Australia is moving towards an energy system that is reducing its impact on our environment through lower carbon emissions – a transition that many hope takes the nation towards a net zero emissions pathway. To meet this overwhelming challenge Australia will need to invest vast sums of money on infrastructure including storage and renewable energy sources, all while maintaining a reliable and affordable supply of energy for consumers.

As we move to a sustainable energy system in a carbon constrained world, renewables will be increasingly critical in the Australian energy mix. According to the International Energy Agency it is thought that wind and solar could grow to supply 40 per cent of primary energy demand by the end of the century, up from only 1 per cent today. But it is important to remember that electricity is less than one fifth of the world's total energy use. So to further reduce emissions, other parts of the economy will need to rely more on electricity.

Storing energy from wind turbines can be expensive. Credit:Bloomberg

The switch to electricity is possible in industries such as light goods and food manufacturing, which require low temperature processes and mechanical activities. But in other industries, such as heavy-haul transport which accounts for more than 20 per cent of road transport energy demand, and the manufacturing of steel, iron and cement – electricity simply does not work.

The other significant challenge we face in this energy transition is that renewables are intermittent. And solutions for storing power when the sun isn't shining and the wind isn't blowing are either dependent on location or very expensive, especially in the case of seasonal storage in extreme climates. Until we have some enormous step changes in storage technology we will only get so far with renewables in the energy mix. They need a backup, and gas is the most logical energy source to do that.