The domestic cost of energy in Australia is on track to be the cheapest in the world, one of the country's leading economists says.
Ross Garnaut says Australia has the richest per capita resources of renewable energy and is in a position to capitalise as the world moves towards a low-carbon economy.
"The cost of developing renewable energy is mainly the cost of capital... and the costs of capital are lower in the developed than in the developing world," Professor Garnaut told the annual conference of Australasian Agricultural and Resource Economics Society in Adelaide.
"So Australia's advantage as a low-cost producer of renewable energy is greater because the only other countries with comparable levels of renewable energy are developing countries with higher costs of capital."
Prof Garnaut said the world would make the transition to a low-carbon economy "sooner rather than later", with major implications for the Australian economy.
He said the shift would restore the "comparative advantage" Australia previously held over other developed countries in the industrial era because of its rich supplies of coal and liquefied natural gas.
Opening the conference on Wednesday, South Australian Premier Jay Weatherill said the transition to a low-carbon economy was good for both the planet and the state economy.
"Our state has demonstrated that you can cut greenhouse gas emissions while still enjoying the benefits of economic growth," he said.
