The Utilities Industry provides an essential service to Australians. The State of the Energy Market 2021 by the Australian Energy Regulator (AER) reports that in 2020, many consumers experienced an increase in financial stress. However, the pandemic only had a moderate impact on broader energy market outcomes, with increased household consumption partially offsetting the drop in commercial usage due to closures during lockdowns. In early April 2020, AER released the first Statement Of Expectations Of Energy Businesses: Protecting Consumers and the Market During COVID-19, which has been subsequentially amended four times. The statement released in June 2021 acknowledges the uncertain nature of the pandemic and is in place to provide protection in the event of further stay at home orders. To prevent multiple retailer failure, the Australian Energy Market Commission (AEMC) published a final determination and rule that introduces a mechanism to allow some retailers to defer network charges to distribution network service providers (DNSPs) incurred between 6 August 2020 and 6 February 2021 for eligible customers for six months.
Australia’s future energy needs have attracted a considerable amount of attention from governments, industry, associations, interest groups and the media. The pandemic recovery process has been seen as an opportunity to accelerate the uptake of renewable energy alternatives to fossil fuels, and thereby create employment opportunities. For example, the Securing Australia’s Recovery: Building a More Secure and Resilient Australia suite of measures from the Commonwealth Government 2021-22 Budget includes investment in new dispatchable generation, battery and microgrid projects, gas generators to become hydrogen ready, hydrogen hubs, and water and natural disaster resilience. While many of the projects announced have potentially long lead times, they highlight the concerns raised in the Industry Skills Forecasts that training entrants and upskilling the current workforce in renewable and new technologies needs to begin promptly.
ESI Generation and ESI Transmission, Distribution and Rail
A high proportion of the recent discussion regarding Australia’s future energy needs and reduction in carbon emissions impacts the ESI Generation and ESI Transmission, Distribution and Rail Industries. The Commonwealth government released a discussion paper in 2020 to seek input to inform its Low Emissions Technology Statements (2020 and 2021), acknowledging the economic recovery from the COVID-19 pandemic must continue to prioritise investment in technologies that improve productivity and support a resilient economy. Australia’s Long-Term Emissions Reduction Plan summarises the Australian, state and territory government co-investments in energy and emissions reductions projects for transmission, interconnectors and renewable energy zones. Examples in the plan include Snowy 2.0, the MarinusLink interconnector, Project EnergyConnect interconnector, Tasmania’s Battery of the Nation, and the Regional Australia Microgrids Pilots program. The Commonwealth Government Budget 2021-22 Securing Australia’s Recovery: Building a More Secure and Resilient Australia document includes funding to assist new gas generators to become hydrogen ready. The JobMaker Plan was introduced to stimulate economic growth in response to the pandemic, a key feature of which is the Modern Manufacturing Strategy. The six priority areas include recycling and clean energy, with the roadmap identifying opportunities for Australian manufacturers benefit from large energy projects.
Key findings of the scenario analysis conducted for the Renewable Energy Employment in Australia: Stage One report include the renewable energy industry could create 20,000 new jobs in the next five years or lose 11,000 jobs by 2022 depending on government COVID-19 stimulus measures and wider energy policy. The Clean Energy Council A Clean Recovery report recommends increased government support for rooftop solar, home battery storage, large scale wind, solar and energy storage projects, and a stronger transmission network. The report also highlights clean energy projects primarily benefit regional and remote areas and have many characteristics that reduce the risk factors associated with COVID-19 transmission. The Clean Jobs Plan, produced by AlphaBeta for the Climate Council also includes installing utility-scale renewable energy and community-scale grid systems as components of its 12 policy decisions. It also highlights funding education and training to transition workers into new roles would create 1,000 jobs. Clean Jobs for Communities: How Local Governments Can Create Sustainable, Strong Economies is based on the Clean Job Plan and shows how local governments can deliver and advocate for opportunities to ensure an economic recovery that empowers. In the clean energy section of the report, it is stated that local governments can drive the transition to clean energy through large and small projects that can provide opportunities for local investment and job creation.
Gas
The Australian Gas Networks AGN – Response to COVID-19 states their operational focus to safely maintain the reliability of gas supply for their customers and the broader community has not been impacted and they would still be carrying out emergency repairs, performing works, and reading meters if access is unhindered. During lockdowns, disconnection orders were cancelled and returned to the respective retailer. COVID-19 Economic Assessment by IBISWorld reports that the pandemic has moderately affected the Gas Supply sub-sector, with the global downturn in economic conditions reducing demand for natural gas in 2020-21. Lockdowns in New South Wales and Victoria in 2021 are expected to have hindered demand from the manufacturing sector, which is the largest domestic market for natural gas accounting for about 60% of industry revenue, but this will be partially offset by increased demand from people working from home.
The Australian Government Gas-Fired Recovery was announced 15 September 2020. Part of the Government’s JobMaker plan, the initiative intends to create a more competitive and transparent Australian Gas Hub by unlocking gas supply, delivering an efficient pipeline and transportation market, and empowering gas customers. New measures were included in the 2021-22 federal budget, and the National Gas Infrastructure Plan: Interim Report (Interim NGIP) has been released, providing a blueprint of infrastructure requirements for Australia’s east coast gas market to 2027. The budget commitments also include funding for infrastructure projects and support the 2020 and 2021 Low Emissions Technology Statements, Australia’s National Hydrogen Strategy under the Technology Investment Roadmap, and the National Gas Infrastructure Plan. In 2018, a pre-feasibility study estimated the construction of a west-east pipeline could take four to five years and support up to 1,300 jobs. The Queensland government has committed to investigating the feasibility and options for a new transmission pipeline to connect the Bowen Basin’s gas reserves to the east coast of Queensland as part of their economic recovery plan.
Water
The Water Industry has played a pivotal role in monitoring and tracking COVID-19 infections. A collaboration between CSIRO and The University of Queensland in early 2020 provided proof that wastewater surveillance could detect COVID-19 prevalence in a community. The validated method built on work by research groups in the Netherlands and the United States of America. Water Research Australia has established a Community of Interest to provide a central place for water utilities to stay up-to-date with COVID-19 and the implications for the water sector. Water Research Australia is also leading the ColoSSos (Collaboration on Sewage Surveillance of SARS-CoV-2) Project, collaboration between water utilities, health departments and researchers to track and monitor the presence of the virus in the sewerage network.
Water Industry associations and suppliers have focussed on ensuring the continuity of water and wastewater services, particularly the work practices of operators and supply of chemicals and allaying potential concerns of consumers. Water Services Association of Australia has produced a factsheet to help providers reassure consumers about the safety and continuation of the supply of drinking water in relation to COVID-19. Water Research Australia reports that while it is possible that SARS-CoV-2 may be present in wastewater, the same is true for a wide variety of pathogens. The controls already in place are based keeping workers safe from much more readily transmissible and established pathogens, and no special or specific changes need to be made due to SARS-CoV-2. The Water Sector Macro Trends: Analysis Report for the Victorian Water Industry states it is possible there will be less acceptance and implementation of recycled water due to public concerns over the transmission of the virus.
The analysis report also suggests financial constraints may affect the ability of utilities to increase water supply resilience, particularly in regional areas where revenue has been strongly impacted by drought, floods, bushfires and COVID-19, and recovery may take many years. The Water Services Association of Australia submission to the National COVID-19 Coordination Commission states that in addition to investing in capital project, investment is needed to develop the capability and capacity of people living in regional Australia. The Queensland government has included continued investment in water infrastructure as part of their economic recovery plan. The 2021-2022 New South Wales Budget Regional NSW paper includes funding for critical local water infrastructure to maintain and improve town water supplies.
