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Green Energy Stocks in Australia

by | Sep 21, 2022 | Green Investments

The green energy stocks in Australia are changing with a growing interest in renewable energy. Government policy incentives, a decline in renewable generation costs, and elevated electricity prices have resulted in the growth of the renewable energy market. However, green energy stocks in Australia do not seem to be doing so well.

However, green energy stocks in Australia rarely feature in popular renewable energy news. Even investors with super funds are reluctant to pour their money into projects in this country. World data shows that China and Europe host some of the world’s largest renewable energy companies. Canada, Thailand, Israel, and Japan also produce winners. But companies in Australia do not even get a mention.

Free photos of Sunset

Why is that? Australia’s geography makes it an ideal and obvious choice for renewable energy investments. But, in reality, there is a high risk associated with this asset class for three main reasons.

The first reason is the Australian grid. The poles and wires that form the energy grid in Australia are simply not built to handle renewable energy. Therefore, investors get lower returns for solar and wind power from Australia.

The second is long-term national policies. The Australian government has not tried to hide the fact that it wants to maximize fossil fuel extraction. Coal, oil, and gas are some of Australia’s top exports.

But the government can support the export industry while promoting domestic energy transition. Countries like Denmark have shown the world that it is possible to expand and promote green energy stocks in Australia while continuing to export oil. The government failing to do this will only damage private sector growth and discourage investments.

The third reason is that renewable energy is not a top priority for India. Renewable energy industry experts have shared that investing in renewable energy projects in China and India is far more attractive because these countries have made renewable energy a top priority.

China has now taken the lead in the manufacture of solar panels, and India wants to compete. Both China and India see the renewable energy sector as a pathway to unlocking jobs and economic growth. The countries have set aggressive targets to boost domestic industries.

Industry experts say that investors will feel safe backing a project only after they’ve observed the company’s track record 5-7 years after setting targets.

Renewable energy in Australia can be a game-changer for the country and the whole world. The country needs a government that will heed and pays attention to the world’s current and future needs. Investing in new fossil fuel infrastructure right now is economic madness.

Green Energy Stocks in Australia

1. Tilt Renewables Limited

Tilt Renewables Limited is an Australian energy company. It owns and operates wind and solar farms across both Australia and New Zealand. Since 2016, when it first formed, the company has established an immense solar and wind development pipeline.

2. Infratil Limited

Infratil Limited invests in companies in Australia and New Zealand within the infrastructure and utility sector. The investments primarily include renewable energy.

3. Mercury Nz Limited

This is a New Zealand-based electricity company. It focuses on using renewable resources to generate electricity. The company also offers energy-related services. It produces renewable energy from a wide range of sources. It also offers energy services and sells energy-related products to retail and wholesale clients.

4. Contact Energy Limited

Contact Energy focuses on investing in a diverse range of renewable energy generation assets to meet New Zealand’s energy needs. The company’s main activity is selling electricity to commercial wholesale and industry partners. It also delivers electricity, natural gas, broadband, and other related services to the mass consumer market.

5. Genesis Energy Limited

Genesis Energy deals in the sale and production of petroleum. The New Zealand-based company generates and sells electricity, natural gas, and LPG to a varied range of customers. The company serves residential, industrial, and commercial customers.

6. Aurora Energy

The Tasmanian government owns Aurora Energy. Aurora Energy is an electricity and natural gas retailer. The company sells power to both homes and businesses. Until recently, the company was the only choice for residential customers. They offer their customers the choice to have all or a part of their electricity sourced from renewable sources.

7. Nectr

Nectr focuses strongly on renewable energy. Nectr currently has two solar plans, the ‘100% Clean Solar’ and the ‘Super Solar’ plans. Their plans are active in New South Wales, South Australia, and Queensland. The company also provides services to people looking to install solar and battery systems for their homes.

The Way Ahead for Australian Renewable Energy

Experts have suggested that Australia has the potential to solve its energy crisis within a generation. A hybrid power generation dominated by renewable energy by 2040 can deliver affordable, clean, and reliable electricity. It can also boost Australia’s economic welfare.

The scenario surrounding green energy stocks in Australia is not looking so good right now. But it can and has to change because:

1. Most coal-fired generators in Australia are nearing the end of their lives, technically and economically. The government must replace them. The only replacement technologies available right now are renewable technologies.

2. The cost of renewables has drastically reduced. The prices still continue to fall. Investing in coal and other fossil fuels will result in economic collapse.

3. Power generation all around the world is taking a turn for the better. The Australian government must observe and follow in the world’s footsteps to ensure a bright future for the coming generations.

Graph 1: Australian Electricity Generation by Fuel Type Free photos of Sunset

Source

Data from the Climate Council showed that renewable energy sources provided more power to Australia’s grid than gas in 2021. Renewables provide five times more energy than gas. If Australia can manage to move to a 90% renewable power system by 2040, the country will reap strong economic and emissions benefits. It could also enable the country to become an international player in the export of power. A sort of ‘renaissance’ must happen in the country to better transition its energy market.

 

Author

  • The author has done a master's in Environmental science and is currently working as chief Environmental Advisor with New Delhi State Government.

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