By Professor Alan Wong, Founder and CEO of IND Technology
A fundamental question remains underexamined: Are we directing grid investment to the parts of the network where risk and consequence are greatest?
As we move beyond the peak summer fire season, with risk increasingly extending into autumn, it is time to shift the conversation from how much we spend to how effectively that spend reduces risk.
From total spend to risk-spend efficiency
At its core, risk-spend efficiency is about the relationship between investment and outcome: how much risk reduction is achieved per dollar deployed.
Not all parts of the network carry the same level of risk, and not all interventions deliver the same level of impact. Yet much of the current approach remains broad-based, compliance-driven or reactive, rather than precisely targeted to where it can deliver the greatest reduction in catastrophic risk.
This matters because the nature of risk in Australia’s electricity networks is changing and doing so faster than the frameworks used to manage it.
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A grid under increasing pressure
The grid is now operating in conditions it was never designed for. Higher average temperatures, more frequent extreme heat events, stronger and less predictable wind patterns, and longer fire seasons are placing sustained pressure on ageing infrastructure. At the same time, demand on the system continues to grow, increasing utilisation and reducing tolerance for failure.
In this environment, relatively minor electrical faults can escalate quickly. Conductor clashing, degraded insulation, loose hardware and vegetation interaction (issues that may once have been manageable) can now become ignition events under the right conditions. This is not a hypothetical risk as faults on electricity networks remain a persistent source of ignition, particularly during periods of extreme heat and wind.
What has changed is the interaction between infrastructure and environment. The probability of failure is increasing, and in many parts of the network, so too is the consequence.
Where risk is concentrated and why it matters
Despite this, investment approaches have not fully adapted. Much of the system still treats risk in relatively uniform terms, rather than recognising that a smaller subset of the network accounts for a disproportionate share of both ignition likelihood and consequence.
This concentration of risk is often shaped by what could be described as the network’s “weakest links”. They are specific components or equipment that, while small in scale e.g. tracking insulators, failing clamps and broken conductor strands, carry outsized consequences if they fail.
These points of vulnerability are not only inherent, but intensifying. Expanding system loads associated with electrification and data centres are placing greater pressure on ageing assets, while more volatile weather patterns are accelerating their deterioration. Over time, this can shift assets from stable operation into higher-risk states, often without being immediately apparent.
From a risk–spend perspective, this has important implications. When risk is both concentrated and evolving, uniform investment across the network becomes inherently less effective. Targeting these higher-risk segments, where both likelihood and consequence of failure are elevated, delivers a materially greater reduction in overall system risk.
Prevention as a high-efficiency investment
One of the clearest opportunities lies in shifting from periodic inspection toward continuous visibility of network conditions. Over the past decade, Australian trials have consistently demonstrated that early fault detection and real-time monitoring can identify developing issues, such as conductor clashing, broken earth wires or vegetation contact, well before they escalate into failure.
A Victorian trial a couple of years back confirmed that these systems are not only effective, but practical and affordable at scale.
Deployment costs have fallen significantly, and indicative modelling suggests that a full rollout would add only a marginal amount to household electricity bills. More importantly, the economic return, measured through avoided catastrophic losses, substantially outweighs the cost.
In this context, prevention is one of the most efficient forms of investment available. Avoiding a single major fire in a high-risk region can offset the cost of monitoring across large sections of the network. Yet deployment remains uneven, and in many cases limited to pilots or isolated programs.
The question, then, is not whether these tools work, but why they are not being deployed more systematically where they can deliver the greatest reduction in risk.
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From investment to impact
The challenge is less about how much is being invested, and more about how those decisions are prioritised.
Across the system, investment is still largely shaped by program-based funding cycles, compliance requirements and broad asset management strategies. This can create a disconnect between where risk is concentrated and how investment is allocated.
Addressing this does not require a fundamental redesign of the grid, but a shift in how decisions are made, from system-wide uplift to more deliberate prioritisation of high-risk segments.
That means identifying where failure would carry the greatest consequence, and ensuring those parts of the network are equipped with the visibility and operational capability to intervene early. It also means recognising that the value of prevention in these areas extends beyond traditional network metrics, shaping outcomes for communities, regional economies and emergency systems.
Australia does not need to start from scratch. The data exists, the technology exists, and the highest-risk parts of the network are well understood. What is missing is a consistent approach to prioritising them.
Until investment decisions are more explicitly tied to where risk is greatest, the system will continue to overinvest in some areas and underinvest in others—leaving the grid less prepared where it matters most.
