The Department of Climate Change, Energy, the Environment and Water has conducted a consultation on its Electricity and Energy Sector Plan Discussion Paper. 

The rapid decarbonisation of the electricity and energy system is essential for Australia to meet its obligations under the Paris Agreement. Electricity generation is the nation’s largest contributor to global climate change. The adoption of renewables will reduce emissions by around a third (CSIRO 2023) and will have powerful flow-on effects for other sectors of the economy.

However, the transformation is remarkably complex. It means reforming electricity and energy infrastructure, workforces, governance, markets, consumer behaviour and the technologies and processes used by businesses and households everywhere. 

Australia’s net zero plan will establish pathways for whole-of-economy decarbonisation. The six sector plans that underpin it must be forward-thinking, considered and harmonious to galvanise the action needed to keep global warming below 1.5°C. The Electricity and Energy Sector Plan must facilitate cohesive and concerted action by energy system actors and enable other sectors of the economy to reduce their emissions. The recommendations in this submission can help it meet those objectives. 

Submission summary 

Climateworks recommends that the DCCEEW consider the following recommendations as the Electricity and Energy Sector Plan is developed. Specific details on each of these points are included in the submission body.

  • Align actions with the Paris Agreement target of limiting global warming to 1.5°C.
  • The rate of decarbonisation planned for in the Electricity and Energy Sector Plan should be rapid due the potential for significant emissions reduction and the sector’s flow-on effects to the rest of the economy.
  • Plan for the rapid and orderly phase-out of gas in the electricity and energy sector. Refocus the gas market to prioritise the clean energy transition and undertake spatial modelling of gas networks to understand locations, pace and order of closures.
  • Prioritise the widespread deployment of demand management mechanisms to reduce energy costs for consumers, enhance grid stability, reduce investment needed in utility-scale infrastructure and accelerate emissions reductions.
  • Review governance of the clean energy transformation to enhance transparency, coordination and efficacy.
  • Align action and ambition of the Electricity and Energy Sector Plan with the five other sector plans, so that all work together to underpin Australia’s net zero plan and ambitious emissions reduction targets.
  • Utilise precinct-scale spatial planning to integrate industrial, export, freight/transport, and urban electrification clusters.

Align government and private sector funding and investment for the Electricity and Energy Sector Plan with the Sustainable Finance Strategy overseen by Treasury, including developing a coherent sustainable finance system architecture in line with international best practices.