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Energy Profile: Australia 2013–2016

Date: 09 January 2014

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8 pages

Executive Summary

The Verdantix Energy Profile of Australia provides corporate energy leaders, strategy leaders and CFOs with an analysis of Australia’s evolving energy landscape. This report forms part of a series of profiles that analyse the energy futures in countries across the globe. To better understand Australia’s energy landscape we assessed change drivers such as energy balance, power generation mix, energy prices, energy legislation, and government targets and incentives. The analysis forecasts that the election of the Coalition government in September 2013, on the back of a mandate to repeal the carbon price mechanism, will cement Australia’s dependency on its domestic coal reserves. The abolition of the carbon tax will offset increases in the network costs of supplying electricity. Tightening of the gas market will put upward pressure on domestic gas prices as reserves are earmarked for export contracts to overseas markets.

TABLE OF CONTENTS

AUSTRALIA DEPENDS ON FOSSIL FUELS AS A PRODUCER AND CONSUMER 

AUSTRALIA FACES CHALLENGES IN BUILDING MORE GENERATING CAPACITY TO MEET BASELOAD DEMAND 

GOVERNMENT HOPES AXING CARBON PRICE WILL MITIGATE RISING ELECTRICITY PRICES 

RENEWABLES ON THE BACK BURNER AS A COALITION GOVERNMENT REIGNITES THE FOSSIL FUEL INDUSTRY 

TABLE OF FIGURES

Figure 1. Coal Accounts For Over Half Of Primary Energy Production
Figure 2. Australia Is A Major Exporter Of Coal But Importer Of Oil
Figure 3. Nearly Three Quarters Of Electricity Generation Is Derived From Coal
Figure 4. Wind Will Account For Over Half Of Renewable Generation By 2020
Figure 5. Network Costs Account For Almost Half Of Retail Electricity Prices In NEM
Figure 6. Exposure To International Markets Will Increase Prices In Eastern Gas Market
Figure 7. Legislation, Policy, Incentives And Standards Shape Australia’s Energy Profile

ORGANIZATIONS MENTIONED

Adani, AGL Energy, Australian Bureau of Resources and Energy Economics, Australian Department of Resources, Energy and Tourism, Australian Energy Market Operator, Australian Energy Regulator, Australian Renewable Energy Agency, Chevron, Clean Energy Finance Corporation, Climate Change Authority, EnergyAustralia, International Monetary Fund, Origin Energy, US Energy Information Administration