Fuelling the future

As alternatives to petroleum based fuels become more available we expect that these fuels will remain part of our energy mix for some time yet, although the transition to a zero-carbon future is well underway.  Through this transition we envision a fuels sector where petroleum products, renewable energies and future fuels coexist together utilising shared assets. AECOM’s Ashley Lang and Craig Bearsley analysed the potential contribution that 58 fuel terminals, dotted around Australia and New Zealand, could make towards our cleaner, greener energy future.

The energy market in Australia is moving fast, with economic drivers and customer preferences outpacing government policy. State and territory governments are introducing policies to encourage the uptake of low or zero emission vehicles. There have also been several recent investment commitments from the private sector, state, and federal government to support advanced biofuel and green hydrogen projects. 

The choices we make in the next few years with regards to these assets have the potential to shape the energy sector for decades to come.  

Unlocking the potential  

Our domestic consumption of petroleum products, including petrol, diesel and jet fuel, is supported by a network of fuel storage terminals. Over time hundreds of smaller city and regional facilities have been consolidated into larger installations spread around the Australian coastline.  

These facilities are positioned to provide optimal access to the markets they serve and the necessary supporting infrastructure such as port, power, water, gas and fuel infrastructure. Over the years these facilities have become integrated into well-established industrial areas where there is community acceptance of their industrial land use. With the right planning and investment, all these sites have the potential to play an extremely valuable and important part of the future clean energy supply chain.  

From fuel storage to energy generation 

We predict that the strategic value of our petroleum fuels storage terminals will see them progressively transition to the generation, storage or transmission of renewable energy and future fuels. To make this a reality the right forward planning and investment will be key. 

To understand the strategic value of these fuel storage terminals, and the role they may play in our energy future, AECOM analysed the strategic attributes of 58 sites across Australia and New Zealand. We assessed each site potential future utility and what role it could play in the generation, storage or transmission of renewable energy and future fuels.   

The future fuel unicorns 

The fuels storage terminal sites are all well positioned to meet current fuel demands, but they vary greatly in their suitability to support our future energy needs. Although all sites potentially have a role to play as part of our energy future, only seven achieved “future fuel unicorn” status, awarded to highly connected and versatile sites, ideally suited to supporting the energy transition. These seven sites had a rare combination of good access to power, water, gas, port infrastructure, combined with land available to generate renewable energy.  

 Key findings: 

Renewable energy superpower  

For Australia to reach our potential as a major exporter of renewable energy we will need to find commercially viable means of domestically distributing and exporting our vast renewable energy resources to global markets. 

Many of these sites have good wind resource and solar irradiance, located in the vicinity of other large energy consumers, and the electricity transmission network. This ability to connect into the grid for both import and export of high volumes of electricity presents numerous opportunities including onsite energy generation and/or storage.  

The storage, domestic distribution, and export of renewable energy in the form of hydrogen is predicted to become commercially viable in the next few years. Many of these sites are ideally located to support this emerging hydrogen market, including though the generation and injection of hydrogen directly into the gas network or export via the existing hydrocarbon transmission infrastructure.   

Fuel storage terminals located at ports in North Queensland, the Northern Territory and Northern Western Australia may well be the best suited for the production and export of hydrogen due to abundant renewable energy resources and proximity to the key hydrogen markets in Singapore, Korea, China and Japan. 

Whether it’s side-by-side with petroleum fuels during a transition period or via a substantial transformation into renewable energy and future fuel generation, storage and export, these sites have a key role to play.  

We think now is the time to look beyond the current horizon and consider a far more radical future for these sites as the infrastructure of our energy transition and low carbon future.