NAB’s 2022 Renewables Survey1 signals a further acceleration of Australia’s transition to renewable energy and net zero carbon emissions policies, a trend we expect to see globally into 2030. The survey also highlights that in addition to cost advantages from renewable energy adoption and decarbonisation, there is a growing cohort of Australian enterprises recognising that a sustainability strategy in line with Australia’s climate goals is consistent with customer expectations and carries benefits for their brand and reputation.
24%of respondents have a policy on renewable energy, up from 18% in 2018.
Respondents reporting renewable energy usage remains steady at 49% with only 15% reporting greater than 25% usage.
43% of respondents have in place or plan to develop net zero carbon emissions plans versus 30% in 2021. Only 6.5% have an active policy.
Chart 1: What are the key drivers for using renewable energy?
Funding for the green transition continues to increase across the globe with the global energy crisis likely to result in corporates prioritising renewable energy adoption to manage rising costs and elevated volatility of traditional fuels.
Highlighting the global momentum on climate change this year is the European Union’s Repowering EU policy which was announced in May and the Inflation Reduction Act which was legislated in the United States in August. These policies combined deliver another US$0.6 trillion in new financing for the green transition.
Australia has been a key player in the global acceleration of climate change initiatives in 2022. Recently Australia announced it is adding A$76bn in funding under the Powering Australia policy to support a 43% reduction in emissions by 2030 (against a 2005 baseline).
The reduction in Australia’s emissions is expected to be driven principally by the continued decarbonisation of the electricity sector, as well as a strengthened safeguard mechanism which was established in 2016 and drives the progressive abatement of emissions from Australia’s largest emitters. These policies, together with the impact of the 2022 global energy crunch, have the potential to see Australia outperform on the latest 2030 climate goals.
The electricity sector will be a key driver of this outperformance, as high energy prices point to a likely faster than expected closure of black coal generation in Australia.
NAB’s 2022 Renewables Survey shows an increase in the number of respondents reporting they have a renewable energy policy, with energy prices a key catalyst for increased renewable energy adoption. We expect the current energy crunch to drive a rapid rise in demand for more renewable energy in Australia, and globally.
Chart 2: Australian electricity generation – fuel mix
1. The inaugural NAB Renewables survey was conducted in late 2018. In February this year we ran the survey within NAB’s regular Quarterly Business Survey. This survey covers 850-900 firms across the non-farm business sector ranging from small (35-99 employees), medium (100-199 employees) to large companies (200 plus employees).