Just as many Victorians are feeling the pinch of the increased cost of living, so too many Victorian businesses are experiencing a sharp rise in the cost of doing business.

And the biggest cost increase for business - and consumers - is rising energy prices.

The way out is renewables. Put simply, if we want to get to the State Government’s target of 95 per cent renewable energy use by 2035, we need to get our skates on.

Which is why the Victorian Chamber has taken a proactive approach by developing a comprehensive roadmap for how Victoria can achieve a net-zero economy in the most efficient and business-friendly way possible.

We believe the path to net-zero is an opportunity for Victorian business. An opportunity for business to not just reduce energy costs but ensure our future energy supply and transition to a net-zero economy while positioning Victoria as a global leader.

While we support the State Government’s renewable energy target, including the re-establishment of the State Electricity Commission (SEC), it’s vital that it works closely with business to make the SEC and transition to a net-zero economy a success.

The SEC hit the right note with voters. My father worked his entire career at the original SEC and there are many families like mine. And the new SEC, with a focus on renewables, is appealing to my children’s generation.

But the new SEC must enable business participation if it is to be successful. That will involve superannuation companies and other business, and it must track a path to profitability to ensure adequate returns on those investments.

One of the most pressing issues for business is certainty. Certainty is being challenged by the rising cost of energy and is resulting in insecure energy supply. This is having a detrimental impact on businesses of all sizes and sectors and impacting their ability to invest in future operations. 

This is particularly true for small, medium, and family businesses which often have limited resources and are more vulnerable to fluctuations in energy prices. These businesses are the heart of our communities and backbone of our economy in terms of jobs and growth.

It’s a given we need the State to provide clarity on the steps that will be taken. The first is to support business and develop a skilled workforce while simultaneously developing and deploying low-emission technologies and practices.

This includes large-scale investment in hydrogen, solar, wind, bioenergy and batteries as well as providing incentives and subsidies for businesses to adopt energy-efficient technologies and practices to address rising costs. It will grow our manufacturing capability and export markets while also creating new jobs in the sector.

Second, we need to promote the growth of renewable energy sources to provide support for businesses looking to transition to clean, sustainable energy options. We also need to invest in upgrading and modernising our energy infrastructure to make it more resilient, efficient, and flexible. That involves the prospect of blue and green hydrogen.

Third, we need to ensure that energy prices are transparent, and that there are mechanisms in place to protect businesses and consumers from sudden price spikes or other market distortions. This can include regulatory reform, or other interventions to prevent price gouging. 

While we support the move towards renewable energy, we also understand and respect different perspectives and the role of other energy sources in our state's economy. The goal is to create a balanced and sustainable energy system that benefits all stakeholders. Business should not have to sacrifice their competitiveness by taking on additional cost to move towards a net zero environment.

Addressing the rising cost of energy and ensuring reliable supply will be critical for Victoria’s economic growth. By investing in low-emission technologies, promoting renewable energy and upgrading infrastructure, we can create a more sustainable, resilient and competitive energy system that benefits businesses and consumers alike.

And we also need to understand many countries are on a similar journey. There is competition for wind and solar generation, and there are limited companies with the capability to deliver. If we delay, other countries that promise greater opportunity will jump ahead and make our path to net-zero even harder.

The coal generation power stations are being shut down, and with it goes the energy generation from that source. The transformation to a net-zero economy that can generate sufficient energy is one of the biggest challenges we will face over the coming decade. But it also presents as one of the greatest opportunities and one that Victoria is well placed to take advantage of. 

It’s a conversation that must turn to action quickly if we are to keep our lights on. Literally.

This article originally appeared in the Herald Sun on Tuesday 28 February 2023.