Figure 1 : Australian Energy Production – fuel type
Queensland Energy and Jobs Plan , 2022 ).
How this plays out from an economic development and jobs perspective is not yet clear , however it will be determined by what we do now .
Source : Department of Climate Change , Energy , the Environment and Water ( 2022 ) Australian Energy Statistics , Table J
While Australia has world-leading renewables and CSIRO finds that wind and solar are the cheapest form of electricity ( CSIRO , GenCost 2021-22 , 2022 ), time and place shifting that new energy is more of a challenge than the mature supply chains for oil , gas and coal . These industries have had over a hundred years to refine their uses , supply chains and business models gaining efficiencies and integration along the way .
Until now , renewables have been focussed on domestic electricity , but to truly decarbonise we will need to scale-up their deployment , storage , supply chains and business models to enable renewable energy exports , and to decarbonise industries such as transport , chemicals , steel and other hard-to-abate sectors .
The most efficient use of renewables is to use them at the point of energy generation , both in time and place . Storing that energy in batteries or pumped hydro , moving it via distribution and transmission networks , and converting it to hydrogen through electrolysis , all require extra operational and capital costs and result in energy losses . However , while some renewable electricity can be exported through underwater high voltage direct current ( HVDC ) cables , there will also be the need for renewable energy chemical carriers such as hydrogen or ammonia , and embedding renewable energy in exported materials and products .
Australia has a significant amount of infrastructure , assets , skills and capability in energy production and distribution .
This expertise , and our demonstrated successes are a magnet for international investment and development in Australia ’ s renewable resources . People will be drawn to our natural energy advantages but the challenge we face is how to deepen the economic opportunity by blending that with our ingenuity .
Until now , renewables have been focussed on domestic electricity , but to truly decarbonise we will need to scale-up their deployment , storage , supply chains and business models to enable renewable energy exports , and to decarbonise industries such as transport , chemicals , steel and other hard-to-abate sectors .
Australia ’ s regions have much to benefit due to the availability of land , solar , wind , biomass , space for pumped hydro , access to existing generating and transmission infrastructure , water , transport , a skilled workforce and other assets . According to the Queensland Energy and Jobs Plan , “ 70 % of direct jobs and 95 % of expenditure will be in regions ” ( Queensland Department of Energy and Public Works ,
PASSIVE VS ACTIVE APPROACH The passive approach will lead to an influx of capital , technology and potentially skills to build solar and wind farms , hydrogen production and other related infrastructure . At best this approach will create some construction jobs and related supplier opportunities . However , a lack of coordination might lead to constraints and adverse impacts in other sectors such as tourism if re-locating construction workforce demand takes up space in hotels , drives up rents and attracts workers out of local councils and other employers . For many regions , this might feel like the activity is happening to them not with or for them . In the passive scenario , uncoordinated construction activity will lead to a series of spikes of employment and investment but with little certainty over long-term , sustainable economic development . The uncertainty of growth may also mean that wider amenity issues such as housing are not adequately addressed .
With a more active approach , there are significant opportunities for Australia to deepen and widen the economic and employment opportunity .
The IEA estimates that $ US 27 trillion ( about $ AU 40 trillion ) of electrolysers , fuel cells , solar panels , wind towers and battery packs will be required by 2050 ( International Energy Agency , World Energy Outlook , 2021 ). IRENA estimates that 43 million new jobs will be required in renewable energy over that same period ( International Renewable Energy Agency , Renewable Energy and Jobs – Annual Review 2021 , 2021 ). The location of this manufacturing and employment activity is not established . Australia has many of the ingredients to capture a significant share of these opportunities .
If we start at the beginning of the value chain , a massive scale-up of minerals is going to be required to make the equipment required to generate , distribute and use renewable energy . Australia is a world-leader in mining and has many of the minerals required to build the equipment and infrastructure for domestic and international markets .
ECONOMIC DEVELOPMENT JOURNAL VOL 15 NO 3 2022 15