Embargoed:

Tuesday 30 July 2013

Australias transition to a low carbon economy is underway

Australia has made significant progress towards reducing greenhouse gas emissions and
building a low-carbon economy, according to new research released today.

The ClimateWorks Australia report, Tracking Progress Towards a Low Carbon Economy, found an
increase in activity to improve energy efficiency and reduce greenhouse gas emissions in the last
decade across all sectors of the economy studied.

This was led by reduced deforestation and increased afforestation, significant increases in
industry energy efficiency and more recently sharp reductions in power emissions.

ClimateWorks Executive Director, Anna Skarbek, said that over the past decade, there has been
no growth in greenhouse gas emissions despite economic growth of 31 per cent over the same
period.

Since 2008-09, emissions reductions accelerated, led by a drop in electricity emissions,
significant increases in renewable energy and a tripling in industry energy efficiency.

Ms Skarbek said the research showed that if recent trends are sustained Australia would achieve
80 million tonnes of greenhouse gas emissions reductions by 2020, which is about 40 per cent of
the abatement required to reach the minimum 5 per cent national emissions reduction target by
2020 through domestic abatement alone.

Ms Skarbek said over the next decade Australias emissions reductions would be led by
reductions in power emissions intensity and continued energy efficiency in industry and
buildings. However, overall emissions would grow because of strong economic growth,
particularly in mining and resources, and also plantation harvesting.

Going forward to 2020, on current trends there would be an increase in emissions because of
economic growth. However, emission reduction activity would counterbalance this growth by
50 per cent, led by continued industrial and residential energy efficiency and renewable energy.

The net result is that Australia is on track to achieve about 40 per cent of the reductions needed
to achieve its 5 per cent emissions reduction target through activity in Australia.

Head of Research, Amandine Denis said the years between now and 2020 provided time to
identify increased incentives that could help capture more domestic abatement, and to consider
increasing the current minimum 5 per cent target through domestic and international
abatement.

Our research shows that there is the potential for nearly three times more emissions reduction
activity than is currently being observed.

This potential would enable Australia to achieve at least a 25 per cent target, the minimum
recommended by international scientists, she said.

The lessons we have learnt from this research are that price signals are powerful; policy
uncertainty is a drag on activity; regulation is reliable; and macroeconomic factors like the
manufacturing downturn can affect emissions.

Tracking Progress is the first whole-of-economy report on Australias progress in reducing
emissions. It covers key sectors power, industry, buildings, land-use and waste, as well as a





special report on factors affecting energy efficiency activity for
47 large industrial companies that account for 70 per cent of Australias industrial energy use.

Ms Denis said the report found there had been emissions reductions across all sectors of the
economy studied. Further opportunities to increase emissions reductions also exist in all
sectors, led by land (reducing deforestation and increasing forest replanting), power (replacing
fossil fuel generation with more renewables and gas), industry (increasing uptake of energy
efficiency and decreasing fugitive emission from coal mines), and buildings (retrofitting existing
commercial buildings in particular).

Key findings of the ClimateWorks Tracking Progress report include:
Power
Recent progress: Emissions intensity of power generation (the amount of greenhouse gases
emitted for each unit of electricity produced) decreased by 8 per cent from 2008-09 to 2012-13
and power emissions have fallen by 13 per cent since their peak in 2008-09.
Outlook 2020: Strong pipeline of renewable energy projects and a slow-down of energy
demand growth is expected, which would deliver 32 per cent of the available potential as
identified in the Low Carbon Growth Plan for Australia.

Industry
Recent progress: Industrial process emissions have been substantially reduced and industrial
energy efficiency has tripled compared to historic levels leading to an estimated 10 per cent
improvement in emissions intensity of industrial production, which has been offset by large
increases in production.
Outlook to 2020: Across the board improvements expected. Current trend would deliver 57
per cent of available potential, partly offsetting strong growth in emissions from higher future
production.

Buildings
Recent progress: The energy intensity of Australias buildings has decreased by 3 per cent
between 2002-03 and 2010-11, led by improvements in the operation of buildings, improved
energy efficiency standards, more efficient appliances and distributed energy. However these
improvements have been offset by additional buildings and increased use of electricity by
electronics in homes.
Outlook to 2020: Reversal of historic growth in electricity use per household, and distributed
energy continuing to increase, but activity in commercial buildings is limited. Current trend
would deliver 30 per cent of the total available potential.

Land and waste
Recent progress: The annual area deforested has halved since 2003 and the total area of
plantations has increased by 21 per cent over the decade. These emissions reductions have
completely offset growth in all other sectors since 2002-03.
Outlook to 2020: Emissions from land use are likely to increase substantially as plantation
forests are harvested and not replanted and there are no further reductions in deforestation
proposed. Emissions reduction activity is expected to be limited to 8 per cent of the total
identified potential. Most of the potential for future activity to reduce emissions from land-use
and waste is dependent on certainty of future revenues from government initiatives.

For further information about ClimateWorks Tracking Progress Towards a Low Carbon Economy
project go to: http://www.climateworksaustralia.org

Media Contact: Aileen Muldoon 0419 112 503 and Luisa Saccotelli 0400 149 901
*ClimateWorks Australia is an independent not-for-profit organisation, founded by The Myer Foundation
and Monash University. Its mission is to catalyse action to substantially reduce Australias greenhouse
emissions, through research and collaboration to drive implementation.