New research by the American Council for an Energy Efficient Economy has revealed the major weaknesses that place Australia way down in the global energy efficiency rankings.
Australia being ranked 18th out of the 25 top energy using countries in the ACEEE International Energy Efficiency Scorecard.
Lack of vehicle fuel efficiency standards, low proportional spending on rail compared to road projects, no mandatory disclosure of residential energy efficiency standards and a dearth of policies and incentives for the industrial sector all contributed.
The ranking places Australia last of all the developed countries, and behind India, China, Indonesia and Turkey.
However, ACEEE senior advisor for research, Shruti Vaidyanathan told The Fifth Estate, the research methodology also contributed to some of the developing nations placing more highly.
This involved looking at energy efficiency policies and outcomes per capita of dollars of GDP. In India and Indonesia, low purchasing power per capita also means lower energy consumption.
Low incomes can also result in people making different choices. India for example, scored highly on transport because most people don’t own a private vehicle and use public transport and cycling as their primary modes of transport.
“With each country there are things that help them reach the goals and targets,” Ms Vaidyanathan said.
The research measured policy and performance across four categories: buildings, industry, transportation, and overall national energy efficiency progress.
Italy and Germany tie in first place
Italy and Germany tied for first place, with scores of 75.5 out of 100 possible points, followed by France, the United Kingdom, and Japan.
France took first place in the transportation category, Japan topped the industry category, Spain topped the buildings category and Germany scored highest in the national efforts section.
Overall, even these high-scoring nations had room for improvement, Ms Vaidyanathan said .
“We can use the scorecard to identify the gaps.”
Spain’s results in the building category included performing really well in terms of energy intensity across both commercial and residential buildings, and having strong building codes and an “impressive” set of retrofit policies.
Being exposed to the European Union’s set of energy efficiency targets, regulations and policies also helps significantly, Ms Vaidyanathan said.
Australian buildings doing well
In Australia, the building sector scored most highly out of all the focus areas, bringing us in at number 10 on the scorecard for the sector.
Ms Vaidyanathan noted Australia’s strong building codes and commercial building disclosure policies as particularly beneficial.
However, on transport we rank at number 20 in industrial energy efficiency 22 and on national efforts 15.
Where Australia is weakest
Low scoring national categories include per capita spending on energy efficiency, the size of the ESCO (energy services companies) market, R&D, national energy efficiency goals, tax credits and loan programs and the efficiency of thermal power plants.
And where the score is zero
In the industrial category Australia has a number of zero scores including the lack of voluntary energy performance agreements with manufacturers, mandatory energy audits, mandates to have plant energy managers, and policies to encourage energy management.
Zero too in fuel economy and smart freight
In transport we had zero scores for fuel economy, fuel economy standards and smart freight initiatives, and low scores for use of public transport and spending on rail compared to roads – just 26 cents for every dollar spent on roads. By comparison, Germany and France both spend more on rail than on roads.
Ms Vaidyanathan said a fuel efficiency standard for light passenger vehicles and one for heavy transport would be an “easy win” for improving Australia’s energy efficiency performance.
Joint first place getter on the scoreboard, Germany, is a “natural leader in energy efficiency”, she said.
It has a national strategy and a solid collective commitment from industry and its population to following the strategy and meeting both its own and the EU targets for buildings and industry.
It also has some of the “more adventurous” programs, such as its KFW program, which provides both technical guidance and financial incentives for energy efficiency.
For the gold standard in building code efforts, Ms Vaidyanathan said “you have to look to France”, where codes apply to both new builds and to existing buildings and retrofit programs.
France will retrofit 500,000 homes
The French government has set a goal of renovating 500,000 homes a year. Its policy also calls for half of these renovations to be dwellings occupied by vulnerable people as a means to help reduce the energy burden experienced by those in low-income communities and social housing.
Grants and programs, such as “Habiter Mieux” will help finance social housing renovations.
Mandatory disclosure has also been implemented across both residential and other building types. All buildings are rated on an A-G scale, and laws have been passed that will mean by 2025, any dwelling must have a rating of E or higher to be sold or leased.
France also has some good policies around transport, with new cars attracting a tax credit based on their fuel efficiency. This is seen as a way to encourage consumers to purchase efficient cars, and to shift car manufacturers towards producing more fuel-efficient vehicles.
Italy also has good scores on transport. Ms Vaidyanathan said it has “done a lot in terms of city-level transport”, including putting resources into a bus rapid transit system.
While there has been much discussion of electric vehicles as a low carbon solution, Ms Vaidyanathan said they are not the whole answer.
“Any transport strategy needs to be comprehensive.”
There needs to be both advanced technology and resources put toward comprehensive mobility options that can service everyone.
EV infrastructure is also not in a state where mass deployment is possible yet, she said.
Creating more momentum in the industrial sector is also an area where Australia needs to take action.
“Selling energy efficiency to manufacturing facilities can be a challenge,” Ms Vaidyanathan said.
The US at No 10 overall
There are a number of ways some of the leaders in this area have utilised. In the US – which ranks at number 10 overall – voluntary agreements between a facility and the federal government have seen some success. The agreements set out the efficiency goals, and the strategies for achieving them.
The use of ISO 50001 the Energy Management Standard has also been effective for energy-intensive facilities in many nations as a roadmap for achieving efficiency outcomes.
Large and medium-sized firms in particular really benefit, Ms Vaidyanathan said.
Trump fails to stump momentum
The change of policy directions at a Federal level under Donald Trump has not seen momentum halt entirely.
Ms Vaidyanathan said there are different stakeholders and state and local governments “rising up to meet the cause.”
They include the cities and state governments that are part of the “We’re Still In” movement that developed following the President withdrawing US Federal support for the Paris Accord.
There are also substantial private companies, including a large number of Fortune 500 companies, that have voiced their commitment to meeting greenhouse gas reduction and climate change goals, Ms Vaidyanathan said.
Luke Menzel, chief executive the Energy Efficiency Council, said Australia’s deteriorating performance on the index is a “wake-up call for policymakers, planners, and business leaders.”
“Our global competitors are saving energy and money with smart energy efficiency policy and investments, while Australia lags at the back of the pack.”
Mr Menzel said the results are disappointing, but point to a huge opportunity.
“We can quickly cut energy bills, while making our homes more comfortable and our businesses more productive by being much smarter about how we use energy.”
Ms Vaidyanathan said that overall, the “big takeaway” for the research is that “there’s room for improvement for every country on the scorecard.”
This is not only because even the best performers were still not scoring higher than just over 75 points out of a possible 100, but because the average score did not change from the previous ACEEE report card in 2016.
“There has been not a lot of progress on a global level,” Ms Vaidyanathan said. “[And] progress is absolutely required for countries to meet the Paris targets.”
- Access the scorecard report here