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4614.0.55.003 - Energy in Focus: Business Expenditure on Energy Research and Development, Nov 2010  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 25/06/2010  First Issue
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BUSINESS EXPENDITURE ON ENERGY RESEARCH AND DEVELOPMENT

Research and development (R&D) spending is important in fostering innovation to increase productivity and efficiency, which leads to increased economic output. Energy research expenditure is a contributor to Australia’s response to environmental challenges because innovation in the energy sector can reduce the impact on the natural environment of energy consumption, and reduce the depletion of raw materials.

In 2006-07, total Australian spending on R&D was $21 billion, representing 2% of GDP (cat. no. 8112.0). R&D expenditure can be classified in several ways, with businesses self-classifying their expenditure on ABS surveys. Socio-economic objective (SEO) classifications such as Energy, Health, Defence or Manufacturing assign R&D spending to the end goal of the research, as opposed to field of study or type of research. Spending by SEO is the measure of energy R&D used in this article.

Of total Australian R&D spending, 10% went to the Energy SEO. The business sector was the predominant contributor, accounting for 90% of the total, while governments and higher education contributed much smaller amounts.

The research priorities of different sectors, as measured by the proportions of total expenditure devoted to different socio-economic objectives, are quite diverse. Energy research constitutes around 15% of R&D for the business sector, but less than 3% of research spending by the government and higher education sectors.


1.1 SELECTED SOCIO-ECONOMIC OBJECTIVES (SEO) OF R&D, BY ECONOMIC SECTOR


Coal, natural gas and oil are the major players in Australia’s energy mix, and they are also the major contributors to research in the Energy SEO. In all, the mining industry spent $1,469 million on energy research in 2007-08, roughly 73% of the total for businesses.

The two predominant industry subdivisions within the mining industry are Oil and gas extraction and Coal mining, each accounting for 34% of total Energy R&D in Australia. Petroleum and coal product manufacturing is the major contributor of energy research in the Manufacturing industry, spending over half the total for that industry.

1.2 BUSINESS R&D EXPENDITURE ON ENERGY SEO BY INDUSTRY
Graph of percentage of total business R&D expenditure on energy, by selected industries.

R&D within the Energy SEO can cover many diverse objectives across different fuel types and different stages of the energy supply chain. However, research in the Mining and extraction of energy resources SEO is predominant in Australia, totalling $1,194 million in 2007-08.

Roughly the same amount of business R&D, $132 million, was invested in Renewable energy as was invested in Energy exploration.

1.3 BUSINESS EXPENDITURE ON R&D BY ENERGY SEO
Graph of business expenditure on energy by selected socio-economic objective.


The ABS welcomes feedback on this analysis in terms of its relevance, usefulness and quality. Please send any comments to sean.lawson@abs.gov.au or phone (02) 6252 5843.

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