Climate change has now been recognised as a global problem that requires an immediate global response. The costs of delaying such action far outweigh the cost of immediate action.

For Australia to effectively respond to climate change, our electricity production must have significantly lower greenhouse emissions and energy must be used more sustainably.

One of the first steps in establishing the Clean Energy Council has been the development of a policy roadmap to achieve this, while ensuring the ongoing competitiveness of the Australian economy.

The roadmap establishes a dual-track approach - an emissions trading scheme (ETS), coupled with the immediate introduction of complementary policies.

An appropriately designed ETS is essential to set a carbon price signal and accelerate the deployment of least cost, abatement technology, providing urgently needed investment certainty for the industry. The Clean Energy Council position is that such a scheme needs to have a target of stabilising greenhouse emissions at 2000 levels by 2020 as a bare minimum.

However implementation of an ETS will not occur before 2011 at the earliest. Fortunately there is plenty we can do now to minimise our greenhouse gas emissions.

The Clean Energy Council believes an additional market based mechanism, designed to ensure that new demand is met by clean energy technologies, must be implemented. This mechanism would require that renewables provide at least 20 per cent of electricity generation by 2020.

An Energy Efficiency Target, reducing growth in electricity demand by a third so that, by 2020, at least 30 TWh of demand is reduced is also required, as are more stringent regulations on minimum efficiency standards for buildings, appliances and equipment.

The Clean Energy Council will also ensure that energy market barriers to distributed generation, by ensuring that the retail and network benefits provided are recognised and rewarded, either through a feed-in tariff structure or through fiscal support measures such as tax rebates.

The establishment of a Clean Energy Innovation Fund, supporting research, development, demonstration and commercialisation of clean

energy technologies is also being advocated. The fund would also encourage the take up of changes in energy demand practice by maximising the number of low cost abatement solutions and techniques of export quality developed and deployed in Australia.

This fund should provide at least $1 billion dollars for each of demand and supply side technologies and should be highly transparent to ensure that technologies and researchers are able to compete on a level playing field for funding.

Building on what we’ve achieved

To date the Australian sustainable energy industry has developed significant capacity, intellectual property, export potential and financial contribution to the Australian energy supply and economy. This contribution needs to be significantly expanded if we are to effectively deal with climate change.

Smarter energy use and deployment of clean energy supply technologies such as renewable energy and gas fired power generation are essential to delivering emissions reductions.

The Clean Energy Council position is that Australia should set a target for 2050 of 60 per cent reductions in overall emissions, based on 2000 levels.

This target is not out of our reach - the clean energy industry has the capacity to deliver on a Clean Energy Target of more than 20 per cent renewable energy by 2020 and more than 30 per cent by 2030 with minimal cost to the economy.

Australia has significant unrealised energy efficiency potential, and the clean energy industry can reduce electricity demand growth by one-third in each year to 2020 at low or no cost to the economy.

A policy framework to guide new investment in energy infrastructure and address end use consumption is required now and is critical to the cost effective reduction of greenhouse emissions.

A carbon price signal will accelerate the deployment of least cost, abatement technology and provide urgently needed investment certainty for the industry. To be durable and achieve meaningful change it should target stabilisation of Australia’s emissions at 2000 levels by 2020 as a bare minimum.

Additional policy measures are also necessary, in order to:

- Encourage ongoing research and development and provide a future stream of deployable technology. - Accelerate the deployment of technically proven and commercially ready sustainable energy generation technology. - Address the barriers to energy efficiency to unlock its potential to deliver emissions reduction in a cost effective manner. - Provide an even playing field for contesting technologies that recognise the true cost of carbon to the economy. -The key policy challenge facing governments in Australia is reducing carbon emissions while ensuring economic prosperity. With growing energy demand, Australia’s energy sector must rapidly reduce carbon intensity to make a positive contribution to this challenge of maintaining strong economic and employment growth and emissions reductions.

We can achieve this – and with the clear policy roadmap established by the Clean Energy Council, the path forward is clear – now, as an industry, we must follow it.