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Economic development in the twentieth century was fuelled by plentiful cheap energy, but it has been clear for decades that the energy outlook is now totally different.

Ian Lowe

Introduction: the Challenges

Economic development in the twentieth century was fuelled by plentiful cheap energy, but it has been clear for decades that the energy outlook is now totally different (Lowe 1977). There is disagreement about the peak of world production of conventional oil, but the evidence suggests it has already passed (Hallett & Wright 2011). The scientific basis for “peak oil” was established more than fifty years ago (Hubbert 1956). The energy source which now powers almost all our transport will certainly become more expensive and supply interruptions are possible. So the near-term future will require a new approach to transport. Public subsidies have encouraged road freight rather than rail and coastal shipping, while inept urban planning has encouraged single-person car use for city trips. These wasteful practices are squandering limited petroleum fuels,

The second challenge for future energy use is global warming. The science has been refined to the point where there is no serious dispute about the human influence on climate (WMO 2013). At the time of writing, there was bi-partisan agreement between major political parties for an inadequate response. It is no exaggeration to say that the future of human civilisation is in the balance (Christoff 2013). Climate change doesn’t just have short-term effects on human societies or our economic prospects. The Millennium Assessment Report (2005) warned that we are losing species at an accelerating rate as the driving forces of habitat loss, introduced species and chemical pollution are supplemented by climate change. This report forecast we could lose between 10 and 30 per cent of all mammal, bird and amphibian species this century. These are alarming consequences that demand a concerted international response.

There has been no concerted policy response to these challenges. While the Gillard government enacted a package of response measures, these were scrapped by the Abbott government, while the Turnbull and Morrison governments have been unable to deliver a coherent policy package. Governments at all levels remain in denial about transport fuel supply, effectively behaving as if petroleum will always be cheap and plentiful by continuing to fund road networks, bridges and tunnels to facilitate private transport and road freight..

1 Emissions reduction target

The science shows that the world’s greenhouse gas emissions must peak by 2015 and then decline steeply so as to be no more than 40 per cent of the present level by 2050 (IPCC 2007). To achieve this global target while allowing for improvement in material living standards in poorer countries, the IPCC called for the industrialised nations to reduce their emissions by 25 to 40 per cent by 2020 as a first step toward cuts of 80 to 95 per cent by 2050. So we must set a serious science-based target and develop a concerted plan to achieve it. This will require courageous action from all levels of government to develop cleaner energy supply and much more efficient conversion of energy into the services we need. To reduce the amount of carbon dioxide we put into the air, we must use cleaner fuels and use them more efficiently. Using coal-fired electricity to heat water or cook, rather than burning gas, puts much more carbon dioxide into the air. Renewable energies, such as solar or wind power, release very little carbon dioxide, so they should be the preferred option.

2 Renewables

We should set ambitious targets for renewable energy in the same way that progressive nations in the northern hemisphere have done. We could aim at generating 90-100 per cent of electricity from renewables by 2030. That is a realistic target based on existing technology. The change need not involve significant price increases. Nearly thirty years ago, a Commonwealth report (Stevens 1992) estimated that we could get 30 per cent of our electricity from renewables at no significant extra cost. The clean energy supply technologies have improved dramatically since then, despite meagre funding and limited political support compared with the huge sums lavished on “clean coal” and inquiries into the possibility of nuclear power. Elliston et al (2013) showed that it is feasible to supply all our electricity needs from a mix of renewables, mainly wind and solar. In 2018, a CSIRO-AEMO report concluded that the cost of power from solar and wind is now about $40/MWh, and even with storage only about $60, while the average wholesale price in NSW is $82/MWh (Graham et al 2018). A 2018 ANU study found that we would only need to use the best 150 of 22,000 identified suitable sites for pumped hydro storage to enable all electricity to come from renewables by 2030 (Baldwin, Blakers and Stock 2018).

3 Efficiency improvements

Equally important, we must convert energy more efficiently into the services we want. Nobody actually wants energy; we want hot showers and cold drinks, the ability to cook our food, wash our clothes and move around. Most of the technology we use is very wasteful. The European Union now has a target of cutting energy use by a quarter by 2020, and some countries like the Netherlands have more ambitious aims.  There is no reason at all to be less ambitious than the EU; since we haven’t taken many of the easy cost-effective actions already adopted in Europe, we should be able to achieve greater savings in the near future. Saving energy is often much cheaper than buying it. The Natural Advantage of Nations gives a number of case studies (Hargroves & Smith 2005), showing that improving efficiency makes business sense. At the household level, if domestic appliances are more efficient, people save money as well as slowing climate change. The National Framework for Energy Efficiency (Commonwealth of Australia 2003) estimated that domestic, industrial and commercial energy use could be cut 30 per cent using measures that would repay the initial investment in less than four years. Most of those measures have still not been implemented. That approach would create more than 10,000 jobs in activities such as retro-fitting buildings and replacing inefficient equipment.

4 Solar hot water

In A Clean Energy Future for Australia (Saddler et al 2006), measures such as solar hot water and improved efficiency are used to reduce electricity demand in 2040 to 14 per cent below the 2001 value, despite anticipated population growth. This is a crucial point. Studies that assume continuing growth in energy use sometimes conclude that new renewable capacity cannot be built fast enough. Solar hot water is the most obvious cost-effective way of reducing electricity demand, since the time to recoup the capital cost almost anywhere in mainland Australia is less than the guarantee period for modern equipment (Lowe et al 1984). It makes sense to mandate solar hot water now for all of mainland Australia except sites where solar access is limited by other buildings. This would create literally thousands of jobs right around the country.

5 Phase out fossil fuel subsidies

There are always winners and losers from major policy changes, so we should develop transitional strategies to handle the structural consequences. Achieving change on the necessary scale requires price signals, appropriate regulation and a process of social learning involving the whole community. The obvious way to fund the transition is to phase out the huge current subsidies of fossil-fuel supply and use. Various studies estimate the annual public subsidy of fossil-fuel supply and use in Australia to be between five and eight billion dollars, without allowing for the costs of climate change (Diesendorf 2007). We should systematically transfer these public funds to the expansion of renewable energy supply technologies and efficiency gains.

6 Financial incentives

We should also provide financial incentives to encourage low-carbon approaches to meet our material needs. A well-designed cap-and-trade system using science-based targets would be a solid basis for limiting our future emissions and would potentially harness market forces to achieve savings in economically optimal ways. The provision of the Clean Energy Finance Corporation is a crucial supporting measure, providing funding for pre-commercial development of new supply technologies.

7 Transport

We should begin planning immediately to reduce our transport fuel use, inflated by the long-standing subsidies of road freight, the encouragement of single-person car use for urban trips and vehicle efficiencies that are very poor by international standards (Newman & Kenworthy 1999).  As well as moving to set serious standards for vehicle efficiency and phasing out the huge subsidy of road freight, we should begin to invest in world-class public transport systems for all major urban areas, rather than squandering huge sums on dinosaur road schemes. The twin forces of climate change and “peak oil” both demand a move to improve dramatically the fuel-efficiency of urban transport. Through Infrastructure Australia, the national government is finally putting resources into urban public transport, long neglected at the expense of extravagant road schemes.

8 Urban planning

Future planning should emphasise compact urban villages with everyday needs within walking or cycling distance to reduce the transport task. Such cities would provide a better social environment and improve community health by promoting physical activity in more natural surroundings, as well as meeting energy goals.

9 Government modelling best practice

As discussed above, some changes require regulation: efficiency standards and targets for clean energy supply are obvious examples. Governments should set an example by ensuring their buildings, transport and other activities model best practice in efficiency and clean energy supply. This is fiscally responsible as well as politically smart.

10 Involving the community

Finally, a low-carbon future will only be politically sustainable if it is developed through a process of public involvement, along similar lines to the approach used recently in Sweden to arrive at their future energy strategy.  A community conversation to develop our future energy strategy should be a high priority.

11 Implementation

The sustainability reform agenda clearly needs an institutional base to work through the Council of Australian Governments, taking a whole-of-government approach at all levels. The first report of the National Sustainability Council spelled out the broad principles of a desirable future; it should be directed to specify science-based targets for such key areas as energy, greenhouse gas emissions, water use, transport, biodiversity, buildings and urban planning. That will be a vital step toward implementing the reforms spelled out in this chapter.


The two big challenges of “peak oil” and climate change demand a different approach to energy supply and use. A concerted response strategy is environmentally essential, technically possible, socially desirable, economically achievable and politically preferable to the alternative of waiting until there is massive social and ecological disruption. It should not need saying, but a future sustainable society clearly must have stabilised both its population and its overall resource use, including its energy consumption, at levels consistent with the limits of natural systems. This is such a radical departure from present thinking that it is widely seen as bordering on heresy, but it is an inescapable conclusion if we are serious about a sustainable future.    


  • K. Hargroves and M. Smith (eds) 2005. The Natural Advantage of Nations: Business Opportunities, Innovation and Governance in the 21st Century. Earthscan, London

  • M.K. Hubbert (1956), Nuclear Energy and the Fossil Fuels, American Petroleum Institute Drilling and Production Practice, Proceedings of Spring Meeting, San Antonio Texas  pp 7-25

  • Inter-governmental Panel on Climate Change (2007), Fourth Assessment Report, IPCC, Geneva: see

  • I. Lowe (1977) Energy options for Australia Social Alternatives 1: 63-69.

  • I. Lowe, D.E. Backhouse & M. Sheumack (1984). The experience of solar hot water systems" Search 15: 165-167.

  • P.W.G. Newman & J.R. Kenworthy (1999) Sustainability and Cities: Overcoming Automobile Dependence, Island Press, Washington DC.

  • H. Saddler, M. Diesendorf & R. Denniss, R. (2004). Clean Energy Futures, WWF Australia, Sydney: see

  • M. Stevens (1992), Renewable Electricity for Australia, NERDDC Discussion Paper No. 2, Department of Resources and Energy  Canberra

  • United Nations (2005), Millennium Assessment Report: see

  • World Meteorological Organization (2013), WMO Statement on the status of the global climate in 2012, WMO No. 1108, WMO Geneva

Ian Lowe AO FTSE is emeritus professor of science, technology and society at Griffith University and holds adjunct appointments at two other universities. He directed the Commission for the Future in 1988 and chaired the advisory council that produced the first national report on the state of the environment in 1996. In 2000 he received the Queensland Premier's Millennium Award for Excellence in Science and the Prime Minster's Environmental Award for Outstanding Individual Achievement. He wrote a weekly column for New Scientist for 13 years and received the 2002 Eureka Prize for promotion of science and technology. The International Academy of Sciences, Health and Ecology recently awarded him the Konrad Lorenz Gold Medal for his contribution to sustainable futures.

Prof. Ian Lowe, School of Natural Sciences, Griffith University, Nathan 4111