In the 2018 International Energy Efficiency Scorecard, Australia has been ranked the worst nation for energy efficiency in the developed world.
The scorecard—produced by the American Council for an Energy-Efficient Economy (ACEEE)—examines the efficiency policies and performance of 25 of the world’s top energy-consuming countries. It’s a critical report because together, the 25 countries represent 78 percent of total energy consumed on the planet.
Sadly, but not surprisingly this year, Australia slipped in the rankings from 16th in 2017 to 18th in 2018—making it the worst-performing nation among all developed nations evaluated by the ranking. In 2014, Australia was ranked 10th most energy-efficient nation. This is a concerning trend. What’s more disappointing is that, if we mirror these calendar years to critical changes in policy positions at a federal level, we can instantly see a correlation.
Although we are falling behind our counterparts, the scorecard had one positive for Australia—building energy efficiency—the only category where we outperformed the median. That said, no country came close to a perfect score, and the average remained the same as in 2016—51 out of a possible 100 points.
We are doing well in this area, but it really isn’t enough. Here’s why:
• Buildings consume over half of Australia’s electricity.
• In 2050, 51 percent of Australia’s buildings will be built after 2019.
• We need a reduction in Greenhouse Gas emissions (GHG).
• Increased building performance is key to resilience in extreme temperatures.
• Australia’s infrastructure cannot cope with the increased energy demands.
• Australian households are paying the highest electricity prices in the world.
Australia has been slipping behind on sustainability for a long time. In general, as with most big policy issues there seems to be a big disconnect in the sustainability space between needs and practice. The ethical imperative of caring for mother earth for future generations is just not demonstrated in our everyday behaviours. But why? Australia is brimming with enthusiastic sustainability and energy professionals, but the same old story gets in the way: cultural and cost barriers.
Why won’t our client’s pay for it? Why aren’t sustainability practices a normal part of everyday life?
As things stand, Australians are paying two to three times more than U.S. citizens for power, a drastic reversal from the 1990s when our power bills were the cheapest in the world. Our power bills are, on average, higher than those in countries where electricity is taxed heavily, such as Germany, Denmark and Italy. This means that at market price Australians pay the highest electricity prices anywhere in the world.
Buildings are a key driver of peak demand across the electricity grid. In Australia we’re very focused on the supply side of the market, the per unit cost of energy. But we tend to forget that our energy bill is a function of unit cost and volume, and that’s what other countries around the world are really focusing on.
Australia is experiencing increased energy demand at peak times. To meet this increased demand, we need to build more infrastructure to deliver it to our homes and businesses. This applies to poles and wires for the electricity network; pipelines and equipment in the gas industry, plus other equipment for industrial users. The costs for this extra infrastructure are passed on to consumers. If we can slow down the growth in demand, or even reduce our energy consumption through efficiency measures, we can avoid the added infrastructure costs.
Most energy used in Australia still comes from hydrocarbon-based sources with varying degrees of associated GHG emissions. Even though we are seeing a transition to renewables, it is expected that hydrocarbons—particularly natural gas—will be used for many years to come. If we can use these resources more efficiently, we can help Australia reach our GHG reduction targets.
Improved energy efficiency requirements could reduce new building energy use by up to 56 percent through the use of simple measures such as more airtight buildings, higher levels of insulation, more shading, ceiling fans and light-coloured walls (in warmer climates), and increased efficiency standards for lights, hot water equipment and air conditioning units.
There are pushes for changes to building codes, but the real issue in Australia is a lack of engaged hearts and minds on the topic, as well as a lack of understanding that the shortterm pain of additional costs has long-term economic and environmental benefits. Money talks, and if our clients had more information about the additional upfront costs vs. the longer-term savings, many might seek the additional financing required.
Everything is a sales pitch, and most decisions are driven by money; which means we can drive change when we are supported with the economic facts. Having formerly worked as a lobbyist, I utilise the following framework to contextualise the information I include my pitches:
• How can I save your organisation money (and/or even make money)?
• How can I help you do your job?
• What information do you need to on-sell what I am telling you with ease?
We can see that Albania, Iceland and Paraguay obtain essentially all of their electricity from renewable sources—Albania and Paraguay receiving 100 percent of their electricity from hydroelectricity; Iceland’s is 72 percent hydro and 28 percent geothermal. Norway obtains nearly all of its electricity from renewable sources—97 percent from hydropower.
Investment in renewable energy was higher in the world’s poorest countries than the wealthiest ones for the first time last year, according to report by Renewable Energy Policy Network for the 21st Century (Ren21).
We can see how the “sales pitch” framework I have included above applies to these countries. Christine Lins, REN21’s executive secretary, pointed out this record level of growth had been achieved despite governments around the world heavily subsidising fossil fuels. Sadly, for every dollar spent boosting renewables, nearly four dollars were spent to maintain our dependence on fossil fuels. However, countries are opting for renewables because they are not only the most environmentally sound, but also the cheapest option—which is a clear signal of the economic viability.
We need to be realistic when we on-sell sustainability measures to our clients. In a country where climate change is a political football, we must drive change with economic facts. We must send in our best staff to sell for us and arm them with cold, hard figures. We must think through and genuinely reflect by asking ourselves this question: Can our team speak to the economic viability of sustainability? And if so, are they able to relay this in simple lay terminology?
Engaging hearts and minds on sustainability issues is critical, but let’s rethink why and how we will achieve this. In 2015, the Pope bitterly condemned the human failures that have eroded much of the environment. What impact did this have? Very little.
Why? The Pope’s paper did make a huge statement, but with very little impact. While his intentions were well meaning, pointing his finger at humanity and waving it with disgust is globally recognised as the best way to disengage an audience— so it was perhaps not the best approach.
We really have not engaged people’s hearts and minds on sustainability on the scale we need because perhaps we are not truly committed ourselves. Actions do speak louder than words. Given how far behind we are on sustainability, let’s think about this with the most basic examples: Are we designing and building food courts which operate on 100 percent disposable plates and cutlery? Or do hotels still utlise the tiny disposable shampoo and conditioner bottles? Are our firms still serving large amounts of meat and handing out water in plastic bottles at corporate functions? Our office kitchens might have containers to separate the recyclables, but do we know what happens to it once it’s collected by the office cleaners?
If we want to engage the hearts and minds in our community, sustainability needs to be a key value in our business which is genuinely reflected in our actions from within our firms. Leaders need to lead on this issue and have tough conversations, even walk away from clients who do not reflect our values. In Australia, trust in government is at an all-time low, while trust in the CEO is higher than ever. In the 2018 Edelman Trust Barometer, 65 percent of respondents agree that CEOs should take the lead on change rather than waiting for government to implement it. And 63 percent of respondents believe that companies can take actions to increase their profits, while simultaneously having a positive social and economic impact on the society where that company operates.
Now more than ever, people are looking to the business community for solutions. We can engage with the community on the issues on a deeper level, talking about the plain and simple facts. We can have an impact by genuinely looking within and adopting practices which reflect the values of the world we want to live in.
Alexia Lidas is managing director, DesignIntelligence Australia.
This article is excerpted from DesignIntelligence Quarterly 3Q 2018 edition.