Both Australia and New Zealand are achieving significant advances in their shift towards renewable energy sources. Both nations are striving to reduce their reliance on fossil fuels while embracing more sustainable energy alternatives. Yet, while they share common climate goals, their approaches to renewable energy are shaped by unique challenges and priorities.

Australia’s push towards green

Australia has traditionally relied on coal and natural gas to meet its energy needs. However, a notable shift has taken place in recent years. The nation is rapidly increasing its adoption of renewable energy sources, especially solar and wind power. By the end of 2024, it was anticipated that more than 30% of Australia’s electricity would come from renewables, with solar and wind at the forefront of this change. The country's climate makes it an ideal site for solar and wind energy projects, leading to significant investments aimed at harnessing these resources.

A key goal for Canberra, thus, is to achieve 82% of its electricity generation from renewable sources by 2030. To accomplish this target, numerous projects are being initiated across the country. Companies like Neoen have recently secured $1.4bn to fund projects that include wind farms, solar installations, and battery storage systems. This investment is crucial for developing the infrastructure necessary to meet renewable energy objectives.

Challenges

Despite the progress being made, however, Australia faces several challenges. One major concern is the stability of the electricity grid. As the share of variable energy sources such as solar and wind increases, ensuring a reliable power supply becomes more complicated.

Energy storage solutions, particularly batteries, are vital in addressing this issue. To tackle these challenges, Australia is allocating significant resources to battery storage technology. As part of this, Akaysha Energy intends to build a 500-MW battery storage facility in the state of Queensland to support the region's solar and wind projects. This facility will store surplus energy produced during peak production and release it during periods of high demand, thereby increasing grid stability.

Australia remains heavily dependent on its aging coal-fired power plants. A considerable number of these facilities are approaching the end of their operational life, and unexpected but increasingly common shutdowns have resulted in rising prices within the National Electricity Market (NEM) as a result.

To this end, experts warn that without significant investment in a range of renewable energy resources and dispatchable energy sources, electricity costs may continue to rise in the coming years.

One manner in which this issue could be stabilised is with the use of nuclear power; a concept much easier said than done in Australia where the Australian Radiation Protection and Nuclear Safety Act of 1998 as well as the 1999 Environment Protection and Biodiversity Conservation Act both serve to ban forever the use of nuclear power.

A federal law, it is also duplicated at the state level making a switch to nuclear Down Under very unlikely any time soon. And although there has been some dialogue in the country regarding the potential role of nuclear energy, there is a prevailing agreement that the focus should remain on cleaner, renewable alternatives.

Across the Tasman Sea

New Zealand's energy sector meanwhile presents a marked difference from that of Australia. In contrast to its neighbour, New Zealand has positioned itself as a frontrunner in renewable energy in recent years, especially in the realm of hydroelectric power.

At present, around 60% of the country's electricity is produced using hydroelectric facilities, supplemented by extensive geothermal infrastructure and wind energy sources. As of late 2022, the proportion of electricity generated from renewable sources in New Zealand had already reached 87%.

While hydroelectric power remains the dominant renewable resource in New Zealand though, the nation is eager to broaden its energy mix. To this end, the government has put in place a political goal of achieving 50% renewable energy use in total energy consumption by 2035. This target includes not only electricity generation but also heating, transportation, and various other avenues of energy use.

Another key area of focus for New Zealand is the advancement of its offshore wind energy capabilities. Reports suggest that the government intends to introduce legislation to facilitate the development of offshore wind farms, with the first round of permits expected in the current year.

In and around New Zealand, offshore wind energy offers a significant opportunity to increase the footprint of renewables, particularly in areas such as the Cook Strait separating the north and south islands, where wind flow is among the best in the world.

Geothermal

New Zealand is not limited to concentrating on offshore wind energy however. Wellington is also working hard to expand its already significant geothermal energy capacity. For many years, geothermal energy has been a reliable power source in New Zealand, currently accounting for about 17% of the country's electricity generation. Unlike solar and wind energy, which can fluctuate, geothermal energy provides a consistent and uninterrupted power supply, making it an ideal complement to other renewable energy sources.

This not only makes it the perfect go-to on a rainy day when energy supply falls short or a grid needs a reliable source of power; geothermal in New Zealand is in the eyes of many the safety net that permits experimentation with all other forms of renewables as the world slowly moves away from fossil fuel use once and for all.