Australia’s Changing Energy Landscape

October 22, 2021

The Current Energy Situation in Australia

There is a changing shift in the mindset of people, and the choices being made on the energy generation options being used today. As of the most recent Australian Energy Statistics released by the Federal Government for 2021, this indicates the increasing preferability towards a renewable energy source1. Of the electricity used in the past year, 24% came from renewables (solar and wind), which is up from 21% of the previous year1. Despite the increase in the use of a renewable energy source, energy provided from either a coal or gas source still contributed the most towards our electricity1. Overall, this past year we have seen a major change in electricity usage and sources, moving from our coal and gas sources from the past, and seeing more use of renewable sources, and a new emerging interest in the importance of batteries2.

What Does that Mean for Coal Power Sources?

The increased production of electricity from renewable resources has caused the price of power to fall by sometimes as high as 57%3. The decrease in the cost for energy will cause a strain on the more expensive to run coal generators3. This can put the coal generators at risk of closing due to lower profits being made, with sometimes no profit being made at all3. The cost that new coal generators incur from their usage can vary, but including all aspects that it takes to run them such as generation, storage, and carbon neutralisation, it can cost up to $300 per mega-watt hour3. In renewables, the highest cost that can be incurred is only $903.

Due to the lower or even non-existent profit being made from electricity generated by using coal, this may cause coal generators to shut down4. Leading on from this, if Australia does not currently have the capacity to make up for this electricity production decrease in other energy sectors such as solar power, this may result in blackouts3. Another issue if the coal generators were to close, would be the increased risk of not enough electricity available in the case that renewable sources cannot be used3. This would include situations such as storms, where solar power could not be captured and used for making electricity3. A potential solution to this would be to invest time and money into the use of assets that would support the storage of electricity long-term3. This essentially would be an investment into the use of large-scale batteries, to ensure that there is always an energy supply to the grid, even when energy production is halted5.

Very recently Victoria has announced it will begin building the first large-scale battery supported completely by the private sector6. Set for completion in 2022, this battery will be able to supply 1 million homes with power for half an hour before it requires any more energy to be put back into the battery6. This development indicates the importance currently to focus on options in the energy industry that can hold electricity until we need it, and lessen the impact that any closure on coal power stations may have.

The Risk of Blackouts

The risk to Australia’s energy supply due to an interruption in a generator, or anywhere along the line of production, is high. For example, recently a fire at the Callide C coal-fired power station resulted in blackouts for 477,000 homes5. Not only did this blackout affect homes, but it also affected hospitals, traffic lights, airports, businesses, and shopping centres5. This was the result of only one coal-fired power station being unable to operate for a short period of time. There is currently 24 coal-fired power stations being used in Australia7. Any decrease in monetary returns for coal fire stations causing their closure, without other sources, could result in blackout occurrences in a variety of locations. If energy is unable to be supplied to a variety of locations at any time, this will create great difficulty for the citizens of Australia, and be incredibly risky in situations such as hospitals.

What are Large-Scale Batteries

The batteries that are becoming of increasing importance to both Australia and the world for the reliable supply of electricity, are most commonly large lithium-ion batteries8. They are made with chemicals that allow the battery to absorb and release energy whenever it is needed8. These batteries have unique properties to other energy storage technology that has been previously used, as they can respond much faster, being able to respond to commands given within less than a second8. These batteries can either be stored in large groups as large-scale battery storage connect directly into the grid or by themselves into homes8.

How batteries will Help us

One example of how Australian’s will benefit from the use of batteries is that the manufacturing of batteries in Australia will add value to our economy9. The creation of batteries will provide jobs, and allow us to be one of the prime manufacturers of large-scale batteries in the world9. This is supported by the fact that Australia is one of few countries that naturally has all the components required to make such a large-scale battery9. While these batteries are in use, it will result in lower occurrences of blackouts and reducing the need to load shed, by increasing the amount of energy available in times of high demand, or when there is other damage to the network such as during storms10.

Batteries can also be used to reduce the customer costs associated with energy consumption10. The batteries can do this by taking in the energy created by renewable generators when demand is low, and outputting this energy that has been stored when demand becomes higher10 . Usually during these times of high energy demand, the cost of energy would increase for the consumer, but if the energy has already been stored and is ready to be used, the amount of energy available is not limited, therefore decreasing the costs that would usually be incurred during these high demand periods. These batteries will also prevent blackouts from occurring during our transition to less coal-generated power sources3.

The production and increased usage of batteries will also assist in our shift towards more renewable energy production methods10. This would result in environmentally cleaner energy options being used within Australia, positively impacting our environment, our climate, and us who can benefit from them10.

The Future of Renewables

With more interest in renewable energy than ever before, more energy and products are being put into further expanding this sector. At the moment, Australia is on track to reach approximately 50% renewable energy sources by the year 20254. And by the 2030s, the renewable sector could have the capacity to provide 100% of the energy required in Australia4. The most recent report by the Australian Energy Regulator predicts that further rooftop solar panels and new wind and solar generators will come online2. The renewable sector itself has also expanded its use and interest in batteries as energy storage, both on the electric grid and on a smaller scale in households2. With the expansion of the renewable energy sector also comes the creation of more jobs11. The University of Technology’s Institute of Sustainable Future has predicted there could be as many as 20,000 jobs created11.

With the changes in energy preference ever changing in Australia, with an increased interest towards renewable sources, Australia will have to continue investing in new technologies, that have the potential to positively affect us, and bring us into the future of energy production and usage.


[1] Imogen Hartmann. Energy. Renewables rise again in 2021 energy statistics. (June 2021).

[2] David Carroll. PV Magazine. AER report highlights reliability issues for future energy market. (July 2021.

[3] Mike Foley & Nick Toscano. The Sydney Morning Herald. Falling cost of renewables creates coal test for federal government. (July 2021).

[4] Ken Baldwin, Andrew Blakers, & Mathew Stocks. The Conversation. At its current rate, Australia is on track for 50% renewable electricity in 2025. (September 2018).

[5] David Carroll. Pv magazine. Australian power outage sparks calls for big batteries. (May 2021).

[6] Peter Hannam. The Sydney Morning Herald. Big $300m battery to be built without government aid in market first.(July 2021).

[7] Parliament of Australia. Retirement of coal fired power stations. (November 2016).

[8] Australian Government. The Australian Renewable Energy Agency. Battery Storage. (June 2021).

[9] Cait Kelly. The New Daily. Battery boom could add billions to Australia’s economy and solve grid crisis. (July 2021).

[10] Andy Colthorpe. Energy Storage News. Australian states push forward large-scale battery plans. (November 2020).

[11] Dyflex Green Energy Solutions. Pv magazine. New software platform designed to support businesses in renewable industries. (July 2021).


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