Carrington Clarke

as we move from existing fossil fuel, big coal-powered plants to renewables.

And the story had been, up until quite recently, that this would be a prolonged period of gas being critical to that transition, which doesn't seem to be playing out.

which is an extraordinary shift in the way we interact with the electricity market.

And it could have major impacts on how inflation goes from here because it is the most volatile item.

Well, fuel, the petrol prices, as we've seen, because of the closure of the Strait of Hormuz, but also it has in the past fed into electricity prices because it's not just gas as well, right?

It's also...

Diesel is important for moving around coal around the country for these power stations.

So the more you're reliant on renewable energy and batteries, the less you're reliant on importing fuel or the international gas price, which could mean lower inflation.

Lower inflation could in turn mean lower interest rates.

And I think part of the reason we have that big spike with electricity prices was because it was a rolling off of the government rebates.

That's true.

Which had disrupted the market, but it's still the most volatile item.

And the more you can control...

the supply of electricity here in Australia.

It's not reliant on what's happening globally.

The more stable you would think inflation would be, and that will be critical for the Reserve Bank because it will mean that they can get interest rates lower, which most people will welcome.

And Australia is very lucky.

in that we are blessed with huge amounts of sunlight.

Now, sometimes that can be a problem when we have drought conditions, but overall, it's a very good position to be.

There's lots of places in Northern Europe who would love to have the access to sunlight that we have.