Explore Energy

Electricity accounts for almost one-third of all greenhouse gas emissions in Australia, according to the Department of the Environment and Energy.1 Fortunately, emissions have been on a slow but steady decline since 2010.

Australians are becoming increasingly aware of the impact traditional energy sources have on the environment. You may be considering how you can use clean, renewable energy in your own home as an alternative to fossil fuels.

What is renewable energy? As the name suggests it’s a source of power that won’t run out. They also produce less harmful emissions or no emissions at all, making them an attractive alternative to hydrocarbons like oil and coal if you’re concerned about the environment.

We’ve broken down the benefits of renewable energy, the different types available in Australia.

Our guide to renewable energy

What are the benefits of renewable energy?

Renewable green energy has a range of benefits, for the planet and you as a consumer. Some of the benefits of renewable energy include:

  • supporting the environment. By switching to sustainable sources of power, such as solar and wind, you’re doing your part to:
  • reduce greenhouse gas emissions
  • minimise the impact your household has on the environment
  • preserve the condition of Australia’s air, water and unique natural assets for generations to come.
  • self-sustainability. Having an independent source of electricity means you’ll be less affected by power grid outages. In addition, if you generate your own renewable energy, you canreduce your overall cost of living;
  • feed-in tariffs. If you have solar panels, you may be able to get paid by your state or territory government for feeding surplus energy back into the grid. You may be eligible for a solar feed-in tariff if your energy system meets certain criteria set out by your electricity provider (also known as your electricity retailer). The exact amount of money you could receive (if any) will depend on where your home is located, as well as your specific provider; and
  • return on investment. After your initial investment, only a few costs are involved with running or maintaining a renewable energy system, such as maintenance costs for solar panels. As such, you’ll start to generate electricity at little expense to your hip pocket. Solar panels with a battery storage system typically pay for themselves in three to five years.2 After that, you’ll be reaping the savings!

Depending on your circumstances, solar may only cover a portion of your energy usage. However, the long-term savings may make it a worthy investment.

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a combine harvester gathering biomass to create green energy

The Australian Commonwealth Government initiative, GreenPower, is an accreditation scheme that makes it easier for you to select an electricity provider that invests in renewable energy.

Through this initiative, you can choose to have your electricity supplier offset your energy consumption with renewable sources, which is put back into the grid. This scheme allows you to support renewable energy producers in Australia.

GreenPower also considers the direct impact that renewable energy sources have on the environment.

For example, new hydroelectricity schemes must allow for an adequate water flow to qualify for GreenPower. They must also avoid any unnecessary damage to the surrounding habitat.

Some renewable energy that isn’t allowed on the GreenPower program includes:

  • coal seam gas
  • biomass generated from native rainforest
  • renewable energy generators that were running before 1997
  • hydro where largescale river diversions occurred during construction of the plant
  • natural gas
  • nuclear energy.3

Excluding these sources of power ensures that the surrounding habitat isn’t damaged and no greenhouse cases are created.

Note that the products available to you may vary between electricity providers, states and territories.

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a family inspects a solar panel

There are two main ways of harnessing green energy from the sun: thermal and photovoltaic (PV) cells.

Thermal energy is produced from heat and can be used directly to heat water in solar water heaters. This type of energy can help reduce power bills for your water heating. On a larger scale, thermal energy can superheat water into steam, which can be used to drive turbines to produce electricity.

As opposed to thermal energy, PV cells (also known as solar energy) produce electrical currents through light instead of heat.

The main drawback of solar energy is that the sun must be shining for it to work. On cloudy days and at night, energy must be stored in a battery or sourced from other alternatives like the national electricity grid.

Furthermore, dust covering a solar panel may decrease its efficiency. So, it’s worth getting your panels professionally cleaned occasionally.

On the plus side, you could be eligible for a solar rebate to help cover the cost of installing a solar system. You might also be able to take advantage of solar feed-in tariffs. This is where you get paid by your state or territory government for surplus energy your solar panels generate that’s sent back to the grid.

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offshore wind turbine at sunset

Wind energy has long been used as a means of production. In the 21st-century, wind turbines are mainly used to produce electricity.

Most wind generators are found in clusters, where reliable winds mean they’re working most of the time.

As with solar energy, wind power is somewhat sporadic in supply. As such, storage and alternative energy options are essential to make them a more efficient source of green energy.

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Aerial view of Gordon Dam in Tasmania

Water wheels, like windmills, are an old form of renewable energy that are often used to run machinery directly. Modern hydropower uses the energy of moving water to turn turbines that produce electricity.

The most famous Australia hydro scheme is the Snowy Mountains complex, which was built in the 1950s in New South Wales.

Hydroelectricity is also widely used in Tasmania, where most of the electricity supply comes from water-powered generators. The main drawback of hydroelectric electricity generation is the large volumes of water required for continuous operation.

Prolonged drought can reduce water supplies below critical levels. In some circumstances, electricity generation may cease in order to preserve supply for drinking water and other purposes.

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biomass ready to be turned into energy at power plant

Biomass is made up of different agricultural by-products that are then burned or broken down into liquid fuel. This process can include burning solid fuels, such as wood, or extracting waste products, such as methane gas from sewerage. When bioenergy is burned it creates steam that powers turbines, creating electricity.

Methane is a potent greenhouse gas with over 20 times the heat-capturing capacity of carbon dioxide. Burning methane as a fuel does release some greenhouse gas in the form of carbon dioxide. However, this process also reduces the overall effect of unburned methane, which also give-off carbon dioxide.

There are some useful by-products created when harvesting biomass as well, such as biomass-based concrete and bitumen for roads and buildings.

In addition to creating electricity by burning bioenergy, gas energy can also be created from methane. Known as biogas or biomethane (depending on the mixture of the fuel), this source of power provides fuel for specific appliances like gas ovens and heaters.

While some greenhouse emissions are released, it’s a completely renewable source of power that provides an alternative to harnessing existing natural gas pockets.

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steam rising from a vent at a geothermal power plant

Unlike other renewable energy, you have to delve beneath the earth’s surface to harness geothermal energy. This type of energy uses the heat created from magma. So, areas close to active volcanos tend to be the most suitable for geothermal energy.

In some areas, water may be injected into the ground, which returns to the surface as steam that can be used to drive turbines to generate electricity. In other places, the water may already be present below the earth’s surface and just needs to be tapped.

While the Australian Renewable Energy Agency (ARENA) notes that Australia does have the potential to harvest geothermal energy, this renewable source of power is not currently cost-effective. This is because:

  • identifying viable sources of geothermal energy is challenging;
  • producing and flowing hot water at a high rate is difficult; and
  • financing costly up-front expenses from harvesting and transmitting geothermal energy will be expensive.4

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How does the Renewable Energy Target reduce emissions?

The Renewable Energy Target (RET) is an Australian Government scheme that plays a central role in reducing greenhouse gas emissions by helping ‘green electricity’ become a more accessible part of Australia’s energy industry.

Green electricity is electricity produced from clean, renewable energy as opposed to fossil fuels. Green energy plans source such electricity or help support the renewable energy industry.

As renewable energy continues to become more widespread, comparing green plans may help you find a more eco-friendly energy provider. It can also help you save on your power bill.

The Clean Energy Regulator noted that the RET is broken down into two parts:

  • large-scale target: this provides financial incentives for the development of renewable energy infrastructure by power generating companies, including solar, wind farms and hydroelectric power stations; and
  • small-scale scheme: this encourages individuals and small businesses to adopt small-scale renewable energy systems through financial incentives.

For example, if you add solar panels to your home, you could be eligible to receive a small-scale technology certificate that energy retailers and other entities are required to purchase off you (also known as RECs – Renewable Energy Certificates).

Eligible green technology includes hydro systems, wind turbines, solar water heaters, air-source heat pumps and solar panels.5

Frequently asked questions

How much of Australia's energy is renewable?

In Australia, renewable energy is generated several ways. In 2019, Australia’s renewable energy production accounted for 55,093 gigawatt-hours (GWh), which came from:

  • wind – 35.4%
  • hydro – 25.7%
  • small-scale solar – 22.3%
  • large-scale solar – 9.3%
  • bioenergy – 6%
  • medium-scale solar – 1.3%.6

How is renewable energy generated?

Most types of renewable energy generate electricity either by turning a turbine or being directly converted into electricity through a process specific to that source.

In some cases, such as natural gas harvested from biofuel, it may be refined as a fuel source which is used by specific appliances designed to operate on that source of power, rather than electricity.

How is renewable energy supplied?

To help supply renewable power to the energy grid, electricity providers use ‘Large-scale Generation Certificates’. Providers purchase electricity from companies who generate it.

When you opt to purchase GreenPower from renewable sources, you’ll typically have a choice between how much of your power you want from green energy. For example, you may choose a plan that has 100% green energy. If you use 6,000kWh of electricity in a year then your provider has to purchase 6,000kWh of renewable energy to be fed into the grid.

An independent government auditor checks to ensure that the amount of renewable electricity paid for is fed into the grid each year.

The money spent on renewable electricity each year ensures that investment in alternative green energy projects continues. This investment allows Australia’s renewable electricity generation capacity to increase over time. This means that your electricity may eventually become cheaper, and more people may be able to afford renewable options over time.

Why is renewable energy so important?

There are a number of reasons why renewable energy is important:

  • it helps combat global warming and climate change;
  • renewable energy sources add diversity to the nation’s energy mix, making it less reliant on just one source of energy;
  • it reduces pollution to promote a healthy natural environment;
  • it helps create jobs, including in regional Australia; and
  • it can become a source of wealth through energy exports to other countries.7

What is Australia doing about renewable energy?

Australia is continuing to increase the amount of renewable energy generated in the country as a part of the RET. According to the Department of Industry, Science, Energy and Resources, Australia has met its 2020 target of increasing renewable energy output by 33,000 gigawatt hours (GWh) a year, and this target will remain in place until the RET ends in 2030.8

The states and territories in Australia are also working on increasing the amount of renewable energy they generate and use. Tasmania now runs on 100% renewable energy sourced in the state as of 27 November 2020.9

How can I access renewable energy?

In most cases, you can simply get in touch with your energy provider to switch over to green energy options. In all states and territories in Australia, some providers can offer you electricity from renewable sources. Some providers offer as little as 10% of electricity to come from renewables. Others offer up to 100% of your energy needs from renewable sources. It’s worth checking with electricity providers before committing to a change and reading all the fine print before signing up.

What are the disadvantages of switching to renewable energy?

We’ve discussed why you might want to switch to renewable electricity, but there are drawbacks. Here are a few things to consider before making a move to green energy:

  • up-front costs. While renewable energy may help you save money in the long-term, installing solar panels on the roof or another clean energy system can be expensive. While state-and-territory-based subsidies may be available, you could be paying $3,500 or more for a basic installation;10
  • timing a purchase is difficult. Innovation means that green technology is constantly improving, and prices are coming down. This can make it difficult to decide when to buy; and
  • efficiency can depend on location and time of year. Whether you have a wind turbine or solar panels at home, your renewable energy efficiency will differ based on your location.

 For example, parts of the Northern Territory and Western Australia get more than 10 hours of sunlight per day on average,11 which means solar panels generate more energy in these locations compared to other areas in Australia. Additionally, longer days mean you can have more solar power generated compared to smaller days.

Renewable energy is significantly better for the environment, and, in many circumstances, it’s cheaper in the long run than traditional sources of electricity.

After taking these points into account and weighing up the pros and cons, you’ll be better able to determine if you should make the switch to green energy.


1 Quarterly Update of Australia’s Natural Greenhouse Gas Inventory: March 2020. Department of the Environment and Energy, Australian Government. 2020.

2 Solar PV and batteries. Department of Industry, Science, Energy and Resources, Australian Government. 2020.

3 Renewable Energy Accreditation. GreenPower, National Green Power Steering Group. 2020.

4 Geothermal energy. Australian Renewable Energy Agency, Australian Government. 2020.

5 How the scheme works. Clean Energy Regulator, Australian Government. 2018.

6 Clean Energy Australia 2020. Clean Energy Council. 2020.

7 Renewable energy. Australian Renewable Energy Agency, Australian Government. 2020.

8 Renewable Energy Target scheme. Department of Industry, Science, Energy and Resources, Australian Government. 2020.

9 Tasmania surges to 100% renewable energy. The Hon. Guy Barnett, Minister for Energy, Department of Premier and Cabinet, Tasmanian Government. 2020.

10 Solar PV and batteries. Department of Industry, Science, Energy and Resources, Australian Government. 2020.

11 Sunshine: Average Daily Sunshine Hours. Bureau of Meteorology, Australian Government. 2005.

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