Australian Construction Outlook – Utilities

The utilities construction sector is primed to have its third boom in a ten year period, this time underpinned by the dawn of the large-scale battery age in renewable energy construction, with additional impetus from construction of gas pipelines to meet future demand for gas on the east coast.

The first utilities boom, which peaked at $35 billion of work done in 2012/13, was partly driven by a prolonged drought, then the 2017/18 peak of $33 billion mostly came from a surge in wind and solar farms, and now we are on the cusp of the next surge, expected to reach $34 billion in 2022/23.

This outlook is supported by these key influences; the next wave of renewable energy investment, driven by the acceleration in large-scale battery storage and a continued process of decarbonisation in the electricity market, additional spending on the NBN, and a new phase of gas pipeline construction aimed at increasing sources of gas supply.

Following this next wave of construction, we forecast a downturn from 2023/24 onwards.