Clean Revolution case study: South Australia

Author:
Clare Saxon Ghauri
Reading time: 12 minutes
26 September 2012

This is part of The Climate Group's Clean Revolution case study series. Read an interview with Tim O'Loughlin is the Commissioner for Renewable Energy in South Australia.

South Australia has led Australian climate and energy efforts for nearly a decade. Driven by strong political leadership, the need to develop new sources of economic growth, and concerns about climate impacts, South Australia has established itself as a leader in clean energy deployment and investment. The development of various state-level initiatives in an often regressive national policy environment makes South Australia’s achievements particularly noteworthy.

Progressive climate and energy leadership is more than simply setting targets and achieving them. Context matters too. This is what makes South Australia a leader in the Clean Revolution.

For the past decade, this small sub-national state (population 1.65 million) has been a pioneer of climate change and renewable energy policies in Australia. From a massive expansion in wind power, to the passing of the southern hemisphere’s first climate legislation with emission reduction targets, South Australia has led the way Down Under. Were it a nation, South Australia would have the second highest level of wind energy penetration in the world after Denmark, and it has achieved higher per capita wind generation than any major country.

On their own, these and other achievements would be impressive in their own right. But South Australia’s actions are even more remarkable in the context of a country with one of the world’s highest per capita emission levels, a nationally divisive climate debate and an economy that has prospered on the back of coal, gas and energy intensive mining industries. In 2009, the state’s emissions were 8.6% below 1990 levels – a figure comparable to many leading European countries. By contrast, Australia’s emissions as a whole grew by 2.7% from 1990 to 2009 and are currently projected to increase by 6% on 1990 levels by the end of the first Kyoto commitment period (2008-2012).

SOME OF THE KEY LEADERSHIP LESSONS HAVE BEEN TO MOVE EARLY AND TO WORK IN PARTNERSHIP WITH INDUSTRY AND THE COMMUNITY.
–Tim O’Loughlin, Commissioner for Renewable Energy, South Australia

Ambitious target setting and the implementation of enabling policies have underpinned South Australia’s climate and clean energy achievements. The 2007 Climate Change and Greenhouse Emissions Act – the first legislation of its kind in Australia, and indeed the southern hemisphere – provides both the focus and framework for many of these efforts.

AMBITIOUS TARGETS

Greenhouse gas reductions: 60% cut in emissions by 2050 from 1990 levels (legislated).

Renewable electricity production: 33% of the electricity generated in the state from renewable sources by 2020 (legislated).

Renewable energy consumption: 50% of the Government’s own electricity needs will be met from GreenPowerTM from July 1 2014, up from 20% today (commitment).

Energy efficiency improvements: 25% improvement in government buildings by 2014 compared to 2001 (commitment).

At the national level, the Federal Government is committed to a 5% emission cut by 2020 relative to 2000, rising to between 15% and 25% if a suitable global climate deal is reached. This year, it committed to an 80% reduction on 2000 levels by 2050, up from 60%.

Both Federal and South Australian Governments set 20% renewable energy targets. In June 2011, South Australia reached this target, three years ahead of the state’s own deadline and nine years ahead of the national aspiration. This success prompted South Australia to increase its renewable energy ambitions to 33% by 2020.

The South Australian Government also intends to effectively ban new coal fired power stations through the introduction of an emissions intensity limit for new electricity generation of 0.7 tCO2-e/MWh.

SUPPORTING POLICIES AND FRAMEWORKS

Solar feed-in tariff: South Australia introduced the country’s first premium solar feed-in tariff in 2008. By August 2011, the tariff has contributed to the approval of 195MW of solar panels by households and small energy consumers across the state. A US$0.92 million fund has also been established to kick-start the creation of community-owned and operated solar farms.

Streamlined wind planning process: South Australia has the country’s most streamlined planning framework and has introduced Australia’s first and only payroll tax rebate scheme for wind investors. The state is the destination of choice for wind farms due, in part, to the regulatory certainty that has been provided by the government. Its policies for land-use planning represent national best practice for accommodating wind farms.

Building Innovation Fund: This US$1.85 million grant program fosters practical and innovative demonstration projects to reduce the carbon footprint of existing commercial buildings.

Six-star energy efficiency: All new homes and extensions must meet the six-star level of energy efficiency since September 2010.This will cut the energy use of new homes a further 15-24% below the five-star energy rating mandated in 2004, and save the average homeowner up to US$312 in annual energy costs.

Climate Smart Urban Development: South Australia is Australia’s first state Government to offer real-world sites for discussion with The Climate Group and its coalition of leading businesses, as part of The Climate Group’s Climate Smart Precincts initiative. Discussions around these sites are testing the policies, technologies and new business models that are set to mainstream an integrated, precinct-wide approach to low carbon and climate-resilient design.

A range of drivers have influenced South Australia’s progressive climate and energy efforts and initiatives.

LEADERSHIP

The former South Australian Premier, Mike Rann, has personally held the Sustainability and Climate Change Portfolio. There is general recognition that Rann’s leadership has positioned climate change action at the forefront of South Australia’s policy agenda over the last decade. The state Government itself has demonstrated leadership in its long-term commitment to climate change mitigation and adaptation and its concrete achievements stand out from other states in Australia.

THREATS

Climate Change projections for South Australia indicate warmer and drier conditions across much of the state, with an increased risk of severe weather events including extreme rainfall events, heat waves, bushfires and a greater frequency and/or severity of drought.

These changes may affect the health and well-being of South Australians and the key industry sectors that underpin the state’s economy, such as its agricultural and viticulture industries. Such threats provide a powerful catalyst for building the state’s future climate change resilience.

OPPORTUNITIES

Creating economic opportunities out of addressing adverse climate impacts is an important driver of action in South Australia. For example, as the driest state in the country, South Australia is positioning itself as an international leader in all aspects of water resource management and technologies, based on its own recent experience of severe drought.

With significant closures over recent years in the manufacturing sector, such as the automotive industry, South Australia recognizes that low carbon market transformation is a platform for economic development. This is exemplified by the planned US$115 million Sustainable Industries Education Centre, which will train more than 8,000 students a year in new green technologies associated with the burgeoning US$ 4.1 billion construction industry. This sector accounts for over 8% of overall state employment, with its average annual employment growing by 20% in South Australia between 2000 and 2010.

Despite its successes, South Australia will continue to face a variety of challenges in the short, medium and long-term in maintaining momentum for its Clean Revolution agenda.

PUBLIC SUPPORT

Governments around the world understand that effective climate change action depends on public support. This is a particular challenge in Australia, where public approval for climate change policies has waxed and waned over recent years, in line with the political agendas and fortunes of the day.

The South Australian Government’s climate and energy leadership credentials are demonstrated by its consistently reinforced positive vision for the state in transitioning to a low carbon future.

THE ECONOMICS

Climate change policy can be an early casualty of fiscal ‘belt tightening’ in times of economic adversity, portrayed as an unfair burden on taxpayers and citizens in hard times. Despite Australia’s comparatively good economic fortunes emerging from the Global Financial Crisis, sensitivity to increased taxation and public expenditure remains high.

In marked comparison to other states, South Australia has successfully communicated the economic, social and environmental benefits of early action and enabling government policies.

0

Number of wind turbines installed in 2002, the year the current government was elected

534

Current number of wind turbines (and counting)

1.15GW

Total installed wind energy capacity in the state

54%

South Australia’s share of national wind energy capacity

26%

Proportion of South Australia’s electricity produced by wind power (see annual energy consumption technology graph)

225,000

Number of homes that could be powered by South Australia’s recently announced intention to develop a US$1.2 billion, 600MW wind farm

87%

Proportion of federal grants provided to South Australia to support geothermal research, exploration and proof-of-concept projects to the end of 2010

US$536 MILLION

Geothermal investment in South Australia to the end of 2010

8%

Decrease change in South Australian emissions between 1990 and 2009

225,000

Number of homes that could be powered by South Australia’s recently announced intention to develop a US$1.2 billion, 600MW wind farm

30% AND 77%

Respective proportion of average total electricity generated by coal-fired power stations in South Australia and the national energy market.

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