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Despite being one of the world’s biggest coal producers, Australia has seen a sharp rise in renewable energy adoption in homes – particularly solar.

Though export volumes have declined this year, coal continues to have a major presence in Australia, both as the country’s second-biggest resource export and as a political lever. Under Prime Minister Scott Morrison, the federal government is disinclined to cut carbon emissions, asserting the importance of coal to the Australian economy. Last year Australia was second only to Indonesia in coal exports, according to the International Energy Agency.

In the absence of leadership on renewable energy at the federal level, Australian states started offering homeowners incentives to buy solar panels in the early 2000s. A solar boom ensued, and today about one in four households in Australia has rooftop solar panels, more than in any other major economy. Australia is deploying new renewables much more rapidly than the average rate globally, surpassing Germany, China, Japan and the U.S., where California leads.

Importantly, climate change has not been the driving force behind most people’s decision to use solar energy in their homes. The economic incentives from state governments, combined with high electricity costs and lower prices on solar panels in recent years have proven more compelling. Solar energy usage is especially high in the politically conservative state of Queensland. It is one of two states, along with New South Wales, in which as many as 50% 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, New South Wales Minister for Energy and Environment. “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.”

Renewable energy may be greening Australia’s electric system and saving people money, but the country continues to suffer frequent blackouts. This growing problem is due to an unreliable grid, record heat straining the system, and damage to utility equipment from wildfires, experts believe. As The New York Times notes, the growth in rooftop solar itself is another factor. In order to accommodate fluctuations in solar power generation in homes, power plants must be able to ramp up and down 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. “It was designed for coal-fired power stations. We’re seeing many of the rules, and the grid itself, are needing to be reformed.”

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