Australia's energy supply network will need almost A$100 billion ($72 billion) in refinancing and new spending over the next five years as it grapples with reducing greenhouse gas emissions, according to an industry survey released on Tuesday.
The Energy Supply Association of Australia (ESAA) survey showed about A$50 billion of the total would be needed to refinance existing energy assets, spit between A$30 billion for networks and A$20 billion for generation assets.
Owners of electricity generators and transmission networks include companies such as Origin Energy Ltd (ORG.AX), AGL Energy Ltd (AGK.AX) and SP Ausnet SPN.AX.
The coming decade will see considerable pressure within the energy industry as it transitions to a low emission energy supply system and dramatically increases the proportion of renewable energy, said ESAA Chief Executive Clare Savage.
The government is proposing a cap-and-trade emissions trading scheme from mid-2010, which the ESAA said will boost the operating costs of coal-fired electricity generators which supply most of Australia's electricity.
The government also plans to introduce a 20 percent renewable energy target by 2020 which will require investment in windfarms, solar energy and geothermal energy.
More than A$6.3 billion of capital expenditure was planned on existing generation assets over the next five years while a further A$12 billion was required for new generation capacity, the survey said.
The survey found network businesses will require A$31.2 billion of investment in both existing and new network assets to facilitate the transition to lower emission generation and ensure reliable energy supply.
Private companies will take up about 78 percent of the total refinancing needs in the generation sector, and about 40 percent of requirements in the network sector.
Currently the private companies get about 45 percent of financing from international sources, ESAA said. ($1=A$1.38) (Reporting by Bruce Hextall)