The Minister for Resources and Energy, Martin Ferguson AM MP, has welcomed a new report showing the energy intensity of the Australian economy fell 1.1 per cent annually throughout the past two decades; a rate in line with other OECD economies.
Funded by the Department of Resources, Energy and Tourism and compiled by ABARE, End Use Energy Intensity in the Australian Economy shows end use energy intensity declines between 1989-90 and 2006-07 have resulted in significant savings in energy consumption.
The report analyses energy intensity (the ratio of energy consumption to the level of economic output) trends and identifies factors affecting the amount of energy consumed in all end use sectors of the Australian economy, including agriculture, mining, manufacturing, services, transport and residential.
Energy consumption in the end use sectors in Australia grew by 45 per cent, from 2457 petajoules in 1989-90 to 3551 petajoules in 2006-07, which equates to an average annual growth rate of 2.2 per cent. However, the report says energy consumption would have grown by 55 per cent had it not been for shifts in the structure of the Australian economy to relatively less energy intensive sectors and energy efficiency improvements throughout this period.
The energy efficiency gains identified have occurred across a wide range of sectors including manufacturing, services, transport and residential. However, these savings were partly offset by higher energy intensity in the agriculture and mining sectors.
In the mining sector, increases in the use of energy for exploration activity, as the industry moves to deeper and lower grade ores, and increases in the production of liquefied natural gas, which is relatively energy-intensive, have contributed to an increase in energy intensity.
In agriculture, the higher energy intensity reflects the severe droughts in 1994-95, 2002-03 and 2006-07 which reduced agricultural output without changes in apparent energy consumption.
Minister Ferguson said: "The APEC Leaders' Declaration in Sydney, in September 2007, set a target for reducing energy intensity in member economies by at least 25 per cent by 2030, compared with 2005.
"The trend in energy intensity reduction observed in this report shows the Australian economy to be on track to meet this target."