No easy choices: which way to Australia’s energy future?

by Tony Wood

No easy choices: which way to Australia’s energy future? explores the acute intellectual and policy challenge Australia faces in energy policy. Markets must be the primary mechanism by which Australia transforms its electricity supply. Yet it will not be able to meet its emission targets and at the same time produce future electricity at a price acceptable to the public unless governments act to reduce the costs of low-emission technologies. It is now clear that the carbon pricing scheme alone is not enough to make low-emission technologies competitive and effect the change that Australia needs. This report and its companion detailed report assess the prospects for seven technologies — wind, solar PV, concentrating solar thermal, geothermal, carbon capture and storage, bioenergy and nuclear — that generate electricity with near-zero emissions and that have the prospect of deployment at large scale over the next 40 years. It finds that all seven face obstacles to achieving their potential. Any might contribute significantly to meeting Australia’s electricity needs, but there is no guarantee that any of them will deliver at a reasonable cost. Australia has no easy choices in meeting its future energy needs. That is why governments need to step in, but with a hard-headed, intelligent approach. This report sets out what government should and should not do. Read the op-ed in the Business Spectator.