Increased Energy Efficiency

For Australia to build a strong economy we need to lift productivity across the board. Energy is a key input and significant, growing driver of costs in our economy. That is why we need to put in place strategies to ensure that energy – like labour, capital and other economic inputs – is used efficiently and productively.

To achieve this, a Shorten Labor Government will:

  • Double Australia’s energy productivity by 2030;
  • Introduce new emissions standards for motor vehicles to reduce emissions in the transport sector;
  • Support policies that reduce per capita environmental impacts in our cities, including more efficient building design and public transport systems; and
  • Broaden Infrastructure Australia’s role to include new assessment criteria of smart infrastructure and sustainability.

We need to have an energy system that is secure, reliable and sustainable while also being efficient and affordable. Boosting our energy productivity helps lift our overall competitiveness. It will reduce costs for business, improve profitability of enterprise and free up capital for investment and job creation. Improving energy productivity is also key to decarbonising Australia's economy while maintaining economic growth.

Australia remains a relatively energy-intensive economy by OECD standards. Energy productivity improvements in recent years have been poor, against both OECD and G20 averages. Over the past two decades, for example, China has improved its energy productivity twice as fast as Australia. We currently sit in the bottom quartile of OECD nations on this important economic measure.

Australia’s relatively poor performance has been exacerbated by large increases in energy costs in recent years - electricity in the past decade and gas more recently. Energy costs grew by two thirds in the decade to 2011-12 - from $72 billion to $120 billion, which is close to the total private sector labour costs for the whole of Queensland. Over that same decade, average energy prices rose by 38 per cent, while productivity only increased by 16 per cent.

Improving energy productivity can make a significant difference to improvements on overall economic productivity. Strong performance in energy productivity has multiple benefits - reducing pollution and reducing costs for households and business, and driving growth in the national economy.

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