Australia’s Opportunity - We Could Be a Superpower
Australia is sitting on a once-in-a-century economic opportunity: to become the world’s premier exporter of embedded renewable energy. This isn’t about shipping solar panels or wind turbines. It’s about trading the green energy hidden within energy-intensive goods — steel, aluminium, ammonia, methanol, and the fuels that will move the ships and planes of tomorrow.
That’s the central message of The New Energy Trade, a detailed, data-heavy report by economist Reuben Finighan and The Superpower Institute. (1) According to it, the report is the most ambitious modelling to date of how Australia could help decarbonise the global economy — while massively lifting our own economic output.
The old fossil fuel trade worked because deposits were unevenly distributed. Coal, gas, and oil moved across oceans because few countries had enough to power themselves. It underpinned the rise of Northeast Asia and Europe. Finighan argues the same will be true for the net-zero era, except instead of fossil fuels, we’ll be shipping clean energy embedded in industrial goods.
And Australia is uniquely positioned to benefit.
Energy Scarcity Is Coming
At first glance, it looks like every country has access to solar and wind. But most don’t have enough high-quality, year-round, cost-effective renewable resources to meet their own decarbonisation goals. According to Finighan, even energy-rich economies like China and India will run into limitations. And densely populated, energy-intensive economies like Japan, Korea, and parts of Europe will simply not be able to meet demand with local renewables.
This coming scarcity makes a new kind of global trade inevitable: a trade in embedded clean energy.
It’s also much cheaper to move the goods than the energy itself. Directly shipping hydrogen or electricity across oceans is enormously inefficient—up to 80% of the original energy can be lost. But converting clean energy into materials like green steel or methanol and then shipping those products is far more economical.
Australia’s Comparative Advantage
Australia has what the report calls a “flat supply curve.” We have some of the world’s best solar and wind resources, vast tracts of low-value land, political stability, and strong institutions. We can produce more renewable energy than we will ever need at home — much more.
If we use that clean energy to manufacture or process industrial products before export, we can carve out a role as the green workshop for countries that cannot decarbonise alone.
Finighan’s model suggests that if Australia:
Processes its own iron and aluminium ores using green energy, and
Supplies just 25% of global demand for other superpower goods like ammonia, methanol, and sustainable fuels,
… it could help reduce global emissions by 7–10% — roughly equivalent to eliminating all emissions from the United States.
Demand Will Outstrip Supply
Critically, the report explains why demand for electricity will far exceed current forecasts. Electrification—replacing fossil fuels with clean electricity—is expected to be the dominant decarbonisation strategy. But most models drastically understate how much electricity will be needed.
Finighan argues that overly optimistic assumptions about energy efficiency and economic restructuring (like economies magically shifting away from heavy industry) are skewing the debate. His modelling shows electricity demand could double or triple in advanced economies and increase more than tenfold in countries like India. In many scenarios, electricity demand outpaces even the most optimistic renewable supply growth.
That’s where Australia steps in. By exporting the energy embedded in our exports, we effectively become a clean-energy surrogate for countries with no other option.
The Global Gap and What Australia Could Fill
The report quantifies the gap between clean electricity demand and what major economies can reasonably generate on their own. In some cases — Japan and Korea in particular — that gap is so large it threatens their ability to meet net-zero commitments without significant imports of embedded energy.
Australia’s potential export contribution is enormous:
We could produce green steel with electricity savings of 33% compared to conventional methods.
Green aluminium (already largely electrified) becomes net-zero with clean power and new anode technologies.
Green methanol and ammonia production can replace fossil-based versions, albeit with significant carbon and electricity requirements.
Aviation and shipping fuels made with green energy will be crucial for decarbonising hard-to-electrify sectors.
By 2060, the combined clean electricity needed to decarbonise just these “superpower industries” globally is projected to be more than 30,000 TWh—nearly the entire world’s electricity production today.
Australia could supply a meaningful chunk of that.
Not Without Reform
But the opportunity won’t realise itself. The report makes it clear: Australia must reform its planning, infrastructure, industrial policy, and regulatory frameworks to make this vision a reality. Grid investment, land-use approvals, skills training, and export-oriented industrial development must all be accelerated.
The scale is immense. To hit the targets Finighan models, renewables would need to directly occupy 0.6% of Australia’s landmass by 2060. That’s around 50,000 square kilometres—not far off the size of Costa Rica. Ambitious? Yes. Doable? Also yes. Practicle? We would argue ‘yes’, though this could be a point of contention for some.
The Bottom Line
The global energy transition is not just about ditching fossil fuels — it’s about replacing them with tradeable, storable, and affordable clean energy embedded in industrial goods. Australia has a golden opportunity to lead that trade. But to seize it, we must stop thinking of ourselves as a mining nation and start acting like a clean energy superpower. The foundations are there. What’s needed now is co-ordinated national ambition (between government and investors) to scale them into something worthy of the challenge—and the prize.
References
1 Reuben Finighan, The Superpower Institute - “The NEW Energy Trade.” November 2024 https://www.superpowerinstitute.com.au/work/the-new-energy-trade
Important Information
EnviroInvest Pty Ltd ACN 685 107 957 (“EnviroInvest”) is an Authorised Representative of Daylight Financial Group Pty Ltd ACN 633 984 773 (“DFGPL”) which is the holder of an Australian Financial Services Licence (AFS Licence No. 521404).
Information in this commentary is current as at date prepared unless otherwise stated. However, please bear in mind that investments can go up or down in value, and that past performance is not a reliable indicator of future performance. For more Important Information please refer to the Disclaimer section of this website.
This communication may contain general financial product advice. It has been prepared without taking into account your personal circumstances, and you should therefore consider its appropriateness in light of your objectives, financial circumstances and needs before acting on it.
If our advice relates to the acquisition or possible acquisition of a particular financial product, you should obtain a copy of and consider the Product Disclosure Statement (PDS) before making any decision.