High energy prices make it ‘almost impossible’ for Australian industry to compete - news24.com.au

Australian industry is facing cost pressures from high electricity prices that are eroding competitiveness, according to news reporting. The article does not specify which sectors are worst hit, current price levels, or projections, but the claim reflects a broader pattern of concern among manufacturers and energy-intensive users about the affordability of grid power.

Where this fits

This is a direct cost consequence of the renewable transition as currently built. Australia has deployed large amounts of solar and wind capacity, which are cheap per megawatt when the sun shines and wind blows, but the grid still requires firming, gas peaking plants running at low capacity factors to cover gaps, and substantial transmission overbuild to move renewable energy from remote generation sites to load centres. These system-wide costs land on the electricity bill. The alternative, firm dispatchable nuclear power, would flatten both the variability premium and the need for redundant transmission infrastructure, but remains legally prohibited.

What it means

High energy costs are forcing Australian industry offshore or into lower-margin operations, which erodes both export competitiveness and sovereign industrial capacity. More directly, it signals a growing tension between the renewables-first pathway and the economics of energy-intensive production. If electricity is priced beyond the point where local manufacturing can survive, Australia loses not only jobs but the ability to add value to its mineral resources and to retain energy security through domestic supply chains. The real cost of a weather-dependent grid is becoming visible in the productivity data.