Supporting jobs in renewable energy is the answer to Australia’s economic recovery. The country’s clean energy industry is flourishing; attracting investment and creating employment. Renewables are providing cleaner, cheaper energy for Australians, and have even delivered sub-zero wholesale electricity prices.
Fast-tracking the transition away from fossil fuels and toward renewable energy would bring an abundance of further benefits to Australia. A report by EY-Parthenon and funded by the European Climate Foundation outlines how there are thousands of “shovel ready” jobs available in the sector. “Pivoting to a clean-energy future would not only boost and diversify Australia’s economy, open export opportunities and create new industries and jobs – but also lower domestic carbon pollution and improve the environment for all”, states the consulting organisation.
How is Labor supporting jobs in renewable energy?
Famous for being heavily reliant on fossil fuels, Australia has a reputation as a global “holdout” on decarbonisation efforts. The new Labor government promises stronger action on climate. But, in the same breath, it supports the continuation – and even expansion – of fossil fuel production.
While Labor’s new Powering Australia plan hopes to create 604,000 new jobs in renewable energy, the country also has over 100 coal, oil and gas projects under development. These projects are leftovers from the Morrison government’s anti-climate agenda, but the Albanese government still supports the fossil fuel industry, and many of these new projects are expected to go ahead. The government are also responding to the 2022 energy crisis with more gas and has opened up ten new offshore gas fields for exploration.
However, supporting expensive, polluting new gas projects is not a solution to the crisis. Moreover, subsidising the gas industry is a poor option for economic stimulus, outlines the independent public policy think tank, The Australia Institute. It would provide very few jobs and squander a “once in a generation opportunity” to permanently reduce energy costs for Australians. Backing gas also “cannot protect the quantity or quality of fossil fuel jobs” in Australia, said The Centre for Future Work. Instead, these jobs will inevitably decline as the global energy system shifts quickly to renewables.
Debunking the myth that fossil fuels drive the economy
Fossil fuel industries are often heralded as the ‘engine’ of Australia’s economy. But, in fact, these industries account for a small proportion of total employment: only one per cent. Moreover, fossil fuel industries have created very few new jobs in recent years compared to other sectors.
While some fossil fuel businesses serve as important ‘anchor’ industries in some regional communities, they create relatively few direct jobs. Fossil fuels contribute just 1.2 jobs per AUD $1 million in value-added compared to an average of 7.2 jobs elsewhere. This means these industries generate far weaker local employment spin-offs than other regional employment anchors. What’s more, workers do not receive most fossil fuel revenues. Instead, the business owners – who are often based abroad – are the main beneficiaries.
Projections show a rapid decline in global demand for fossil fuels over the coming years. Therefore, leaders need to be proactive to manage this transition properly at national and regional levels. In Australia, this will affect over 80,000 jobs in coal, oil and gas export industries, found the Centre for Policy Development (CPD) in a comprehensive review. The report calls on all levels of government to plan for a “predictable and manageable” change. “To deny the reality of what the global market is doing is to set ourselves up for failure”, warns CPD’s policy director Toby Phillips.
Australia’s potential as a leader in the renewable energy sector
Australia boasts some of the best clean energy resources in the world: enough to power the country 500 times over. WWF-Australia is calling on leaders to make Australia the world’s leading exporter of renewable energy by 2030. “As the world shifts to a low carbon future, Australia has everything we need to take the lead and become a renewable energy export superpower”, suggests the organisation. “We’ve got endless sunshine, plenty of space, powerful winds, world-class expertise and strong trade relationships: it’s a winning combination.”
The International Renewable Energy Agency (IRENA) found that every million US dollars invested in renewables or energy flexibility would create at least 25 jobs. In addition, renewables could support an improved gender balance in the energy sector, where currently women only hold an estimated 32 per cent of jobs.
States and territories leading the way on renewables
In 2021, Australia’s renewable energy industry generated more clean energy than ever before and added a record amount of new capacity. In total, 32.5 per cent of Australia’s total electricity generation came from renewables in 2021. Wind and solar were the drivers of this change, increasing a massive 59 per cent year on year. Records for renewables have continued throughout 2022, with wind and solar powering over 60 per cent of Australia’s main grid on multiple days in September.
For the first time, Australia has now moved into the three most attractive countries in the world for renewable investment. This achievement is primarily due to its rapid solar photovoltaic deployment.
This progress signalled the inevitability of Australia’s clean energy future, says Kane Thornton, Clean Energy Council Chief Executive. States and territories continued to lead this transition, demonstrating what strong policy and bipartisan support can achieve. For example, wind and solar powered the entire state of South Australia over a 93-hour period in 2021. This set a record for a gigawatt-scale electricity grid anywhere in the world. The state’s grid now leads the world for wind and solar powered electricity, averaging 64 per cent in the 12 months to September 2022.
Canberra also plans to become the first city outside Europe to shift entirely to renewable energy. “Achieving 100% renewable status shows what governments can achieve with strong climate and energy policy”, said Richie Merzian, Climate & Energy Program Director at the Australia Institute. “This shows that states and territories are leading the way on climate action while national governments often lag behind. Australia is a perfect example.”
A roadmap for Australia’s renewable energy jobs
There is a bright future for renewable energy in Australia. Many reports have found vast opportunities available in the renewable jobs market. For example, the highly regarded Million Jobs Plan outlines that renewables and low emissions projects can deliver 1.8 million new jobs in Australia in just five years. It was launched in 2020 by leading figures in business and industry, including architect of the Paris Climate Agreement, Christiana Figueres.
Independent analysis from former Treasury economist Chris Murphy found that this plan would deliver a robust economic recovery from COVID-19 for Australia. Benefits include lower unemployment, higher living standards and contained government debt. Whatmore, the plan only requires modest government support through seed funding. Key benefits from Murphy’s analysis are:
- A boost to private investment by AUD $25 billion annually, representing close to two per cent of GDP.
- A real wage increase of one per cent in 2022–2023 and two per cent by 2035–2036.
- A significant boost to diverse business sectors and provide jobs throughout Australia – over 70 per cent in regional areas. The plan delivers results almost immediately, and its benefits persist for many years.
Stepping up ambition
Australia’s success in renewables has been largely attributed to the 2020 Renewable Energy Target (RET), which attracted much investment. However, the preceding conservative government’s lack of “meaningful policies” on climate was threatening investor confidence, suggests the Clean Energy Council. The rapid growth of Australia’s renewable energy capacity in recent years has been hindered by grid limitations and insufficient long-term policy targets, according to energy research and consultancy firm Wood Mackenzie. They outline that the long-term RET for Australia needs to increase to unlock AUD $52.5 billion in investments.
The Clean Energy Council also found that skills shortages hold back renewable energy. This is causing issues such as reduced efficiencies and costly project delays. In addition, IRENA’s Renewable Energy and Jobs Annual Review 2020 calls for stronger federal government policy support for renewable energy. “Comprehensive policies, led by education and training measures, labour market interventions, and industrial policies that support the leveraging of local capacities, are essential for sustaining the renewables jobs expansion”, the agency outlines.
Australia is gifted with an abundance of low-cost clean energy resources. But, the country’s addiction to fossil fuels threatens the thriving renewable economy that is right within Australia’s grasp. The best way for Albanese to now support workers, communities, the economy and the climate is to end support for fossil fuels and “supercharge” the transition to renewable energy and the plentiful job opportunities the industry can create.