Explore Energy

Electricity accounts for over half of all greenhouse gas emissions in Australia, according to the Parliament of Australia, which can be a hard statistic to swallow for the more environmentally-conscious customer. Thankfully, things are changing in Australia.

We cover in this guide:

Australians are becoming increasingly aware of the impact traditional sources of energy are having on the environment, which is one reason why many are seeking alternative methods of electricity production.

In fact, the government’s Renewable Energy Target (RET) is leading the country down a path towards a greener future. This target sees that by 2020, 23.5% of Australia’s electricity will be generated from renewable energy resources.

What is the RET?

The Renewable Energy Target (RET) is playing a central role in helping ‘green electricity’ become a more accessible part of Australia’s energy industry. As renewable energy continues to become more widespread, comparing green plans may enable you to find a more eco-friendly provider while also saving on your power bill. It also helps to know when to switch.

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

  • Large-scale target: This provides financial incentives for the development of renewable energy infrastructure, including solar, wind farms and hydroelectric power stations.
  • Small-scale scheme: This encourages small businesses and individuals to adopt small-scale renewable energy systems through financial incentives. Eligible technology includes hydro systems, wind turbines, solar water heaters, air source heat pumps and solar panels.

Meanwhile, the technology that supports the creation and storage of renewable energy is becoming more affordable, which is driving the cost of sustainable electricity down.

While some people are in a position to install solar panels on their home and take some control of their electricity production, there are other options for reducing reliance on non-renewable energy sources.

We’ve broken down the renewable energy options that may be available to you, so you can make a more informed decision about where your energy comes from.

Back to topic list

What are the benefits of renewable energy?

It goes without saying that investing in renewable energy has long-term benefits for the environment. Reducing the country’s dependency on fossil fuels and minimising harmful greenhouse gas emissions will help preserve the condition of Australia’s air, water and unique natural assets for generations to come.

However, it’s also worth noting that renewable energy also comes with some very tangible economic benefits that could have a positive impact on you as a consumer. In fact, the Clean Energy Council stated that the average Australian household could save hundreds per year on electricity.

Back to topic list


The Australian Commonwealth Government initiative, GreenPower, is an accreditation scheme that makes it easier for you to select an electricity retailer that invests in renewable energy options (e.g. energy produced from solar panels, hydro and wind).

Through this initiative, customers can opt to have their electricity suppliers to offset their energy with renewable sources, which is put back into the grid. This scheme provides a great way for residential customers to support renewable energy producers indirectly, while allowing the industry to flourish alongside conventional retailers. These products vary between electricity providers and between states and territories.

The GreenPower accreditation also takes into account the direct impact the renewable energy source has on the environment. For example, new hydroelectricity schemes must allow for an adequate flow of water to qualify for GreenPower, avoiding any unnecessary damage to the surrounding habitat. Additionally, bioenergy (a renewable energy source created from organic materials) is only eligible for the program if it’s sourced from land cleared before 1990, from waste products or from sustainable plantations. Some of the alternative methods of electricity generation that are covered by the scheme are discussed below.

Back to topic list


There are two main ways of harnessing 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 can help reduce power bills for your water heating, or on a larger scale can be used to superheat water into steam, which can be used to drive turbines to produce electricity.

As opposed to thermal energy, PV cells produce energy through light instead of heat. Electrical currents can be produced directly from solar energy using PV cells, which are more commonly known as solar panels. Electricity produced by PV cells is initially a direct current but can be converted to an alternating current, which most household appliances use.

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.

Back to topic list


Wind energy has long been used as a means of production – including grinding wheat into flour in old-fashioned windmills and for pumping water. However, twenty-first-century wind turbines are mainly used to produce electricity. Most wind generators are found in clusters, where reliable winds mean they are working most of the time, and they are often placed on land which is otherwise productive, such as agricultural land.

As with solar energy, wind power is somewhat sporadic in supply. While the wind is always blowing somewhere in the world, it’s not always blowing strongly enough to generate electricity at any given wind-farm location. This means that storage and alternative energy options are essential in combination with wind.

Back to topic list


Water wheels, like windmills, are an old form of renewable energy often used to run machinery directly. Modern hydropower uses the energy of moving water to turn turbines that produce electricity. Probably 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, and in some circumstances, electricity generation may cease in order to preserve supply for drinking and other purposes.

Back to topic list


Similar to a compost heap, biomass is made up of different agricultural by-products. This can include the burning of solid fuels, such as wood, or the extraction of waste products, such as methane gas from sewerage. 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, but it also reduces the overall effect of unburned methane.

Strict regulations cover the sourcing of other biomass used for bioenergy generation, and materials sourced from old growth forests, and other native forests are excluded from the scheme.

Back to topic list


Unlike other renewable energy, the source of geothermal energy isn’t as apparent. In fact, you have to delve beneath the earth’s surface to harness it. Geothermal energy uses the heat created from magma, meaning places closest to active volcanos tend to be the most suitable candidates for geothermal energy.

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

Geothermal energy is in a very early stage of development compared to other alternative renewable sources, but estimates have shown there is potentially more than enough geothermal energy to supply Australia’s energy requirements.

Back to topic list

Frequently asked questions

How is renewable energy generated?

In Australia, renewable energy is generated in a number of different ways. According to the Clean Energy Council, hydro (33.9%) and wind (33.8%) accounts for the majority of clean electricity generated, with small-scale solar PV (20.3%) also contributing a significant portion of renewable energy in Australia. Bioenergy and large-scale solar lag a little further behind, and are responsible for 9.7 per cent and 1.8 per cent of Australia’s sustainable energy respectively.

How is renewable energy supplied?

Electricity retailers use “Large-scale Generation Certificates” to purchase electricity from companies who generate it. When you opt in to purchase GreenPower from renewable sources, the retailer buys an appropriate amount of electricity from a renewable energy generator, and it’s fed into the national grid. An independent government auditor checks to make sure that the amount of renewable electricity that has been 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, which means renewable electricity generation capacity increases over time. This means that your electricity eventually becomes cheaper, and more people will be able to afford renewable options over time.

How can I access renewable energy?

In most cases, you can simply get in touch with your energy supplier to switch over to green energy options. In all states and territories in Australia, some retailers and suppliers can offer customers a fraction of their electricity from renewable sources.

There are options with some companies for as little as 10% of electricity to come from renewables. It’s worth checking with electricity suppliers before committing to a change, and reading all the fine print before signing up.

Compare electricity & gas

Ready to look for a better deal? It’s easy to compare with us.

Compare energy plans
Or call us on1800 990 003