This is a best prospect industry sector for this country. Includes a market overview and trade data.
The growth in the renewable energy sector in Australia over the past five years has been significant. Australia’s electricity system has become cheaper, more reliable, and cleaner. The industry passed a significant milestone in 2020, with renewable energy accounting for 27.7% of Australia’s total electricity generation, the first time that more than a quarter of the country’s energy came from renewable sources.
Much of this progress was driven by state and territory governments, which introduced a number of world-leading renewable energy policies and targets in 2020. New South Wales, Victoria, and Queensland committed to developing Renewable Energy Zones. In NSW, the Government will support over 6,300 construction and 2,800 ongoing jobs, mostly in regional NSW. Meanwhile, the Victoria government has pledged $543 million. As a result, there has been a continued increase in clean energy jobs, with the industry employing more than 25,000 Australians in 2020.
The Australian government launched the Technology Investment Roadmap in 2020 as a strategy to help the country meet its emissions reduction targets and has committed to producing regular updates tracking progress against its technology goals. Priority technologies include: Clean Hydrogen, Energy Storage, Low Carbon Materials, and Soil Carbon. Clean energy was also listed as one of the government’s five priorities in the $1.1 billion (AUD 1.5 billion) Modern Manufacturing Strategy announced in 2020.
Energy produced from wind is Australia’s main sources of renewable energy, generating enough electricity to meet 7.1 percent of the nation’s total electricity demand. At the end of 2018, there were 94 wind farms in Australia, delivering nearly 16 GW of wind generation capacity. This energy type is one of the lowest-cost sources of new electricity supply in Australia, along with utility-scale solar PV. The cost of utility-scale wind energy in Australia is expected to continue falling, with new wind farms expected to deliver electricity at around $50-65/MWh in 2020 and below $50/MWh in 2030.
With large potential for renewable energy, large fossil fuel resources, and good potential CO2 storage sites, Australia is well placed to become a major producer of hydrogen for domestic use and as an export industry. Several noteworthy steps were taken in 2020 to develop Australia’s emerging renewable hydrogen industry. The most significant of these was hydrogen’s inclusion in the Federal Government’s Technology Investment Roadmap. A network of 13 regional hydrogen technology clusters has been unveiled across Australia as part of a drive to establish a nationwide hydrogen cluster. With $1.85 million to be invested in the clusters, the network will foster a multi-billion dollar, globally competitive hydrogen industry. The states and territories also upped their investment in renewable hydrogen, committing millions of dollars to various pilot projects and new initiatives throughout the year. Federally, the Australian government released a National Hydrogen Strategy in 2019.
Improved technologies, more complex electricity market designs, and increased penetration of renewable energy has been driving the deployment of energy storage solutions in Australia. Sixteen large-scale batteries were under construction at the end of 2020, representing more than 595 MW of new capacity. This will increase the country’s cumulative storage capacity to 2.7 gigawatt-hours, according to Wood Mackenzie’s latest report on Australia’s energy storage market. It is forecasted that the industry in Australia could implement dynamic tariffs (time-of-use tariffs) to shift some peak load and flatten peaks in electricity demand, leading to a decrease in the costs of running the electricity transmission and distribution networks. As energy storage continues to grow, micro-grids will become more dependent on renewable fuels rather than fossil fuels.
There remains a need for additional investment in transmission capacity to support the energy connections. The 2020 Technology Investment Roadmap outlines the need for international partnerships to lower emissions. Priority low emissions technologies are those expected to have a significant impact on Australia’s big technological challenges and opportunities. These technologies have the highest abatement and economic potential in areas of comparative advantage for Australia. They are priorities where government investments can make a difference in reducing prices and improving technology readiness.
The priority low emissions technologies identified in this roadmap are:
- clean hydrogen;
- energy storage;
- low carbon materials (steel and aluminum);
- carbon capture and storage;
- soil carbon.
There are a number of other opportunities available for U.S. exporters:
Advancing Renewables Program supports a broad range of development, demonstration, and pre-commercial deployment projects that can deliver affordable and reliable renewable energy for Australian businesses and families.
Regional Australia Microgrid Pilots Program aims to support pilot projects for microgrids in regional Australia.
National Hydrogen Roadmap provides a blueprint for the development of a hydrogen industry in Australia.
Renewable Energy Zones will accelerate the transition away from fossil fuels and towards zero-emissions electricity.
- Clean Energy Australia Report
- Clean Energy Council Fact Sheet