Germany provides a good example of how dangerous it is to increase reliance on fossil fuels and the risks associated with treating gas as a transition fuel.
To compare Australia’s energy crisis with the situation in Germany, as columnist , is a red herring and false analogy. Germany is a completely different political and resource base context.
However, for the sake of argument, one thing we can draw from the comparison is that the German example does demonstrate what happens if a country keeps building fossil fuel plants instead of making bold investments in renewables and storage technology.
The German example highlights the danger of relying on a global fuel market that is subject to the kinds of shocks we have seen resulting from Russia’s invasion of Ukraine.
The problems in Germany occurred when the country voted to shut off its nuclear and coal as quickly as possible. The nation started to build wind and solar farms quicker than most other European nations. It wanted to close its nuclear and coal industries and still meet its climate emissions targets.
But its efforts to build renewable power and storage capacity fell behind other EU nations. In fact, it lags the EU average for percentage of power from renewables and half or a third as much as its colder and darker neighbours such as Denmark, Sweden, Norway, and Finland.
Instead of ramping up investment in renewables and storage, Germany made a Faustian bargain to increase its use of gas as a transition fuel to help meet its emission reduction targets, despite having almost zero domestic petroleum or gas resources.
That meant it had to start importing more and more gas from Norway, the Netherlands, and to an increasingly large degree – Russia. Had Germany pushed harder and smarter with renewables, it wouldn’t have become so dependent on imported Russian gas.
Right now, Australia has a golden opportunity to heed this lesson. Just as Germany must now do some soul-searching on how to increase its climate resilience and energy security, Australia can act decisively to reduce the chance we will find ourselves in the same position as Germany in 10 or 20 years.
But Australia is in a much stronger position with an overabundance of wind and solar resources. With the correct effort and smart investments, our research shows that Victoria can get to coal-free and net-zero by the start of the next decade.
As Environment Victoria’s recent discussion paper The case for 100 per cent renewable energy by 2030 in Victoria points out, shifting to 100 per cent renewable energy is not only technically achievable within a few years, it’s also economically, socially and politically desirable.
Importantly, there is a staggering range of groups outside the environment movement that corroborate this view.
NSW’s grid operator, Transgrid, the Australian Energy Market Operator (AEMO), the Grattan Institute, and the Blueprint Institute all agree that this kind of massive and rapid change is feasible – and desirable – for our power grid. Both NSW’s Liberal and Victoria’s Labor governments are also decisively moving in this direction and should be encouraged and supported to move fast enough to meet the challenge.
And the best news is that the rapid growth in renewables is already saving households money. Modelling released by the Australian Energy Market Commission (AEMC) in November last year shows that an influx of renewables and battery storage is expected to reduce wholesale electricity prices by around 39 per cent or $207 in Victoria by 2024.
As Chris Uhlmann has indicated, transforming our energy system to renewables will take mammoth effort. It will take resources, determination, and focus.
Better those efforts are focused on securing the net-zero economy now so that they will make us more resilient and energy independent, while providing long-term energy security. Instead of chastising forward-thinking states from making bold energy transitions today, we should applaud them for not repeating Germany’s mistake of over-reliance on so-called transition fuels.
Making a wartime-like effort to transform Australia’s energy grid now will pay off. To suggest otherwise by using erroneous European examples is to indulge in energy Schadenfreude.