ACOSS welcomes the opportunity to make a submission to the Federal Government’s consultation on the development of the Technology Investment Roadmap (Roadmap). 

ACOSS and our members work to eliminate poverty and inequality and create a fair, inclusive and sustainable Australia where all individuals and communities can participate in and benefit from social and economic life. 

Climate change and a slow, poorly managed transition to zero net emissions is a major threat to achieving our vision. Consistent with the Paris Agreement, Australia must act to support global efforts to limit global warming to 1.5 degrees C above pre-industrial levels. As a wealthy, developed country, this means reducing our net domestic emissions to zero before 2050 and by at least 45% on 2005 levels by 2030. Based on the available evidence, delaying action now will require faster, more expensive and more disruptive change in the future, while heightening risks of more dangerous climate change.

While we support the development of a technology roadmap, we are concerned that the current Roadmap, especially in isolation of policy and emissions reduction targets, does not advance Australia towards addressing the climate crisis with the urgency and magnitude that is required. 

Key points we make in the submission include:

• The Roadmap should be clearly linked to emissions reduction goal.
• Technologies should be consistent with the goal of achieving net zero emissions before 2050.
• Government subsidies should not be provided to support fossil fuel technology.
• Technology prioritisation criteria and stretch goals must be consistent with emissions reduction goals.
• The Roadmap should prioritise energy efficiency, demand management and electrification.
• Continue support for the Clean Energy Finance Corporation (CEFC) and the Australian Renewable Energy Agency (ARENA).
• Consider sustainability of technologies.
• Various enabling  policies are needed to support technology deployment and adoption at scale in Australia.

Please find below further detail for consideration.

1.   The Roadmap should be clearly linked to emissions reduction goals 

The vision and goals outlined in the document were not clear or consistent throughout and had no explicit link to emission reductions strategy or targets. 

Figure 1 in the Roadmap, states the visions as “Australia plays a leadership role in accelerating development and deployment of emissions technology”. Later in the document it articulates the vision as a grab bag of achieving reliable, secure, affordable energy, maximising employment and growth, as well as becoming a technology leader.

The Minister’s forward states the Roadmap ‘will be a cornerstone of Australia’s long term emissions reduction strategy’, which is required under article 4, paragraph 19 of the Paris Agreement. Yet the vision makes no mention of achieving emissions reductions strategies or achieving the Paris goals. 

We recommend the vision be re-written along the following lines:

Australia will invest in technologies required in Australia and globally to support reduction in global emissions consistent with the Paris Agreements emissions reduction goals of limiting warming to 1.5 degrees, and support a fair, sustainable, strong economy.

In addition to the goals articulated under the vision on page 9, we would also recommend the inclusion of the following goals:

• Support an equitable and just transition.
• Be consistent with Australia’s carbon budget required to contribute its fair share of global goal to pursue 1.5 degree C temperature limit (pre -industrial level).

2.   Technologies should be consistent with the goal of achieving net zero emissions before 2050 

The Intergovernmental Panel on Climate Change advises that global emissions will need to reach net-zero by around 2050 to achieve the goals of the Paris Agreement.to limit global warming to well below 2 degrees and pursue a limit of 1.5 degrees C. The global emissions budget for limiting average global temperatures is rapidly closing. A recent report by UNEP finds that countries are on track to produce, and presumably utilise, 120% more fossil fuels than is consistent with limiting warming to 1.5 degrees.

The Roadmap should prioritise zero emissions technology and preclude any technologies that do not provide a rapid pathway to zero emissions. 

Large scale wind, solar, solar thermal, batteries, pumped hydro, green hydrogen, along with energy efficiency and demand management should be prioritised.

Technologies such as brown hydrogen (hydrogen derived from coal or gas), carbon capture and storage (CCS) associated with electricity infrastructure and/or where other zero emissions technology exist, should be explicitly ruled out. Further expansion of fossil fuels also cannot be justified, including new gas (which emissions life cycle is almost as high as coal).

3.   Government subsidies should not be provided to support fossil fuel technology

Even without a carbon price in Australia, private investors are reluctant to invest in new fossil fuel power stations and increasingly reluctant to invest in the expansion of coal production and in some cases gas. 

Given the need to accelerate zero emissions technology if we are to stay within the global carbon budget and limit warming to 1.5 degrees C, governments should not be providing subsidies to support fossil fuel production, technology development or use. 

Any further investment in emission intensive technology and industries will tie future governments and industries to stranded assets and lock consumers into dysfunctional markets.

Government funds should be targeted to support zero emissions technology, a just transition and building resilience to climate change.

4.   Technology prioritisation criteria and stretch goals must be consistent with emissions reduction goal

In determining which technologies the Government should prioritise and invest in, the following criteria should be included:

• Emissions profile – Ability to contribute to achieving zero (or negative) emissions. Including the emissions life cycle.
• Changes to cost curves – consideration of cost curves of different technologies should be considered noting that some are forecast to dramatically reduce in coming years, especially with public investments in R&D.
• Investability – noting that global markets and insurance companies are moving away from fossil fuels including gas and carbon capture and storage (i.e. anything that is not zero emissions). This will in turn help to ensure that technologies are not supported which may become stranded assets in the next decade or two.
• Enabling capacity – ability to enable or accelerate the implementation of other zero emissions technology, for example, batteries, pumped hydro, energy efficiency, demand management.  Technology should be de-prioritised if its implementation slows or hinders the cost-effective development of low-emissions technology. 

The government should make clear what weighting will be given to criteria used to prioritise and invest in technologies to reduce emissions.

The Roadmap also states the Government’s intention to set measurable economic goals or “stretch goals” for specific priority technologies and track progress towards them, for example producing hydrogen under $2 per kilogram. Again we would argue the stretch goal also has to be consistent with emissions reduction goal. There is no point in producing brown hydrogen at $2 per kilogram if it means we blow our carbon budget.

We also encourage the consideration of a stretch goal of more than 100% renewable energy to not only power our electricity grid but to power green industry (such as green steel, aluminium and ammonia) and export renewable energy (green hydrogen, renewable electricity via underground cable). See for example a recent report released by WWF-Australia Making Australia a Renewable Export Powerhouse.

5.   The Roadmap should prioritise energy efficiency, demand management and electrification

Energy efficiency and demand management

Energy efficiency and demand management are a critical part of the toolkit to support acceleration of new technology and reduce emissions. Energy efficiency in the building sector could deliver 28 per cent of Australia’s 2030 emissions reduction target at low to negative cost. It can also contribute to making energy more affordable and improving the reliability and stability of energy systems. For people in low-income, energy efficient homes creates better lives by significantly reducing energy bills, improving climate resilience and improving health and well-being. 

The COAG Energy Council has agreed to a Trajectory for Low Energy Buildings, a national plan that sets a trajectory towards zero energy (and carbon) ready buildings, including existing homes. However there are actions that can be taken now, especially as part of a COVID economic stimulus plan. More than 50 organisations are calling for governments to invest in a national low income energy productivity program that would Invest in installing energy efficiency measures and solar on low income homes. The NLEPP would quickly create thousands of jobs (in training, auditing, installation, manufacturing and local retail), and increase household disposable incomes to spend in the economy (through reduced household energy costs).

Energy efficiency should be prioritised in the short and medium term timescales outlined in the Roadmap.

Electrification

Electrification of the electricity grid, parts of industry (those requiring heat and steam) and the transport system (cars, buses, trains), would accelerate the shift to net zero emissions. 

In addition, electrification can contribute to reducing energy costs of homes, by eliminating the need to pay fixed costs for electricity and gas networks.  In 2018, Renew undertook a detailed analysis of the economics of household gas versus electricity use which demonstrated that in many cases households would be much better off financially with a switch to efficient electric appliances when replacing old appliances at the end of their life, or when building new. For example the report found homeowners would be between $9,000 – $16,000 better off over 10 years if they establish their new home as all-electric with a 5-kilowatt solar system rather than gas-electric with no solar.

Electrification should be prioritised in the short and medium term timescales outlined in the Roadmap.

6.  Continue support for the Clean Energy Finance Corporation (CEFC) and the Australian Renewable Energy Agency (ARENA)

We support ongoing roles for the Australian Renewable Energy Agency (ARENA) and the Clean Energy Finance Corporation (CEFC) to support the development and deployment of zero emissions technology.

We support expanding ARENAs remit to include energy efficiency, clean transport, and clean industrial technologies. We do not support their remit being revised towards ‘end of pipe’ solutions for fossil fuel-based industries, such as carbon capture and storage.

7.   Consider sustainability of technologies 

The roadmap should avoid technologies that negatively impact on the health and wellbeing of people and the environment in its production, use and disposal (for example nuclear energy).

In supporting technologies, consideration should be given to the sustainability of the life cycle of technologies with respect to:

• Emissions profile during extraction, production and use
• Other impacts such as disposal at end of life

8.   Enabling policies to support technology deployment and adoption at scale in Australia

There are numerous enabling policies that need to be considered as part of the Roadmap to support technology deployment and adoption, including:

Policy framework – The technology roadmap must be embedded in an emissions reduction strategy alongside price signals to unlock private investment in technologies on the scale required.

Regulatory frameworks that ensures there are appropriate consumer protection frameworks that cover new technologies, including the National Energy Consumer Framework (NECF) and its interaction with the Australian Consumer Law (ACL) and corresponding state laws.  

Energy pricing reform that ensures there are efficient and equitable price signals (costs and benefits) to retailers, other energy service providers and end users to:

• Reflect costs placed on the electricity grid helping to reduce grid costs and cross subsidies
• Optimise integration of distributed energy technologies into the grid and more equitable cost recovery

Complementary measures, such as better targeted energy concessions, will likely be needed to support people on low incomes who may be worse off under reforms such as cost reflective pricing for example.

Support for people on low incomes to access technologies – People on low incomes or experiencing disadvantage, especially if they rent, often cannot afford or access emerging distributed energy technologies such as solar PV, batteries, electric vehicles and smart metering technologies.

Support mechanisms that enable people and certain communities to participate in the future roadmap and ensure people and communities are not left behind are critical, including:

• Prioritising investment in energy efficiency and clean energy for social  housing
• Introducing mandatory energy efficiency standards for rental properties and phase in rooftop solar
• Federal, state, local councils and energy retailers work cooperatively together to co-fund ongoing programs for low-income and disadvantaged households to provide access to energy-efficient knowledge, products and solar PV
• Prioritising Investment in clean energy for remote indigenous communities
• Piloting new technologies with low-income and disadvantaged households

Acceleration of large scale renewables by ensuring the transmission grid is optimised to support acceleration of large scale renewables, where cost recovery is fair and equitable. 

Target skills development and job creation by ensuring we have the right skills needed to support development and deployment of zero emissions technologies. New technology job creation should be targeted to help with just transition of workers and communities affected by the shift to a clean economy and/or address regional disadvantage. 

 

For further information contact:
Kellie Caught, Senior Adviser, Climate and Energy, ACOSS
[email protected]