AI at Work in Australia: Renewables-Based Electricity Transition
Report by OCNUS Consulting June 2025
All research conducted by OCNUS Consulting is independent. Information in this report, including references to government policies, is neutral and involves no conflict of interest.
1. Executive Summary
Research at OCNUS Consulting shows that Australia's transition to a renewable energy system for electricity generation is both challenging and achievable following the recent Federal Election. The report analyses multiple dimensions of such a change through evaluation of existing credible sources to determine its viability, challenges and potential under the Australian Labor Party (ALP) government. The findings indicate that Australia can develop a 100% renewable electricity system by utilising its natural resources and technological capacity, but requires substantial progress in power grids and storage solutions, together with policy improvements. This transition can become economically beneficial when properly handled, as it produces substantial long-term advantages, including job creation, critical minerals refining development, and stronger energy security. The integration of artificial intelligence presents multiple promising opportunities to enhance power grid management whilst speeding up the deployment of renewable energy systems.
2. Introduction: The Imperative for Renewable Energy in Australia
Australia's power sector depends heavily on fossil fuels, mostly coal and gas, for its electricity production. Energy security in the nation has depended on these resources, but their usage positions Australia as a major greenhouse gas emitter, demanding an urgent transition to cleaner energy solutions. Australia's renewable electricity generation capacity has risen dramatically since 2010 and reached 43% of total electricity production during the initial months of 2025. The growing solar and wind power infrastructure demonstrates that expanding renewable energy deployment in the power system remains both feasible and realistic.
The combination of environmental needs and economic reasons makes this transition essential. The Australian government must decarbonise its energy sector because it needs to fulfil its climate change obligations and match the Paris Agreement targets and net-zero emission goals by 2050. Solar and wind power renewable technologies have achieved cost parity with traditional fossil fuel power plants in the current energy market. Renewable energy technologies have become more attractive economically because their production costs continue to decrease whilst fossil fuel markets show price volatility that worsens with geopolitical events. Moving to renewable power systems functions as a protective measure against the potential impacts of carbon pricing schemes and potential international trade restrictions that may target countries with elevated carbon emissions.
The Albanese Labor Government has set specific national energy transformation goals to confirm Australia's dedication to developing clean energy systems. The Australian government passed a legislative requirement to achieve 82% renewable electricity generation by 2030 and net-zero emissions by 2050 through Senate approval in September 2022. National renewable energy targets operate alongside separate state-specific targets, which often establish more demanding goals that address regional requirements. The renewable energy production in South Australia reached 74% in 2023, whilst Victoria aims to reach 95% renewable energy by 2035. The "Powering Australia" plan under the ALP creates jobs whilst reducing energy costs and lowering emissions by increasing renewable power whilst leveraging Australia's natural resources to build new industries and drive economic growth. These elevated renewable energy targets demonstrate widespread political agreement about the urgent requirement to transform to a cleaner energy future.
3. Charting the Course: A Renewable Electricity System for Australia
Renewable energy deployment in Australia has established solar and wind power as the leading technologies for constructing new electricity generation infrastructure. During 2023, the electrical grid received a total of 5.9 GW from combined large and small-scale renewable projects, where rooftop solar generated 3.1 GW and utility-scale solar and wind projects supplied 2.8 GW. Solar electricity production showed a 21% increase from the previous financial year and has reached eleven times its previous decade levels. Australia's abundant solar irradiance and wind resources enable the rapid expansion of solar and wind technologies for large-scale deployments throughout the country. The significant contribution of rooftop solar installations stems from their ability to enable electricity generation for consumers who have installed over 3.7 million rooftop solar PV systems across Australia.
The analysis of future renewable energy composition for complete renewable power systems reveals that solar and wind power will remain dominant, but other renewable energy sources will also contribute to the system. The power generation will consist of hydroelectric and bioenergy sources, which will provide stable power output and support network reliability. The development of offshore wind energy represents a substantial untapped resource for Australia because coastal areas offer consistent and powerful wind patterns that have led to the announcement of feasibility licences for the Hunter and Southern Ocean regions. According to the Australian Energy Market Operator's (AEMO) Integrated System Plan (ISP), the pathway towards high renewable penetration will fulfil Australia's decarbonisation targets as the plan requires installing at least 6 GW of utility-scale generation in the National Electricity Market (NEM) every year until 2030. A 100% renewable power system demands multiple renewable energy technologies working together to deliver consistent electricity supply across different weather patterns and geographical areas.
The main technical barriers to developing a 100% renewable electricity system stem from maintaining reliable power grids. The intermittent nature of solar and wind power demands substantial investments in firming infrastructure to support continuous electricity production. The transition from synchronous generators to inverter-based renewable generation creates additional challenges in managing grid frequency and voltage operations. Prime renewable energy zones (REZs), which exist in various locations, require extensive upgrades to transmission infrastructure to establish effective connections between these areas and major demand centres. The successful energy transition depends on grid modernisation, which needs substantial financial support and strategic planning to build flexible networks that manage renewable power variability alongside distributed generation growth. A stable grid with dominant renewable energy sources requires innovative solutions extending beyond traditional methods, including advanced grid-forming inverters and synchronous condensers to deliver essential system functions.
Energy storage technologies represent essential elements for overcoming intermittency problems to deliver a safe and economical electricity supply through 100% renewable power systems. The electricity supply and demand equilibrium during different time periods depends on battery storage systems installed at grid-scale and distributed throughout homes and businesses, together with pumped hydro energy storage. Green hydrogen technology shows potential as a storage solution for extended durations in the future. AEMO predicts Australia will need to deploy at least 22 GW of energy storage by 2030 and 49 GW by 2050 to support a renewable energy-based power grid. A 100% renewable electricity system demands extensive growth in energy storage capabilities to transfer surplus energy made during high production times to periods when demand is high but renewable energy generation is minimal. The coordinated implementation of distributed energy resources through virtual power plants with household batteries can enhance grid stability and minimise the requirement for expensive large-scale grid infrastructure investments.
4. Navigating the Economic Transition
A complete shift to renewable electricity generation would create economic challenges for existing fossil fuel businesses and their labour forces. The shutdown of coal mines together with gas-fired power plants will trigger employment reductions in conventional sectors, demanding organised worker support and community assistance. The transitional period may experience price volatility because the market needs time to adjust to substantial infrastructure investments for grid upgrades and new renewable generation and energy storage projects. The process of obtaining social acceptance for renewable energy projects remains difficult because certain communities oppose the visual changes and land utilisation modifications and local impacts that may result in project delays and elevated expenses.
The implementation of strategic planning and well-designed policy mechanisms proves effective in reducing these potential disruptions. The ALP government uses its just transition plans to offer support for workers in transitioning industries through training programmes and employment access to new roles, whilst the Net Zero Economy Agency and the Department of Employment and Workplace Relations collaborate with local communities. The planned retirement of current coal-fired power plants during a specific time frame that matches renewable generation capacity expansion with energy storage deployment will maintain electricity supply stability. AEMO's 2024 draft ISP outlines the complete shutdown of all coal-fired power plants between FY2037-2038. The reliability of the grid requires government and private sector investments into power grid infrastructure and energy storage to achieve efficient renewable energy integration and decrease electricity expenses for customers. The "Rewiring the Nation" programme gives special financial terms for essential grid modernisation projects. The sector requires long-term policy signals that are both clear and consistent to draw private investment and drive sector innovation. The expanded Capacity Investment Scheme (CIS) aims to back new renewable electricity generation at 23 GW and dispatchable capacity at 9 GW from 2024 through 2027 to reactivate large-scale investment. Renewable energy project development requires social licence by implementing benefit-sharing schemes alongside proactive engagement and transparent communication to address community concerns.
A 100% renewable energy system is projected to be highly cost-effective for Australia when considering the long-term perspective. Renewable energy technologies need no fuel expenses and require fewer operational costs than fossil fuel power plants, thus leading to major savings throughout the system's operation period. Renewable energy infrastructure requires large initial investments totalling more than A$100bn annually from 2024 to 2050 for energy and transport decarbonisation, as well as A$3 trillion until 2050 to achieve net zero and hydrogen export targets. The levelised cost of electricity (LCOE) for solar PV and wind power matches or surpasses the prices of new coal and gas-fired generation systems when system integration and firming expenses are included. The cost advantage will grow stronger because technology prices will decrease and carbon pricing regulations will spread across the world. The shift to renewable energy systems prevents the major environmental expenses that result from fossil fuel usage, such as polluted air that harms public health and greenhouse gas emissions that harm the environment. Delaying renewable energy system implementation will result in higher consumer energy expenses because of ongoing dependence on costly volatile fossil fuels and greater economic dangers from intensifying climate change impacts, which models predict will cost Australia $6.8 trillion of its GDP by 2050.
5. Unlocking Economic and Societal Benefits
Australia's transition to 100% renewable electricity generation will create various economic and societal advantages. The most important advantage of this transition is its ability to generate substantial job opportunities throughout different sectors. The renewable energy sector, which includes power generation and storage alongside transmission and manufacturing and installation and maintenance and research activities, will produce hundreds of thousands of employment opportunities. AEMO's ISP indicates that new energy infrastructure development will require more than 60,000 personnel for direct employment and maintenance work until 2050, and the clean energy workforce needs to expand from 21,500 to 59,300 workers by 2030. According to Reputex's modelling of the ALP's Powering Australia policy platform, there could be 604,000 new direct and indirect employment opportunities created by 2030. The energy transition provides companies an opportunity to build a more diverse workforce through training and reskilling initiatives that help fossil fuel workers move into renewable energy positions, according to the Energy Industry Jobs Plan. The rapid growth of the renewable energy industry demands strategic education and vocational training investments to develop a skilled workforce that will support its expansion.
The extensive critical mineral deposits found in Australia, containing lithium and rare earths and cobalt and nickel, enable the nation to build up its domestic minerals processing facilities, which are vital for renewable energy and battery technologies. The Albanese Government plans to spend A$22.7bn during the upcoming decade through "Future Made in Australia" for maximising economic value and industrial growth from the net-zero transition, with specific focus on processing and refining critical minerals. The government offers both a ten per cent production tax credit worth A$7 billion and funding for strategic projects like Arafura Rare Earths' Nolans Project (A$840 million) and Iluka Resources' Eneabba Rare Earths Refinery (A$1.65 billion loan including A$475 million extra funding). Moving beyond exporting raw materials to processing and refining operations will establish new industries which will increase export revenue and strengthen Australia's economic stability. The path to achieve this goal will need to overcome two main challenges, which include expensive processing expenses alongside strong foreign competition from current market leaders, as demonstrated by the Pinjarra gallium refinery example.
The renewable energy transition provides substantial economic advantages that go beyond creating employment opportunities and mineral refining capabilities. The reduction of fossil fuel imports will boost Australia's energy independence and security, making the country less susceptible to international price shifts and political turbulence. The nation should pursue clean energy export opportunities by developing green hydrogen manufacturing through renewable electricity generation and by enhancing power transmission infrastructure for renewable electricity exports and green material production through clean energy. The energy transition will create new opportunities for technological advancement, which will establish a clean technology marketplace whilst driving innovation throughout renewable energy and adjacent sectors.
The social advantages of shifting to a 100 per cent renewable electricity power supply are equally important as the economic benefits. People will experience better health outcomes because reduced fossil fuel use leads to decreased airborne pollution, which worsens respiratory and cardiovascular diseases. The First Nations Clean Energy Strategy aims to improve energy access and reliability through decentralised solar power systems and battery storage, which benefit remote and regional communities that depend on less efficient diesel generators. The renewable energy sector will deliver $9.7 to $11.7 billion in payments to landholders, combined with community benefits through community contributions by 2050. The transition to renewable energy systems will lead to societal fairness and sustainability by protecting the environment and enhancing life quality for every Australian.
6. The Intelligent Grid: Integrating Artificial Intelligence
Artificial Intelligence has the power to drive substantial change in enabling Australia to achieve 100% renewable electricity generation. AI delivers exceptional value to grid management through its real-time data processing capabilities, which help optimise system operations whilst handling complex renewable energy system variability. AI algorithms enable precise demand predictions, which help grid operators make accurate supply adjustments based on energy requirements. AI systems optimise load distribution on the power grid, which enables stable operation despite variable renewable energy supply. AI-powered virtual power plants (VPPs) unite distributed energy resources like rooftop solar and electric vehicles, and home batteries to deliver essential grid services and maintain grid stability. AI performs detailed predictions of renewable energy generation through historical data and weather patterns, and other relevant factors which enable better grid planning and operation.
Renewable energy infrastructure benefits from predictive maintenance through AI technology advantages. AI algorithms monitor solar panels and wind turbines and batteries, and transmission lines through sensor data to detect subtle anomalies that help predict potential failures before they happen. The predictive maintenance strategy enables better timing of maintenance operations, which results in fewer equipment downtimes and cheaper repairs whilst extending the equipment lifespan. AI-powered drones, along with robotics, enhance efficiency whilst ensuring safety during inspection and maintenance tasks, benefiting extensive solar and wind farm operations.
The integration of distributed energy resources (DERs) into the power grid achieves substantial benefits through AI applications. AI-powered control systems and smart inverters enable DERs, including rooftop solar and home batteries and electric vehicles, to provide essential grid services through bidirectional energy management. When implemented through intelligent integration, DERs can reach their complete potential, turning them from being passive consumers into active grid stability and resilience contributors.
Several practical case studies show how AI technology benefits Australia's renewable energy sector. AI-powered robots have shown success in installing solar panels autonomously at major solar farms, reducing construction times and costs at Neoen's Culcairn Solar Farm in NSW and Engie's Goorambat East Solar Farm in Victoria. An AI-based maintenance monitoring tool improved solar farm efficiency by 12% at a Queensland facility by detecting subpar panels and predicting upcoming maintenance requirements. Australian companies Reposit Power and Future Grid use AI systems to optimise grid operations, improving distributed solar and battery system management whilst strengthening power grid stability. The successful implementation of AI technology for wind power forecasting by Google DeepMind demonstrates the potential that AI offers to improve renewable energy system reliability and efficiency. AI implementation in renewable energy transition across Australia demonstrates real-world advantages that create conditions for broader acceptance and new technological progress.
7. Policy Frameworks and Recommendations
The Albanese Government put forth different policies for renewable energy deployment to support energy transition after winning the recent election. The Capacity Investment Scheme (CIS), along with the Renewable Energy Target, work together to stimulate investments in new renewable power capacity. The "Rewiring the Nation" programme supports vital grid infrastructure projects by offering funding for upgrading transmission networks that receive renewable energy. The "Future Made in Australia" strategy supports domestic critical minerals processing along with manufacturing industries through substantial development programmes. The "First Nations Clean Energy Strategy" focuses on placing First Nations peoples as central figures in clean energy development to solve energy accessibility problems and economic opportunities. The current policies demonstrate progress towards a cleaner energy system, yet require thorough assessment for maximising their effectiveness in achieving fast and complete renewable energy transition.
Australia requires immediate solutions to existing policy gaps and challenges if it wants to accelerate its renewable energy transformation. The complex and time-consuming nature of renewable energy project regulatory and planning approval procedures slows down deployments and makes them two to three times longer and 25 times more expensive in NSW than in Queensland. The government must work with the private sector to secure necessary grid infrastructure and energy storage funding because these remain significant barriers. The development of renewable energy projects depends on meaningful community engagement, which also addresses social licence issues because dissatisfaction with community engagement reached 92% among respondents in a 2023 federal survey. Australia needs a complete national energy workforce strategy to develop qualified staff who will construct and operate, and maintain a completely renewable electricity system because engineer and electrician shortages exist currently. The large-scale deployment of renewable energy projects to achieve ambitious targets requires governments to establish clear and consistent long-term policy signals which will provide necessary investment certainty.
A number of policy recommendations emerge from the evidence to help Australia achieve 100% renewable electricity.
The government should simplify the regulatory framework for renewable energy projects and accelerate their approval processes whilst maintaining environmental and social safeguards by completing detailed regional biodiversity mapping to determine suitable development zones and prohibited areas.
The government needs to increase its funding for grid expansion as well as storage capacity development because these systems are essential to a high-renewable system, and they need stronger incentives and long-term financial backing.
National guidelines and best practices should be developed for community engagement and benefit sharing to build social licence and deliver renewable energy project benefits to local communities.
The government should dedicate more funds to educational programmes and training initiatives that focus on renewable energy systems and grid integration to build up a qualified workforce that includes training First Nations people and other underrepresented groups.
The government should create long-term policy signals for renewable energy targets and support mechanisms to drive innovation and private investment.
The government should implement targeted policies along with incentives to establish a competitive domestic processing and refining sector for critical minerals needed in renewable energy technologies whilst using the "Future Made in Australia" plan.
AI research and development need support through funding and encouragement to enable the deployment of artificial intelligence for grid optimisation as well as predictive maintenance and distributed energy resource integration whilst maintaining environmental management.
8. Conclusion: Realising Australia's Renewable Energy Future
A transition to 100% renewable electricity in Australia is technically feasible and provides economic benefits and environmental protection. The nation benefits from plentiful renewable energy resources and rising technological capabilities, and increased policy dedication to reduce carbon emissions under the ALP government. The evidence demonstrates that a transition to renewable energy systems produces environmental benefits through emission reductions, together with economic opportunities through job creation and industry growth and social benefits through improved health outcomes and energy reliability.
A complete renewable electricity system demands solutions to various obstacles during its implementation. The economic transition for existing industries and workforces needs careful planning, together with strategic investments and effective policy frameworks to achieve stability and reliability of the grid using variable renewable energy sources and obtain social acceptance for necessary infrastructure developments.
The adoption of artificial intelligence in the energy system provides a powerful solution to handle complexities whilst optimising power grid operations and speeding up renewable energy technology deployment and maintenance.
The achievement of Australia's renewable energy future depends on united collaboration between governments at every level, along with industry representatives and research organisations and local communities.
Through addressing policy gaps and overcoming technical obstacles whilst harnessing extensive economic and societal advantages, Australia can establish itself as a global clean energy leader, which will significantly support worldwide climate change reduction and secure long-term prosperity for future generations.
Table 1: Projected Renewable Energy Generation Mix for Australia
Table 2: Cost Comparison of Electricity Generation Technologies (AUD/MWh)
The average cost of electricity production per megawatt-hour (MWh) throughout a power plant's operational lifespan defines LCOE (Levelised Cost of Electricity). The calculation of LCOE includes four essential factors:
• Capital costs • Operating and maintenance costs • Fuel costs • Financing costs • Expected electricity output
Table 3: Potential Economic Benefits of Renewable Energy Transition
