From Renewable Expansion to System Decarbonisation

Clean Energy and Water Technologies (CEWT) Policy Note | ARENA / CEFC Engagement From Renewable Expansion to System Decarbonisation Over the past decade, renewable energy deployment has scaled rapidly with strong institutional backing. While this has delivered meaningful progress in electricity decarbonisation, broader system-level outcomes remain incomplete. Key Insight Decarbonisation of electricity is not equivalent to decarbonisation of the economy. Industrial systems require continuous power, heat, and process stability that current investment patterns do not fully address. Observed Gaps • Industrial decarbonisation remains limited • System complexity and duplication are increasing • Dispatchable energy gaps persist Strategic Risk Without system-level alignment, continued capital deployment risks locking in inefficiencies, reducing industrial competitiveness, and diluting public value. Policy Direction • Shift from project metrics to system metrics • Enable integrated energy architectures • Prioritise industrial continuity • Align funding with whole-of-economy outcomes Conclusion The next phase of climate finance must focus on integrated, resilient energy systems that support both decarbonisation and economic productivity.