Australia might not have the greatest record in clean technology innovation, but according to a new study, our cleantech sector is fast establishing itself as a major component of the economy, on par with the nation’s car manufacturing industry.
In a detailed analysis of 1,160 of Australia’s leading cleantech companies, Australian CleanTech has found that the sector was growing its revenues and creating high value jobs in a year that saw some parts of the general manufacturing sector struggle.
The report found that Australia’s cleantech sector employed 45,000 workers during 2011, making it the same size as the nation’s auto manufacturing sector, and was equal in value to a quarter of the entire general manufacturing sector, racking up 119 separate capital transactions totalling $2.9 billion during 2011. NSW and Victoria were revealed as the most active states, while waste, water, solar, environmental services and wind were credited for generating more than $1 billion of revenue.
As for listed cleantech companies – which make up just 4 per cent of companies on the ASX – the report revealed a combined market capitalisation of $7.4 billion at the end of December 2011 (less than 1 per cent of the market capitalisation of the total market), down from $11.9 billion for the previous corresponding period, with companies raising a total of $898 million in new capital in the 12 months to December 31 201.
And while cleantech companies might not be raking in the funds yet, workers in the sector were found to make, on average, about five times the revenue per employee in comparison to both automotive and general manufacturing.
As for the sector’s future, the report concludes that “possibly the biggest boost for the long-term growth of cleantech in Australia will be that the ‘sky doesn’t fall in’ on 1 July with the introduction of the Carbon Price.”
The report also points to rising oil prices, the establishment of bilateral trade initiatives, and interest and investment from multi-national corporations – particularly from our Asian neighbours – as factors that will boost growth in Australia’s cleantech sector.
On the clean energy front, the report says the rising price of Renewable Energy Certificates, which it says will reach $45 during 2012, will help drive large-scale renewable energy projects, but that increased state-based wind planning changes would challenge future development of wind farms.
The report predicts a growth of 1-3MW in solar projects underpinned by PPAs; and says the falling prices in solar PV, combined with the strong Aussie dollar, will drive continued household uptake of solar panels.
The report also predicts a “geothermal resurrection,” with 2012 set herald the completion of the first proof of concept with deep wells in Australia, and the timing of positive cash flows possibly becoming more reliable, and thus providing encouragement to investors.
“Overall, the Australian cleantech sector is establishing itself as a major component of the economy,” said John O’Brien, managing director of Australian CleanTech. “Governments are increasingly realising the potential of cleantech to both improve the efficiency, competitiveness and resilience of existing industry whilst at the same time growing the industries of the future. Furthermore, Australia’s growing cleantech links with Asia will see the growth continue to accelerate over the next few years.”