Trump Factor Unlikely to Impact Australia's Clean Energy Progress

Australia's energy transition is showing strong signs of recovery, thanks to several months of robust investments. The latest industry data underscores that this positive momentum is expected to continue, irrespective of Donald Trump's possible return to political power.

According to a report released by the Clean Energy Council, Australia has recorded its best clean energy investment performance since late 2022. Chief Executive Kane Thornton emphasized that investment in renewable energy would persist regardless of the so-called “Trump factor” or the status of the United States in international climate agreements. The recent Quarterly Renewables Report indicates a significant rebound in Australia’s energy transition.

During the third quarter of the year, Australia saw financial commitments for about 1400 megawatts (MW) or $3.3 billion worth of new large-scale renewable energy projects. This includes a notable increase in energy storage projects, which are essential for ensuring grid stability. The data revealed a record high of 1235 MW/3862 MWh in energy storage, marking a remarkable 95 percent increase compared to the same period last year.

The onshore wind sector also exhibited a resurgence, with newly committed capacity reaching 1758 MW in 2024 alone. Thornton observed that the growing investment activity suggests that challenging economic conditions are gradually easing. The investment during the September quarter alone has surpassed the total for all of 2023.

As construction on various projects progresses, it is anticipated that nearly half of Australia's energy supply will come from renewable sources by the end of 2025. Thornton indicated that, since 2020, over $40 billion has been invested in renewables and storage. If this strong investment trend continues, Australia is projected to achieve 82 percent renewable energy generation by 2030.

It's worth noting that there has been a global shift in clean energy investments. Following the passage of the Inflation Reduction Act by President Joe Biden’s administration in 2022, there was a considerable influx of investments into the U.S. This included some capital moving away from Australia. Thornton mentioned that if the pace of investments were to slow down in the United States, Australia could become more attractive for investors looking to redirect their funds back into the country.

Despite the focus on U.S. investments, strong drivers for renewable energy investment exist both in the U.S. and Australia, implying that momentum in Australia is likely to remain strong.

energy, investment, transition