Australian energy projections to 2029-30 From ABARE research report 10.02 • In this report, ABARE’s latest long-term projections of Australian energy consumption, production and trade are presented, with an outlook horizon of 2029-30. These projections are not intended as predictions or forecasts, but as indications of potential changes in Australian energy consumption, production and trade patterns given the assumptions used in the report. • In undertaking these projections, ABARE included government policies that have already been enacted and those that can reasonably be expected to be adopted over the projection timeframe. On this basis, the Renewable Energy Target (RET) and a 5 per cent carbon emission reduction below 2000 levels by 2020 have been incorporated in the analysis, as well as other existing government initiatives. • The outlook presented in this report represents a significant turning point from ABARE’s previously published projections. The current projections show that Australian energy consumption will continue to grow over the next 20 years, albeit at a slower rate than experienced in the past 20 years. This reflects the long-term trend in the Australian economy toward less energy intensive sectors, and energy efficiency improvements, both of which can be expected to be reinforced by policy responses to climate change. • However, the expected transformation in the Australian energy landscape is even more evident in the composition of our energy mix (figure). Driven by policies designed to move Australia toward a low emissions economy, these projections point to a shift to low emission technologies over the outlook timeframe. While non-renewables are expected to account for 92 per cent of Australia’s primary energy mix in 2029-30, this represents a decline in their overall share in 2007-08 (95 per cent). Primary energy consumption, by fuel 40 35 30 25 20 15 10 5 share % coal oil gas renewables 2007-08 2029-30 Australian energy projections to 2029-30 abare.gov.au 10.02 • Within the non-renewables category, there is a marked increase in the use of gas (natural gas and coal seam gas), primarily for electricity generation—the largest user of primary energy—and LNG production. Gas-fired electricity generation is based on mature technologies with competitive cost structures relative to many renewable energy technologies. As such, it has the potential to play a major role as a transitional fuel until lower emission technologies become more cost effective. • Notwithstanding the bullish outlook for gas, renewable energy is projected to have the strongest growth prospects. Within this cluster, the highest growth trajectory is expected for the lowest cost renewable energy sources; namely, wind energy. However, the results also support a small but growing contribution from solar energy and geothermal energy. Much of this growth is driven by the RET and other government initiatives, designed to accelerate the development and deployment of renewable technologies. Report: Syed, A, Melanie, J, Thorpe, S and Penney, K 2010, Australian energy projections to 2029-30, ABARE research report 10.02, prepared for the Australian Government Department of Resources, Energy and Tourism, Canberra, March.