a suite of sectoral
proposals across the economy