It’s 100 years since Victoria started transmitting electricity from the Yallourn Power Station to Melbourne. While there are a few things that haven’t changed a whole lot, the overall energy landscape in Australia is looking very different.
We’re in the middle of a period during which our entire energy system is being reshaped and we might look back on 2025 as a pivotal year in that transition, even though it’s already well underway.
Here are five topics that we expect to hear a lot more about in the coming months.
1. Energy management
Energy is one of the major contributors to the cost of doing business in Australia.
The cost of energy is an unavoidable item on the balance sheet of every business, and any rise can have a significant impact on competitiveness and profitability. For energy-intensive industries, a relatively small reduction in energy costs can translate to significant savings.
As a result, we’re seeing more and more businesses implementing strategies like off-peak energy use, energy-efficient equipment, and renewable energy integration.
Meanwhile, now that there is a mandatory Climate Reporting Law, any larger energy-intensive business needs a comprehensive energy management system to comply with the regulatory requirements.
The Australia Climate Reporting Law (which came into effect this month) mandates transparent reporting on energy use, carbon emissions, and environmental impacts. The aim of the Law is to encourage businesses to adopt cleaner energy practices.
2. Re-engineering the grid
Australia’s electricity grid is unique. For one thing, it’s long and thin, making it less flexible and more vulnerable than most others in the world, which tend to have a greater density of interconnectors in all directions. Add to that the relatively recent, but ever-increasing, challenge of accounting for our world-leading take-up of distributed energy.
As we’ve discussed previously, traditionally, electricity grids were built to transfer electricity from large, centralised coal-fired power stations with assistance from natural gas and hydro. The transfer was in one direction to end-users. Now that we have more and more people supplying energy back into the system from rooftop solar, the grid needs to be two-way.
So, the big challenge for re-engineering the grid to make it more fit-for-purpose and more efficient is maximising the effectiveness of existing grid infrastructure while also integrating a range of renewable generation sources, including Virtual Power Plants (VPPs) and small-scale devices collectively referred to as Distributed Energy Resources (DER).
For more on this topic, you might like to read an article we posted this time last year, Tackling Australia’s energy transformation, which goes into some detail about the role of the CSIRO in the Global Power Systems Transformation Initiative (GPST).
3. The role of technology
Both of the above topics rely heavily on technology. Energy management systems are able to co-ordinate and optimise every part of a system to ensure maximum efficiency while the performance of our current grid network is also being improved through the use of smart technology.
In fact, there’s no part of the production, generation, distribution, storage, and even usage of energy that can’t be enhanced by technology right now. Meanwhile, there are numerous research and development projects working to innovate further and take the contribution of technology to the next level.
Here are a few of the specific areas where enhanced technology is being explored or in development:
· Improving cables to reduce loss during transmission
· Using edge intelligence to improve grid flexibility
· Substation automation and optimisation
· Creating more efficient, lower-cost and longer-lasting photovoltaic cells
· Improving battery storage capacity and efficiency
· Reducing operating expenses and maintenance costs
· Improving safety and reducing risk
Technological innovations are also constantly improving the amount, variety, granularity, and accuracy of the data we’re able to collect. This helps improve our understanding of complex networks, track trends, and analyse points of friction. Artificial intelligence (AI) can then be used to understand that data and inform us how to adjust for improved outcomes.
4. Nuclear energy
We know we’re going to be hearing a lot more about nuclear energy in the coming months. However, because our political parties have polar opposite positions on the subject, there’s little chance that the public will see the facts presented dispassionately.
There is debate over build costs, location, implementation challenges, the probable timeline, operational practicalities and more. The lack of broad social acceptance of the need for or benefit of nuclear energy means it’s hard to imagine a time when everyone would be accepting. If there was already widespread support for nuclear energy in Australia, then things would be different.
However, many other countries have long accepted that nuclear energy has a role to play in their energy-generation mix. Nuclear power plants currently operate in 32 countries and generate about a tenth of the world’s electricity. France has the largest share of electricity generated by nuclear power, at about 70%.
Several other countries are considering the feasibility of introducing nuclear energy in the future, as the technology underpinning Small Modular Reactors (SMRs) is improving. SMRs have advantages over traditional reactor designs: they can have a fail-safe design, can be constructed more quickly, often require less downtime, and generate up to 300 megawatts each.
Putting aside ideology, perhaps what will be most interesting in the discussion of nuclear energy will be whether the projected cost or the projected timeline is seen as a bigger stumbling block. If neither of those was to be considered an overwhelming issue, we suspect the discussion would be different again.
5. Electric vehicles
As we noted in our post Is the next evolution of EVs closer than we think? three months ago, nearly one in five cars sold around the world in 2023 was electric.
The figures for 2024 indicate that almost one in ten vehicles sold in Australia last year was an EV, with over 90,000 sold (doubling the number of EVs on our roads). EV sales are projected to nearly double over the next two years.
Major contributing factors to the improved take-up have been the influx of new and cheaper models, the availability of at-home charging, and the popularity (and greater maturity of the market) of household solar.
The number of fast and ultra-fast charging locations has almost doubled in the past year, with over 1,000 sites across Australia. Greater availability of fast-charging stations will continue to be a major consideration for many thinking of buying an EV.
Meanwhile, New South Wales, Victoria, Queensland and South Australia all have EV uptake targets of 50% by 2030 … which means this is one topic we’ll be discussing regularly for at least the rest of the decade!
A fluid landscape
These definitely won’t be the only five energy-related topics we’ll be hearing about and discussing in 2025. As we look back over the past 10 years, there are so many things that we would not have anticipated learning about or wanting to understand that we now know quite a bit about.
For example, Virtual Power Plants (VPPs) continue to be a topic of great interest with the potential to play a much more substantial role in the future.
Whatever comes up, we’ll keep trying to give you more information on each subject.