Overview:

Introduction

Currently, there are roughly as many drivers to renewable energy development in Australia as there are barriers. Australia's renewable energy market offers great opportunities due to its tremendous natural resource availability. For now, however, Australia will continue to be largely reliant upon governmental incentives and regulatory frameworks to increase its renewable energy development.

Features and benefits

* Analysis of installed capacities and generation output for the main sources of renewable energies across Australia, at a national level and by state.
* A detailed identification of the key drivers and barriers shaping these markets, and the likely growth potential of each renewable technology.
* An examination of new technology introductions and innovations, and future areas of opportunity for manufacturers and power providers.

Highlights

Australia has weathered the global recession well and its economic indicators are set for growth. Aging energy infrastructure and assets, however, will need to be replaced and voters' climate change concerns taken into account.Australia's renewable energy development has been relatively sluggish, but recent federal and state level incentives, particularly the Renewable Energy Target, could give developers a great boost. Especially wind and solar power sectors are forecast to grow strongly in the coming years.Despite governmental funding, Datamonitor estimates that around A$45bn of private investment will be required to develop the 20GW of renewable energy capacity that is currently under development. In order to meet the Large-scale Renewable Energy Target (LRET) requirements by 2020, around 14GW of new renewable energy capacity need to be installed.

Your key questions answered

* Assess the state and future outlook for renewable energies in Australia
* Determine how different elements of Australian legislation and wider market trends are influencing the development of the main renewable energy market
* Understand how renewable energy strategies are likely to evolve and how your company should interact with Australia’s renewable energy market

Executive Summary
Australia's economic situation is set for growth, but will its electricity market cope?
Australians are worried about the environment and climate change
Australian renewable policies are characterized by patchwork approaches and uncertainty
Renewable energy capacities have grown since the beginning of the millennium
Renewable energy capacity could grow threefold should project proposals become reality
Australia is home to abundant sources of renewable energy
Renewable energy investment in Australia is nowhere near the levels required
Conclusion
OVERVIEW
Catalyst
Summary
Methodology
RENEWABLE ENERGY IN AUSTRALIA
Macroeconomic background
Australia largely managed to avoid the recent global downturn and its economic outlook seems positive
Electricity market
Thermal fuels still comprise almost 80% of all Australian generation capacity
Electricity generation has steadily risen in the past but has stabilized in recent years
Energy intensity has decreased throughout the years, but emission levels have been constantly on the rise
Steam turbines dominate thermal installed generation capacity, while gas turbines are much rarer
Two new energy institutions have initiated attempts to improve market transparency and efficiency
Wholesale electricity prices have been rising and falling roughly in line with oil price developments
Average annual retail prices across different states have fluctuated strongly in recent years
Australia's energy market faces several issues and concerns
PUBLIC OPINION
Environmental concerns
24% of Australians rank air pollution as their number one environmental issue, followed by climate change
More than 80% of Australians support greater development of non-carbon based sources of energy
Government role
Australians are unsure about the role of the government in combating climate change
AUSTRALIAN RENEWABLE ENERGY POLITICS
Overview
The Carbon Pollution Reduction Scheme was an unsuccessful first attempt to lower Australia’s emission levels
Renewable energy targets
The development of renewable energy will form a key part of the new government's energy strategy
Other federal policies
Federal renewable energy development programs
State and territory renewable energy policies
Overview
Drivers of renewable energy policy
Barriers to renewable energy policy
RENEWABLE ENERGIES IN OPERATION
Existing renewable energy capacity
Renewable energy production facilities in Australia reflect the climatic conditions of different regions
Existing renewable energy generation
Despite representing 16.5% of installed capacity, hydropower only supplied 5.2% of all generation in 2008
In total, renewable energies generated only 7% of Australia’s total net electricity supply in 2008
RENEWABLE ENERGIES UNDER DEVELOPMENT
Renewable energy capacity under construction
Victoria leads the way in terms of renewable energy capacity currently under construction
Renewable energy capacity under development
Victoria has the greatest amount of proposed renewable energy capacity
Wind energy continues to dominate proposed renewable energy capacities across Australian states
There are proposals to install almost 15GW of new wind energy capacity across Australia
The average size of Australia's proposed solar energy plants is 27MW
Wood waste represents the biggest fuel source for proposed biomass energy capacities
Australian renewable energy capacity could increase roughly threefold in capacity over the coming years
Victoria, South Australia and Western Australia are growing their renewable energy capacities significantly
Future energy generation
Natural gas, not renewable energy, is set to replace the shrinking share of coal-fired generation
Wind power output will overtake hydro as the number one source of renewable power
New South Wales should witness the greatest absolute growth in terms of electricity generation by 2030
RENEWABLE ENERGIES LANDSCAPE
Hydro energy overview and resource potential
Hydropower is a clean and renewable source of energy, with competitive annual levelized costs
Australian hydropower is predominantly generated in the southeastern states
Water availability is a major constraint on future growth in hydroelectricity generation in Australia
The recent drought had a major impact on hydropower consumption levels in Australia
The prospects for new large-scale hydroelectric projects in Australia are limited
Wind energy overview and resource potential
Australia has some of the world’s best wind resources along its southern coastlines
Wind power installation has grown strongly and will play an important role in Australia's future energy mix
Barriers to greater wind energy deployment are technical, environmental and social in nature
Solar energy overview and resource potential
The growth of solar energy in Australia depends on several key factors
Biomass energy overview and resource potential
Biomass as a means of power generation is underexploited, but offers good growth prospects
Geothermal energy overview and resource potential
The share of geothermal power production is likely to increase once its commercial viability is proven
There are four types of geothermal power plants currently in operation for commercial use
Various technologies have emerged to adapt geothermal energy plants to specific geological conditions
Australia has considerable hot rock and lower temperature geothermal energy potential
Geothermal projects need large capital investment and improved economic viability
Ocean energy overview and resource potential
The ocean energy market is eager to replicate the success of the global wind power industry
RENEWABLE ENERGY INVESTMENT
Overview
A major step-up in investment is needed to achieve Australia's 20% renewable energy target
Hydropower costs
Costs for new hydropower plants are offset by long life cycles and low operational costs
Wind power costs
Wind energy offers the most promising investment opportunity of all renewable energy sources
Solar power costs
Asset costs make up the bulk of the annual levelized development costs of solar power
Biomass power costs
Biomass power is a cost-attractive option for co-firing
Geothermal power costs
Costs of geothermal power are largely incurred during the drilling phase
Ocean power costs
Ocean energy power is unlikely to become cost competitive with other renewables in the medium term
Future investment requirements
About A$45bn of investment are required to develop the currently proposed 20GW of renewable capacity
14GW capacity will be required to meet the LRET target of 41,000GWh of additional renewable output
Power generation forecast
Growing energy demand will affect the investment climate for renewable energies
Power prices forecast
Australians have become accustomed to low electricity prices
Renewable power project developers
Renewable energy project development is driven by a number of public and private organizations
Wind and hydro are the sectors with the largest number of project developers
Renewable technology investments
Utility renewable energy investment profiles
Other utilities and equipment suppliers
CONCLUSION
Drivers and barriers
Currently, there are probably as many drivers as barriers to renewable energy development in Australia
Outlook
Australia will continue to be reliant on fossil fuels in the near future
APPENDIX
Definitions
ACT
Biofuel
Biomass
Cap-and-trade
Capex
Carbon dioxide (CO2)
Carbon dioxide equivalent (CO2e)
Carbon footprint
Carbon offset
Carbon trading
Clean Energy Initiative (CEI)
Clean Energy Innovation Centre – Enterprise Connect network
Clean Energy Trade and Investment Strategy
Cleantech
Climate change
Cogeneration
Compound annual growth rate (CAGR)
Carbon Pollution Reduction Scheme (CPRS)
Emissions trading
Geothermal drilling program
Geothermal energy
Greenhouse gases (GHGs)
Hydropower energy (hydro)
Innovation investment fund
Microgeneration
Mandatory Renewable Energy Target (MRET)
Municipal solid waste (MSW)
NSW
NT
Ocean energy
Ocean thermal energy conversion (OTEC)
Photovoltaic (PV) and solar thermal energy
Renewable energy
Renewable Energy Demonstration Program
Renewable Energy Future Fund
Renewable Energy Target (RET)
Resource Exploration Rebate (RER)
Retooling for Climate Change Program
QLD
SA
Second Generation Biofuels Research and Development Program
Solar Flagships Program and the Australian Solar Institute
TAS
Tidal energy
United Nations Framework Convention on Climate Change (UNFCCC)
Venture capital investment (VC)
VIC
WA
Wave energy
Sources
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