Australia has a first world problem with renewables

The energy crisis could end up being bad for the new Labor government in Australia. The rise in electricity, which adds to the already worrying inflation, was not something that Prime Minister Anthony Albanese wanted to inherit in his first weeks of work. But it is an opportunity.

The country should be an example in renewables, since it has a large amount of sun and wind on a huge land mass that is very uninhabited. Devoting just 2% of the land to green energy could generate more than 20 times the country’s needs and make it a major exporter, according to the Australian National University.

Years of bad policy by previous governments ignored these possibilities, leaving the country dependent on an aging fleet of coal-fired power plants for two-thirds of its power. These plants routinely stop operating: up to a third of capacity has been out of service for planned maintenance or breakdowns in recent weeks. And the second consecutive year of La Niña flooded some coal mines. That made the workload heavier for gas, but producers overestimated their reserves and have contributed 50% less to the market this past year than in 2017, while exporting more. That raises fears of a supply shortage, especially in the south.

A policy of mitigation and adaptation could have prevented or improved this situation, even with the effects of the war in Ukraine. Albanese’s promise that renewables will provide 80% of electricity by 2030 is a good start. But you have to combine that with efficiency: deaths attributable to cold homes are double the rate in Sweden. According to the Climate Council, operating costs and residential emissions could be reduced by 12%.

Setting clear targets for the closure of fossil fuel plants, as well as supporting mining communities, is key. The German Coal Commission would be a good model. If politicians put together a complete package, investors will funnel more capital into renewables.