There’s a rapidly increasing awareness that the global future of energy is coming, ready or not. Recent contributions to The Strategist describe very different possible Australian responses to the emerging renewable energy transformation, from David Uren and from Grant Wilson.

How this develops will be fundamental to Australia’s security, not just because it will determine the power of a future economy to support Australia’s security agendas, but because Defence will inevitably be part of the energy transition, and the ADF will operate in this transformed environment.

As a central component of the energy transformation in grid scale and domestic energy storage and transportation, battery systems are now recognised as a dominant future industry and source of wealth. The government is preparing a national battery strategy and released an issues paper seeking public comment.

Projected world demand for electric vehicles alone over the next four years will require successive annual doublings of battery production. By some estimates the annual average revenue stream from the global battery industry by 2050 will be in the order of US$1,000 – $1,250 billion.

However, it’s unlikely that the global battery industry will continue functioning as it does. Currently, China dominates global battery production with some 75% of world battery cell output.

Nonetheless, the neoliberal globalist model on which this position has been built is currently (and likely to remain) out of fashion with major Western nations.

Donald Trump began the trend in 2016, capturing the votes of those disadvantaged by globalised manufacturing. The Corona virus pandemic exposed the weakness of globalised systems facing crisis, reinvigorating local manufacturing policies. Following the pandemic, failures of global supply hubs have disrupted commerce and added to globalised inflation.

A neo-mercantilist approach is emerging as the preferred way of managing national renewable energy transformations. The US is promoting the development and adoption of renewable technologies under the Inflation Reduction Act, allocating around US$369 billion in subsidies for work undertaken in America. The European Union has replicated US policy by committing $9.6 billion to subsidise battery production through the Net Zero Industries Act.

Such actions are in part a response to the need to hugely invest in renewables, but the dominance of security concerns over market dynamics seems unlikely to abate soon. Current geopolitical competition and insecurity seems entrenched by America’s distrust of China and the European Community’s need for energy independence from Russia. An America so concerned about China that it would accede to the transfer of nuclear-powered submarine technology as a key part of the AUKUS agreement is unlikely to allow itself to be dependent on battery supplies from China.

Nonetheless, battery supply during the 2020s is likely to be insecure. Demand for energy storage is expected to increase from 34 GWh in 2020 to 1,028 GWh in 2030, requiring investment of some US$262 billion.

With high competition for batteries, a scramble by Western trading partners to secure supply will boost Australia’s balance of payments but prices are likely to represent premiums for shortage rather than uncorrupted market signals.

The danger is that Australia might repeat past practice; selling raw product and failing to invest in the more substantial returns from manufacturing. This could end in the ultimate failure of policy, replicating Australia’s current gas price increases, with Australia a global leader in minerals supply but failing through overseas production disruption to secure the batteries needed for its own energy transformation.

As a base line then, Australian policy should not rely on market-based approaches where the subsidies of other countries massively distort the market. Instead, policy should ensure that local manufacture can supply sufficient battery systems to allow Australia’s own unimpeded renewable energy transformation.

Part of this will reflect the needs of Defence which will be a significant participant in Australia’s energy transformation. Notwithstanding the AUKUS decision, electrification of ADF capabilities can be expected to proceed alongside civil and commercial technological developments.

More importantly, electrification will have specific relevance to the combat effectiveness of the ADF. In 2020, the UK defence R&D organisation, Qinetiq, published Powering the Electrified Battlespace,  a study of the electrification of warfare, which concluded that ‘the fundamental enabler for all future warfare is electric power’.

The ADF is increasingly deploying platforms and systems relying on batteries for their operation. Hybrid and EV versions of the Bushmaster troop carrier are being developed. They are understood to be short on range currently but with operationally significant rates of acceleration. The Navy is exploring battery powered autonomous craft such as the Bluebottle surface surveillance drone and the Ghost Shark uncrewed underwater vehicle, while the Army is evaluating high-performance electric bikes for stealthy scouting missions. In February, Australia announced it was sending $33 million worth of electrically powered aerial drones to Ukraine. No less significant are the logistics required to support the great number of batteries used in the field at individual and unit level.

Defence’s strategy for exploiting the renewable energy transition is currently unclear. We have suggested organisational changes Defence needs to make to better understand and adapt to the electrified battlespace. Regardless, Defence will be major users of renewable energy systems, including batteries.

Consequently, government support for the development of battery manufacturing, at least underwriting the nation’s renewable energy transition, appears unavoidable. This is not popular in policy formation but the decade of the 2030s is likely to be far from normal. If such times justify spending $300-ish billion on one aspect of maritime security, it seems more than justified to spend $17-23 billion to 2030 on a fundamental of national security—building a battery manufacturing industry.

 

Originally published 12 December 2019.

When David Nicolson and his fellow soldiers in Combat Team Alpha from the Royal Australian Regiment’s 2nd Battalion served in a remote outpost in Afghanistan’s Mirabad Valley, there was a standing joke in the unit that ‘Mates don’t let mates drive Route Whale’.

The rough dirt road ran through the valley, which, in 2011, was Taliban territory and a major insurgent supply corridor. Route Whale was strewn with so many improvised bombs that it was rare for a convoy to make it home without finding one, or being hit by one.

The combat team was part of Australia’s Mentoring Task Force 3 helping train members of the Afghan National Army, which was tasked with blocking the flow of weapons and other supplies to Taliban fighters.

Nicolson recalls a stiflingly hot afternoon when the Australians were tired after a full day of patrolling on foot and climbed aboard three Bushmaster troop carriers. They passed through a small village that was normally full of people, but this time there was no one in sight. That raised anxiety levels.

Abruptly, a petrol bomb was thrown at the last of the Bushmasters and narrowly missed the gunner in his hatch at the rear of the vehicle. A massive directionally focused bomb blasted out of a wall, lifting the 15-tonne lead vehicle onto two wheels. It was poised for a time and then slammed back down.

This was the third time Nicolson had been in a vehicle hit by an improvised explosive device. ‘You black out for a second or two’, he recalled, ‘then you’re dizzy, you feel sick and sometimes you spew. Dust is everywhere. In your eyes, nose and mouth, you have that smell and taste of explosives. Your adrenaline is in overdrive.

‘While your body is going through all of this, your training kicks in and you’re making sure that you’re OK, the boys in the back are OK and casualty and damage reports are going out. You’re eyeballing the area for signs that this is a complex ambush, for signs of the enemy, the triggerman and lookouts.’

Darkness was descending as the soldiers in the stricken Bushmaster headed back to the patrol base. They moved slowly, with the front tyres shredded by shrapnel and the steering badly damaged. The bomb had demolished the external cargo bins and scarred the vehicle’s bulletproof windows, but the ‘Bushie’ was still drivable.

Before he completed his nine-month posting, Nicolson encountered a fourth bomb. He survived that, too.

Nicolson emerged from Afghanistan with a great affection for the Australian-designed and -built Bushmaster. But, like many of the soldiers whose lives were saved by the nuggety vehicle, he had little appreciation of just how hard key figures had to work to bring it into production.

The policy seeds that ultimately produced the Bushmaster were planted in the Hawke government’s 1987 defence white paper, The defence of Australia, which raised the possibility of small groups of foreign troops landing in the country’s north and identified the need for ADF ground forces to be given the mobility and speed to find and deal with them. That spurred the decision to obtain a large number of lightly armoured and versatile troop carriers.

It was assessed that such raiders would arrive lightly equipped and aim to capture materials to build bombs, which were later to become ubiquitous in Iraq and Afghanistan as IEDs.

The Bushmaster’s DNA contained echoes of wars past and campaigns on continents far away. Drawing on South African and Rhodesian experiments with landmine-blast-deflecting V-shaped hulls, it was conceived as a lightly armoured truck.

Australian troops on peacekeeping missions in the Middle East and in nations such as Namibia and Cambodia saw both the devastating impact of landmines on the occupants of soft-skinned vehicles like 4WDs and the effectiveness of vehicles designed to defend against them. The peacekeepers brought home with them insights that, much later, informed the Australian defence organisation’s planning for the Bushmaster project.

It took a long time for the army to come to love ‘this massive thing’ that wasn’t intended to be a fighting vehicle and was originally sold to government as a simple off-the-shelf acquisition. Instead it became a complex development project that pushed industry and Defence into new and more productive relationships.

Even after its early operational success in Iraq and Afghanistan, the Bushmaster was to be haunted by its association in many army minds with the ‘Defence of Australia’ strategy as well as with big cuts to the service’s size, funding and role in the years after Vietnam. Some argued that anything with four wheels and no tracks was a truck and was not to be taken seriously; anyway, the tyres of this ‘armoured Winnebago’ would be chopped to pieces by rocky terrain.

Matters got so bad at one point that, in December 2001, the team charged with overseeing such programs, the Defence Capability and Investment Committee, wrote to Defence Minister Robert Hill recommending that the project be abandoned.

Hill shared the committee’s concerns about the project running late and well over budget but says he was persuaded by the Chief of Army, Lieutenant General Peter Cosgrove, to keep it going because troops in future wars would need a high level of protection.

Ultimately, the Bushmaster faced a reality very different from what was envisaged—not a conflict fought on the red soil of northern Australia but a series of brutal battles and running fights in Iraq and Afghanistan.

Events created a desperate need for such a vehicle. Tragedies in Iraq and Afghanistan showed the vulnerability of troops, even the most capable special forces, when operating soft-skinned vehicles against insurgents with the technical know-how to build IEDs and the tactical skill to employ them well.

There was nothing else readily available on the world market. US troops in Iraq were welding additional steel plates onto their own poorly protected vehicles.

The Bushmaster’s capability wasn’t fully appreciated until it was in action and by then it was seen to be a defining reason why so many Australian soldiers survived IED blasts while British and American lives were lost.

After bombings in Afghanistan, troops sent back technical reports and ‘tiger teams’ of engineers and scientists were sent to the war zone to examine the damage and to find ways to strengthen the vehicle. The manufacturer, Thales, was able to improve Bushmasters on the production line and in the operational area.

A cheaper, off-the-shelf vehicle from overseas would not have given Australia the flexibility to adapt to changing enemy tactics in Afghanistan. Indeed, the way industry, the army, Defence scientists and others worked so quickly and effectively together to harden the Bushmaster against ever more devastating IEDs is a model of the ‘fundamental input to capability’ idea that promotes innovative work between Defence and industry.

Ultimately, the Bushmaster proved itself a lifesaver in combat and vindicated those who had faith in it.

While lengthy counterinsurgency campaigns in Iraq and Afghanistan have provided our military with valuable operational experience, they haven’t necessarily prepared us for the next conflict. On the other hand, the Russo-Ukraine War provides some valuable insights into the challenges of future war. Russia’s modernised force and way of new generation warfare provides a key lesson: to enable close combat, a modern armoured warfare capability is necessary because armour saves lives. The Russian experience highlights the importance of armour within our own military modernisation program.

The 2016 Defence White Paper confirmed the government will ‘replace the Army’s current ageing fleet of mobility and reconnaissance vehicles with a new generation of armoured combat reconnaissance and infantry fighting vehicles, as well as tank upgrades.’

This capability acquisition is known in Defence as LAND 400 and is forecast to cost around $20 billion. Notably, it comes at a time when the Army’s only operationally deployed armoured (albeit lightly) vehicles are the Australian-made Bushmaster Protected Mobility Vehicle (PMV).

The mission profile for current operations is such that we don’t need to employ heavy armour. In what are now predominantly training missions in Iraq and Afghanistan, the PMV provides the right balance between mobility, firepower and protection.

So what about the future operating environment?

While the PMV has proven highly survivable against improvised explosive devices (IEDs), it lacks the necessary ballistic protection, mobility and lethality to engage in close combat. We don’t want to be caught wrong-footed—planning and training for the next war based on the last. That would be folly, particularly given we are in the midst of a period of such great strategic change with the rise of China and re-emergence of Russia. We must learn from events in the Ukraine and pay particular attention to Russia’s way of warfare, characterised by combined arms manoeuvre centred on the employment of armour.

We need a land force that is adequately trained and resourced for all contingencies from conventional state-on-state conflict through to countering the persistent threat of terrorism. Any scenario within the spectrum of conflict may require armoured capabilities, so we must be prepared.

The Land Combat Vehicle System (LCVS)—being delivered by LAND 400—is Army’s next generation of Armoured Fighting Vehicles (AFVs). It will replace or upgrade our current mounted combat capability, including:

• M1A1 AIM Main Battle Tank (MBT)
• Australian Light Armoured Vehicle (ASLAV)
• M113AS4 Armoured Personnel Carrier (APC)

LAND 400 will replace the ASLAV with a new combat reconnaissance vehicle (CRV) and the APC with a new infantry fighting vehicle (IFV). Additionally, the MBT will be upgraded to ensure it remains lethal and survivable against increasingly adaptive threats.

Why can’t the current ASLAV and APC fleets just be upgraded instead of replaced?

Both the ageing ASLAV and APC fleets are approaching technical and tactical obsolescence. The ASLAV has been in service for more than 30 years and the APC for more than 60 years. Although the APC has undergone a major upgrade in that time, it essentially still has the same survivability characteristics as the M113s that served in Vietnam. Clearly, Australia’s strategic environment has changed significantly since Vietnam; therefore, our military capabilities must keep pace with likely future threats.

The threat has advanced such that heavier armour and improved firepower are required. Regardless of whether it’s close combat against another AFV, protecting against an anti-tank guided missile, or a counterinsurgency scenario where the threat is predominantly IEDs, our service men and women deserve to be equipped with the best capabilities to fight, survive and win.

LAND 400 will provide the best AFV capability to deliver the government’s future strategic needs. It’s a big project that will deliver the LCVS over the next decade. That seems like a long, drawn-out process, but these are complex, expensive systems that will remain in service beyond 2050. As such, we need to invest wisely.

Although they will be military off the shelf acquisitions, Defence is taking the necessary time to properly test and evaluate each down-selected option to ensure our armoured cavalry regiments are equipped with the right close combat capabilities in the future. Throughout the process, LAND 400 will have to compromise and carefully balance the need for protection, firepower, mobility and capacity.

The new LCVS will be deployable in the Air Force’s C-17 Globemaster III aircraft and the Navy’s Landing Helicopter Dock (LHD) ships, enabling the strategic reach necessary for future joint operations. The vehicles will be digitally networked with air and maritime capabilities to enable the joint force to operate in a multi-domain environment.

Through LAND 400, the Australian Army is modernising its close combat capability. The other services are undergoing similar force modernisation: the RAAF is upgrading the F/A-18 to F35 Lightning II, and the RAN is upgrading its guided missile frigate (FFG) to the Air Warfare Destroyer. These are responsible capital acquisitions that will deliver more potent and lethal joint effects. It’s an insurance policy for the future.

Reflecting on my operational experiences in East Timor, Lebanon, Sudan, Afghanistan and Iraq: from close combat to counterterrorism, armour saves lives.