Australia is wealthy in coal and gasoline reserves however lacks vital oil sources. Traditionally, this was not a priority as trains operated on native coal. Nonetheless, with the rise of automobiles and vehicles, the nation has more and more trusted imported oil.
Presently, imports make up roughly 80% of Australia’s refined gasoline consumption, a report excessive. Within the occasion of a disruption to grease provide attributable to battle or financial instability, Australia has roughly 54 days’ price of gasoline in storage earlier than operating out, which poses a big threat.
The shift in direction of electrical automobiles (EVs) is poised to alter this dynamic. This transition is already evident in nations like China, the place the adoption of EVs is decreasing oil demand.
Ending Australia’s dependence on international oil is prudent, particularly amid geopolitical uncertainty. Nonetheless, a larger reliance on electrical automobiles might inadvertently improve dependence on China, the main producer of EVs.
Decreasing oil reliance is clearly useful for each local weather and nationwide safety, however it have to be approached cautiously to keep away from changing into overly depending on a single nation.
Vulnerability from Oil Imports
In recent times, most of Australia’s refineries have closed. The federal government has invested billions to maintain the Geelong and Brisbane refineries operational and to reinforce gasoline safety measures, together with growing home gasoline reserves and constructing extra storage.
The remaining refineries are reliant on imported crude oil, as native oil from the North-West Shelf is essentially unsuitable for refining. Consequently, Australia is now extra depending on gasoline imports from main Asian refineries, significantly in South Korea, Singapore, and Malaysia, importing round 45,000 megalitres of gasoline from these nations in 2023.
Roughly 74% of those liquid fuels are utilized in transportation, with highway transport consuming over half of all liquid fuels. This dependency poses vital power safety dangers; a disruption in oil provide attributable to struggle, geopolitical tensions, or value volatility might carry Australia’s transport system to a standstill.
As of January, Australia had 30 days’ price of petrol and a complete of 54 days’ price of all varieties of oil, which falls in need of the 90-day reserve requirement set by the Worldwide Vitality Company (IEA).
Native Electrical energy Era
Transitioning to electrical automobiles gives the promise of cleaner air and considerably decrease long-term prices for drivers, as electrical energy is mostly cheaper than petrol or diesel and requires much less upkeep.
Notably, Australia’s electrical energy is produced solely inside its borders utilizing native sources, making electrical automobiles inherently safer. Not like oil, which might be affected by conflicts or commerce disputes, electrical energy technology stays resilient. This issue is a key driver behind China’s aggressive shift to EVs, aiming to scale back its oil dependency.
Mainstreaming EVs in Australia will necessitate a rise in renewable electrical energy manufacturing, permitting the nation to not solely energy properties and industries but in addition cost automobiles effectively. Such measures would improve power safety, diminish dependence on imported oil, and decrease emissions.
The EV market is quickly evolving with extra fashions, lowered costs, improved battery charging instances, and rising shopper adoption. In 2024, over 17 million EVs (comprising each battery electrical and plug-in hybrid automobiles) had been offered globally, together with 91,000 battery and 23,000 plug-in hybrids in Australia. Based on IEA information, electrical automobiles assist scale back international oil demand, alongside electrical bikes and mopeds.
Shifting away from oil dependence will probably be gradual. Analysis from the Australia Institute means that 8% of imported fuels might be substituted with native electrical energy as soon as EVs represent 25% of the passenger automobile fleet. At full electrification, oil demand might lower by 33%. The remaining two-thirds of demand primarily comes from vehicles, planes, and ships, with the electrical truck sector not but as superior as that of electrical automobiles, and related challenges exist for electrical planes and cargo vessels.
Strengthening Vitality Safety by EVs
Australia doesn’t but manufacture EVs on a big scale, resulting in imports primarily from high manufacturing nations, with China producing 80% of Australia’s new electrical automobiles. Whereas Australia is a big provider of important minerals important for EV manufacturing, reminiscent of lithium, cobalt, and nickel, a lot of the worldwide provide chain for refining these minerals and manufacturing batteries is dominated by China.
This reliance poses dangers, given the present geopolitical instability. Though EVs present substantial advantages for power safety by decreasing dependence on risky oil markets, it’s important to deal with different safety considerations, together with elevated reliance on China and potential privateness dangers from information assortment in related EVs.
A balanced technique is required that helps power independence by renewables whereas selling automobile electrification by sturdy legislative and regulatory frameworks. Policymakers ought to give attention to diversifying provide chains, enhancing cybersecurity, and fostering native manufacturing of EV elements. This strategy can mitigate new safety dangers whereas unlocking the environmental and financial benefits of widespread EV adoption.
Hussein Dia, Professor of Future City Mobility, Swinburne College of Expertise
This text is a republished piece from The Dialog beneath a Artistic Commons license.
