Mar 23, 2026
Grant McDowell is in London and Tim Buckley is in Sydney
recording the Spark Club Podcast on the 23rd March 2026
Highlights – Draft AER Default Market
Offer
Brilliant to see the Australian Energy Regulator has today flagged
draft default market offer (DMO) electricity pricing down ⬇️ 1% to
⏬ 10% for residential consumers, and between ⬇️ 8% to ⏬ 21% for
small business consumers
The DMO sets an efficiently priced safety-net for households and
small businesses on standing offer electricity plans and acts as a
reference price to help consumers compare market offers. This is
the draft ruling, with the final ruling released May 2026 for
effect for the 12 months starting 1 July 2026.
This is consistent with Australian Energy Market Operator (AEMO)'s
quarterly energy dynamics highlighting Australia hit a record high
51% RenewableEnergy share in the 4QCY2025, and wholesale
electricity prices fell by >40% yoy as a result.
Highlights – PRRT reform - Petroleum Resource Rent Tax -
Dodge
The ACTU this week is calling for a flat 25% tax on Australian LNG
to replace the entirely failing PRRT, to capture the wind fall
war-profits being generated, and to then use the massive tax
revenues of up to $40bn to fund energy poverty relief across
Australia.
Highlights – CATL CY2025 results highlight their global
leadership and scale
Nothing short of staggering to watch the rise and rise of China's
CATL to supremacy in battery manufacturing. Their speed & scale of
technology innovation is amazing to see.
🔋 a ⏫ 42% yoy jump in net profit to Rmb72.2bn (US$10.4bn) before
one-off items, on sales ⏫ 17% yoy to Rmb424bn.
🔋 a ⏫ 39% yoy lift in sales volume of lithium-ion batteries to
661GWh
🔋 CATL has a massive home market advantage. China is the world's
largest EV & BESS market. China’s EV industry continued to grow
sales nearly 30% yoy to >16 million units.
🔋 CATL sold 541GWh of power batteries, ⏫ 41.9% yoy, propelling the
company to a new all-time high in global market share.
🔋 CATL employs >23,000 R&D personnel, investing Rmb22bn in
CY2025, +19% yoy (5.2% of sales). CATL stands as the sole battery
industry firm selected for the “Top 100 Global Innovators.” Total
number of domestic & foreign patents owned and applied for by CATL
reached 54,538.
Lowlights
- The AFR is running a Minerals Council of Australia line that the Albanese government will ignore their super majority and leave the $11bn annual subsidy for high emissions super expensive imported diesel fuels in place. Claiming now is not the time. Tim disagrees. We need to learn from the current crisis and put in place
Main Story – NEW CEF REPORT:
CHINA'S $120bn INVESTMENT BLITZ INTO GLOBAL CRITICAL MINERALS
LEAVES AUSTRALIA EXPOSED
Climate Energy Finance report warns Australia's
dig-and-ship economy faces a clear and present threat as China
systematically diversifies away from Australian supply across
lithium, iron ore and critical minerals
New report released 19th March –
Raw Power: China locks-in global dominance of critical
minerals and metals with $120bn outbound investment
surge – finds that China's accelerating outbound
resource investment program is reducing China’s supply chain risks
and locking-in its global dominance of key materials as it
diversifies away from its dependence on Australian exports.
This presents a clear and present economic risk to
Australia, particularly as we have yet to find a structure to allow
our world leading mining sector to move meaningfully beyond
“dig-and-ship”.
CEF’s report finds that:
- Australia holds world-significant reserves of the critical minerals and strategic metals that underpin the zero-emissions economy – bauxite, copper, nickel, rare earths – and is the world's #1 exporter of both lithium and iron ore, with China the overwhelmingly dominant destination for both. Yet Australia fails to process onshore, as a result ranking 105th of 145 countries on Harvard's Atlas of Economic Complexity, behind Botswana and Côte d'Ivoire, with manufacturing accounting for just 6% of GDP.
- CEF has tracked China investing more than US$120bn around the globe into mining and upstream processing since 2023 – building lithium supply chains across Africa and South America, anchoring the US$23 billion Simandou iron ore project in Guinea, and increasingly developing in-country processing capacity across partner nations. This is starkly illustrated by Simandou, which delivered its first shipment to China in January. Once fully ramped up by 2029, it will make Guinea the world's third largest iron ore exporter, producing high grade ore suitable for green steel. It is the centrepiece of China's explicit strategy to reduce its 80% reliance on Australian and Brazilian iron ore supply, directly threatening Australia’s long dominance.
- In lithium mining, China's own domestic production now outstrips Australia's, where as recently as 2023 Australia had a 50% global market share. The absence of new Chinese investment into Australian lithium is a direct reflection of China’s strategic diversification, and the February 2026 closure of Albemarle's lithium hydroxide plant in WA after just four years is a stark consequence of China’s capacity expansions,both on- and offshore, and the critical need for a public interest response by Australia’s governments to protect our base industrial capacities on national interest grounds. A string of threatened closures across alumina, aluminium, nickel, copper, lead, zinc and steel signals our mining value-add sector is under existential pressure.
- KPMG tracks that Chinese outbound foreign direct investment (OFDI) into Australia has collapsed by 85% since 2018, in 2024 making up just 1.5% of total inbound OFDI, and at just US$882m, a fraction of the peak of US$16bn in 2008 – even as two-way Australia-China trade reached an all-time record of A$300bn in 2025.
- CEF notes the geopolitical move by Japan’s JOGMEC in March 2026 to collaborate with Australia’s Lynas Rare Earths to secure rare earth supply long term at an agreed and mutually beneficial price. This is the sort of strategic investment required to enhance global supply chain resilience and underwrite surety of supply. Far more effective and lasting than blunt import tariffs on everyone and threats.
- Australia's green industrial program – the Future Made in Australia (FMIA) initiative, backed by more than A$81bn in federal capital support since 2023, plus A$6bn from state governments – is directionally correct and strategically important, particularly in the absence of a sufficient carbon pollution price signal to mobilise private capital. However, FMIA must accelerate in both ambition and execution, and be leveraged to attract value-adding FOAK investment. We should carefully and selectively engage in partnership opportunities with China, the world's cleantech leader, before its diversification away from Australian supply becomes more pronounced.
We make a number of recommendations including
balancing policy support for foreign investment with targeted
anti-dumping tariffs, local content mandates and onshore processing
as a condition of new partnerships; accelerating public capital
deployment to crowd-in private investment to value-adding
industries; prioritising carbon pricing to value renewables-powered
commodity value-adding; developing Green
Energy Statecraft for national security, including an
Australia-China Green Transition Cooperation Framework; and
reforming Australia’s foreign investment review regime to create a
fast-track pathway for strategically aligned green projects.
What’s coming up?
Tim is off to Hainan province in China next week for the Boao Forum
business forum between Australia and China.