An Input-Output Analysis of Australian Energy Planning Issues

The belief that the price mechanism can be used exclusively to combat problems arising from growing energy shortages has led to the neglect of issues related to energy conservation. Moreover, many studies consider only the direct effects of energy use and concentrate overly only pertroleum shortages, consequently underestimating the total repercussions associated with the changes in demand for energy in Australia. This study attempts to overcome these short-comings, by modifying input-output modelling to estimate all primary energy demand for fossil fuels in Australia. The complex interactions between energy conservation an macroeconomic goals are investigated at sectoral level. The optimal sectors that meet and energy constraints have been identified using analytical techniques. The tradeoffs between energy and macroeconomic objectives ae quantified using an energy numeraire. The conflicts that emerge between macro-planning criteria and energy use efficiency are exemplified and the need to reconcile them using value judgements of political decision-makers is clarified