The politics of an unsettled energy transition

By Sophie Webber, School of Geosciences and Gareth Bryant, School of Social and Political Sciences

Australia is undergoing a globally significant renewable energy transformation. Rapid growth in large-scale renewable installations in recent years through solar and wind farms and sustained growth in the rooftop solar market has transformed Australia’s energy mix.

For brief periods in 2022, renewables powered two thirds of the (nearly national) electricity grid when just five years ago peak renewables maxed out around 30%. In South Australia, 70% of electricity comes from wind and solar, and for 180 days in 2021 the state was able to meet its total electricity demands from renewable sources, aided by batteries. As the Clean Energy Council states, a renewable energy future in Australia is both urgent, but also now ‘inevitable’. The different institutional, regulatory and market bodies that govern Australia’s electricity and infrastructure now work towards a shared goal of supplying affordable, reliable and low-emissions electricity to the grid.

This was the celebratory mode and mood of the recent State of Energy Research Conference. NSW Treasurer and Minister for Energy, Matt Kean, promoted the work of the NSW Government with its Electricity Infrastructure Roadmap, Renewable Energy Zones (REZs), and plans for critical mineral extraction, which pave an ambitious pathway for the state to become a global ‘Energy Superpower’.

Conference organisers and panellists exclaimed: “we’re actually doing stuff!”; so much stuff, in fact, that the current Australian energy market is now one of the most dynamic in the world, particularly at the household scale. Different presenters showed graphs depicting Australia’s future energy mix, with growing proportions of wind and solar in the decades ahead, eclipsing the soon miniscule role of fossil fuels in powering the nation (see here). They argued: 2022 was the year in which wind, solar and batteries were “settled” as the power source of the future, with their rise assured by the rapidly decreasing costs of new renewable installations. While not ready to declare Australia’s ‘Climate Wars’ over, the message of the conference was: the renewable energy transition is happening now, so get on board.

There are many reasons that regulators, engineers and politicians might promote this self-congratulatory account of the current state of the renewable energy transition in Australia. But, away from the main stage – and within the growing body of research examining the unfolding transition across Australian homes, workplaces and landscapes – fractures in this view emerge. While many of the conference participants acknowledged – indeed, fixated on – the technical problems with managing peak load in distributed electricity systems and the scale of transmission needs, there are more fundamental challenges for Australia’s renewable energy transition. In particular, the renewable energy transition must grapple with the politics of land, labour and finance in the transition to net zero emissions. Let’s briefly consider each in turn.  

Land

The renewable energy transition is happening on First Nations lands and waters: “Indigenous peoples have recognised land interests over more than half of the continent… with more under claim”. This is a point not well communicated in, for instance, AEMO’s step-wise Integrated Systems Plan (see here), which maps development for the nearly national grid, and locates the large scale installations and transmission lines that will be necessary to reach net zero emissions. Nor is the Aboriginal land estate considered in the State’s plan for critical mineral exploration, extraction, processing and value add hubs (see here).

But, as First Nations renewable energy advocates remind us, Indigenous-owned land will be an essential component in a variety of requisite technologies for renewable energy generation, storage and transportation. The NSW REZs do stipulate engagement, employment, and benefit sharing as part of an Indigenous Procurement Policy. At a minimum, then, the renewable energy transitions creates new economic opportunities and access to services for Aboriginal peoples, but can it more expansively works towards self-determination, and even decolonisation? Can there be not only First Nations participation, but control?

Labour

Who is going to build this transition? Infrastructure Australia describes an “unprecedented” pipeline of infrastructure investment across the nation. Over the next decade, as each state looks to significantly expand its capacity for large-scale renewable energy installations, this infrastructure crunch will intensify with significant impacts on skilled labour availability.

Researchers at UTS have recently demonstrated that labour demand exceeds supply acutely during peak construction periods in each of the REZs. A shortage of skills supply will become even more pronounced as renewable energy infrastructure construction booms globally. Some commentators remain sceptical as to whether planned installations will be built as projected.

‘Just transition’ programs aim to shift workers in highly polluting industries to greener ones, where coal communities in, for instance, the Hunter and LaTrobe Valleys, are revitalised through access to employment in renewable energy industries. One of the goals of the REZs is to secure employment for affected workers. However, projections of construction activity in renewable energy industries indicates that there will be a boom in work over the next decade – which labour projections indicate will not be easily met – and then a rapid decline as more minimal operations and maintenance requirements continue.

Meeting these jobs will require an increase in training programs and detailed planning of timelines. In addition to the quantitative questions of work are more important ones about quality: much of the labour force constructing renewable energy installations face temporary and precarious positions in their employment contracts and residency rights, and patterns of gendered and racialised exploitation are emerging across the supply chain. Not all green jobs are good jobs.

Finance

In our previous research, we’ve considered who will pay for climate infrastructures, and what these financial relations mean for the social and environmental impacts of how infrastructure is built. In short, who pays – whether the state, a combination of state and market through public-private partnerships, or new collectives in community-based renewables – matters for renewable energy installations. However, these considerations were curiously absent from the conference, despite Australia hosting one of the world’s largest green banks, the Clean Energy Finance Corporation, which has acted as a global model for blending public and private finance.

NSW and Victoria have adopted contrasting financing models in their ambitious renewable energy investment pipelines. Victoria aims to reverse many key instruments of privatisation undertaken in the 1990s in pursuit of public ownership of energy, and will re-establish the much maligned State Electricity Commission. In contrast, while the NSW Government has been key to the establishment of the REZs and the turbo-charging of renewables more generally, it positions the role of governments as subsidising and ‘de-risking’ the private sector, which will finance, build and operate these installations. Understanding the financial, social and environmental effects of financing models for renewable energy will be a crucial area of future research.

While the last year has seen dramatic changes in the renewable energy landscape of Australia, the social, environmental and economic stakes of these changes remain high. The renewable energy transition is far from settled.

Sophie Webber is a Senior Lecturer and ARC DECRA Research Fellow in Geography in the School of Geosciences at The University of Sydney. Sophie studies the politics and economies of climate change adaptation and resilience, primarily in the Pacific region and Southeast Asia.

Gareth Bryant is a Senior Lecturer and ARC DECRA Research Fellow in the Discipline of Political Economy in the School of Social and Political Sciences at the University of Sydney. Gareth studies how public policy and public finance can create more sustainable, equal and democratic economies.

Header image: Albany Wind Farm via Shutterstock, ID: 1441763480.