Australian Energy Industry as a Major Contributor to Climate Change - Case Study Example

Australian Energy Industry Author’s Name Class Name Professor’s Name School City and State Date Introduction Energy sustainability is the most crucial issue in the energy industry in the world today. It involves reducing greenhouse gas emissions that cause climate changes as well as building renewable energy sources. This essay focuses on energy industry in Australia and its sustainability by addressing the climatic changes issues. According to Energy White Paper 2015, Australia is among the largest world exporters of coal, uranium, oil, and gas. It exports approximately 80% of all the energy produced in the country. The report also shows that its exports rose by 14% in 2012- 2013. According to the Department of Climatic Change and Energy Efficiency 2012, the Australian energy emissions rose by 44.2% from the year 1990 to 2010. More also, in the year 2010 the county’s energy sector accounted for 76.9% of greenhouse gas emissions. The energy industry is a major contributor of climate change. Emissions of greenhouse gasses lead global warming thus the energy industry has a greater role to play in energy sustainability and climate change. This essay seeks to explore the Australian energy industry and climate change and how it can become more sustainable with regard to changes in in climate. The essay has five sections with first section showing the current state of Australian energy industry and its sustainability with regard to climate change. The second section focuses on stakeholders’ involvement and roles while the third section looks at the challenges to sustainability. The fourth section shows preferred responses and strategic responses to the challenges of energy sustainability. The Fifth section details how approaches can be implemented to achieve the required goals. Finally, we have a conclusion that gives an overall summary of the essay. Australian Energy Industry Current State Australia has abundant renewable and non-renewable energy resources. According to Australian Bureau of Statistics (2013), the country is ranked as the ninth largest energy producer in the world. It accounts for an estimate of 2.5 % of total energy produced in the world and accounts for approximately 5% of energy exported in the world. The report also shows that in 2010-2011 Australia’s total net supply amounted to 18,879 (PJ) which was a decrease of 4% from years 2008-2009. According to Bureau of Resources and Energy Economic (2014), Australian energy production rose by 9% in 2012-13. Black coal is the largest contributor accounting for 49% of the country’s net energy supply. Uranium is the second contributor despite its fall from 25 percent in years 2009-10 to 18 percent in 2010-11. Both crude oil and natural gas increased their share from 10% to 13% and from 10% to 12% respectively in the same years (Australian Bureau of Statistics 2013). When the coal exported from Australia is burnt, it emits more greenhouse gas than any other source of emission in the country (Greenpeace 2012. Energy involves heat and electricity production, petroleum refining and other industries. The Australian energy industry involves business that deals with coal mining, electricity production and supply, oil and gas extraction, steel manufacturing, and petroleum refining. It also involves coke ovens that are used for steel and iron manufacturing, gas and waste services as well as transport and storage of gas. According to the White Paper 2015, in year 2013-2014 the energy sector employed 170,000 people and accounted 7% of the Australia’s GDP with export earnings of 71.5 billion dollars. Australia has a strong energy sector that drives its economic growth and raises the standard of living of its citizens. According to the Clean Energy Australia Report 2014, more than 15000 businesses installed solar power systems to help them lower their electricity bills in year 2014. In the same year, 13.47 percent of the country’s electricity was sourced from renewable resources. However, this was a fall from the previous, which generated 14.76 percent. In 2014, the new renewable energy produced 16,000 GWh, which is almost half of their 33,000 GWh target. South Australia used approximately 40 percent of renewable energy in 2014. There was a policy uncertainty that was caused by the Federal Government (FG) review of Renewable Energy Target (RET). This uncertainty led to falling of investment in large-scale renewable energy by 88%. Las year rainfall fell by almost a quarter compared to the previous year. There are high expectations that the renewable energy will continue to grow every year in Australia. Although there was steady rise of contribution from solar power (29%) and wind (6%), they could not offset the fall in hydropower. Investment in renewable is increasing on yearly basis with a record of three new wind farms completed in year 2014 including the Trustpower’sSnowtown 2 project which is the second largest Australia’s wind farm. Although the fossil fuel is still the largest contributor of energy, it is slowly decreasing as the renewable energy increases meaning that the country is becoming greener. Australian Energy Industry Stakeholders The stakeholders in the Australian energy industry include the government, Investors, NGOs, citizens, and the media. Australian Government The role of the government is to provide leadership to its citizens and steer the country’s developments in the right direction. The government is responsible for protecting the environment to ensure that their no negative impact that leads to changes in climate. Protecting the environment can be achieved by controlling the emission of greenhouse gasses. The government should make laws that guide every stakeholder on how best to achieve a sustainable clean energy. The laws and regulations such as the clean energy act that was made in 2011 help to regulate the firms in the energy industry. The government is also responsible for research in changes in climate and advice all the stakeholders accordingly. More also the government should invest in renewable energy sources and reduce usage of fossil fuels. Renewable energy can be increased if the government offers incentives to investors who focus on building renewable energy plants and increase taxes on the investors in non-renewable energy business. Non-Governmental Organizations Non-governmental organizations work hand in hand with the government. They are always at loggerheads with investor/firms in the energy industry since they represent different interests. The investors will always want to make more profits without caring about the climatic impact. On the other hand, the NGOs focus environmental preservations. The NGOs carry out research on climate changes and advises the entire country on steps to take to reduce pollutions. NGOs such as Carbon Neutral and Green Peace engage in environmental preservation and are committed to reducing greenhouse gases emissions hence reducing global warming. Finally, the NGOs have responsibilities of educating the citizens on how to reduce energy consumptions to reduce production of excess non-renewable energy. NGOs have a significant responsibility of improving energy sustainability in the energy sector. Citizens The Australian citizens provide market for the energy produced. They can also play a role in ensuring that there is energy sustainability by installing solar panels in their home. Additionally, the citizens have a responsibility of controlling power wastage by ensuring they use the power that they only require. Reduction of power wastage helps to reduce the non-renewable energy produced thus increasing sustainability. Citizens can also combine efforts to preserve the environment and influence the government to improve performance in ensuring that the companies reduce greenhouse emissions. Firms/Investors in the Australian Energy Industry The firms in the energy industry must be responsible for their activities in the energy production. They should comply with the set government policies in ensuring that greenhouse gases are reduced as the country shift the focus to clean energy. It is crucial for all the investors in the energy industry to have their own targets in ensuring that they environment is free from pollution. Moreover, they have a corporate social responsibility to the employees, communities around them as well as the consumers. As everybody in the world shifts the focus of energy production, they should also move with the trend and focus their businesses to a cleaner energy production to ensure that they remain in business. Media Media plays a crucial role in educating people about energy sustainability and climate changes. The media also passes information to the people about the companies that have best complied to the government policies or have put good measures hence increasing their publicity to the citizens. Good publicity means that the company customer base increases hence high profits. Such moves will motivate companies to compete in ensuring that do their level best to invest in greener energy. Media are also businesses like any other and have a responsibility contributing to NGOs and other institutions that promote energy sustainability and environmental preservation. Strategic Challenges to Energy Sustainability Increasing Population Population is increasing at a high rate in Australia. The economy of the country is also growing every year. Similarly, according to the Energy collective (2015), the global population grows by 200,000 people every day. As the population increases and the economy grow, the status of the middle-class rise hence a greater desire for products and lifestyle products. Production of these products requires more energy, which means that Australia will need to produce more energy for both domestic and export purposes. Unfortunately, the increase in the production of renewable energy is growing at a very slow rate. Minimizing air pollution and climatic changes becomes a challenge since the country strategies to have sustainable energy are over showed by growing energy demand. Extreme Weather Impacts According to the Clean Energy Australia Report 2014, Australia’s electricity from renewable sources fell to 13.47% in 2014 from 14.76% in 2013 because of drop in amount of rainfall. The report reveals that the country experienced almost a quarter of the rainfall experienced in 2013. Extreme weather conditions such as floods, cyclones, fires, and storms as well as sustained heat waves may have disastrous effects to equipment used in energy production and distribution (Maru et al). Extreme weather conditions leads to high consumptions of energy in households as people warm or cool their houses. Increased energy demands leads to depletion of natural resources thus posing energy sustainability in the Australian energy industry. Australian Poor Energy Policies The major player in ensuring sustainability in the energy industry is the Australian government. On the other hand, the government is responsible for ensuring that the environment is preserved to reduce the climatic changes. Australian government is not able to strike a balance between prevention of environmental pollution and coal production (Falk and Settle 2011). Australia has black coal and oil which are considered economical feasible. Due to availability of these non-renewable energy resources, the government has no proper policies to limit their production. Technological Issues Since many industries emit carbon dioxide, Australia requires to invest in technology to help reduce carbon emissions to the environment. Australia also lacks a good technology to store renewable energy for example electricity. Although the required technology is expensive, Australian government lacks political goodwill to develop renewable energy that will substitute uranium, oil, coal, and gas. Possible Strategic Responses and Preferred Approach Responses to sustainable energy in Australia in light to the climatic changes revolve around greenhouse gas emissions and reduction of over reliance of non-renewable energy resources. The country has a lot of coal, oil, uranium and gas which are key energy sources hence it could continue to experience more emission in future. The energy industry has a responsibility of reducing the greenhouses gas in support of the laid government policies. All the stakeholders must come together to safeguard the environment as a solution to climatic issues. A major preferred approach is to reduce over reliance on coal, oil and other non-renewable energy sources since they are not sustainable. Australian energy industry should embrace nuclear power and renewable energy to satisfy the increased energy demand and replace the fossil fuel. The preferred approach to greenhouse gas emission is to embrace the technology that reduces emission of carbon dioxide into the air. The Australian government should make long policies that have a proper transition mechanism from non-renewable to renewable energy. Firms in the energy industry should have plans to mitigate the risks of extreme weather conditions. Implementation The responsibility to improve the climate change and sustainability of energy industry lies on everybody. However, the major players are the firms involved in energy production and the government. The government should make long-term, mid-term, and short-term policies to ensure that there solutions to improve energy sustainability and climate changes. According to analysis done Karbek and Denis (2015), Australia can halve emissions by 2030 to a level which was witnessed in year 2005. Diesendorf (2014) predicted that the emissions will be at peak in year 2030 if there is no action taken to improve the energy industry in Australia. The federal government should have short-term plans to be achieved in five years (2015-2020), mid-term plans to be achieved in 10 years (2020-2030) and long-term plans that will be achieved by year 2050. By year 2050, the energy used should be completely sustainable with minimal or no impact on the environment. In the first five years, the government should aim at reducing the energy consumption the country by 15% by educating the public on proper use of energy to reduce household energy consumptions. The government should also offer incentives to the investors to woo them into investing in renewable energy sources. The next ten years should be utilized in building of renewable sources and ensuring that all the companies have a technology that reduce emission of greenhouse gas into the environment. More also the companies in the energy industry must comply with policies of climate change sustainability by the year 2030. The other 50% to ensure the energy industry completely sustainable with no negative impact on the climate should be achieved by year 2050. This will be achieved by ensuring innovation in the energy industry to ensure high renewable energy productivity and efficiency in consumption. Finally, the government should cooperate with other countries to overcome the mutual weakness and participate in ensuring that the whole world has a sustainable energy that has negligible or no impact to the environment hence no impact on climate change. Conclusion Australian energy industry is well endowed with natural resources such as oil, coal, uranium, and gas, which are of great importance in energy generation. Although the government has made some policies to improve its sustainability, there is still a long way to go since the impact to the climate is quite high. The strategic challenges hindering the sustainability in light to the climate changes include extreme weather conditions, lack of proper policies, lack on required technology and increased energy demand due to growing population. The strategic challenges require multiple approaches to in the energy industry. These challenges can be mitigated by reduction of over reliance on non-renewable energy and concentrating on renewable energy as well as increasing the efficiency in consumption. The government should have long-term, midterm and short-term sustainability plans. All the stakeholders should work together to ensure that these plans are implemented. Finally, the government should join with other countries in the world in ensuring that there is sustainable energy that has negligible impact to the climate. References AUSTRALIAN BUREAU OF STATISTICS. (2013). Information Paper: Towards the Australian Environmental-Economic Accounts, 2013. Australian Bureau of Statistics. Retrieved from http://www.abs.gov.au/ausstats/abs@.nsf/Products/4655.0.55.002~2013~Main+Features~Chapter+3+Energy?OpenDocument AUSTRALIAN GOVERNMENT DEPARTMENT OF INDUSTRY AND SCIENCE.(2015). Energy White Paper 2015.Australian Government Department of Industry and Science. Retrieved from http://ewp.industry.gov.au/ BUREAU OF RESOURCES AND ENERGY ECONOMICS.(2014).2014 Australian energy update. Bureau of Resources and Energy Economics. Retrieved from http://www.bree.gov.au/sites/default/files/files//publications/aes/2014-australian-energy-statistics.pdf> CLEAN ENERGY COUNCIL. (2014). Clean Energy Australia Report 2014). Clean Energy Council. Retrieved from http://www.cleanenergycouncil.org.au/cleanenergyaustralia DEPARTMENT OF CLIMATE CHANGE AND ENERGY EFFICIENCY.( 2012). National inventory report 2010.Department of Climate Change and Energy Efficiency. Retrieved from http://www.environment.gov.au/node/35989> DIESENDORF, M. (2014).Sustainable Energy solutions for climate change. NewSouth Publishing, Sydney, NSW. Energy Collective. (2015). Meeting the Challenges of a Sustainable Energy Future. Energy Collective. Retrieved from http://www.theenergycollective.com/maartenwetselaar/2196001/meeting-challenges-sustainable-energy-future Falk, J. & Settle, D. (2011).Australia: Approaching an energy crossroads.Energy Policy, vol. 39, no.11 GREEN PEACE.(2012). Climate.Green Peace. Retrieved fromhttp://www.greenpeace.org/australia/en/what-we-do/climate/ MARU, Y.T., CHEWINGS, V. & SPARROW, A. (2012).Climate change adaptation, energy futures and carbon economies in remote Australian: A review of the current literature, research and policy. Cooperative Research Centre for Remote Economic Participation Working Paper CW005. SKARBEK, A. AND DENIS, A. (2015). New analysis: Australia can halve emissions by 2030. The Conversion. Retrieved from https://theconversation.com/new-analysis-australia-can-halve-emissions-by-2030-43850 Read More