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Policy Paper #1/25: Australia's Energy Transition: Policy or Experiment?

Author: Dr Tom Biegler (February 2025)

Key points:

  • Australia’s clean energy transition involves replacing fossil fuels with clean renewables in electricity supply systems. The aim is to stop using fossil fuels (coal, oil and natural gas) entirely and reduce to zero the emissions of their combustion products, especially carbon dioxide.

  • State and Commonwealth governments set, regulate and progressively raise “percent renewables” targets for generating clean electricity. Solar and wind energy are the recognised growth sources of clean energy.

  • These targets have risen from an initial 2% in 2001 to the present 82%, to great public applause. However broader official data sets, give a quite different impression. For example in 2023 renewables comprised just 9.4% of Australia’s total energy consumption. And under present policy mechanisms it will take the % renewables metric 58 years to reach 100%. A growth strategy based solely on targets and incentives will be inadequate for eliminating fossil fuels.

  • Reconciling these apparently contradictory figures is complex but does not affect the broad conclusions of this paper.

  • “% renewables” is a faulty metric. It exaggerates progress rates. It wrongly implies that “100%” means elimination of fossil fuels from the energy system. It ignores the large fraction, around 60%, of fossil fuels NOT used in power generation. It is cherry picked.

  • Importantly the slow growth and misleading targets show that Australia’s solar/wind renewables-based clean energy policy is an experiment, with major associated risks.

  • No industrialised economy can operate on a clean solar/wind/storage system alone. Australia will eventually have to add nuclear energy to the mix.

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