Australia has key role to play as clean energy reshapes Indo-Pacific relations

With the incoming federal government declaring it will make Australia a “renewable superpower”, China dominating clean energy supply chains, and the Russian war in Ukraine disrupting the global energy market, now is a pivotal moment for Australia to shape the future of clean energy within the Indo-Pacific.

A new report by the Perth USAsia Centre, in collaboration with the Climate Council, recommends five practical actions for Australia to secure its economic and strategic clean energy advantages in the Indo-Pacific:

  1. Promote the many economic, strategic, and energy security benefits of clean energy in the region.
  2. Diversify clean energy supply chains and relationships so all countries in the region enjoy fairer access and greater energy resilience.
  3. Develop a dedicated clean energy diplomacy program with the Department of Foreign Affairs and Trade that provides assistance to developing countries and leverages Australia’s key advantages.
  4. Expand the focus of our clean energy outreach beyond economic and political capacity to increase inclusivity and better governance.
  5. Work with all allies and partners, led by the Quad, to develop a truly multilateral Indo-Pacific clean energy program that promotes coordination and collaboration, and guards against risks.

Published ahead of a major international forum on energy supply chains – the Sydney Energy Forum (12-13 July) – the report, Reenergising Indo-Pacific Relations: Australia’s Clean Energy Opportunity, explains that the Indo-Pacific sits at the heart of the global shift from fossil fuels to clean energy systems, the ramifications for Australia’s economic and strategic interests, and the leading role that our country could play.

Global warming is a significant security threat for all countries, but those within the Indo-Pacific region are among the most vulnerable. More affordable and available renewables can improve energy security and erode troublesome interdependencies in the region. However, significant obstacles must be overcome, including China’s dominance in the global energy sector.

“The necessary transition from fossil fuel to clean energy systems is reordering Indo-Pacific relations. Australian government and industry should work to ensure emerging supply chains and interdependencies advance our national interest,” said report author James Bowen.

China’s current dominance in global clean energy sectors has created vulnerabilities for both the energy transition, and broader system of Indo-Pacific relations. Diversifying supply chains and relationships is pivotal to the clean energy transition, and countries such as Australia have untapped potential to improve supply chain resilience and create a fairer and well-governed Indo-Pacific transition.

Australia’s role in the regional energy landscape is currently as a major supplier of coal and gas to economies in the Indo-Pacific. However, the shift toward net-zero emissions has profoundly changed Australia’s economic prospects. Economies such as Japan and Korea will continue to want Australian exports, but they now expect clean energy alternatives.

“Australia has emerging clean energy strengths in the critical minerals, technology, resources and industrial goods sectors. Enhancing cooperation with partners and allies could unlock the country’s vast economic and strategic potential in a decarbonising Indo-Pacific,” continued Bowen.

Climate Council Senior Researcher Dr Wesley Morgan added: “The growing economic advantages of renewable energy are driving an unprecedented global energy transition and the Indo-Pacific is at the heart of it. The upcoming Sydney Energy Forum presents a huge opportunity for Australia to shape the future of clean energy cooperation in the Indo-Pacific.

“There can be no doubt that Australia’s economic and strategic interests are now tied to leading a rapid clean energy transition.”

With both its natural resources and geopolitical alignments, Australia has the potential to become a clean energy superpower. The time is right for Australia to accelerate clean energy and associated climate action and secure its economic and strategic advantage in the Indo-Pacific’s clean energy future.

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