Renewable energy is becoming more and more relevant to our current and future lives. Some of the fastest growing industries are the ones focused on green technology, renewable energy, energy storage and basically anything that will reduce our harm to the planet. Industries appear to be moving and changing rapidly, with a buzz surrounding a new innovation in solar power, the latest wind farm or renewable technologies pushing fossil fuels to the side.
One central buzz-phrase is the ‘solar power revolution,’ an emerging boom in the uptake of renewable energy worldwide. So, how much is solar really taking over? The answer is 1 percent. Solar Power Europe’s Global Market Outlook revealed solar power is supplying 1 percent of the world’s energy needs. Today, we will discuss who is leading this so-called solar revolution and why.
Well, many are suggesting that Australia is the solar leader of the world. But is this really the case? And if so, what are they doing right? According to the Australian Bureau of Statistics, 19 percent of Australian households now have either rooftop solar panels or solar-powered hot water systems — this is 1 in 5 households nationally.
The global market: How does Australia measure up?
In terms of an international comparison, the Energy Supply Association of Australia found that Australia is, in fact, world No. 1 in terms of residential rooftop solar — at 15 percent, with this rooftop solar penetration expected to rise to 50 percent within the next decade.
The Energy Supply Association’s CEO Matthew Warren described Australia as a “pioneer” in the area of rooftop solar. The small global player has seen some positive international acknowledgement for these achievements.
Bloomberg New Energy Finance revealed that while Australia does have a high capacity of rooftop solar per capita, where it falls behind is in the area of large, nationally- or state-run public solar projects. Just 15 percent of Australia’s solar industry is made up of large-scale, utility-level solar projects — something that is almost the opposite of the U.S., where utility-scale solar makes up the majority of solar capacity.
The cause: Australia’s coal economy
In addition to previous statistics from the Bloomberg New Energy Finance report, the penetration of large-scale solar in Australia was said to be as low as 300 megawatts in 2015 — compared to 7.3 gigawatts of large-scale solar projects in California alone.
The reason for the marked disparity between Australia’s private and public solar sectors is an interesting one. High levels of solar in general should not come as a shock with Australia experiencing one of the world’s highest amounts of sunlight year round.
The relatively free market that solar has become in Australia is what has caused the unusually high levels of residential solar and lower levels of public projects. In other words, consumer demand and small business supply have carried Australia’s solar boom.
Looking even deeper, the Australian economy’s long history of reliance on the coal and fossil fuel industries can explain a lack of action on large-scale and public solar projects on the part of the government and big business.
The perpetrator: Australia’s notorious energy utilities
On the topic of fossil fuels, the utilities that sell this energy are the key players that have inhibited the growth of large-scale solar projects in Australia – and for good reason, as renewables are a direct competitor. The control of utilities over this natural competition, however, is beginning to fail.
The long-standing oligopoly that has controlled energy prices in Australia is being slowly broken down by the entry of renewable energy alternatives into the market. The poor relationship between energy utilities and their consumers has pushed the Australian public to take solar energy consumption into their own hands.
An IPSOS-Mori survey conducted in the U.K. revealed that in Australia only 22 percent of the population have a favorable view of the mainstream energy industry. The variety of reasons given for this poor industry-consumer relationship points to things like gas supply, controversial coal seam gas projects, and the alleged neglectful customer service attitudes of large energy retailers that have long had the power to control energy prices.
The result: A solar leader with a long way to go
As is often the case, the market dynamics that have led to Australia’s successful solar industry can be put down to a number of players and a particular set of circumstances. This doesn’t mean, however, that lessons cannot be taken from the Australian model. This will be particularly the case when we follow the growth of newly introduced battery storage systems by Tesla and its many emerging competitors.
Likewise, Australia has some learning to do within sectors of its own renewable energy industry. The global community should take note of Australia’s successful balance between government support through strategic financial incentives and a thriving economic market bouncing off this government support.
On the other hand, Australia must not be let off the hook for its surprisingly low large-scale renewable energy action. Following strong commitments that emerged from theParis climate summit in 2015, there is no room for any nation to hide behind favorable statistics in one sector to divert attention from disappointing ones in another.
Australia must follow the lead of Europe and the U.S. in terms of deploying commercial, utility-scale solar projects just as much as it should set an example in the rooftop solar sector. After all, if we’re striving for a better planet, there’s nothing wrong with a bit of healthy competition.
Image credits: 1) Flickr/Alan Levine 2) Bloomberg New Energy Finance
