School of Social Sciences
Advancing national security through the green energy transition
Published on the 04 March 2026
The green energy transition’s potential to be a national security multiplier, boosting economic, energy, environmental, socio-political and geo-strategic securities. Photo: Adobe Stock images.
The green energy transition could help Australia advance a comprehensive security-enhancing agenda.
A new governance approach to green energy will help expedite a sustainable transition and maximise its national benefits, says a UNSW expert in international political economy.
“The green transition has the potential to be a massive national security multiplier,” says Professor Elizabeth Thurbon from UNSW’s School of Social Sciences. “It can boost economic, energy, environmental, socio-political and geo-strategic securities simultaneously.
“While some countries manage certain dimensions well – for example, China has made the largest investment in clean energy and green technologies to promote economic and energy security – an integrated approach is lacking internationally.
“A more holistic governance approach, what we call Green Energy Statecraft, would enable national decision-makers to capitalise on the unavoidable energy shift and simultaneously address pressing multi-faceted national challenges.”
The Green Energy Statecraft (GES) project, led by Prof. Thurbon, is a collaboration between UNSW Sydney, University of Melbourne, University of Sydney, Australian National University, University of Technology Sydney and international partners.
The team is collaborating with government, industry, civil society, philanthropic and research partners to create a robust governance model for the energy transition.
The research identifies the essential features of this statecraft-in-the-making and conceptualises the governance challenges and changes taking place. It also assesses progress towards a more coherent, goal-oriented governance approach.
In Australia, advocates of the renewable energy shift have tended to focus on the environmental security benefits, arguing that the reduction of emissions will help to address climate change. While the environmental benefits of the transition are real and vital, the economic and geo-strategic payoffs are also huge but typically understated or ignored, Prof. Thurbon says.
“On the domestic front, rapidly building and scaling the technology-intensive, export-oriented green energy industries of the future will help us fend off, outflank or move in step with foreign rivals.”
Australia’s largest exports – iron ore, coal and natural gas – make up nearly half of Australia’s total export value; more than 80% of these go to East Asia. “Currently we face significant risk because East Asia is decarbonising; eventually, they're not going to want our coal, iron or gas.”
By contrast, green iron represents a high-value export opportunity, she says. Green iron is produced using renewable energy rather than coal processes that produce significant carbon dioxide emissions.
“Iron ore is currently our biggest export, and we could triple its value by being greener. There are skilled jobs – social security – and new technologies also attached to this. It’s like being kicked in the behind by a rainbow.”
Failing to embrace a more integrated approach would jeopardise the pursuit of green energy superpower status, the stated ambition of national governments, including China, the UK, India, Canada and Australia.
“Green Energy Statecraft is not just advantageous but necessary to deliver an ambitious, effective green energy policy in today’s era of polycrisis [the cascade of converging challenges facing policymakers today].”
The green transition supports greater energy security and equity
Renewables present an opportunity for greater energy security. Australia relies heavily on imports, such as petroleum and crude oil, for our liquid fuels, such as petrol (gasoline) and diesel. “This is a huge vulnerability,” Prof. Thurbon says.
“We’re constantly being called out by the IEA [International Energy Agency] for not having enough reserves, because they’re really expensive, so we are really susceptible to supply chain shocks.”
Choosing to power transport with renewables, through electric vehicles, would completely reduce that risk, she says. “Renewables are now the cheapest form of electricity, so their reliability and affordability would boost energy security.”
The distributed nature of renewables, with small-scale systems located close to points of consumption, is also a lot more stable than coal-fired power stations or gas plants, she says.
“A flexible and distributed grid supported by battery backup is important in the face of the growing disasters associated with climate change.”
Additionally, for First Nations communities, renewable energies provide a transformative pathway to economic sovereignty through Indigenous ownership of green energy system, she says.
“Remote and regional communities have the highest energy prices, and are often largely dependent on diesel, which is expensive, noisy and polluting.”
Equally, farmers on the climate crisis frontline facing increasing droughts, crop failure and floods could host renewable projects and sell energy back to the grid to improve their livelihoods, she says.
“Renewables are cheaper, more reliable and they promote greater energy equity and justice.”
Nourishing our networks in the Asia-Pacific
The clean energy transition would support our geo-political alliances, she says. “Being a large exporter of fossil fuels harms our relationships and reputation with our Pacific Island neighbours.
“We must strive to be the development partner of choice for our Pacific Island neighbours. Being a better neighbour is about respecting and taking seriously their biggest concerns; in this case, climate change.”
Additionally assisting countries, such as Japan and Korea, to decarbonise helps strengthen our networks. “Japan and Korea are big steel producers; they don’t have a lot of green energy capacity due to their geography.
“By exporting them green iron we help them meet their international obligations and deepen our relationships. This is important within the context of the China/US conflict.”
Further embedding our domestic green energy statecraft efforts within our international trade, investment, energy, aid and military agreements is key to their success, she says.
Supporting the green transition through financial architecture
Establishing non-partisan consensus is key to capitalising on these payoffs, but this must be underpinned by strong financial foundations, Prof. Thurbon says.
“Currently the high cost of capital (not tech) is slowing investment. Renewable projects are capital-intensive, most of their cost is tied up in finance, not fuel.
“The private market, facing deep uncertainty, is struggling to provide the long-term, fixed-price power contracts that big industrial users depend on.
“When the cost of capital (WACC) rises by just 1%, the price of renewable power typically rises by about 10%.”
The weighted average cost of capital (WACC) is the average rate a company expects to pay to finance its assets, factoring in the cost of debt and equity. It's used to assess the risk of investments, evaluate projects, among other things.
“When it comes to projects like green iron that require not only the green iron plant but also the massive build out of renewables to power it, private developers face project on project risks. Without investment-grade counterparties they must charge higher prices to compensate. That means financial risk, not engineering cost, is now the main driver of Australia’s power prices.”
Rather than grants, cash subsidies or bailouts, the research team supports an innovative public-private financing tool called a Scheme Finance Vehicle (SFV).
“Here the government lends its balance-sheet credibility [its low risk of default] to clean energy projects by standing as a high-credit counterparty; it buys power from renewable developers and on-sells it to large industrial users under long-term, fixed-price contracts.”
By de-risking projects at the source, the SFV lowers financing costs making clean energy more accessible. This solution is now being applied to the Tomago Aluminium smelter – Australia's largest smelter currently in administration – to help revive and green this vitally important national asset.
“The SFV is a market fix that aligns public credibility with private investment to deliver clean power faster and cheaper,” Prof. Thurbon says.
“It creates greater security for industry; it accelerates at-scale renewable development; it protects taxpayers through its contractual nature; and it strengthens the grid.
“It’s the missing financial architecture for an orderly, affordable energy transition that works for households, industry and the planet.”
Changing the mindset
The GES team are working with industry, finance, unions, environmental groups, NGOs, policymakers and state and federal governments to promote the effective implementation of green energy statecraft.
They’ve delivered training initiatives and intensive briefing sessions for Australian political and policy leaders at both State and Federal levels, as well as government officials throughout the Southeast Asian region.
The project’s policy innovations – including the Clean Commodities Trading Initiative and the Scheme Finance Vehicle – have also been extensively showcased by the World Economic Forum, where Prof. Thurbon currently serves as a member of the WEF Global Future Council on Equitable Transition.
The research is about reframing the purpose of the green energy transition promoting the proactive role of the government within it, Prof. Thurbon says.
“It’s been heartening to see strategies, such as [the Federal] Future Made in Australia [policy that aims to boost investment in the net-zero transition and strengthen the national economy], demonstrating greater ambition in terms of climate change and the economic and geostrategic benefits of the green transition,” she says.
“Australia, perhaps more than any other nation around the world, has been committed to neo-liberal economic thinking: that governments are part of the problem, that governments shouldn’t get involved in strategic decision-making.
“We have a lot to learn from East-Asian countries like South Korea about the advantages of a more ambitious and strategic role of government. The green energy transition is the opportunity for us to capitalise on this and promote a more sustainable prosperous future for all Australians.”
School/Centre
Researcher
Professor Elizabeth Thurbon
Pillar
Pillar 6: Accelerate the transition to a sustainable society and planet
- Researchers
- News
- Our team
- References
