Australian energy companies are facing a “perfect storm” as renewable alternatives are hastening the move to off-grid electricity.
Earlier this month US energy giant Brookfield announced it had signed a deal with property group LWP to build a new suburb near Newcastle, NSW, powered entirely off-grid, challenging incumbent industries to adapt or perish.
The move has enormous implications for rural and regional communities throughout Australia where the tyranny of distance has often led to towns becoming stranded at the far end of a very long energy line.
But rather than diversify, some energy companies have lobbied governments to make going off-grid a crime.
In June US courts in the state of Florida ruled it illegal to go off-grid.
Earlier this year the (then) Abbott government instructed the $10 million “green bank” Clean Energy Finance Corporation to stop investing in wind power and to exclude direct investment in small-scale solar.
Professor Andrew Blakers, Director at the Centre for Sustainable Energy Systems, told Fairfax incumbents ought to adapt and diversify or else face “dire consequences”.
“Competition from [solar], wind and storage will penalise companies that imagine that their business models don’t have to change,” he said.
“While there is quite a way to go before this proposal actually comes to fruition, change is coming very quickly, and these sorts of proposals will become ever more common, with dire consequences for traditional business models.”
Simon Hackett, chair of RedFlow —an Australian company that designs off-grid batteries — told Fairfax the Australian energy industry is facing a “perfect storm”.
“The combination of high energy prices, widespread deployment of photovoltaic solar panels (PV), a ready supply of sunshine and the looming presence of widespread, affordable and effective energy storage systems is encouraging customers to look for other ways to supply their energy needs,” he said.