Australia’s sliding doors moment: From “dig and ship” to trusted renewables transition partner

Australia is one of the most vulnerable countries in the Indo-Pacific in a fossil-fuel based energy system, but one of the best placed to benefit from a new model of energy security defined by renewables, electrification and energy efficiency. 

That is the central finding of The New Energy Security, the first report released today in WWF-Australia’s A Future Made with Australia series, which examines how energy security is being redefined across the region and what that means for Australia.

The report analyses the energy security of major economies in the Indo-Pacific in the wake of the current fuel crisis.

Australia was found to be highly vulnerable under a fossil fuel model due to its high consumption of fossil fuels, thin liquid fuel reserves and reliance on imported oil.

China is the least exposed due to its early action to reduce its reliance on fossil fuels and build resilience through clean energy systems. Other countries like South Korea are now following suit.

It is clear the fossil fuel model of energy security is broken and a model based on renewable energy partnerships must be built in its place.

Fossil fuel dependence is a vulnerability multiplier

It’s no longer just that fossil fuels are the worst choice for climate and nature; they are also proving to be the worst choice for achieving energy security. 

Compared to previous energy shocks, structural alternatives to fossil dependency – such as renewables, electrification and storage – are now faster and in most cases cheaper to deploy. Fossil fuels have been exposed as the weak link in a secure economy and stable region.

For decades, Australia’s energy diplomacy has rested on a simple proposition: that we are a reliable, stable and long-term provider of energy and economic security through fossil fuel exports. 

However, this offer of energy security is rapidly expiring and Australia faces a sliding doors moment.

Countries across the region are actively shifting toward renewables and electrification to protect their economies from future energy crises. Our neighbours are not debating whether to move beyond fossil fuels. They are deciding how fast and with whom.

A renewables-based model of energy security is now superior

The same shock that is temporarily lifting demand for Australian liquified natural gas (LNG) and coal is accelerating the transition that will permanently reduce it.

Whether motivated by cost, resilience or geopolitical exposure, Australia’s fossil fuel buyers and strategic partners will draw similar conclusions to those reached in Europe after Russia weaponised gas supplies: that long-term affordable energy security lies in electrification of end-uses, diversified renewables, trade in lower-risk energy-embedded products, and less exposure to supplier concentration. 

Clean energy investment now materially outpaces fossil fuel investment across the Indo-Pacific region with more than $2 invested in clean energy for every $1 in fossil fuels. Over the coming decade, both the demand for, and diplomatic significance of, Australian fossil fuel exports will decline significantly.

Australia can choose to treat this as an alarming threat to its economy and regional influence, or it can seize the opportunity to reposition itself as a leader in renewable energy security. 

A Future Made with Australia: the case for a broader value proposition

Australia must reposition itself from being a ‘dig and ship’ fossil fuel supplier to a trusted renewable energy transition partner.

A Future Made with Australia approach would see Australia working alongside partners to build strong, reliable energy systems that last. This shifts the focus from transactional fuel exports to co-investment, co-delivery and shared resilience and energy security. 

Our report shows Australia is well placed to play this role. We have world-class renewable resources, critical minerals, technical capability, strong institutions and deep relationships across the Indo-Pacific. Few middle powers combine these assets at scale. But credibility as a “renewable energy superpower” cannot be assumed.

The central challenge Australia must overcome is coherence. In a world moving rapidly toward renewables-based energy systems, credibility will be earned not by what Australia claims to be, but by whether our policies and projects truly deliver at pace and scale. 

As more than 50 countries gather this week in Santa Marta, Colombia to plan a shift away from fossil fuels, Australia must address a core credibility issue. 

Australia can no longer afford to position itself as a renewable energy partner while simultaneously expanding fossil fuel supply without a plan to manage the transition. Mixed signals undermine trust, slow investment and create space for others to lead.

Australia’s renewable superpower can be a regional security offer

Closing these gaps is essential if Australia’s clean energy offer is to be trusted and taken seriously by partners. We must be honest about where long-term security lies, and align policy, diplomacy and public finance accordingly. 

Australia risks being associated with an energy model our partners increasingly see as a source of risk rather than stability. We face a choice between defending this model, one that leaves us exposed to every global shock, or helping build one that makes our economy and region more resilient. 

Long-term security will not come from Australia exporting more fossil fuels, but from helping the Indo-Pacific region build clean, affordable energy systems that last. 

Camille Malbrain is renewable exports manager and Rob Law is senior manager of energy transitions at WWF-Australia