Three major trends are reshaping Australia’s energy sector
Decarbonisation, decentralisation and digitalisation are the three main trends reshaping Australia’s energy sector, according to a new report. Against the backdrop, change has become the only constant in the industry – and it is accelerating.
Most countries across the world are being forced into introspection when it comes to their energy production and distribution practices. A historical burden on natural resources, the energy sector in many countries plunders natural reserves and generates substantial carbon emissions.
In the face of changing global perspectives, many have found themselves frozen in their tracks, unable to decide between a steady revenue source and heavy investments to structurally transition to more eco-friendly practices. In a new report, researchers from accounting and consulting firm Deloitte have advocated action.
Much like the three abovementioned Ds are changing the energy sector, two Cs – consumption and collaboration – demonstrate the path forward. In terms of consumption, Deloitte highlights how the drive towards a cleaner energy future is being dictated by individual consumer choices from one day to the next.
As Australians become more climate aware, they are choosing avenues of energy consumption that have minimal individual impact on the environment, even if it means a considerable change in their lifestyle. This represents a marked change in attitudes compared to the recent past.
“They are critically questioning the traditional approaches to demand and supply challenges, as well as expressing a desire for new and innovative ways to receive and consume energy services,” write the authors Michael Rath (Head of Power & Utilities at Deloitte for Asia Pacific & Australia), Sandra James (a Partner at the firm) and Shari Boyd (a Director) in the report. One example of this is the choice to drive electric vehicles, which is changing the entire mobility landscape in Australia.
When it comes to collaboration, Deloitte recommends alignment of objectives across all major stakeholders in the energy ecosystem, ranging from the government to consumers. Even amongst the broader business environment – which is responding to increasing demand for environmental consciousness – providing a mutual support system is crucial to navigating a time of disruption.
Stakeholder collaboration represents the intersection between; the global energy sector, where technological developments are driving change at a rapid rate; Australian energy policy, which is focused on cutting emissions; and consumer choice, which is a crucial factor in driving policy as well.
Of these factors, ‘consumer voice’ is placed as the central factor by the authors, primarily due to the intensity with which consumer preferences have shifted with the new generation. The desire to prioritise the climate over individual lifestyle is characeterised as a very millennial way of thinking.
With the radical change in perspective comes a radical change in demands. “This means that consumers are no longer willing to wait for governments to meet their needs. There is growing discontent and a view that governments are unwilling and unable to look beyond the current election cycle.”
Across the globe, the shift in consumer perspective is manifesting itself in concrete ways. Deloitte reports that there is an increase in the incidence of “coordinated shareholder resolutions at annual general meetings for action against climate change.”
