Higher prices are offsetting lower production
Melbourne, Australia (PRWEB) May 08, 2013
The Fossil Fuel Electricity Generation industry in Australia is expected to earn revenue of $17.1 billion in 2012-13, representing annualised growth of 4.1% over the past five years. According to IBISWorld industry analyst Caroline Finch, “this reflects the combination of slightly lower output and substantially higher prices over that period”. Industry revenue is expected to expand more strongly in 2012-13, as higher prices (due to the introduction of carbon pricing) more than offset a fall in the amount of electricity generated from fossil fuels.
As Australia does not export or import electricity, the size of the local market matches output. “Generating electricity from fossil fuels is a capital-intensive activity, but the industry employs a substantial number of people”, says Finch. There are about 49 firms involved in the Fossil Fuel Electricity Generation industry and numerous smaller ones that generate electricity for their own use and can also sell power into the public grid. The major players in the industry are International Power (Australia) Holdings Pty Limited, Macquarie Generation, AGL Energy Limited, Delta Electricity and Eraring Energy.
Demand for electricity is expected to return to growth over the five years through 2017-18, reflecting ongoing economic growth and Australia's increasing population. This is expected to support production growth over the five years through 2017-18. Some caveats remain, not least the political uncertainty around carbon pricing with an election due in 2013-14, which could shape policy in this area. Other issues affecting the industry are growing end user electricity prices, as distribution and transmission costs increase the average electricity bill. The rollout of small-scale solar generation among Australian households is another factor likely to limit demand growth, as are ongoing energy efficiency initiatives.
For more information, visit IBISWorld’s Fossil Fuel Electricity Generation report in Australia industry page.
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IBISWorld industry Report Key Topics
Firms in this industry use fossil fuel such as coal, gas or oil to drive steam producing turbines that generate electricity.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
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