Last updated:22 June 2023
A secure supply of adequate, clean, reliable energy at an affordable price is vital for Australia’s economic growth and prosperity. Fortunately, Australia is well endowed with an abundance of both fossil and renewable fuels. Our energy resources power our homes, cars and industry, and are a key contributor to Australia’s economic prosperity. The Australian energy sector directly accounts for 5 per cent of gross industry value-added; 20 per cent of total export value; supports a large range of manufacturing industries; and provides significant employment and infrastructure in every state and territory. The demand for energy is increasing as Australia’s economy and population grow.
To date Australia’s energy needs have been largely met by fossil fuels. Australia’s abundant and low-cost coal resources are used to generate three-quarters of domestic electricity and underpin some of the cheapest electricity in the world. Australia’s transport system is heavily dependent on oil, some of which is imported. At present renewable energy sources account for only modest proportions of Australia’s primary energy consumption (around 5 per cent) and electricity generation (7 per cent), although their use has been increasing strongly in recent years.
The Australian Energy Resource Assessment provides a comprehensive review of Australia’s energy resources, from fossil fuels and uranium to renewable energy, including a review of known and potential resources, technologies for extraction, and projected energy use and production in 2030.
Australia’s Energy Production, Consumption and Exports
- Australia has an estimated 46 per cent of uranium resources, 6 per cent of coal resources, and 2 per cent of natural gas resources in the world. In contrast, Australia has only about 0.3 per cent of world oil reserves.
- Australia produces about 2.4 per cent of total world energy and is a major supplier of energy to world markets, exporting more than three-quarters of its energy output, worth nearly A$80 billion.
- Australia is the world’s largest exporter of coal. Coal accounts for more than half of Australia’s energy exports. Australia is one of the world’s largest exporters of uranium, and is ranked sixth in terms of liquefied natural gas (LNG) exports. In contrast, more than half of Australia’s liquid fuel needs are imported.
- Australia is the world’s twentieth largest consumer of energy, and fifteenth in terms of per capita energy use.
- Australia’s primary energy consumption is dominated by coal (around 40 per cent), oil (34 per cent) and gas (22 per cent). Coal accounts for about 75 per cent of Australia’s electricity generation, followed by gas (16 per cent), hydro (5 per cent) and wind around (2 per cent).
Data on Australia’s energy production and consumption are published annually in the Australian Energy Statistics produced by Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES). The database consists of detailed historical energy consumption and production statistics compiled from various sources.
Australia’s abundant, high quality energy resources are widely distributed across the country. With the exception of oil, these resources are expected to last for many more decades, even as production increases. Australia has a significant proportion of the world’s uranium and coal resources and large resources of conventional and unconventional gas. Australia also has access to a range of high quality, abundant renewable energy sources, many of which are yet to be developed.
Australia’s non-renewable and renewable energy resources and their distribution are described in the Australian Energy Resource Assessment. Geoscience Australia provides annual assessments of Australia’s petroleum resources in Oil and Gas Resources of Australia and coal and uranium (and other minerals) in Australia’s Identified Mineral Resources.
Australia has substantial resources of coal, both black and brown. The most significant black coal resources are located in the Bowen-Surat (Queensland) and Sydney basin (New South Wales). Coal is Australia’s largest commodity export with annual thermal and metallurgical coal exports worth more than $40 billion, mainly to Japan, India, European Union, Republic of Korea and Taiwan. Economic demonstrated resources (EDR) of black coal are adequate for about 90 years at current rates of production.
Australia’s very large brown coal resources are located mostly in the Gippsland Basin in Victoria where it is used for electricity production. At current rates of production, there are nearly 500 years of brown coal resources remaining.
Australia also has significant resources of gas that include large conventional gas resources located mostly in the Carnarvon, Browse and Bonaparte basins off the northwest coast with smaller resources in the Gippsland Basin offshore Victoria and the onshore Cooper-Eromanga Basin in South Australia. EDR of conventional gas are adequate at current levels of production for around 60 years.
Substantial resources of coal seam gas (CSG) are associated with the major coal basins of Eastern Australia. CSG resources are being rapidly increased by exploration with significant economic demonstrated resources of CSG now identified in the Bowen, Surat and Sydney basins.
Crude Oil, Condensate and Liquified Petroleum Gas
Australia’s crude oil resources, located mostly in the Carnarvon and Gippsland basins, are only small by world standards but are boosted by substantial condensate and LPG resources associated with the major largely undeveloped gas fields in the Carnarvon, Browse and Bonaparte basins off the northwest coast of Western Australia. A number of sedimentary basins remain to be assessed. Australia also has significant oil shale resources, especially near Gladstone, Queensland that could provide additional liquid fuels if developed.
Australia has more than one third of the world’s known economic uranium resources. Australia’s reasonably assured resources of uranium recoverable at less than US$80/kg (equivalent to EDR) are estimated to be around 1160kt, equivalent to more than 130 years at current production levels. Major uranium deposits are located in South Australia, the Northern Territory and Western Australia. All production is for export.
Australia’s large renewable resource base is also widely distributed across the country. With the exception of hydro energy resources which are largely developed and wind energy which is growing rapidly, large-scale utilisation of Australia’s renewable resources has been constrained by higher transformation costs relative to other energy sources (except for hydro), immature technologies, and long distances from markets and infrastructure.
Australia has large but as yet inadequately defined and quantified geothermal energy resources. These include hot-rock type geothermal resources associated with buried high heat-producing granites as well as hot sedimentary aquifer-type geothermal resources present in deep aquifers in a number of sedimentary basins.
Australia’s hydro energy resources lie within areas of highest rainfall and elevation and are mostly in New South Wales and Tasmania. Hydro energy resources were developed early in Australia and are currently the largest source of renewable electricity. A dry climate coupled with high evaporation rates and highly variable rainfall over much of Australia limits substantial expansion of hydro power.
Australia has some of the best wind energy resources in the world, primarily located in western, south-western, southern and south-eastern coastal regions but extending hundreds of kilometres inland and including highland areas in south-eastern Australia. Wind energy technology is relatively mature, and wind power is expanding rapidly, encouraged by government policies, notably the Renewable Energy Target. Wind energy is expected to become Australia’s largest source of renewable electricity in the near future.
High solar radiation levels over large areas provide Australia with some of the best solar resources in the world. The best solar resources are largely located in the northwest and centre of Australia, commonly in areas that do not have access to the electricity grid, and are distant from the major population centres and key energy markets. To date relatively high capital costs have limited widespread use of solar energy resources but significant investment in research and development is aimed at increasing the efficiency and cost-effectiveness of solar power, including the development of solar thermal power stations.
Australia has a world-class wave energy resource along its western and southern coastline, especially in Tasmania. The best tidal resources, on the other hand, are located along the northern margin, especially the northwest coast of Western Australia, and largely removed from the major demand centres. At present most ocean energy technologies are relatively new and still need to be proven in pilot and demonstration plants.
Bioenergy is another significant potential energy resource in Australia. Biomass (organic matter) can be used to generate electricity generation and heat, as well as for the production of liquid fuels (biofuels) for transport. Currently Australia’s use of bioenergy for electricity generation is small and limited to bagasse (sugar cane residue), wood waste, and gas from landfill and sewage facilities. A small but increasing amount of biofuels is produced, mostly ethanol from sugar by-products and waste starch from grain.