How Coal-Loving Australia Became the Leader in Rooftop Solar

CAIRNS, Australia — Australia is the world’s second-largest exporter of coal, which plays an outsize role in its economy and politics. But the country has also quietly become a renewable energy powerhouse.

About one in four Australian homes have rooftop solar panels, a larger share than in any other major economy, and the rate of installations far outpaces the global average. The country is well ahead of Germany, Japan and California, which are widely considered leaders in clean energy. In California, which leads U.S. states in the use of solar power, less than 10 percent of utility customers have rooftop solar panels.

Most Australians who have embraced solar do not appear to have done so for altruistic reasons like wanting to fight climate change. Many are responding to incentives offered by state governments in the absence of a coordinated federal approach, a sharp drop in the price of solar panels in recent years and an increase in electricity rates.

Politically conservative homeowners have also embraced solar to become less reliant on the electricity grid in keeping with the high value many Australians place on rugged individualism.

In two of the country’s most populous states — Queensland, a conservative stronghold, and New South Wales, home to left-leaning Sydney — as many as half of homes have solar panels.

“The future for New South Wales and indeed the country is one where our energy comes from sun, wind and pumped hydro, not just because it’s good for the environment but because it’s good for the economy” said Matt Kean, minister for energy and environment in New South Wales.

“That’s one of the reasons we’ve got the highest penetration of rooftop solar anywhere on the planet,” he added. “People are doing that because they want to save money.”

But many state governments have taken a very different approach. After the federal government failed to adopt a renewable energy policy in the early 2000s, Australian states began adopting aggressive climate policies and giving homeowners incentives to buy solar panels and, more recently, batteries to store power.

Those incentives kick-started the solar boom, and rooftop solar regularly provides about 5 percent of Australia’s electricity, compared with just under 1 percent in the United States.

Mr. Row believes the climate is changing but, like many other conservatives, isn’t sure how much of the change is caused by humans, he said. “I don’t think renewables are the total answer yet,” he said.

The growth of rooftop solar itself has caused some problems. Traditionally, power plants supplied electricity and homes used it, making it easy for officials to manage the grid. Now many homeowners are both consumers and providers of electricity, depending on the time of the day. That has forced grid managers to line up power plants that can ramp up or down more quickly to balance supply and demand.

“One of the bigger challenges that’s arising is that the electricity grid just wasn’t designed and built for high levels of rooftop solar,” said Kane Thornton, chief executive at the Clean Energy Council, the country’s renewable energy industry association. “It was designed for coal-fired power stations. We’re seeing many of the rules, and the grid itself, are needing to be reformed.”

More than half of the roughly two dozen coal-fired plants in operation are expected to be retired within 15 years, and it is not clear what will replace them. While environmentalists want more renewable energy, conservative lawmakers assert that the country needs to keep using coal.

“We’ve got to be realistic when we’re making transitions,” said Warren Entsch, a member of Parliament from Queensland in the governing Liberal Party, Australia’s equivalent of the Republican Party. “Coal is going to be part of our economy for, I believe, a long time into the future.”

Mr. Entsch is a special envoy to the Great Barrier Reef, off Queensland. He only recently acknowledged that climate change was the primary threat to the reef.

The recent rolling blackouts in California, the first since an energy crisis two decades ago, highlight the dangers posed by climate change and a rapid switch to renewable energy without careful planning. Hotter weather can increase demand for electricity while the supply from a grid that relies too much on solar panels and wind turbines can become erratic, producing less power on cloudy and breezeless days.

In Australia, battery prices are expected to fall 10 to 15 percent this year, according to Warwick Johnston of SunWiz, a consulting firm. That is driving interest: There were more than 70,000 home battery systems in the country last year, and Mr. Johnston expects that 28,000 more will be installed this year.

Eytan Lenko, the executive chair of Beyond Zero Emissions, a climate research and advocacy organization, installed a 17-kilowatt solar system last year along with a battery at his home in Melbourne.

“We’re easily generating way more than what were using,” Mr. Lenko said, adding that the battery had helped keep the lights on during a storm in August that caused a citywide blackout. Climate change, he said, “is going to create more of these storms.”

Still, batteries typically provide power for up to only five hours at a time. That has limited their use, especially by electric utilities.

Mr. Kean, the New South Wales energy minister, said Australia had to make its electric system more reliable, reduce costs and address climate change with the help of solar, wind, batteries and other renewable technologies.

“This is the economically rational position to take,” he said. “Those people arguing for coal, gas and nuclear are actually arguing for more expensive, dirtier energy. The future is not those things.”

Livia Albeck-Ripka reported from Cairns, and Ivan Penn from Los Angeles.

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