The global energy crisis sparked by the Iran war hit home this week in the form of a national fuel crisis that threatens to drive up interest rates and emissions.
Capital
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Following the IEA’s “unprecedented” decision to direct oil producers to release 400,000 barrels of oil from their strategic stockpiles to make up for lost production at key Qatari and Iraqi oil fields, Australian energy minister Chris Bowen declared Australia was in a national fuel crisis.
Australia has just 29 days of jet fuel, 32 days of diesel and 24 days of petrol in its emergency reserve. Under IEA obligations, it is supposed to keep 90 days of each in its minimum stockpiles in the event of a crisis. Jarden analyst Nik Burns told The Energy that the Commonwealth government should look to its friends and neighbours around the region, including the US, Japan and even China, to import additional oil to fend off a domestic shortage.
Analysts from NZ-based investment bank Jarden labelled the initial reaction by oil traders to Iran’s blocking of the Strait of Hormuz as “muted” to date, because they thought the Iran missile crisis would be resolved quickly. The analysts have modelled three scenarios for how likely the conflict will play out. They believe that “energy markets are sleepwalking” and under their worst case scenario of a “Prolonged Shock” of over two months of conflict forcing the Strait of Hormuz to be fully controlled by Iran, Brent Crude prices would skyrocket to US$150 a barrel for most of the year.
The energy market chaos caused by the Iran conflict will drive overseas trading partners to look towards Australia “as a source of secure, high-volume” LNG supply, Robert Monterosso, economic security research fellow with Sydney University’s United States Studies Centre has noted in a research note analysing potential recovery scenarios for the global LNG market.
Japanese energy giant JERA Co sold its 0.417% and 0.735% stakes in Australia’s Gorgon and Ichthys LNG projects, respectively, to MidOcean Energy. Chief executive of MidOcean De la Rey Venter said the new structure will increase the company’s energy production volume “in resources that aren’t already tied to fixed sales contracts.”
Investment in Australian and New Zealand renewable infrastructure has surged 52% year-on-year but the region nonetheless ranks last in the world in terms of near-term growth confidence, procurement platform Ansarada notes. Just 7% of executives surveyed for its 2026 Renewable Energy Infrastructure Outlook Report said they see ANZ as a top region for increased renewable activity in the next two years.
Solar may be continuing its explosive growth in China but it’s moving the other way in the United States, which added just 43.2GW of new solar generation capacity last year. That’s a 14% decrease from 2024, compounded by a nearly 40% fourth-quarter decline in utility-scale projects as developers delayed energisation due to changes in tax credit deadlines.
Policy
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Energy minister Chris Bowen authorised a temporary relaxation of national fuel standards to allow higher sulfur levels for the next 60 days – a move that will divert around 100 million litres of new petrol supply per month to the domestic market, with a focus on agricultural supply and regions of greatest shortage.
Surging retail petrol prices led the government to direct the ACCC to crack down on market abuses by petrol retailers. The government has doubled potential penalties for false or misleading conduct and cartel behaviour – to $100 million per offence – with treasurer Jim Chalmers pointing out that at this point in the war, “We are not experiencing a fuel shortage, but rather localised disruption due to significant spikes in demand.”
United Nations secretary-general António Guterres called out the importance of renewables as a solution to a heavily concentrated fossil fuel economy in which “every conflict risks sending shockwaves through the global economy.” Renewables, he said, have provided an “exit ramp” from “dependence on volatility” and “cannot be blockaded or weaponised.”
Crossbench MP Sophie Scamps pushed for the lifting of diesel subsidies to encourage more uptake of biofuels and low carbon liquid fuels that could replace petroleum diesel but are in their infancy.
California Energy Commission Chair David Hochschild said US states yield the upper hand to set the policies that drive the transition in a federal policy vacuum. Speaking on the sidelines of Climate Action Week, he said “ It's an interesting legal posture they're taking because by pulling back to the extent that they are and saying the federal government has no role here. That actually creates a legal opportunity for states to then regulate and actually be even stricter." California is still targeting 60% of zero-carbon electricity by 2030 and 100% by 2045.
Regulation
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Relief might be on its way for the approximately 190,000 Victorians whose electricity costs are set by the Victorian Default Offer, with the average offer proposed to drop by 3% for households and 5% for small businesses. Lower environmental costs are the primary reason for the proposed decrease. The Victorian announcement comes a week ahead of the release of the Default Market Offer and amid reform of the DMO by the federal government.
Under a proposed rule change responding to the unprecedented growth in data centres connecting to the grid, large inverter-based loads would be forced to adhere to new grid-access standards. They would require data centres of 30MW or greater to ride through certain frequency or voltage disturbances in order to prevent cascading failures and potential blackouts. The standards would not be applied retrospectively, but instead to those who have not yet received an offer to connect.
The Australian Energy Market Commission opened consultation on two rule change proposals that would enhance the system security frameworks of the NEM. The first request, submitted by AEMO in November, seeks changes to system strength, inertia and Network Support and Control Ancillary Services frameworks, Regulatory Investment Test for Transmission process and more, while a second rule proposed by the Australian Energy Council and Clean Energy Council would strengthen the ‘actionability’ of AEMO’s annual Transition Plan for System Security and increase procurement standardisation. Submissions on the consultation paper close on April 16.
Victorian electricity distributor CitiPower, Powercor and United Energy (CPU) pushed back on suggestions it is slowing the rollout of EV chargers with delayed connection times, high charges and poor data. Meanwhile the federal government looks set to overhaul a program to build a nationwide network of 117 electric vehicle charging stations, with just 45 completed to date at an average cost of $336,000 each.
The lack of a “single, reliable source of truth” drove the Australian Renewable Energy Agency (ARENA) and software company DlgSILENT Pacific to propose a NEM rule change that would specify open access to non-confidential power system data through development of an ‘Open NEM Model’. ARENA explains that the new rule, which will be fleshed out through an AEMC consultation paper due out on May 28, would facilitate sharing data models across platforms and create a single, AEMO-managed online space where users can access data.
AEMO lodged a rule change request with the AEMC to amend the National Electricity Rules with a principle that marginal loss factor (MLF) determinations consider the need for investment stability — including addressing “large annual swings” in the current methodology by adjusting AEMO’s MLF calculation procedure to reduce year-to-year volatility and investor risk.
 Projects
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Wind and solar power accounted for over 70% of all new electricity capacity growth globally over the past five years, according to a new Global Energy Monitor (GEM) analysis that found Australia has the world’s second largest pipeline of wind and solar projects with colocated storage capacity, with around 44% of projects designed this way – behind only Türkiye (63%) and ahead of Nigeria (43%), Chile (40%), and the Dominican Republic (35%).
Origin Energy (ASX: ORG) officially completed the first stage of its 460MW Eraring Battery Project and said the second stage was on track for completion in March 2027.
Octopus Australia broke ground on its $900 million Blind Creek Solar Farm and Battery project, a 300MW solar farm and 243MW/486MWh battery in Bungendore, NSW.
SA’s SunPork piggery will welcome Australia’s first commercial-scale agricultural renewable gas facility. LMS Energy subsidiary Helmont Energy said the Wasleys RNG Facility will use anaerobic digestion methods to capture biogas providing 40TJ of RNG that will be supplied to gas users across the state.
Technology
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Five companies – Allegro Energy, BroadBit Batteries, e-Zinc, Isothermix and Knode – have been chosen as ‘champions’ for the first challenge of WA’s GreenTech Hub’s innovation challenge, with early-stage WA tech firm CO2 Onboard earning honourable mention. The challenge – the first of seven such GreenTech Hub competitions – saw 31 submissions from Australia, Asia, Europe, and North America competing for honours.
Chinese electric vehicle maker BYD has unveiled new batteries that can charge from 10% to 70% in 5 minutes and from 10% to 97% in 9 minutes. BYD's chairman, Wang Chuanfu, said that the new 2nd-generation Blade Battery delivers a driving range of 777km. (PV Magazine)
Research
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Significant research gaps threaten Australia’s energy transition goals, the Australian Council of Learned Academies (ACOLA) has warned in pushing for greater coordination between government, industry and research institutions. ACOLA identified five priority research areas including researching how energy transition decisions and responses are made; technical research into an integrated energy system; skills mapping to strengthen workforce and capability; analysis of commercial value from the transition; and an updated governance model against holistic metrics and benchmarks.
At the same time, Australia’s university energy institutes called on the Australian Government to double public investment in energy research, development and innovation. The Energy Research Institutes Council for Australia (ERICA) wants the government to recognise energy as a nationally significant R&D priority and commit to a staged increase in public energy R&D investment to reach 0.06% of GDP by 2028 given Australia has fallen behind OECD peers for R&D.
New Zealand’s progress towards its goal of 100% renewable electricity generation by 2030 means the country has no need for a new LNG import terminal, a new Victoria University of Wellington analysis has shown – with offshore wind projects crucial to smoothing supply through seasonal variations in hydro power reserves. (The Conversation)
Looking ahead to next week, the Default Market Offer will be announced and Climate Change Authority Chair Matt Kean and Airtrunk founder Robin Khuda will address the Energy Networks Australia conference.
