Australian manufacturers are facing their biggest energy risk in decades – Most haven’t noticed yet
By Jonathan Pooch Let me be direct: most Australian manufacturers are carrying a significant energy risk right now, and most of them don’t know it. That world of low, stable energy prices where energy sat in the engineering manager’s inbox and not the boardroom is gone. And the organisations that haven’t updated their thinking are the ones most exposed to what’s coming. The federal government’s Demand Side Statement of Opportunities (DSOO) is a signal worth paying attention to. The study, currently in development by the Department of Climate Change, Energy, the Environment and Water with CSIRO and the Australian Energy Market Operator, is expected to be released later this year. It will for the first time formally model the value of industrial energy users as active participants in managing the grid. The CSIRO’s FlexCost study alongside it puts a price on what it costs to incentivise businesses to flex their energy loads, shifting consumption to off-peak periods, storing heat or power for later use, responding dynamically to grid conditions. The first FlexCost report is due this quarter. This is a fundamental shift in how the energy system is being designed. And most manufacturers have no idea what it means for them. Here’s what it means. We are entering a new world of renewables, batteries, solar and electrification, and with it comes a significant and growing risk for manufacturers who haven’t started thinking strategically about energy. Gas prices are up. Price volatility is increasing. The grid is becoming more complex. And at some point, government funding becomes irrelevant, because the energy price itself will force decisions. The question is whether you’re making those decisions under pressure or whether you’ve already mapped your options and can move fast when the moment arrives. I’ve been in enough boardrooms to know that energy is […]
