Australia's energy crisis silver linings

Apr 12, 2026

Ask episode

Chapters

Transcript

Episode notes

Highlights – The Business Leaders Forum at Boao, China

Tim attended the Boao Forum in Hainan Island, China, joining an Australian delegation that included Oliver Yates, Frank Jotzo, Justin Punch, Jenny Selway, Geoff Brooks, Andrew Forrest and six members of the FMG green team, and Australian Ambassador to China Scott Dewar.

China's stated position remains one of full commitment to electrification and decarbonisation.

Highlights – PRRT Reform div]:bg-bg-000/50 gmail-[&_pre>div]:border-0.5 gmail-[&_pre>div]:border-border-400 gmail-[&_.ignore-pre-bg>div]:bg-transparent gmail-[&_.standard-markdown_:is(p,blockquote,h1,h2,h3,h4,h5,h6)]:pl-2 gmail-[&_.standard-markdown_:is(p,blockquote,ul,ol,h1,h2,h3,h4,h5,h6)]:pr-8 gmail-[&_.progressive-markdown_:is(p,blockquote,h1,h2,h3,h4,h5,h6)]:pl-2 gmail-[&_.progressive-markdown_:is(p,blockquote,ul,ol,h1,h2,h3,h4,h5,h6)]:pr-8"> _*]:min-w-0 gmail-gap-3 gmail-standard-markdown">

The ACTU continues to call for a flat 25% tax on Australian LNG to replace the The Petroleum Resource Rent Tax, with the objective of capturing windfall profits and generating tax revenues of up to $10bn to fund energy poverty relief across Australia.

The Albanese government is reported to be considering options to impose a new levy on gas multinationals, as well as further changes to the Petroleum Resources Rent Tax (PRRT).

CEF's Matt Pollard has published a detailed analysis (featured in Pearls & Wisdom) examining how the Queensland State Government's 2022 move to a progressive tiered royalty system saw the state receive 40 cents in the dollar for coal export sales above $300/t, with five lower tiers starting at 7% when coal prices are depressed. This generated $18bn in FY2023, compared to NSW receiving $4.5bn under its existing framework. The coal industry recorded $50bn in gross profit in a single year during a period of elevated energy prices affecting consumers.

Highlights – Accelerating Capital Deployments

Treasurer Chalmers' Single Front Door pilot is now operational. The Treasurer noted: "The supply chain disruptions we are seeing as a consequence of the conflict in the Middle East demonstrate just how important it is to build up our sovereign capability in these essential areas."

Four project proposals are under consideration:

HAMR — converting biomass into low-carbon liquid fuels, leveraging the Federal Government's $1.1bn low-carbon liquid fuels funding via the CEFC
Ardea Resources' Kalgoorlie Nickel & Cobalt Project (WA) — one of Australia's largest nickel and cobalt resources
New Energy Transport's Wilton Project (south-west of Sydney) — a large-scale zero-emission heavy road freight depot
Copenhagen Infrastructure Partners' Murchison Green Hydrogen Project (mid-west WA) — a green hydrogen plant proposing large-scale green ammonia production using wind, solar, and desalination. This proposal received an $814m Hydrogen Headstart grant from ARENA in March 2025. The project's path to FID appears contingent on securing a long-term offtake agreement and an Asian CBAM mechanism.

Government capital deployments total $4.5bn year-to-date as of April 2026, representing an annualised run-rate of $16bn, up from CY2025's $15bn — and excluding a potential Tomago deployment of up to $10bn.

Lowlights

Canavan and Co's coal-to-oil proposal is a thought bubble. (stronger language in the podcast)

Main Story – CEF Op-Ed in The Energy: Lessons for Australia from the Global Energy Crisis

As global oil markets face significant uncertainty and price volatility, China has spent two decades building energy independence as a strategic hedge against exactly the kind of energy disruption now affecting global markets.

At the recent Boao Forum in Hainan, energy security framed every panel across the week. China's position was clearly stated: it will maintain its electrification and decarbonisation targets and engage with any nation that wishes to participate. This stands in contrast to Washington's current posture.

Building a new oil refinery would take approximately a decade, and no private investors are currently proposing to do so in Australia. Australia's two remaining refineries are sub-scale, ageing, and have received ongoing government subsidies. Coal-to-liquid technology has not attracted significant investment in comparable economies.

Australia does not need to replicate China's political model to draw lessons from its long-term energy planning approach. A 15-year transition horizon for the trucking sector — shifting away from imported diesel — is achievable if investment begins now. Rooftop solar can be installed within hours. An EV purchased today eliminates imported fuel dependency for approximately 20 years, directly contributing to domestic energy security.

One observable consequence of the current geopolitical environment is that electrification timelines are likely to accelerate globally.

What's Coming Up

Tim is travelling to Perth to speak at a Critical Battery Minerals conference, presenting CEF's recent report on China's expansion into critical minerals, strategic metals mining, and upstream value-adding, and the implications for Australia.

6–7 May 2026 — SEC Sydney Conference
12 May 2026 — Federal Budget 2026