The energy crisis is a massive opportunity for renewable energy to provide security and slash costs.
The current oil crisis, triggered by disruption to Middle East shipping routes, has sent Australians into panic buying and authorities into new security planning, with fuel prices soaring and interest in electric vehicles surging.
Yet beyond the immediate consumer response lies a deeper strategic opportunity: this shock could finally force a long?overdue rethink of what “energy security” means in the 2020s.
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For decades, security meant stockpiling oil in static tanks. Australia is supposed to hold 90 days of net imports; in practice, we hold barely 50 days on land, with diesel – the backbone of freight, mining and agriculture – down to roughly 28 days’ cover.
That leaves us critically exposed every time trouble flares in the Persian Gulf, through which 20 per cent of global oil flows.
The traditional answer is to spend more, building bigger fuel tanks and maintaining larger inventories. But there is now a better, dynamic alternative: redirect that capital into batteries—at utility scale, in businesses, in homes and inside electric vehicles.
Unlike fuel reserves that sit idle until a crisis, batteries work every day, stabilising the grid, absorbing cheap solar and wind, displacing gas peakers, and simultaneously creating a distributed emergency reserve.
Why batteries are overtaking even solar
Over the past decade, solar delivered the fastest energy transition in history as in the figure below.
Now batteries are beating solar’s trajectory. Global battery production more than doubled from roughly 1.1 terawatt hours in 2023 to around 2.3 TWh by 2025, with grid scale systems alone expected to dispatch hundreds of terawatt hours of electricity in 2026.
Battery Pack prices have fallen more than 90 per cent since 2010, and utility scale battery systems can now be built for around $US120 a kilowatt hour – roughly the same order of magnitude per unit of energy as a barrel of oil, but usable repeatedly instead of burned once.
In Australia, this shift is already tangible.
The National Electricity Market now hosts 59 utility scale battery facilities with over 10 gigawatts of power capacity and more than 20 gigawatt hours of storage. Their annual dispatch has more than tripled in just two years, regularly outcompeting gas peakers and smoothing the evening peak.
In the fastest energy transition in human history, clinging to oil tanks as the cornerstone of security is not just expensive—it is a wasted opportunity.
Germany shows a different pattern: most of its roughly 25 GWh of installed storage is in household batteries paired with rooftop solar, creating a highly distributed, resilient layer.
Between these models – grid scale and behind the meter – a plausible future emerges: roughly one third utility storage, one third commercial and industrial, one third residential, all working together.
The diesel dimension
Within Australia’s broader oil dependence, diesel is the pivot. We import about $35 billion of diesel annually, accounting for roughly half our liquid fuel consumption and touching every vulnerable sector: long haul freight moving goods along the Hume, Pacific and Newell highways as well as across the Nullabour; mining operations consuming around 10 per cent of national energy; and remote power generation.
Electric vehicles do more than replace petrol cars; they create mobile storage. Global EV batteries already dominate lithium ion demand. With the right standards and incentives, they can become part of the emergency reserve.
If fully electrified with domestically generated renewable power, that represents about $22 billion per year in potential import substitution and a reduction of roughly 90 million tonnes of CO – around 15 per cent of Australia’s total emissions. More importantly, it eliminates a strategic vulnerability tied to long, fragile supply chains through politically unstable regions.
China is already demonstrating how fast this can happen with almost half of their new heavy trucks now electric. Cheaper electric trucks are the next big export from China.
But how are they being recharged?
Rapid recharging is now coming to the fore globally and battery swap networks are being used in China for heavy trucks. They are being deployed at scale, with around 305 stations operational by early 2026 and plans for 900 by year end, covering 78,000 km of freight corridors.
More than 10,000 electric mining trucks are already in service. These are not pilots; they are production deployments running today.
Batteries on wheels as strategic reserves
Electric vehicles do more than replace petrol cars; they create mobile storage. Global EV batteries already dominate lithium ion demand. With the right standards and incentives, they can become part of the emergency reserve.
Japan has shown this works: electric cars routinely power evacuation centres and shops after disasters.
In California, electric school buses discharge to the grid during heatwaves to help avoid blackouts. Australia is now building a national vehicle to grid network to harness these “batteries on wheels”.
A large logistics depot with hundreds of battery electric vehicles could provide tens of megawatt hours of dispatchable storage to critical infrastructure during a crisis.
Commercial fleets – delivery vans, buses, mining equipment –are especially valuable because they return to depots with dedicated charging infrastructure, making them easy to orchestrate for grid support or emergency backup.
A large logistics depot with hundreds of battery electric vehicles could provide tens of megawatt hours of dispatchable storage to critical infrastructure during a crisis.
Even people who insist they will never own an EV have a rational interest in supporting electrification: every EV on the road is one less vehicle queuing for petrol during a shortage. It is like thanking cyclists for freeing up road space, or public transport users for not being in your traffic jam.
From static stockpiles to living infrastructure
If Australia redirected the capital implied by a full 90 day oil reserve into batteries instead, tens of billions of dollars in fuel inventory and storage tanks would be saved. Current prices would fund well over 200 gigawatt hours of storage. That is far more than most planning scenarios contemplate and enough to transform grid reliability, renewable integration and crisis resilience all at once.
The same logic applies globally. Ninety days of world oil consumption is worth around $U$735 billion, enough to build more than 6000 GWh of batteries—storage capacity that could materially reshape how every major economy balances electricity supply and demand.
Legacy projections from the early 2020s routinely underestimated these trends, often embedding assumptions that protected fossil fuel incumbents.
If we keep planning using yesterday’s failed scenarios, we lock in today’s vulnerabilities. If instead we plan for what batteries and renewables are actually delivering, we can replace static fuel stockpiles with infrastructure that supports the grid every day and stands ready when things go wrong.
The current oil shock is painful, but it also clarifies a choice. We can keep pouring scarce capital into idle hydrocarbon reserves and hoping the next disruption is not too severe, or we can build a battery backed, increasingly electrified system that is cheaper, cleaner and more resilient.
In the fastest energy transition in human history, clinging to oil tanks as the cornerstone of security is not just expensive—it is a wasted opportunity.