As the G20 euphoria has fizzled out, the Federal Government must address the issue which became the ‘heart of the G20’ – energy – here in Australia.
The global interest in energy expressed at the G20 summit has transposed through to the Australian public.
Over the past few years, ‘energy’ has been a topical subject within the discourse of Australian politics.
Recent talks have sparked, fuelled, generated (or any other energy related word you can think of), a review of the Renewable Energy Target (RET), which was fully implemented in 2010.
The RET is a legislated government scheme. The goal is to source 20 per cent of emissions by 2020.
It works by charging households slightly more than their regular electricity bills to cover the cost of the required investment in renewables under the scheme. The scheme adds up to $107 for an average household’s electricity bill.
In Australia, electricity usage has been steadily dropping since 2010. At the end of 2013’s financial year, National Electricity Market (NEM) demand was 4.3% lower than in 2009.
Mr David Adamson is a Senior Research Officer at The University of Queensland’s School of Economics. He believes that the RET has been a fundamental facet in reducing electricity usage, both on a household level and on a larger scale.
“The RET did a wonderful thing by saying ‘the carbon price is a bit low, it is not quite changing the liberal demand we want,’ and it allows us to change the prices slightly. This allows people to use less electricity.
“We quickly saw a decline in energy use, which meant people were paying less overall. They started adopting things like solar. This reduced their demand,” Mr Adamson said.
Mr Adamson believes that the RET has appealed predominately to low to middle income households.
“The RET at the household level is exceptionally popular. The adoption of solar has primarily been by low to middle income housing.
“The RET has given a bit of welfare transfer to lower income people,” Mr Adamson said.
Though Mr Adamson believes a system like the RET is effective, he believes that the carbon pricing scheme was essential in producing a strong outcome for renewable energy.
“I think they both work very well together. When you talk about economics, you talk about supply and demand of a good. It effectively increased the carbon price, which changed demands even faster. Also, the policy itself caused people to invest in renewable energy,” Mr Adamson said.
Energy is becoming a focal point for strong economies around the world. In conjunction with the benefits for regular Australians, renewable energy is fast becoming a priority for the government.