Australia’s utilities construction sector is experiencing its largest boom in 15 years thanks to a massive surge in renewable electricity projects, according to a new report from industry forecasting company Macromonitor.
The report, Utilities Construction Outlook — Australia, provides detailed forecasts for Utilities construction spending in Australia, covering water, wastewater, electricity (including renewable energy), gas pipelines and telecommunication.
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The report notes that over the past three years, the total value of utility construction has soared by 41% to an all-time high of $40 billion, surpassing the previous record of $38 billion set in 2012/13. This growth is expected to continue, peaking at around $50 billion in 2026/27.
“Electricity construction is leading this boom, accounting for over half of all utility construction in the next decade,” according to the report’s author, and Macromonitor economist, Abdul Hannan.
Macromonitor expects that renewable energy investment, driven by government clean energy targets, coal plant closures, and global decarbonization efforts, will rise from $12 billion in 2023/24 to $20 in 2026/27 (both figures in constant 2021/22 prices).
“However, several challenges could slow the progress of renewable energy construction. High construction costs, delays in new grid connections, and issues in regulatory agreements could hamper the pace of large-scale renewable projects,” Hannan says.
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The delayed retirement of coal plants like Eraring in New South Wales, and the possible extension of Victoria’s Yallourn Power Station beyond 2028, reflect concerns over energy security during the renewable transition.”
Macromonitor forecasts a 33% rise in gas pipeline construction between 2022/23 and 2025/26, as major infrastructure projects address supply issues in the east coast gas market.
