Renewable energy

Renewable sources of power generation have the potential to significantly augment and in the longer term supplant electricity generating systems based on fossil fuels and nuclear power. Renewable energy involves technologies designed to acquire energy from a variety of sources that are inexhaustible on human timescales, for example:

  • the sun's heat and light (solar energy)
  • the heat from the deep earth (geothermal energy)
  • movement of the wind, ocean, and rivers (wind, tidal, wave, current and hydro energy), and
  • the heat generated by burning gaseous or solid organic waste products (biomass or bioenergy).

Renewable technologies include those suited to direct generation of electricity, as well as to a broader range of applications including transport.

Electricity accounts for about 40 per cent of the world’s primary energy use, and with an annual growth rate of 2.7 per cent, demand for electricity is growing twice as fast as the total demand for energy. The dominant technologies for electricity generation are coal and nuclear, and much of the debate about the capacity of renewable energy relates to its ability to compete against them. However, this debate is increasingly less about simple comparisons in the costs of generating electricity. Firstly, renewables offer obvious advantages in reducing carbon emissions, so that as mitigation policies are implemented and the costs of carbon are applied to the electricity sector, the renewable energy sector is becoming increasingly competitive. Secondly, renewables are sustainable; their supply is not finite and dwindling, unlike the carbon fuels currently used for the vast majority of energy generation in most of the world. The rate of technological improvement and efficiency gains is rapidly evolving in the renewable energy sector. These technological improvements, combined with greater awareness of the environmental imperatives of climate change and the spread of government programs and funding favourable to clean energy, are behind the accelerating development and deployment rate of renewable energy facilities around the world.

Australia is well endowed with a wide range of renewable energy resources: particularly wind in the south; tidal in the north, geothermal in the centre and southeast; and solar everywhere. A study by Energy Strategies for the Clean Energy Future Group showed that by 2040 renewable energy could supply over half of Australia’s electricity, reducing CO2 emissions from electricity generation by nearly 80 per cent (relative to 2001 levels). In the longer term, renewable energy could supply 100 per cent of grid electricity. Some forms of renewable power also offer ways of producing liquid and gaseous energy such as biofuels, biogas and hydrogen, so that the reach of the renewable energy sector could in the longer term cover all aspects of the energy market in Australia.

The inherent intermittency of several forms of renewable energy and the distribution of suitable renewable energy sites are challenges that need to be adequately addressed in order to overcome impediments to growth of the sector. These challenges include cost-effective and reliable energy storage devices, and restructuring of power distribution infrastructure away from the highly centralised coal-based infrastructure, towards a more distributed infrastructure reflecting the very different geography of renewable resources.

Below, we give an overview of:

More detailed information is available in the Parliamentary Library Research Paper The potential for renewable energy to provide baseload power in Australia.

Renewable energy technologies

Renewable energy is produced from essentially inexhaustible natural sources of energy associated with solar radiation, the Earth’s internal heat, air or water movement in the atmosphere, oceans and river systems, and also from effectively continuous supplies of combustible organic material.

There are many different forms of renewable energy sources and technologies, and it is likely that scientific research will develop as yet unknown ways in which energy can be tapped from natural or readily renewable sources. The different forms of renewable energy are:

  • Solar thermal technologies, which harvest energy directly or indirectly from the sun’s radiation upon the Earth. Techniques include:
    • Zero to low concentration, low temperature applications including panels or tubes for solar hot water commonly seen on house roofs; solar chimneys where warm air rises up a chimney to turn a turbine; and solar ponds where sunshine onto brine ponds warms the highly saline layers, and this heat can be used for low-grade heating applications.
    • High concentration, high temperature devices which focus the sun’s heat onto a small collector using special reflectors, to generate high temperatures capable of turning water into steam. Different sorts of concentrating devices made up of arrays of mirrors of different geometries include parabolic troughs and dishes and Fresnel collectors. These devices can be grouped in arrays surrounding a central solar tower, enabling longer periods of heating at very high temperatures.
  • Solar photovoltaics (PV), where panels incorporating semiconductor materials directly converts the energy of sunlight into electrical current.
  • Geothermal energy harvests heat in the Earth’s crust. Unlike New Zealand, Australia lacks surface/near-surface volcanic activity, and so geothermal heat is accessed by drilling into hot fractured rocks to circulate water and produce steam, up to several kilometres below the surface. There are also a few areas where water flowing from geothermal aquifers (underground reservoirs of hot water) via artesian bores (wells) is hot and plentiful enough to generate electricity.
  • Wind energy is harvested by turbines with generators incorporated in the hub at the top of the tower.
  • Ocean energy can be tapped from tides, waves, and marine currents, and research and development is underway to examine other possibilities including thermal layering and salt gradients (i.e. making use of large differences in temperature and salinity in different layers of water to generate energy).
  • Hydro power relates to energy generated by moving water in river and lake systems – predominantly hydroelectric turbines installed in large dams. Mini-hydro systems can be installed in rivers and other opportunistic settings suited to small outputs for local consumption.
  • Biogas or methane is collected from decomposition of organic material from landfill and other facilities, or by gasification of biomass with oxygen. It can be used to power internal combustion-driven generators.
  • Biomass involves burning crop or agricultural processing residues and wood waste to drive steam turbine generators. Plants absorb CO2 as they grow, and burning biomass then releases CO2, so the use of biomass as an energy source is essentially carbon-neutral (although, as with other renewable energy sources, there may be emissions associated with harvest, transport, manufacture of required equipment, and processing).


Challenges for the renewable energy sector

Renewable energy technologies are capable of providing electrical energy and also stored and transportable energy as gases and liquids, and there is no conceptual barrier to their supplanting all non-renewable energy. The renewable energy sector is undergoing rapid growth, but for its potential capacity to be realised, some significant financial and technical challenges need to be overcome including scale, cost, extension of the electricity grid, and intermittency.

Whilst the renewable energy sector is the fastest growing energy sector in percentage terms, this growth rate relates to a very low quantum of electricity production. When viewed in terms of megawatts electricity produced, this growth is greatly overshadowed by increases in coal-fired electricity. This is most evident in the USA, China and India which together account for 80 percent of the world’s energy demand growth. The rate of growth of the renewable energy sector will need to increase further if it is to challenge the dominance of coal and gas electricity generation.

Technological development is advancing quickly, but as well as efficiency of energy production, the scale of renewable energy installations will need to increase substantially, for example to the same order of a new coal-fired power station of 1000 Megawatt (MW) capacity. This will require the development of very large 'farms' of wind turbines, solar thermal collectors, wave machines etc. Geothermal power based on hot fractured rock resources have the potential in the longer term to form the basis of large capacity power stations. The following table lists the largest scale renewable energy facilities that are currently under consideration or construction, or that have government support.

Table 1: Examples of large planned renewable energy facilities

Type Largest planned installation Company, location Timing
Wind 1000 MW offshore windfarm, 341 turbines. Individual turbines now <7 MW London Array, Kent UK Phase 1 (175 turbines) by 2012
Wave 4 MW oscillating water column device RWE Isle of Lewis, Scotland Delayed owing to financial difficulties
7 MW ‘Wave Dragon’ anchored overtopping device Wave Dragon, Pembrokeshire coast, Wales Currently testing, could lead to 70 MW installation in Irish Sea
Tidal Up to 1000 MW Severn barrage, undergoing feasibility study by the UK government Decision to be made in 2010
Ocean current 300 MW array of sea channel turbines, each 1 MW Lunar Energy and Korean Midland Power Co, southern Korea 2015
Solar 1000 MW photovoltaic array (up to 4 individual arrays) Under Australian Government Clean Energy Initiative, site tba Bids to be assessed in 2010
850 MW parabolic dish + Stirling engine Stirling Energy Systems Solar One, Calif USA 2014
400 MW solar trough BrightSource Energy, Ivanpah, Calif USA 2012
550 MW photovoltaic array First Solar, Topaz, Carrizo, Calif USA 2013
177 MW linear Fresnel collector PG&E, Ausra, Carrizo, California USA 2010
Geothermal 500 MW hot fractured rock Geodynamics Limited, Innamincka, Australia 2015
Biomass 300 MW wood waste Oglethorpe Power Company, Ga USA 2015

Overall, the cost of electricity generated from renewables is significantly higher than for coal and gas. However this differential largely disappears when the cost of including carbon capture and storage is factored into coal and gas-based generation. Recent predictions suggest that the adoption of clean coal technology would see the cost of wholesale electricity rise by 50 per cent and the price to consumers go up by a quarter. The cost of power from biomass, wind and wave power is already within the range of costs for coal generation with carbon capture and storage, and technological advances and upscaling promise to reduce these costs further.

There are additional external costs related to impacts upon climate change and human health from the different energy generation methods. These additional costs are significantly higher for gas, black coal and brown coal, compared to renewables such as solar PV and wind. They include issues such as emission of air pollutants, industrial safety, environmental impacts, and impacts on land and water resources. Whilst not normally considered when costs are compared, these externalities suggest that significant savings in societal costs may accrue from a major shift away from carbon-based energy production.

Several renewable resources are relatively remote from main areas of energy use and from the national electricity grid. However, systems can be constructed to solve this problem in much the same way that railways have been constructed to bring coal from remote mine sites and gas is piped from central Australia to the eastern seaboard. HVDC (high voltage direct current) cables are already used to transmit electricity over long distances with little loss, such as the Bass Link between Tasmania and Victoria.

The inherent intermittency of several renewable energy sources can affect the continuity of supply, and the cost and complexity of a new electricity system based on renewables. Methods to counteract the intermittency issue include:

  • a mix of generating capacities and distributed locations to reduce reliance on daylight hours, sun, wind, or waves
  • incorporating renewables in the mix which are not subject to intermittent energy, i.e. biomass and geothermal hot fractured rock
  • back-up generation utilising sources which can respond quickly to demand fluctuations and which are less polluting in CO2 and other greenhouse gases than conventional coal technologies
  • smart grids or smart controllers to manage inputs from various distributed renewable energy sources and match these with demand, and
  • technologies to store excess energy to be used when primary generation exceeds demand.

A range of possible technologies are being investigated to capture and store intermittent and excess power and in turn provide a reliable continuous energy source. These include:

  • mechanical – e.g. flywheels, pumped hydro, compressed air storage
  • thermal – e.g. ice storage, hot water, molten salts
  • electrochemical – e.g. low temperature batteries, high-temperature batteries, flow cells and fuel cells, and hydrogen, and
  • direct – e.g. capacitors and superconducting magnetic energy storage.


Further reading and sources:

S Needham, 2008, The potential for renewable energy to provide baseload power in Australia. Parliamentary Library Research Paper 2008/9, 34pp.

World Nuclear Association website:

Renewable Energy Policy Network for the 21st Century, Renewables global status report, 2009 update.

Australian Greenhouse Office January 1999. Consultancy report; 2 per cent Renewables Target in Power Supplies, Potential for Australian capacity to expand to meet the target. Redding Energy Management & RMIT Environmental Management Group.

A Jolley 2007. Technologies for Alternative Energy, Climate change working Paper No 7, March 2006. Centre for Strategic Economic Studies, Victoria University.

Norwegian Water Resources and Energy Directorate, Renewable Energy, 110 pp.

J Arlidge, P Gill and K Orchison 2007. Powering Australia: the business of electricity supply 2007-08. Focus Publishing, Woolloomooloo 2007.

Australian Bureau of Agricultural and Resource Economics 2008. Australian Energy Statistics update 2008.

T Biegler 2009. Externalities – the reality of hidden costs of electricity, ATSE Focus 2009, vol. 155.

R Baxter 2007. A call for back-up: How energy storage could-make-a-valuable-contribution-to-renewables. Renewable Energy World magazine, vol 10 September 2007.

A Collison 2000. The costs and benefits of electrical energy storage. In Renewable energy storage. Institution of Mechanical Engineers (UK) Seminar Publication 2000-7.

Electric Power Research Institute. Review and comparison of recent studies for Australian electricity generation planning: Report for UMPNER. 21 November 2006.

House of Lords Select Committee on the European Community’s “Electricity from Renewables” HL Paper 78-I, June 1999.

N Jenkins and G Strbac 2000. 'Increasing the value of renewable sources with energy storage'. In Renewable energy storage. Institution of Mechanical Engineers (UK) Seminar Publication 2000-7.

H Saddler, M Diesendorf, & R Denniss 2004. A clean energy future for Australia. Clean Energy Future Group, Sydney.

22 October, 2010