Industry hit by faltering energy transition
The stuttering energy transition is forcing big industrial companies like Boral to temporarily shut down cement production to avoid peak electricity prices, putting at risk the nation’s build-out of housing and infrastructure stock.
Boral CEO Vik Bansal said he was “extremely nervous” government plans to build housing, hospitals and even infrastructure for the Brisbane Olympic Games were vulnerable to an energy market that was at times incentivising the nation’s biggest cement maker to down tools.
Boral CEO Vik Bansal (right), Australian Energy Regulator chairwoman Clare Savage and AGL Energy CEO Damien Nicks (left) at the Summit on Monday. Dion Georgopoulos
The revelation at The Australian Financial Review Energy & Climate Summit that one of the country’s key manufacturers was regularly curtailing production in response to electricity prices comes amid calls from several quarters for Australia to set up advanced manufacturing to better tap its abundant resources of critical minerals.
It also comes as the national energy market operator stepped up calls on project developers to push projects through to construction to get Australia’s energy transition back on track.
One hurdle is that big industrial players – including Boral – were unwilling to sign up to the long-term contracts, sometimes lasting as long as 20 years, that were required to underpin the economics of projects because of uncertainty around future supply and prices.
Australian Energy Regulator chairman Clare Savage said there were more undeveloped energy projects “in the pipeline” than existing power generation assets, but calls to rapidly accelerate them must be tempered by the need to secure community support and keep costs down.
The boss of the Australian
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