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According to the Department of the Environment and Energy, electricity accounts for almost one-third of all greenhouse gas emissions in Australia.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 and turning instead to renewable energy technology. 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. These sources also produce less harmful emissions or even none 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 and 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 both the planet and you as a consumer. Some of the benefits of renewable energy include:

  • Supporting the environment. Direct benefits include reducing greenhouse gas emissions, minimising the impact your household has on the environment and preserving 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 can reduce your overall cost of living through minimising energy bills.
  • 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 retailer. You may receive a credit that’s then offset against your electricity bill depending on the location of your residence and your specific retailer.
  • Return on investment. After your initial investment, only a few costs are involved with running or maintaining a renewable energy system, such as maintenance of your solar panels. In general, solar panels with a battery storage system typically pay for themselves in seven to nine years.2 After that, you’ll likely be reaping the savings!

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

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Home powered by Greenpower

Greenpower, an Australian Government initiative, is an accreditation scheme that simplifies the process of selecting an electricity retailer that invests in renewable energy.

Through this initiative, you can choose to have your electricity retailer offset your energy consumption by feeding renewable sources back into the grid. This scheme allows you to support renewable energy producers in Australia.

GreenPower also considers the direct impact of renewable energy sources 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 sources that aren’t allowed in the GreenPower program include:

  • Coal seam gas
  • Biomass generated from native rainforests
  • Renewable energy from generators that were running before 1997
  • Hydro power where largescale river diversions occurred during construction of the plant
  • Natural gas
  • Nuclear energy.3

By excluding these power sources, the Government is encouraging future projects to consider not damaging the surrounding habitat as well as minimise the greenhouse gas created.

The GreenPower products available to you may vary between electricity retailers, states and territories.

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Solar panels producing renewable energy

There are two main ways of harnessing green energy from the sun:

  • Thermal energy. This is produced from a rise in temperature and can be used directly to heat water in solar water heaters, helping reduce energy bills. On a larger scale, thermal energy can superheat water into steam, which can be used to drive turbines to produce electricity.
  • Photovoltaic (PV) cells (also known as solar cells). PV cells 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. To keep your lights on during cloudy days and at night, energy must be stored in a solar battery or sourced from alternatives like the national electricity grid.

Furthermore, dust covering a rooftop 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 and 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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Wind turbines producing wind power

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 can be somewhat sporadic in supply. As such, storage and alternative energy options are essential to make them a more efficient source of green energy.

Victoria (VIC) is currently leading the country in developing offshore wind farms, with energy production beginning as soon as 2028.4 These farms are part of a sustainable development plan to have net-zero greenhouse gas emissions by 2050.

In 2021, new wind installed capacity added 1,746 megawatts (MW) of energy to the grid(a new annual record) for a cumulative total wind capacity of 9,126 MW.4

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Water wheels producing renewable hydroelectricity

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 Australian hydroelectricity scheme is the Snowy Mountains complex, built in the 1950s in New South Wales (NSW).

Hydroelectricity is also widely used in Tasmania (TAS), where most of the electricity supply comes from power stations (also known as power plants) harnessing hydropower. 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, so in these and other circumstances, electricity generation may be stopped to preserve a supply for drinking water and other purposes.

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Biomass being converted into renewable bioenergy

Biomass comprises 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 from sewerage (such as methane gas). 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 gives off carbon dioxide.

There are some useful by-products that can be made with harvested biomass, such as concrete and bitumen for roads and buildings.

In addition to creating electricity by burning bioenergy, gas can also be made 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 an entirely renewable source of power that provides an alternative to harnessing existing natural gas pockets.

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Geothermal factory producing renewable energy


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 places for generating geothermal energy.

In some areas, water may be injected into the ground so it returns to the surface as steam that can be used to drive turbines and 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.
  • Financing costly up-front expenses from harvesting and transmitting geothermal energy will be expensive.5

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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 that which is produced from clean, renewable energy sources as opposed to fossil fuels.

Green energy plans for customers, offered by many electricity retailers, source such electricity or help support the renewable energy industry. 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 plants, wind farms and hydroelectric power stations.
  • Small-scale 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.

Eligible green technologies include hydro systems, wind turbines, solar water heaters, air-source heat pumps and solar PV panels.6

Frequently asked questions

How much of Australia's energy is renewable?

In Australia, renewable energy contributed as much as 32.5% of total electricity generation in 2021.7 Australia’s renewable energy production accounted for 74,679 gigawatt hours (GWh), which came from:

  • Wind – 35.9%
  • Small-scale solar – 24.9%
  • Hydro – 21.6%
  • Large-scale solar – 12.3%
  • Bioenergy – 4.3%
  • Medium-scale solar – 1.1%

How is renewable energy supplied?

To help supply renewable power to the energy grid, electricity retailers use large-scale generation certificates, which involve retailers purchasing 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, so if you use 6,000kWh of electricity in a year, your retailer must purchase 6,000kWh of renewable energy to be fed into the grid.

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

Each year, the money spent on renewable electricity ensures that investment in alternative green energy projects continues. This investment allows Australia’s renewable electricity generation capacity to increase over time. As interest and development into renewable energy grows, 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:8

  • 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 land, water and air pollution to promote a healthy natural environment.
  • It helps create jobs, especially in regional Australia.
  • It can become a source of wealth through energy exports to other countries.

What is Australia doing about renewable energy?

Australia continues 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 GWh a year. This target will remain in place until the RET ends in 2030.9

The states and territories in Australia are also working on increasing the amount of renewable energy they generate and use. TAS now runs on 100% renewable energy, all of which was sourced in the state as of November 2020. 10

How can I access renewable energy?

If you’re looking to make the energy transition to renewables, in most cases you can simply get in touch with your energy retailer to switch over to green energy options. There are some retailers throughout the states and territories in Australia that offer you electricity from renewable sources.

Some retailers offer as little as 10% of your electricity to come from renewables, while others offer up to 100% of your energy needs from renewable sources. It’s worth checking with electricity retailers before committing to a change and reading 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.11
  • Timing a purchase is difficult. Innovation means that green technology is constantly improving, and prices are coming down. This can make it challenging to decide when to buy.
  • 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 (NT) and Western Australia (WA) get more than nine hours of sunlight per day on average,12 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 shorter 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.

Meredith O'Brien

Top renewable energy tips from our Head of Energy, Meredith O’Brien

  • Check which retailers offer green energy and / or carbon offsets if you prefer switching to a more environmentally conscious provider.
  • Check that the green energy you are purchasing is accredited to minimise your carbon footprint.


1 National Greenhouse Gas Inventory Quarterly Update: September 2021. Department of Industry, Science, Energy and Resources. Australian Government. Accessed May 2022.

2 Section 1: Why install a solar electricity system at home? Solar Panel (PV) Buyers Guide. Solar Victoria, Department of Environment, Water, Land and Planning, Australian Government. Last reviewed April 2022. Accessed May 2022.

3 Renewable Energy Accreditation. GreenPower, National Green Power Steering Group. Accessed May 2022.

4 Offshore Wind Energy. Department of Energy, Land, Water and Planning, Victorian Government. Updated March 2022. Accessed May 2022.

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

6 Small-scale Renewable Energy Scheme. Clean Energy Regulator, Australian Government. Updated May 2022. Accessed May 2022.

7 Clean Energy Australia Report 2022. Clean Energy Council. Accessed May 2022

8 Renewable energy. Australian Renewable Energy Agency, Australian Government. Accessed May 2022.

9 Renewable Energy Target. Clean Energy Council. Accessed May 2022.

10 Tasmania surges to 100% renewable energy. The Hon. Guy Barnett, Minister for Energy, Department of Premier and Cabinet, Tasmanian Government. 2020. Accessed May 2022.

11 Solar PV and batteries. Department of Industry, Science, Energy and Resources, Australian Government. Access May 2022.

12 Sunshine: Average Daily Sunshine Hours. Bureau of Meteorology, Australian Government. 2005. Accessed May 2022.

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